This is interesting (honest)

[ShadowPaladin V1.0]

Higher game prices for the next gen consoles you say? This is so predictable.

 

Every time a new round of consoles starts to appear on the horizon publishers see a little window of opportunity to sneak in some price-raising shenanigans on software to cash in on the loyalty of frenzied early adopters who'd happily shell out top dollar to get the latest gaming kit, along with the top games for them.

 

Last time out when retailers got a bit bored with making a 12 quid profit margin, they slashed the prices down to the sub GBP 30 mark following the lead of one-time retail giant Virgin, and game sales soared and rescued the otherwise fairly humdrum summer of '99.

 

During the rest of that console generation prices never went back up, and although the unit sales increases were pretty impressive, the actual revenues were, shall we say, a little static.

 

This price 'promotion' (as it was dubbed optimistically at the time to fool punters into believing they were getting a special deal) was little more than a cynical, but well-intentioned attempt to force the price of these disproportionately high priced entertainment items down to a more sellable level. Retailers love shifting units, especially the non-specialists that traditionally make their money off impulse-priced items like audio disks and videos; to them, games have always seemed over-priced. They don't tend to buy the argument that you get more hours for your bucks out of games.

 

 

 

He started it. That guy.

Publishers were not amused and really took a pounding. Retailers, though, used their power to maintain their margins and all was looking good. Gamers were getting a better deal into the bargain. But then with the release of the PS2 in November 2000 game prices crept back almost up to their previous levels and stayed there until relatively recently.

 

But that wasn't the end of the publisher-retailer battle. A few renegade high retailers tried the same trick that Virgin tried in '99, notably Argos in Christmas 2003 and 2004, but the dominant retailers such as GAME kept their resolve until just a few weeks ago. Having slowly seen their (frankly enormous) market share chipped away at by aggressive retailers (notably the online sector), the group decided enough was enough and promptly kicked off an "if you can't beat 'em, join 'em" price campaign that has - surprise surprise - lasted well beyond its initial 10-day run.

 

The thing is, it's not likely to change either, with other retailers forced to match their prices or face being completely frozen out by savvy bargain-hungry customers.

 

This leaves publishers in a precarious position once again, with profit margins in the world's third biggest games territory (around 30 per cent of all European revenues, remember) being slashed to the bone in order to keep their retail relationships intact. In this situation it's rarely the retailer that suffers, and don't they know it. The massively increased demand caused by these price promotions proves all too well that consumers respond eagerly to the prospect of cheaper games, and many of the less dominant publishers are in a difficult bargaining position when trying to desperately offload poor-selling titles.

 

 

 

Malcolm the marine: an expensive date.

And, let's be honest here, most games that get released are poor-selling. The games industry's entire economic model is built on big hits bailing out the proliferation of quickly forgotten flops. Just looking at the Chart-Track sales reports proves that, but unfortunately copyright restrictions and the prospect of negative PR makes doing that very difficult for any gaming publication. But take our word for it. There are some scary statistics out there that would make any caring gamer wince at the injustice that goes on in the nether regions of the charts.

 

So the news today that several big name publishers including THQ, Take-Two and Activision are eyeing up a $59.99 price point (and we all know from bitter experience that means fifty quid even despite the current exchange rate) for next-generation games follows in this predictable pattern of old. Wait for the current gen to reach critical mass, then hit the early adopter with a premium price point and never lower it until determined retailer pressure eventually brings it crashing down again. Don't you just love cycles?

 

But although its hard to argue that the cost of game development is rising all the time, is the industry poised to shoot itself in the foot again and put off literally millions of gamers from buying into the next-generation machines until sanity is restored on the high street? Having invested a bigger than usual sum on a next-gen console, memory cards, extra joypads, leads and all the peripheral junk we end up buying, the last thing we need on top is the prospect of being stung for our loyalty by extra-expensive games into the bargain. What are they thinking? Is this a deliberate ploy to halt the growth of the industry? Sometimes it really feels like that.

 

 

 

Heavenly Sword: one of the few confirmed next-gen games.

As online retailer Simply Games' managing director Doug Bone told Eurogamer: "As superior technology comes along, the creative potential (and associated development costs) inevitably also rise accordingly. While this is not an obstacle for the early adopter, we need to be careful to ensure that any price hike (e.g. between PS2 and PS3 games) is backed up by the quality of product the customer gets. A price hike purely because publishers 'can' won't help."

