Poll: Video Game Pricing

[theultimateend]

So I was thinking in another thread. When developers make games and charge 60 dollars and folks try to justify the cost of the game to help recoup cost of development. It got me thinking (as the beginning of this post might have already pointed out...) do they really need to charge 60 dollars?

According to nexgenwars.com there are tens of millions of each console sold, the specific numbers as of the posting of this are below:

360 32,193,652
PS3 24,772,300
Wii 53,268,494

Now imagine if you will if someone made a game and only charged two dollars per copy (perhaps requiring it be digital but lets just say hard copy). That means that if every person who owned a certain console bought it they would make the following amounts:

360 32,193,652*2= $64,387,304
PS3 24,772,300*2= $49,544,600
Wii 53,268,494*2= $106,536,988

Now from my quick google the most expensive game ever made was supposedly 100 million dollars. However the average cost to make a next gen top tier game is roughly 60 million.

Now I realize that by that account the PS3 would not be able to recoup costs and the 360 would be pretty close. But this is JUST 2 dollars. You bring it up to 3 or 4 dollars and all companies are making a profit and still staying at a low enough cost that there is almost no danger in the purchase.

So yes, before anyone attacks this, I realize that 2 dollars is likely a bit on the extreme. But the study here is to see if folks would be more likely (even regardless of quality, considering 60-100 mil is for really top of market games) to buy something without fear if it was this inexpensive.

It is also in hopes of dismissing the idea that if a company doesn't charge 60 dollars per copy that they'll never recoup costs.

Really? Even on the PS3 that would end up being a possible 1,486,338,000 dollars in profit. Now I'm not a rocket scientist but I'm pretty sure that nobody has come near to spending 1.4 billion dollars on a game (that isn't constantly maintained and even then I don't think wow is near this kind of cost yet).

The less you charge for a product the more people will buy it. In the past companies (long before video games) made some pretty sexy profits by selling in bulk, now it seems the new strategy is to sell less at a higher price. While this might be more friendly on physical resources it certainly isn't consumer friendly .

 

[theultimateend]

Does anyone remember that N64 games used to cost 60-70 dollars when they first came out? Just throwing that out there.

I was actually talking about back in the 40's when I said "back in the day" but yes I remember that.

 

[StarStruckStrumpets]

I bought Kung Fu Panda + Lego Indy for £3. Why not?
Bargain. They're both so much fun.

 

[Timotei]

Does anyone remember that N64 games used to cost 60-70 dollars when they first came out? Just throwing that out there.

Or games for the NES when everybody had one.

If you actually look at how much games and systems used to cost and adjust them for inflation you'd notice that gamers pay less now for games than ever before.

EDIT: I also bought Warship Gunner 2 for 2 buck in a bin at Gamestop. Little did I know at that moment that I had bought a jewel for $2.

 

[gamer416]

wow im an american and that is way to cheap.
but i would still buy it

 

[theultimateend]

Does anyone remember that N64 games used to cost 60-70 dollars when they first came out? Just throwing that out there.

Or games for the NES when everybody had one.

If you actually look at how much games and systems used to cost and adjust them for inflation you'd notice that gamers pay less now for games than ever before.

Which still doesn't change the point of the original topic at all but regardless. Also need to take into account the quality of games. A game from 1990 != a game from 2009. Just because they are both games doesn't mean they are the same product. But that is subjectivity which is why I understand your train of thought as opposed to mine.

Does anyone remember that N64 games used to cost 60-70 dollars when they first came out? Just throwing that out there.

Yeah made buying games a pain in the arse for the system. I barely bought any N64 games because of that. I'll tell ya going from 50 to 60 dollars really is the breaking point for me when getting games. It was true when I was a kid and it is even more true as an adult.

Yeah I tended to just borrow games from my friends since the cost was (and is) outrageous.

I bought Kung Fu Panda + Lego Indy for £3. Why not?
Bargain. They're both so much fun.

