AMD hints at Xbox One and PS4 price drops on the horizon

The Xbox One and PlayStation 4 could be heading for a significant price drop, with next generation chips bringing the cost of production down.

AMD are a huge player in the console market, with its chips powering the key players including Sony and Microsoft, and the expense of this component is a factor in the overall price point of the games machines.

AMD's CEO Lisa Su, talking at a CES round-table with techradar in attendance, confirmed that there was going to be an opportunity in the current generation's life-cycle to develop new technology that will allow for a price drop without impacting on performance.

"The consoles work on a five to seven year strategy, that's the lifetime for these consoles," said Su.

"Without talking about any particular party's console - there will be opportunities to cost-reduce.

Price cuts, more sales

"Consoles tend to be very sensitive to price point, we see that as price comes down console [sales] volume goes up, and that will afford an opportunity to do that in this cycle."

Although there was no time frame put on this move to a new chip architecture, we are now heading into the third year of the current generation, fast approaching the likely mid-point of the life-cycle.

There have traditionally been mid-production changes to console manufacturing that lowers costs, so this isn't a huge surprise. But the prospect of a major drop for Xbox and PS4 will be encouraging for many who find the current price steep.