In Sony's deep dive into PlayStation 5's underlying architecture, the system's lead architect Mark Cerny said that a lot of thought went into ensuring backwards compatibility with the 5's predecessors, and that "almost all" of top 100 PS titles by playtime will be compatible at launch.
Sony's occasionally radical hardware changes have led to severe compatibility issues between a few consoles, which is obviously less than ideal. Thankfully, Cerny and his team pulled through magnificently.
Even beginning to untangle the complexity of emulating earlier games on newly designed systems is enough to give one a headache. Just adding CPU clocks to the equation is enough to turn it into a procedure that's more trouble than it's worth, and we're still severely oversimplifying here.
Strictly speaking from a consumer standpoint, launching a successor console that's incompatible with its predecessors and/or games doesn't really make sense, especially with the PlayStation ecosystem spanning several generations.
"Achieving this unification of functionality took years of effort by AMD, as any roadmap advancement creates a potential divergence in logic", Cerny said. Finally, he stressed that all the additional work was worth it, as the top 100 PS titles rated by playtime will run just fine on PS5 right out of the gate.
Cerny reminded that the backwards compatibility is native to Sony's next-gen offering, so it's not a feature that can or will be scaled down with costs or anything. Some titles required individual testing to ensure compatibility, but it's a small price to pay for the one PlayStation to rule them all.
PS4 graphics engines will run just fine on PS5 without having to rely on newer features, but there's plenty of headroom left for developers. Ray-traced shadows and reflections are notorious hardware hogs but Cerny mentions a game that uses both in large scenes without breaking a sweat.