Word. I'm a bit envious . But that's why I use gamefly, I'm essentially paying pittance since I blow through the games so fast.

22 bucks a month with each game lasting about 3 days. That's 10 games a month which is a little more than 2 dollars .

 

[JamminOz07]

So I was thinking in another thread. When developers make games and charge 60 dollars and folks try to justify the cost of the game to help recoup cost of development. It got me thinking (as the beginning of this post might have already pointed out...) do they really need to charge 60 dollars?

Well, here in Oz, we're talking up to about AU$120 for a AAA game. That's $103 of your damn US dollars at this point in time! So don't ***** to an Aussie about how expensive they are for you!

US$60 = AU$69.50!

As for your post, yeah sounds good in theory, but there's probably a reason why games and lets face it, all products aren't that cheap. I mean, even at STUPID AUSTRALIAN VIDEO GAME PRICES!!! I still buy a couple of games a month. If they were cheaper I probably wouldn't buy more because only a small percentage of all video games released are worth buying, in my opinion.

 

[Timotei]

Word. I'm a bit envious . But that's why I use gamefly, I'm essentially paying pittance since I blow through the games so fast.

22 bucks a month with each game lasting about 3 days. That's 10 games a month which is a little more than 2 dollars .

Bah. I gave up on Gamefly long ago after having to send Halo 3 back 4 different times because the disks were scratched beyond playability. Gamefly makes millions a year and yet they can't spend $12 for a friggin disk fixer?

 

[theultimateend]

Word. I'm a bit envious . But that's why I use gamefly, I'm essentially paying pittance since I blow through the games so fast.

22 bucks a month with each game lasting about 3 days. That's 10 games a month which is a little more than 2 dollars .

Bah. I gave up on Gamefly long ago after having to send Halo 3 back 4 different times because the disks were scratched beyond playability. Gamefly makes millions a year and yet they can't spend $12 for a friggin disk fixer?

Bummer O.O. Hasn't happened to me yet. But I understand your plight.

So I was thinking in another thread. When developers make games and charge 60 dollars and folks try to justify the cost of the game to help recoup cost of development. It got me thinking (as the beginning of this post might have already pointed out...) do they really need to charge 60 dollars?

Well, here in Oz, we're talking up to about AU$120 for a AAA game. That's $103 of your damn US dollars at this point in time! So don't ***** to an Aussie about how expensive they are for you!

US$60 = AU$69.50!

As for your post, yeah sounds good in theory, but there's probably a reason why games and lets face it, all products aren't that cheap. I mean, even at STUPID AUSTRALIAN VIDEO GAME PRICES!!! I still buy a couple of games a month. If they were cheaper I probably wouldn't buy more because only a small percentage of all video games released are worth buying, in my opinion.

Yeah but the thing is. Just because you live with it doesn't mean it couldn't be better. Folks used to live with Polio, doesn't mean we really need to accept it . There are better options that result in a much happier result for all parties involved.

 

[JamminOz07]

Yeah but the thing is. Just because you live with it doesn't mean it couldn't be better. Folks used to live with Polio, doesn't mean we really need to accept it . There are better options that result in a much happier result for all parties involved.

Point taken. I must say that I can usually buy games new release for about AU$89 and that makes me happy. Like anything, you need to be a smart consumer when you buy videogames. the big retailers here will price match each other, you can trade old games etc. I will also rent a game that I'm not that sure about for a night. If I like it but not heaps, I'll wait a couple of months and pick it up for $40 on special or 2nd hand. Ha, not all games though, I saw Fallout 3, 2nd hand, for $94. Outrageous!

 

[Kurokami]

Depends on the game: (quality, multiplayer?)

 

[theultimateend]

Yeah but the thing is. Just because you live with it doesn't mean it couldn't be better. Folks used to live with Polio, doesn't mean we really need to accept it . There are better options that result in a much happier result for all parties involved.

