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Console Game Prices Going Up?
The Bungi writes "MSNBC is running a story that I found interesting in light of the previous article here on Slashdot predicting hardware prices will likely fall. The MSNBC piece is quoting analysts that think software prices might go up by about $10 for a new title. The reasons? Among others, more complex games and anti-piracy measures built into the media. Get ready for $60 Halo II."
That's why I've never bought the argument that the reason software (including games) is so expensive is because of piracy. Supposedly, no one can really copy a Gamecube game and play it on a Gamecube (at least yet), but the prices for the games are the same as the XBox, which supposedly has a piracy problem and PS2.
Forget the whales - save the babies.
GTRacer
- Not the One
Defending IP by destroying access to it? That makes sense, RIAA/MPAA. Go to the corner until you can play nice!
The last console game I bought only cost 50 cents.
Of course, it was for my Atari 2600, and prices have fallen a bit...
The reasons? Among others, more complex games and anti-piracy measures built into the media
Anti-piracy measures should increase revenue, not decrease it; otherwise, why use them at all? If anything, the prices should come down as a result of less piracy (I mean, isn't piracy forcing companies to raise prices? That's what I've always been told).
As for the increased complexity of games, shouldn't it - at least in part - be offset by code reuse? Developing a similar game or a sequel should be much easier than the initial title.
Remember how a few years ago every game had full motion video? Now that you can get decent results with real-time rendering, we don't need all these real-life actors, just voice talent.
I would think that as we move along to the future hardware will stop being so different and it will just be a matter of aesthetics or just which brand you want to back. Software will be the main difference. I would say raise the software prices IF hardware prices go down. People put a big chunk down for a high end PC and then they buy one or two games a year because they are still paying off their PC. Make a high end PC around $500 and games around $60 and then people will buy some more games for their cheaper nicer hardware.
Where you run into problems though is copy protection. People will just pirate that $60 game.
So in order to reverse it then charge more for hardware and infinitely less for software. I guess we will see how it turns out.
Courage is fear holding on a minute longer. George Patton
If anti-piracy technologies are supposed to make games harder to pirate, then there should be less priacy. If there's less priacy, then they should sell mores copies of protected software. Why should I pay extra for something that should already make them more money?
Of course, all of that was based on the assumption that piracy costs the industry money.
would be to LOWER the price of the games.
Says towards the bottom of the article that only about 10% of the games are big hits. IOW, you pay more for the top tier games because of all of the shovelware that comes out.
The price will go up until the soccer moms stop buying titles for their little brats.
Jesus was all right but his disciples were thick and ordinary. -John Lennon
I remember paying $40 for Apple II games in the 80s. Inflation must certainly take its toll on game prices eventually, and I am all for supporting game developers. What I am not for is supporting the near-extortion practices of game publishers (coughmicrosoftcough) who force developers to get games out the door prematurely. That, I believe, is why we see games with so much less spit and polish than we used to. The first time I saw a game seg fault on the Xbox, I raged. Because of that, I am willing to pay $60 for a Blizzard game that I know will be clean and well-concieved. And for software which is belted out before a Christmas deadline so that a trillion dollar multinational corporation can recoup losses on the system itself, I'll pay nothing at all...
Among others, more complex games and anti-piracy measures built into the media.
We need to charge this much for games because so many are pirated. Now we need to charge you more because we're trying to negate that. I'd like to call them idiots but we consumers are the ones who keep falling for this stuff and teaching them that they can get away with it.
The IRS could learn something here. *fears*
This is complete and utter bullshit. While I can sympathize with the fact that it costs more to develop a game these days, I don't see why that should affect the retail price in all cases. Maybe there companies that are spending upwards to $10 million to develop a game should ensure that the game is good so that they can recover their investment.
The story mentions Enter the Matrix, which is a pretty crappy game. It seems that Shiny spent $20 million developing it. All I can say is "Boo Hoo." The game is still selling very well (over a million units in the U.S. alone), but it would have sold even more if the game was any good.
I know that games and movies are vastly different, but consider this: I pay $10 to see a new movie release, regardless of the cost of production. Why should it be any different for games?
If anything, game prices have to come down, so that Joe Sixpack can pick one up on a whim. $50 is a lot of money to plonk down for a game that might just suck enormous ass. Game prices need to come down for gaming to truly become a mainstream form of entertainment.
Games are already overpriced if you really take a look. With multiple consoles pulling players in multiple directions, a handheld system to accompany each of them (almost), and companies fluctuating in and out of existence on nearly a monthly basis, I smell a market crash coming...
If someone releases a new ET game then it's a sure sign the end is near...
Now if you'll excuse me, I have some skulking around to do in Thief Gold...at a 1024x768 resolution!
I have read a few insightful and interesting comments in reply to this article that are based on common sense. Mainly this...
That makes complete sense if of course that was the real reason. I mean, come on, of course piracy wasn't the real reason behind high prices - duh! That is nothing but some marketing/PR spin to justify those high prices.
I have another theory which I think also relies on common sense, but looks at it from a money-snagging business ploy that I would implement if I was in that industry. To me it makes perfect (business) sense to raise prices while increasing the level of security / anti-pirate technology. People are forced to pay the hiked up prices because it is now even more difficult to circumvent the protections in place, plus you have the added benefit of protection against circumvention thanks to the unbelievably awful DMCA.
I mean you're all set...
There is no missing middle step, that's all it takes.
Raise prices when people are forced to pay them and have less alternative options. Does this make the consumer happy? Of course not! But it sure does make the industry happy to see the extra money come in, because no matter how idealistic people like try be in saying, "That's the final straw, I'm not supporting this industry any more. They won't get my money!" - which will work for a small minority of people, but won't for the majority of people who will fork out more cash for the new games. The other unfortunate thing is that many games of late seem to be rushed to completion before they're ready and don't even deserve the higher prices on their own merit.
