>If at some point consumers have to pay more than they would in a more competitive market, how is that not harm?
No one HAS to pay for entertainment. It's a pure luxury. There's tons of things you can do with your free time besides playing video games (let alone brand-new AAA console titles): go outside, take a hike, play an instrument, take up a hobby, socialize, learn to cook, write your own software, I could go on and on. You can even do other forms of entertainment with your time: watch a movie or TV series, watch YouTube, watch a sports game, actually play in a sports game, play retro video games on archive.org or in an emulator, etc. All these things compete with (modern Activision) video games for time.
No one HAS to pay for entertainment. It's a pure luxury. There's tons of things you can do with your free time besides playing video games (let alone brand-new AAA console titles): go outside, take a hike, play an instrument, take up a hobby, socialize, learn to cook, write your own software, I could go on and on. You can even do other forms of entertainment with your time: watch a movie or TV series, watch YouTube, watch a sports game, actually play in a sports game, play retro video games on archive.org or in an emulator, etc. All these things compete with (modern Activision) video games for time.