Point taken. I must say that I can usually buy games new release for about AU$89 and that makes me happy. Like anything, you need to be a smart consumer when you buy videogames. the big retailers here will price match each other, you can trade old games etc. I will also rent a game that I'm not that sure about for a night. If I like it but not heaps, I'll wait a couple of months and pick it up for $40 on special or 2nd hand. Ha, not all games though, I saw Fallout 3, 2nd hand, for $94. Outrageous!

It is a shame that you have to be a smart consumer . Be nice if you could just throw a couple bucks down and even if it sucks its not a big loss. Just the cost of a hamburger or two this way at least .

 

[Low Key]

The best selling 360 game to date is Halo 3, which sold an approximate 8.1 million copies. That is a quarter of the number of total 360 consoles sold. Now take into consideration that not everyone buys the same game. Heck, the next game on the list [http://en.wikipedia.org/wiki/List_of_best-selling_video_games#Xbox_360] is Gears of War at 5 million copies sold.

True, price a game low enough and more people will buy it. Certainly $60 for a game is a bit overboard, but if a game only sells a half a million copies at $60, the developers are $30 million in the hole.

And you have to remember, pressing the discs will cost at least $2 a pop. Say everyone who owned a 360 bought a copy of that game. That means just pressing the discs would cost roughly $64 million, more than the total cost of development. That doesn't factor in Microsoft's cut, marketing, publishing, or anything else. So, let's say the said game will cost $10. That means the profit would be about $320 million, right? Well, take away at least half for Microsoft and publishing (moreso Microsoft so they can license each game). That leaves $160 million. Marketing would have to run almost non-stop for everyone who bought a 360 to also buy said game, so cut that total in half again. Now, we're down to $80 million. Subtract that $64 million for pressing the game, and that leaves the total at $16 million, far short of that $60 million that is considered bare minimum to develop a game.

 

[theultimateend]

The best selling 360 game to date is Halo 3, which sold an approximate 8.1 million copies. That is a quarter of the number of total 360 consoles sold. Now take into consideration that not everyone buys the same game. Heck, the next game on the list [http://en.wikipedia.org/wiki/List_of_best-selling_video_games#Xbox_360] is Gears of War at 5 million copies sold.

True, price a game low enough and more people will buy it. Certainly $60 for a game is a bit overboard, but if a game only sells a half a million copies at $60, the developers are $30 million in the hole.

And you have to remember, pressing the discs will cost at least $2 a pop. Say everyone who owned a 360 bought a copy of that game. That means just pressing the discs would cost roughly $64 million, more than the total cost of development. That doesn't factor in Microsoft's cut, marketing, publishing, or anything else. So, let's say the said game will cost $10. That means the profit would be about $320 million, right? Well, take away at least half for Microsoft and publishing (moreso Microsoft so they can license each game). That leaves $160 million. Marketing would have to run almost non-stop for everyone who bought a 360 to also buy said game, so cut that total in half again. Now, we're down to $80 million. Subtract that $64 million for pressing the game, and that leaves the total at $16 million, far short of that $60 million that is considered bare minimum to develop a game.

Well like I said. 2 dollars is an extreme and was just used as an example. One could very well make it digital distribution or make it 5 bucks if necessary. The point was just that they are charging massive prices when it likely only hurts overall sales.

Sure only 8.1 million people bought Halo 3. But if it had been 2-10 bucks I would have bought it. I didn't buy it though. How many more people were like me?

The assumption in your post that I gathered was that the exact same amount of people would buy the item if it was cheaper. My assumption is that far more people would buy it. Likewise marketing wouldn't need to work anywhere near as hard if the game was only 2 dollars. Most of marketing is convincing people that a game is worth the huge price tag.

McDonalds didn't get to where they are by charging 60 bucks for a hamburger. Much of their gain was from decades of selling their food at low prices to make profits by sheer massive numbers. Just as a quick (occasionally) delicious example.

Overall though it does look like you skipped over the "I realize this is an extreme and is just an example" statement. But I'm cool with it since yours seemed like a suggestion instead of doing exactly what I warned folks was unnecessary. This here be a thought experiment.

