So popular that Sony canceled almost all of theirs, and they were made instead of singles, which inflated the development time even more.
This isn't true, they cancelled 3 or 4 and still will release the GaaS of a 12 IPs as planned but will take a little longer. Other than this, some pitches weren't greenlighted, but that isn't a cancelled game because they aren't in production.
And to cancel games is somethign very common and normal in games. To don't greenlight pitches even more.
My logic was that price hikes would make next consoles too expensive for the mass market, so it would be better to keep this generation going for a few more years.
Sony will manage a way to make next gen consoles affordables. They keep increasing the average user spent to record numbers, as I remember the most recent number was that on average a PS5 owner spends over $800 on the console not counting the hardware.
Their first party games generate more money than ever, around twice than the previous gen, mostly thanks to their GaaS (with generate 40% of their first party revenue) and their expansion to PC.
They'll continue releasing more GaaS, some of which like Marvel Tokon and Marathon very likely will be very successful. They'll also continue expanding on PC, mobile, cloud and off-gaming adaptations (plus apparently portables too). On top of that they plan to continue acquiring, so pretty likely with all this combined they will continue expanding their first party revenue, which means would increase their profitaiblity, which would further give them more room to subsidize more the console if needed.
This generation they have been achieving great sales numbers even if had to increase the price instead of cutting it, partly due to component prices rising over time instead of decreasing over time. So pretty likely to release PS5 at let's say $499 or even $599 subsidizing maybe up to $200-300 if needed in specific cases like Black Fridays wouldn't be an issue for them.
Other than this, over time AI training servers and electric cars will start using dedicated chips and memory optimized for them, that would use different enough technology made in dedicated factories different than the one used in consumer PCs and game consoles. So I think as tech specializes the components overlap will reduce, meaning the prices will be less impacted because of that.