EA Boss Says Games Too Expensive

EA's John Riccitiello has been shaking things up at EA lately, with everything from layoffs to the purchase of BioWare. Now he's suggesting the company take some really drastic measures: make their games less expensive. "Riccitiello says the $31 billion gaming industry will suffer if it doesn't start to reevaluate its business model. Game executives at Sony, Microsoft and Activision must answer some tough questions in the coming years, like how long they can expect consumers to pay $59 for a video game. Riccitiello predicts the model will be obsolete in the next decade. 'In the next five years, we're all going to have to deal with this. In China, they're giving games away for free,' he says. 'People who benefit from the current model will need to embrace a new revenue model, or wait for others to disrupt.' As more publishers transition to making games for online distribution, Riccitiello says he expects EA will experiment with different pricing models."

Comments

Is this thing on? Can you hear me...

[Bin_jammin]

game publishers? I won't spend $60 on a game. I won't spend $40 on a game. You'd be hard pressed to get me to spend $25 to play a game that has a storyline, because it's wasted money after the story is complete. I'll buy used games for far cheaper (if at all) if I'm looking to kill some time. I'm about as casual a gamer as you'll ever find, but the ever rising price of consoles and games means you've lost me as a customer. I bought a PS2 and an Xbox, both of which are gathering dust. I may break them out once a month (or far less frequently in the summer) but don't count on it. I've considered buying a Wii because it's almost affordable, but there's not a whole ton of games for it. Consider this, I would LOVE to be able to buy a console that had games priced between $15 to $20. I don't really give a squat about the graphics, I want to be entertained. You'll have a customer for life if you make that happen, as I'll be able to justify buying a game or two a week. I realize you'd be hard pressed to put out that many quality titles, so chapterize them. Break the content up over a few games and I'll buy 'em one piece at a time, but don't make them updates, each would have to be a standalone title I'd be able to pick up and play for a few hours. At those prices you'd be competing with movies, and have my attention for at least twice as long.

Three models of less expensive games

[WillAffleckUW]

1. Release games in increment bundles - you buy basic version and get expansions or pay extra for online content.

Pro: Better revenue stream for game producers. Bug fixes easier to release.
Con: Consumers feel, rightfully, that they're getting ripped off.

2. Release games with in-game ads and product placements - signs in game and t-shirt logos and decals and maybe songs and optional extras are from adversiers.

Pro: Better revenue stream for game producers. Targeted ads from game registration.
Con: Consumers may feel they are oversold.
Note: If done only to level of real world or fantasy world normal experience, without flashing vids and noisy ads, this has higher buy in from consumers and doesn't feel bad to them.

3. Release games at lower cost and take money from CEO/exec pay while not stiffing game developers.

Pro: Investors in game producing firm get same return. Developers feel not as ripped off. Games cheaper.
Con: Fantasy. Game execs will never do this and will fix things so this never happens. Better off shooting the execs dead to practice marksmanship skills for in-game experience.

So he's saying games should be immune to inflation

[r_jensen11]

With SNES games costing sometimes $70 when they were launched (I have no clue what NES games cost when they were released), I'm surprised video games are as "cheap" as they are. Sure, some games have a rediculously high price now, like Guitar Hero and Rock Band come to mind. But there, you're also paying for new hardware, which doesn't cost *that* much more than a typical controller, and given that they're made in smaller quantities and require more materials, it makes sense that they cost more than a typical controller.

If games cost $60-$70 for the SNES, if video games were subject to inflation, and given a modest 3% inflation rate, they would be costing between $93.48 and $109.06. Yes, I know that not all games cost $60-70 back fifteen years ago, but some very popular ones did.

Re:Cheap games would be nice but...

[physicsboy500]

Try some of the cheap games, they can be very good - and the gameplay is what makes the game. If you really think that spending thousands of dollars on graphics makes a game then it's your choice whether to buy it or not. It's not just the graphics as much as the overall immersion in the game, and larger budget production games generally do a better job. There are many things that can be short-cut in order to produce a lower budget game like physics, writing, voice acting, graphics, ect. All of these are a part of the experience and if any single one is done poorly, the overall experience can be ruined. I agree that cheaper games "can" be addictive, but if you want a true experience then I'd have to agree with GPP because fewer corners will be cut.

Re:Cheap games would be nice but...

[FlyByPC]

If this is an excuse to release crappier games, count me out. These things are expensive to make and I'd rather own 3 or 4 good games that have been invested in than 10 games that were just pounded out by some off-shore devs.

Yes, I'm sure some troll with mod points will kill my karma by me stating the obvious.
Amen. And would it kill them to make at least one or two games that aren't either about shooting-everything-that-moves, sports, or race cars?

If you can read this... 01110101 00100000 01110010 00100000 01100001 00100000 01101110 01100101 01110010 01100100
No no no. A 01100111 01100101 01100101 01101011, if you please.

Re:So he's saying games should be immune to inflat

[Osty]

Sure, some games have a rediculously high price now, like Guitar Hero and Rock Band come to mind. But there, you're also paying for new hardware, which doesn't cost *that* much more than a typical controller, and given that they're made in smaller quantities and require more materials, it makes sense that they cost more than a typical controller.

If you do the math, those peripherals actually cost less than a new controller. For example, I recently purchased Guitar Hero III for Xbox 360 for $90 (+ tax). If you assume the game by itself would be the usual $60, that means the wireless Les Paul guitar controller is only $30. A wireless controller from Microsoft costs around $40. Similarly with Rock Band, the bundle price for guitar + drums + mic + game is going to be $170. If you take the $60 game out of the equation, you're left with $110 for three peripherals. IMHO the breakdown for that is most likely $20 mic, $30 guitar, and $60 drums (the drums are actually very high quality for a toy). Factoring out the drums, you're paying list price or less for the other components.

If games cost $60-$70 for the SNES, if video games were subject to inflation, and given a modest 3% inflation rate, they would be costing between $93.48 and $109.06. Yes, I know that not all games cost $60-70 back fifteen years ago, but some very popular ones did.

You're comparing apples to oranges. The SNES games that cost $60+ were that expensive because of the cartridge technology. They were using bigger memory chips (SF2, Finaly Fantasy VI, Chrono Trigger). When consoles moved away from cartridges, games dropped in price significantly. Final Fantasy VII was only $50 (IIRC) even thought it was bigger than FF6, because the CD format was significantly cheaper to produce (also, some of the cost moved elsewhere, since you purchased separate memory cards rather than having on-cartridge writable memory+battery). That's not to say that games shouldn't adjust for inflation, but you can't use the SNES as a starting point because it was not disk-based.