PS. I'm seriously curious who said no . I'd like to know of how good a game has to be before you'd say "I could spare 2 dollars." I realize not everyone has money, but that's not even a value meal cost right there (unless you get water instead of soda).

 

[Low Key]

The best selling 360 game to date is Halo 3, which sold an approximate 8.1 million copies. That is a quarter of the number of total 360 consoles sold. Now take into consideration that not everyone buys the same game. Heck, the next game on the list [http://en.wikipedia.org/wiki/List_of_best-selling_video_games#Xbox_360] is Gears of War at 5 million copies sold.

True, price a game low enough and more people will buy it. Certainly $60 for a game is a bit overboard, but if a game only sells a half a million copies at $60, the developers are $30 million in the hole.

And you have to remember, pressing the discs will cost at least $2 a pop. Say everyone who owned a 360 bought a copy of that game. That means just pressing the discs would cost roughly $64 million, more than the total cost of development. That doesn't factor in Microsoft's cut, marketing, publishing, or anything else. So, let's say the said game will cost $10. That means the profit would be about $320 million, right? Well, take away at least half for Microsoft and publishing (moreso Microsoft so they can license each game). That leaves $160 million. Marketing would have to run almost non-stop for everyone who bought a 360 to also buy said game, so cut that total in half again. Now, we're down to $80 million. Subtract that $64 million for pressing the game, and that leaves the total at $16 million, far short of that $60 million that is considered bare minimum to develop a game.

Well like I said. 2 dollars is an extreme and was just used as an example. One could very well make it digital distribution or make it 5 bucks if necessary. The point was just that they are charging massive prices when it likely only hurts overall sales.

Sure only 8.1 million people bought Halo 3. But if it had been 2-10 bucks I would have bought it. I didn't buy it though. How many more people were like me?

The assumption in your post that I gathered was that the exact same amount of people would buy the item if it was cheaper. My assumption is that far more people would buy it. Likewise marketing wouldn't need to work anywhere near as hard if the game was only 2 dollars. Most of marketing is convincing people that a game is worth the huge price tag.

McDonalds didn't get to where they are by charging 60 bucks for a hamburger. Much of their gain was from decades of selling their food at low prices to make profits by sheer massive numbers. Just as a quick (occasionally) delicious example.

Overall though it does look like you skipped over the "I realize this is an extreme and is just an example" statement. But I'm cool with it since yours seemed like a suggestion instead of doing exactly what I warned folks was unnecessary. This here be a thought experiment.

PS. I'm seriously curious who said no . I'd like to know of how good a game has to be before you'd say "I could spare 2 dollars." I realize not everyone has money, but that's not even a value meal cost right there (unless you get water instead of soda).

My calculations were assuming all 32,000,000+ people who own a 360 console would buy the game you are talking about. Digital distribution would eliminate the cost of pressing copies of discs, but not everyone has their 360 connected to the internet, so that would leave many million without access to the game.

As far as the McDonalds example, due to inflation, burgers rose from $.10 to $2 over the course of 50 years which is actually pretty reasonable. I mean, McDonalds is an international corporation with millions of employees they have to pay. 50 years ago, I doubt there was more than a couple hundred employees, so it kept the cost of operation down.

I know what you are getting at. Don't think it's beyond me or anything. Games could stand to have at least $10 taken off the price tag, but charging an unreasonably low price for a game without a guarantee of who will buy it is a pretty big risk to take given the number of channels it has to go through before it makes even the slightest profit.

 

[Biosophilogical]

Well I am an Aussie but my 'back in the day' thing would be the gameboy where games were $50 max over here. If it was like $5 for a new-gen console game then I would buy out the store, and the workers at the store would still get paid cause the amount of games sold would be massively more and then, of course if you up the price to $10 (Aust.) the companies making the game would be filthy rich but the stores would be set for life.

