Detail of the logo on a Sony PlayStation 5 home video game console, taken on October 29, 2020. … [+] (Photo by Olly Curtis/Future Publishing via Getty Images)
President Donald Trump has declared that enormous trade tariffs will soon go into place across a number of countries like Mexico, Canada and others, and while countless industries will be affected, that also includes video games.
In a statement that has been shared with Kotaku, the Entertainment Software Association warnings of “significant harm” caused by the tariffs:
“Tariffs on video game devices and related products would impact Americans of all ages across the country. We urge the administration to consult with the private sector in a transparent process to avoid causing significant harm to everyday Americans and to one of the fastest growing entertainment sectors in the United States.”
Update: There is now a modified statement the ESA has issued with some different phrasing:
“Video games are one of the most popular and beloved forms of entertainment for Americans of all ages. Tariffs on video game devices and related products would negatively impact hundreds of millions of Americans and would harm the industry’s significant contributions to the U.S. economy. We look forward to working with the Administration and Congress to find ways to sustain the economic growth supported by our sector.”
While software, now mostly distributed digitally, would likely escape these tariffs due to their nature, that would not be true of video game consoles and accessories. That could increase the prices of hardware from where we are now, and as a reminder, that would be:
- PS5 Pro – $699
- PS5 Slim – $449
- Xbox Series X – $499
- Xbox Series S – $349
- Nintendo Switch OLED – $349
Nintendo Switch console is seen at the store in Krakow, Poland on December 30, 2021. (Photo by Jakub … [+] Porzycki/NurPhoto via Getty Images)
It’s unclear how much prices would increase as a result of these tariffs, but the ESA believes it would be a harmful impact, and for many consumers these prices are already high. I am thinking ahead to what higher prices on consoles might inspire, and that would be:
- A push toward buying used consoles online or at places like GameStop, where the tariffs would not directly impact the resale price (unless they too manually increase as a result of more demand).
- A boost for cloud gaming, something Microsoft is heavily pushing as of late, as it does not require a new console and may use devices consumers already have.
- A boost for PC gaming if you…currently own a PC, given that prices for computer components are no doubt going to increase as well.
As for the request by the ESA for the administration to “consult with the private sector” about these tariffs, that does not seem likely, as the tariffs appear to be unilaterally implemented and are about to happen seemingly without consulting many industries, many of whom are also issuing statements in this vein.
It these tariffs do go into effect and target locations where console and accessory components are important, we may see prices go up almost instantly. We’ll have to wait and see if this actually happens and how much that may affect the industry as a result. Clearly the ESA is not optimistic.
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