If an industry analyst is to be believed, then Microsoft may have the upper hand on pricing their next generation offering compared to Sony.

An episode of Geoff Keighley’s Bonus Round which features Michael Pachter has some interesting tidbits for the viewers, and it starts at around the 10:30 mark, but here’s the full video if you want to watch the episode in its entirety:

First of all, this is Michael Pachter we are talking about, who seemingly has more misses than correct guesses, but what he says does make sense, especially if Microsoft want to regain some sort of edge going into the next generation.

The Xbox One did not quite pan out the way they wanted it to, as they had priced it more expensive than the PS4 on launch. Among other things, price is one of the big determining factors of which console to go for, especially during these trying times where people aren’t very liquid.

Pachter proceeds to go on, saying “From what I’ve seen, Sony’s gonna have to charge 500 bucks for their PS5 and Microsoft has a big balance sheet, if they want to cut the price by 100 bucks, just price below and subsidize the first 10 million, they will. So, I think they’re waiting to have Sony blink first, and then they’ll reveal the price and launch date. It’s going to be Holiday, so very likely sometime in November, very likely 400 bucks and fans are going to get a lot for their 400 bucks.”

Peter Moore, a former Xbox executive, gives the nod, saying that it boils down to how much each company can afford to lose in the first 12-18 months, which will be offset by attach rate and services, something Microsoft is prepared for since their Game Pass subscription has a lot going for them apart from usage rate and the fact that you can play first party games for free on day one, something Sony may not do for the likes of God of War or The Last of Us.

The prevailing idea is that Sony will price their console at $500 give or take, which sounds about right given the specs of their machine. While the Series X releasing at $400 sounds ridiculous given the power it is packing under the hood, they could indeed launch at a loss to gain the advantage off the bat. Then again, as we always say, nothing is final until both Sony and Microsoft officially unveil their offerings, which we hope is sooner rather than later.

The Series X is looking to be quite the impressive offering from Microsoft, which will showcase great games and very pro consumer features like Smart Delivery. They’ve also got Game Pass going for them, which is a great subscription service that offers a massive portfolio of games that you can play for free like Red Dead Redemption 2.

Whatever the case may be with regards to pricing, both consoles will have their own offerings and deals to sweeten the deal. It’s going to be a good and exciting time for console gamers as the next generation indeed is truly upon us.