 

[theultimateend]

The best selling 360 game to date is Halo 3, which sold an approximate 8.1 million copies. That is a quarter of the number of total 360 consoles sold. Now take into consideration that not everyone buys the same game. Heck, the next game on the list [http://en.wikipedia.org/wiki/List_of_best-selling_video_games#Xbox_360] is Gears of War at 5 million copies sold.

True, price a game low enough and more people will buy it. Certainly $60 for a game is a bit overboard, but if a game only sells a half a million copies at $60, the developers are $30 million in the hole.

And you have to remember, pressing the discs will cost at least $2 a pop. Say everyone who owned a 360 bought a copy of that game. That means just pressing the discs would cost roughly $64 million, more than the total cost of development. That doesn't factor in Microsoft's cut, marketing, publishing, or anything else. So, let's say the said game will cost $10. That means the profit would be about $320 million, right? Well, take away at least half for Microsoft and publishing (moreso Microsoft so they can license each game). That leaves $160 million. Marketing would have to run almost non-stop for everyone who bought a 360 to also buy said game, so cut that total in half again. Now, we're down to $80 million. Subtract that $64 million for pressing the game, and that leaves the total at $16 million, far short of that $60 million that is considered bare minimum to develop a game.

Well like I said. 2 dollars is an extreme and was just used as an example. One could very well make it digital distribution or make it 5 bucks if necessary. The point was just that they are charging massive prices when it likely only hurts overall sales.

Sure only 8.1 million people bought Halo 3. But if it had been 2-10 bucks I would have bought it. I didn't buy it though. How many more people were like me?

The assumption in your post that I gathered was that the exact same amount of people would buy the item if it was cheaper. My assumption is that far more people would buy it. Likewise marketing wouldn't need to work anywhere near as hard if the game was only 2 dollars. Most of marketing is convincing people that a game is worth the huge price tag.

McDonalds didn't get to where they are by charging 60 bucks for a hamburger. Much of their gain was from decades of selling their food at low prices to make profits by sheer massive numbers. Just as a quick (occasionally) delicious example.

Overall though it does look like you skipped over the "I realize this is an extreme and is just an example" statement. But I'm cool with it since yours seemed like a suggestion instead of doing exactly what I warned folks was unnecessary. This here be a thought experiment.

PS. I'm seriously curious who said no . I'd like to know of how good a game has to be before you'd say "I could spare 2 dollars." I realize not everyone has money, but that's not even a value meal cost right there (unless you get water instead of soda).

My calculations were assuming all 32,000,000+ people who own a 360 console would buy the game you are talking about. Digital distribution would eliminate the cost of pressing copies of discs, but not everyone has their 360 connected to the internet, so that would leave many million without access to the game.

As far as the McDonalds example, due to inflation, burgers rose from $.10 to $2 over the course of 50 years which is actually pretty reasonable. I mean, McDonalds is an international corporation with millions of employees they have to pay. 50 years ago, I doubt there was more than a couple hundred employees, so it kept the cost of operation down.

I know what you are getting at. Don't think it's beyond me or anything. Games could stand to have at least $10 taken off the price tag, but charging an unreasonably low price for a game without a guarantee of who will buy it is a pretty big risk to take given the number of channels it has to go through before it makes even the slightest profit.

Very true on all your examples. The gist of my idea is that low prices lead to sales. Even now at 2 dollars with inflation, they COULD charge 10 or 20 bucks, they likely would find that they'd get sales but it would be nothing compared to their current business model.

10 dollars is likely a good place to be since I got Evil Genius for 10. But I felt it was too high to get my bullet point across. I'm fairly surprised that games are even put on discs anymore, I'd figure that SD cards or other hard media would be better options at this point. Can't really be scratched, are much smaller, and require far less space to be taken up in a console.

That would result in far more money saved in shipping, packaging, and in the development of the console they'd save on parts, shipping, and repairs (less moving parts).

But then again since the rise of SD and USB devices I've just been in an endless awe that CD's and DVD's still survive like they do. I imagine I'm part of a small group of folks that thinks both are pretty darn dated (even bluray seems like an odd next step to me).