Just my $.02
Are you bovilexic? Moo!
I remember paying $70 for Phantasy Star IV, and $60 for any RPG on the SNES. $50 prices on games is not really that bad nowadays, considering inflation and all.
On the otherhand, there is Nintendo, who just lowered their fees for 3rd publishers. Sega is releasing alot of their exclusive GameCube games, for $40 (Viewtiful Joe, and Billy and the Giant Egg, come to mind). Now this is a great price for some kickass games (the demos rocked). $40 for a brand new Sega exclusive game.
Hell yea.
$60? Count yourselves lucky. Game (UK retail chain) and Electronics Boutique (the UK retail chain bought out by Game, not the US one) charge 65 to 70 EUR here. Even PC games are up to 50 EUR a go :(
(Even second hand games are 45-50 EUR)
Fortunately there are some independent shops which don't charge such stupid prices.
Pretty straightforward: hardware price going down, software price going up. Give away the razor, sell the blades. Especially when the development cost of the razor has been paid for by early adopters.
Jesus was all right but his disciples were thick and ordinary. -John Lennon
1980s and early 1990s games: box contained a game, a thick manual, and usually some extras, such as a cloth map, a booklet with background informations or cut-outs of spaceships (Wing Commander series). Price per game: $50
2001-03 games: Box, which is much smaller (in the case of Europeans a DVD box even for PC games) contains a game and a thin booklet with installation instructions. The manual is on the CD; no extras. Price: $50.
Prices of games have already gone up. What I described, however, is only the most visible indication. You also have games that start at $60 (Neverwinter Nights, Warcraft III), or "special editions" that can cost as much as $80 and have box contents roughly equal to those of games that cost $50 ten years ago. In addition, the dollar spent per hour of gameplay is increasing all the time. Where you spent anywhere between 25 and 50 cents per hour of gameplay ten to fifteen years ago, you now spend up to $5 per hour of gameplay on titles like Command & Conquer: Renegade and Unreal II. That means that where you spent maybe $50 per month on games, you spend the same amount per week these days, or even more. Games are already enormously expensive, compared to a decade ago, but people didn't notice. The publishers used the ages-old strategy to decrease the amount of sold, while keeping the price stable, and it worked. Unfortunately for them, there is very little left to cut away from games, and so they have to resort to increasing the prices.
Don't tell me we're back to this. Your statement is simply not true at all. X-box and Ps2 have been sold at a loss, but the Nintendo Gamecube, Gameboy Advance, and the Gameboy Advance SP have NEVER during their entire life cycles yet been sold for a loss whatsoever. Nintendo is making the Gamecube's right now for only about $50, so even giving away a free game, they still make over $50 a console sold in profit.
The original Gameboy Advance, they were able to lower the cost point of that down so low that they reduced the price of the system when it was still selling like hotcakes. I may be wrong, but I don't think any manufacterer has ever done anything like that before. That would have been like Microsoft selling Halo for $20 after it hit a million copies sold.
The GBA SP is still selling at a profit and always has.
Also, your post makes it seem like you're saying that selling games is pure profit, but it's not. Of a $50 game, between $2.50 and $5 goes to the store that sold it, another $20 or so to the company whose console it's sold for, then the rest back to the developer, to cover the cost of production, design, and manufactering.
And losses for the two consoles being sold at a loss are supposed to currently be over $50... so no, one game does not make up for selling a console at a loss. Normally, It is 6-8 games that is considered the point for breaking even.
It's a sad day when we're getting video game news from MSNBC. It seems like anybody with half a credential could send out a news release "predicting" a price change and some news outlet would report it. Don't believe the hype until Sony/Big N/MS say something.
It's not stupid. It's advanced.
MY analysis, were I so bold as to make one, would including looking at a similar industry and the trends there: VHS/DVD sales. Specifically, when pre-recorded VHS movies hit the market, they were sold entirely for the purpose of rental. The prices would start at around $50 and peak at around $100 per copy. Once enough people had VCRs and production costs for VHS tapes had dropped enough, movie studios took a look at the market and wondered if they could actually get people to BUY the movies. ET debuts at $20 (discounted soon after to $15) and just about everybody ran out and got a copy. Seeing that they had something there, everyone started jumping on the bandwagon. By the time DVDs started their meteoric rise BRAND NEW VHS movies could be had for $10-15 a piece and bargain bins were filled with videos between $5-10 each. DVD has followed suit, though much faster because of the incredibly rapid adoption of the format by consumers.
Even more on point, one could look at the prices of Atari 2600 games. Those prices dropped significantly once the 2600 reached a critical mass where just about everybody had one - and those were on cartridges which are more expensive to produce than DVDs. (Prices also fell when the video game market went to pot but we'll ignore that here.)
If we then look at video games, it's clear that a similar result is on the horizon. While it's unlikely that top-flight games are going to drop as low as $20 a piece (they don't get box office revenues like movies do), the number of consoles in use today is so much larger than it ever has been that even a bad PS2 game can sell 50,000 units ($2.5 million retail) in the US and great games can sell into the millions. If console makers ever manage to understand the potential benefits, they could all change their royalty structures (as Nintendo recently has) and a $10 price drop across the board could end up spurring even more sales. A $10 price increase, on the other hand, will likely show an even more significant negative effect.
Obviously, I'm no market analyst so you can take my thoughts and words with a grain of salt. But I certainly wouldn't give any more weight to the ideas of a single market analyst (and a writer who was probably desperate for a story and happened to see a press release) who, unless he has access to actual top executives who are TELLING HIM that prices are going to go up, is also just talking out his ass.
If prices do happen to go up $10, I expect that they'll drop right back down once they see what I expect will be a chilling result on sell-through.