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Cheap Games a Risk To the Industry, Says Nintendo President
Recent comments from Nintendo president Reggie Fils-Aime indicate that the company is worried about the effect of inexpensive mobile games on the industry.
"'Angry Birds is a great piece of experience,' he said, 'but that is one compared to thousands of other pieces of content that for one or two dollars I think create a mentality for the consumer that a piece of gaming content should only be $2.' Taking one last dig at the mobile competition, Fils-Aime added that he 'think[s] some of those games are actually overpriced at $1 or $2, but that's a different story.'"
While low-priced mobile games might not be good for Nintendo, it can still work out well for indie developers. 2DBoy, makers of World of Goo, released some statistics about launching the iPad version of the game.
Big-name games that cost $10 million to develop and have $25 million marketing budgets aren't going to be $1 any time soon, the market just isn't large enough to sell 50 million+ copies, at any price. Only 50 million Xbox 360s have been sold, for reference.
The console makers set the licensing fee that publishers pay per disc, AFAIK it's a flat fee, so disc games will never be $1. Do you think Wal-Mart would bother stocking $1 games? They might set up a RedBox-style machine that spits out discs, but the shelf space used for the traditional route would no longer be feasible.
Publishers are running scared because they know the future is in digital distribution, and precedent is being set, while they're still on the fence twiddling their thumbs, for $1 games being the norm. This is problematic as $1 is a suboptimal price for many games, especially high-quality games with a massive advertising budget. The main reason it 'works' in the mobile phone space is due to the mechanics of toplists and how they're self-influencing. Console makers could halt this simply by eliminating the ability for end users to browse and download games via toplists. They could be replaced by alternative, possibly more complex lists.
For downloadable games with low (under $200k) budgets, it's alot iffier if a $1 standard is bad or not, as the market is definitely theoretically large enough to make it sustainable. When cellphones start coming out with analog sticks and buttons (like the PSP phone) and still have $1 games then I might start worrying.
Corruption is convincing someone that the selfless ideal is the same as their selfish ideal.
backgrounds and animations because that looks to be the golden ratio of where it's worth it for a developer to make a $.99 game and for it to sell enough copies to people who want a game to play on the toilet.
Isn't that exactly where the money's at? People that work all day and have friends don't have time to play games except on the toilet... :(
Nintendo seems to have developed a pricing problem all of its own of late, which has nothing to do with $2 phone games. I'm pretty sure this has contributed to Nintendo's current profits slump, at a time when the company should be using its large installed base for the Wii to really rake off the cash.
The company just seems to have some really, really odd ideas of what a game should cost. It's most notable in the Wii's online store, where in the UK, direct, unmodified ports of 25 year old arcade games (many of which are hardly timeless classics) often tend to be priced in the £6-£8 range. Things are mildly better in the US, I believe, but the prices seem out of whack.
I absolutely don't want to hold up the Xbox Live Arcade and Playstation Network Store as paragons of value for money, but they certainly offer a better deal than Nintendo's online shop (and have much more consumer-friendly terms of service as well, which link games to an account rather than a console). Compared to the classic game packs you can pick up on Steam and other PC services such as GOG, Nintendo's pricing looks positively extortionate. If Reggie wants to talk about games that would be over-priced at $2, he should look at the stuff like Exed Exes and Commando in his own online store - which he's trying to sell for four times that price.
Things aren't much better on the boxed-game front either. As we get further into this console generation, the general quality gap between Wii games and games for the other consoles and the PC is widening. There are a few honorable exceptions, but most of the Wii games released these days tend to feel short and shallow. And yet despite this, and despite their increasingly painful graphical shortcomings (with most Wii games still struggling to match the best the PS2 had to offer), the games tend to be priced at roughly the same level as games for other platforms (usually a few $ behind the PS3/360 games and a few $ above the PC games).
If I were Nintendo, faced with the dramatic profits slump they've seen, I'd be looking to boost volumes of sales by pitching more boxed games at the more realistic $30 (or £20 in the UK) price-point and slashing the prices of titles in the online store. If you sell more games, you keep people using their Wiis. And if you keep people using their Wiis, they will buy more games for it. Sony managed to achieve that virtuous circle on the PS2, but despite their installed base lead, Nintendo haven't managed it this generation.