Games are cheaper than they've ever been,
Yes, when considering inflation, F2P and having more and faster discounts games are cheaper now than ever.
and this is the first generation where Sony has not had real competition from another console.
Not true.
This generation Nintendo focused more in portability instead of high end hardware, so don't compete that directly, but still are there, Switch can be connected to a tv and been breaking records.
Xbox's console was instead very similar offering than Sony, bought many companies including Bethesda or ABK and did put their games day one in their gamesub, plus many important 3rd party ones.
PC handhelds are still a small thing but started to appear and keep some players busy.
Due to many reasons, tons of PS4 still haven't migrated to PS5 (long dev times, huge amount of games being crossgen, PS4 having good GaaS and gamesub still supported, etc).
So PS5 had a lot of aggresive competition, more or less direct, but they dominated it and kept breaking many records.
To the point Nintendo didn't go back to high end consoles with Switch 2 and Xbox seems will leave the console market this generation.
Recency bias is also a thing. Look, there was garbage back then but plenty of things were better too. Call a spade a spade. Shorter development time, no woke trash, games weren't as buggy or broken on release day, less microtransactions, less GAAS, more physical games, free online play, and less lazy and expensive remasters.
In the free time I study and research gaming history and work in preservation projects helping to document, dump and emulate forgotten old games to preserve old games and companies.
We have way more games of way more types now getting released every month or year. This includes more good games and more bad games released every month/year (including physical ones).
In the past in addition to have less quantity, there was also less average quality. Specially in the 70s-early 90s age, including many well received games back then, today would be considered broken and not fun because of their insane difficulty, awful framerate in terms of performance, or asset flips in terms of innovation. And in many cases with awful or no audio. Plus also many games weren't released in many regions or had a delay of many months or years. And many weren't localized to the many languages games that now use to get localized to.
Back then we were ok with that because it was the only thing we had.
But the biggest thing for me they were more creative back then. These days most games feel like a rehash of something I played already. I've been with playstation since the first console, but once physical dies off for good I see no reason to stick around anymore.
This is a big myth. Most main genres were invented in the 70s or the 8 bits, so most of the ones who really were new things were made there.
Since then, they kept iterating, expanding or combining with others, creating different new genres and subgenres, specially when adding online, new input methods, 3D visuals or VR.
Nowadays there are more creative games than ever, but most of them get ignored by most people because humans prefer to have more of familiar stuff they know they like and normally rejects the new, different things. Often get even insulted as non-games or similar.
And well, the narrative of 'the industry is creatively stagnant', 'the creativity is gone', etc. has been repeated every generation since we had printed magazines. Here in Spain there were magazines saying that the years that games like the original Tetris or Street Fighter 1 were released.