 

Indeed. It really does appear as if publishers have adopted this thinking literally because they "can" and because "we've done it before".

 

But there is a way out for publishers, and that's if they come good on the suspected pledge of only raising the prices on premium product, i.e. the magical "triple A" product we always hear about but rarely find when we open the boxes.

 

The trouble is, a lot of publishers have egos the size of the moon and believe most of their half-baked average games are worthy of the AAA label. So expect another characteristic pattern to emerge in the next gen: Game X goes on sale at full price. Game X sells next to nothing. Game X price slashed to clear stock. Repeat to fade.

 

Is that what we want? Is the industry ever going to learn or do we simply have to keep making the same mistakes over and over again like a demented, hapless goldfish?

 

http://eurogamer.net/article.php?article_id=58303

[J.E. Sawyer]

Do you know how much it costs to develop a console game today? It's a hell of a lot more than it was five years ago.

[ShadowPaladin V1.0]

Do you know how much it costs to develop a console game today?  It's a hell of a lot more than it was five years ago.

<{POST_SNAPBACK}>

 

Dosnt suprise me in the slightest. It's always been one of those things about the games market. It dosnt really matter how much you put in you cant really charge for it. So no Morgan cars in the industry. I guess thats why sales are everything when it comes to publishers.

 

I've noticed that people are always very eager to talk about quality. Until it comes to forking over the cash, then most go silent.

[Judge Hades]

I am sure it costs a lot more to make video games, console or PC. I am surprised prices for games haven't gone up to $60 to $70 instead of being $40 to $50. I would have easily given $70 for KotOR 2 if it was in full completed form.

[ShadowPaladin V1.0]

Well where it says "He started it , that guy" It should have a picture of Richard Branson next to it.

 

Game dropped their prices within the last month. At some point the overheads of stores will be too much to compete with widespread online shopping. The most common question the staff get asked there is "why is XXXX

[Judge Hades]

Well, Online stores don't deal with property taxes and renting. Thats what I would tell them.

[Child of Flame]

Well, Online stores don't deal with property taxes and renting.  Thats what I would tell them.

<{POST_SNAPBACK}>

 

 

Or massive inventories...or huge employee bases...or shipping between many smaller hubs to distribute their product to all the different stores...

 

It's all overhead Hades, which is what SP was referring to.

[Monte Carlo]

I've stopped buying games and DVDs from shops. I buy online and save a ridiculous amount of money instead. It's almost like there are two prices for electronic entertainment products: one for people with a bit of patience and/ or savvy and another for the sheep/ non-IT savvy civilians.

 

:: shrugs :: You pays your money and you takes your pick. if I was the bloke working in Game being asked why the new Gran Turismo or whatever was five quid cheaper online I'd say "why aren't you buying it online, brainiac?" After all everything is cheaper online; just check out the difference between UK budget airline tickets for example. Financial services products are actually cheaper online. Etc.

 

Cheers

MC

[Darque]

heh... need to finish my thoughts...

 

As for console games... a higher pricetag isn't that big a deal, since you don't have the problems you encounter with PC games.

[Child of Flame]

I've stopped buying games and DVDs from shops. I buy online and save a ridiculous amount of money instead. It's almost like there are two prices for electronic entertainment products: one for people with a bit of patience and/ or savvy and another for the sheep/ non-IT savvy civilians.

 

:: shrugs :: You pays your money and you takes your pick. if I was the bloke working in Game being asked why the new Gran Turismo or whatever was five quid cheaper online I'd say "why aren't you buying it online, brainiac?" After all everything is cheaper online; just check out the difference between UK budget airline tickets for example. Financial services products are actually cheaper online. Etc.

 

Cheers

MC

<{POST_SNAPBACK}>

 

 

Not always, if you're buying a game the week it hits or so (I really want to do this with the new Splinter Cell, but come to think of it, I really shouldn't be buying anymore games as busy as I am), they're generally the same price, or even MORE expensive online.

[ShadowPaladin V1.0]

Not always, if you're buying a game the week it hits or so (I really want to do this with the new Splinter Cell, but come to think of it, I really shouldn't be buying anymore games as busy as I am), they're generally the same price, or even MORE expensive online.

<{POST_SNAPBACK}>

 

True since Game dropped it's prices. It's 99p cheaper (the cost of postage) KOTOR online cost 30.98 and 29.99 in store (minus usual discount).

 

I do enjoy being able to order when I like and then having everything arrive on Thursday though , whether I am here or not. Which is the real reason I shop online.

[Child of Flame]

Not always, if you're buying a game the week it hits or so (I really want to do this with the new Splinter Cell, but come to think of it, I really shouldn't be buying anymore games as busy as I am), they're generally the same price, or even MORE expensive online.

<{POST_SNAPBACK}>

 

True since Game dropped it's prices. It's 99p cheaper (the cost of postage) KOTOR online cost 30.98 and 29.99 in store (minus usual discount).

 

I do enjoy being able to order when I like and then having everything arrive on Thursday though , whether I am here or not. Which is the real reason I shop online.

<{POST_SNAPBACK}>

 

 

Things come on different days of the week here depending on postage traffic, what day you order it on, etc. Plus we live in the boonies, so postage is rather erratic anyway, especially if it's not sent by UPS (Fed Ex/USPS up here SUCKS big time). I'll usually try to get down to the mall if I'm going to buy a game brand new, or for their used section (I don't like buying used games online, gotten too many scratched discs that way, they'll let me take a look at the discs at EBGames before I hand them my cash to make sure they're not damaged, can't do that online), just because I really like the store, and the whole experience of going in, chatting with the guys at the register, etc. Plus the tasty smoothies in the food court are...tasty. Usually end up getting the game quicker if I'm paying fullprice for it anyway too.

[Drakron]

Do you know how much it costs to develop a console game today?  It's a hell of a lot more than it was five years ago.

<{POST_SNAPBACK}>

 

Yes but there are a hell more consoles now there were 5 years ago.

 

The problem they mention above is that something that costed 20 million to make have exactly the same price tag of something that costed 5 million to make, I remenber the Xbox lauch titles and their price (about 70 euros!).

[Feargus Urquhart]

I always find this topic both hilarious and extremely depressing. When I was first buying games, something like 20 years ago now - they were priced between $29.95 US and $49.95 US. Does that range look familiar? That's what it is today.

 

However, 20 years ago it cost me $3 US to goto a movie and it now costs me $10 US.

 

I get confused why it has been ok for everything else to go up in price, but not computer games. CD's were like $13.99 full price when I was buying them in the late 80's and now at Tower they are like $18.99 or more when not on sale.

 

What is even more of a pain is that it no longer costs $100K to make a game but more like $5M to $15M. I know this all comes off as whining - but like I said this topic always makes me laugh and cry.

[Tanuvein]

I always find this topic both hilarious and extremely depressing.  When I was first buying games, something like 20 years ago now - they were priced between $29.95 US and $49.95 US.  Does that range look familiar?  That's what it is today.

 

However, 20 years ago it cost me $3 US to goto a movie and it now costs me $10 US.

 

I get confused why it has been ok for everything else to go up in price, but not computer games.  CD's were like $13.99 full price when I was buying them in the late 80's and now at Tower they are like $18.99 or more when not on sale.

 

What is even more of a pain is that it no longer costs $100K to make a game but more like $5M to $15M.  I know this all comes off as whining - but like I said this topic always makes me laugh and cry.

<{POST_SNAPBACK}>

 

I'm not going to comment on the price of games, since I figure they will rise in prices eventually or fold - they have to, if they aren't already doing it

 

But as for CDs, you should never pay more than 12 dollars for one. There are two great places if you want new CDs: The End Records for metal, Bullmoose for everything else. All CDs tend to be 10-12. And no shipping.

 

Yay for teh intranet!

 

Oh, and Feargus, about the price of games: Any idea on the price of NWN 2 at release?

[Nartwak]

Seven hundred dollars.

[Mad_Scientist]

I get confused why it has been ok for everything else to go up in price, but not computer games.  CD's were like $13.99 full price when I was buying them in the late 80's and now at Tower they are like $18.99 or more when not on sale.

<{POST_SNAPBACK}>

 

Who says it's ok for other things to go up in price? They should all stay the same! I demand it!

[Nartwak]

They should get lower.

[kirottu]

I know this all comes off as whining - but like I said this topic always makes me laugh and cry.

<{POST_SNAPBACK}>

 

In my very best comforting voice: "There there Fergie, there there."

[Pidesco]

I always find this topic both hilarious and extremely depressing.  When I was first buying games, something like 20 years ago now - they were priced between $29.95 US and $49.95 US.  Does that range look familiar?  That's what it is today.

 

However, 20 years ago it cost me $3 US to goto a movie and it now costs me $10 US.

 

I get confused why it has been ok for everything else to go up in price, but not computer games.  CD's were like $13.99 full price when I was buying them in the late 80's and now at Tower they are like $18.99 or more when not on sale.

 

What is even more of a pain is that it no longer costs $100K to make a game but more like $5M to $15M.  I know this all comes off as whining - but like I said this topic always makes me laugh and cry.

 

Maybe I'm wrong, but it seems to me that there is a difference between games and CD's or movie tickets. That is that computer gaming market was a lot smaller 20 years ago than it is now, while the markets for other entertainment items hasn't changed all that much.

[ShadowPaladin V1.0]

I think the prices have decreased in the UK. I remember it being quite common to pay

[Darth Barth]

Is it my mind playing tricks on me, but I could have swore that prices for games have come down since the 80's and early 90's. The only old game I have here to compare is Wizardry VII and my receipt inside says $69.95. And I know I didn't buy it when it first came out.

 

EDIT: It seems SP had the same thought.

[Yst]

Is it my mind playing tricks on me, but I could have swore that prices for games have come down since the 80's and early 90's.

 

Well, as far as the eighties go, it seems to me they've gone up. My TI 99 games (1981 to 1988) were generally priced between $12 and $40, it seems. Certainly, there was a price increase in the transition between the "a few thousand lines of BASIC" game design era (although, admittedly, a lot of assembly was used on the systems of the early '80s) and the "voice acting, FMV, texturing, modeling and large-scale corporatised development" era which saw media rich games like Wing Commander III introduced. But I think that was a fairly rational point in time for price increases to hit, and a logical basis for them. KotOR and KotOR II, as development projects, are far closer to a movie than a BASIC game, obviously.

 

As for the original price comparisons, they seem out of place. I think CDs are probably a bad source for price comparison, given the disturbing sickness of that industry. The core music industry is, at least among the modern and web saavy, seemingly pretty much considered the poster child for a diseased medium whose biggest proponents are doing everything imaginable to destroy it on their own behalf. I really doubt anyone in their right mind should wish to emulate their pricing model.

 

And I tend to think games can only realistically base their revenue model on their own costs and their own revenues. Currently, they're making money. Analogy to quite disimilar and horridly malfunctioning media industries in other areas isn't going to serve to enlighten as to its own circumstances and profitability. If games are making money at their current typical price per unit, it's hard to imagine that collusion on such a scale as would be necessary to permit a substantial industry wide price increase will ever occur, except gradually.

[Kaftan Barlast]

Continuing upon Feargus tragicomic theme here

 

 

I think the price of computer games is among the few areas where capitalism and market economy actually works in reality. If games cost more, people simply wouldnt buy them.

 

 

So the selling price remains at the same level while production costs continually rise. The only logical thing to do, is to make shure you can sell to a wider audience by making computer games as much a mainstream product as music, books and film. Games have always had this "kids stuff" stamp on them that is gradually wearing off as is happening with comics.

[Yst]

Regardless, games don't seem to have passed a point where profitability is prohibited by production costs outstripping revenues. It seems to be quite the opposite.

 

I take the position that the great and successful games of days long past, rather than the games of today, were the ones which were selling at nonsensical prices (from a purely cost and time investment vs. pricing standpoint).

 

Games which essentially constituted several weeks of coding by one or two programmers, in the early eighties, selling for $40, whether on carts, disks or casettes, was a situation where it doesn't seem to me time and expense were in alignment with the price on the label. But it was a much smaller industry back then. To cite my own pet system, the number of experts in TI 99 assembly worldwide, doing all the games for the system in the early '80s, is a figure you can count on your fingers. There was a time when the same could be said for Apple II. But that isn't the case anymore. So more realistic pricing focused on real expenses and time investment is inevitable.

 

There's such a thing as selling a product for virtually pure profit, with utter indifference to operational expenses, and some industries occassionally operate on the basis of that kind of indifference. A few years ago, when it was still possible to market dialup web access at $15-$20/month, that was a product that was almost pure profit for the businesses with existing dialup customer bases. And when it was still possible for coders to sit down for a few weeks, write up a big pile of BASIC and some Assembly and have a chance at making it big as a game designer, that was virtually pure profit. But in a crowded market, that kind of thing won't persist forever. And it didn't persist for the games of the BASIC era.