Would decreasing the cost of games be cost-efficient?

[LordofPurple]

We all know how ridiculously expensive it can be to make a videogame. Would decreasing the price of games from the $60 mark(in America) be cost effiecient considering how much they cost to make?
We all want the price of games to drop, but has anyone done any real calculations on how successful it would be, or are we kind of binging on the hope that lower prices = more purchases? As much as I would love to be able to buy games more than once every few months, how do we know that a drop in price would really help the industry itself?
I think if a game that's guaranteed to be extremely popular (any Call of Duty or Blizzard game, for example) then that's a good chance to test it out because no matter what they'll make money, but I think it's unlikely a large company will take that risk of losing so much potential profit, which would leave it to a smaller company for whom it would be a much bigger risk. In an industry so afraid of taking risks as it is, why would they go out of their way for the consumer and put their company on the line for it?
All that being said, I really hope someone figures out something, because having to pay as much for games as we do is ridiculous.
Any thoughts?

 

[Aeshi]

I personally doubt it would change much, the cost of used games would just go down a bit and the only people who would by new would be those who would've bough it new anyway.

Best case scenario, the extra sales cancel out the losses from the price drop and you break even.
Worst case scenario, you make less money.

 

[veloper]

Overal the current setup is working well for the publishers I reckon.

Start at 50 or 60. Quickly drop to 30, so people think they are getting an awesome deal.

 

[AD-Stu]

Unless sales drop markedly there really isn't a need for them to drop prices - quite simply, the market is telling developers that they're OK with the price of games as they are. Hell, in a lot of cases we're paying the asking price and then giving them more down the track for DLC.

I really don't see an experiment on pricing happening with a triple-A title like a COD, Battlefield or Assassins Creed, BTW. For one, they're going to sell bajillions almost regardless of the asking price so developers would only be doing themselves a disservice by cutting prices. Also, premium pricing is a big part of how those games define themselves - if COD sold for $40 but Battlefield was still selling for $60, people would be subconsciously assuming that Battlefield was better because people are stupid like that. Cutting the price would devalue the brand and potentially hurt future sales. Plus so many people already buy them that I don't know if the market is big enough to support a "halve the cost, double the sales" strategy.

Personally, I don't see prices changing much unless studios also go through some serious back-of-house cost cutting and even then, I'd expect them to try to hang onto the higher margins for as long as possible.

 

[Kahunaburger]

If you think a game is too expensive, you don't buy it. If you think it's good value for money, you do buy it. Everyone does this, and the market does the rest.

 

[Indecipherable]

No-one here can really answer that without having the numbers such as costs and elasticity of demand.

 

[oplinger]

...Cost efficient depends on projected sales more than the cost to make the game. If the company expects to sell 1 million copies, and spend 50 million to make the game, 50 dollars is what the projected value of the game would be to break even. Bump it to 60, make a profit.

If the game took...8 million to make, and they projected 500,000 copies sold, and still sold it for 60 dollars because that's what the going price for a game is, fuck them. 20 bucks would make them profit if they met their projections. (And most companies project high, so this is not exactly what a company would do....breaking even, i mean.)

So, really, decreasing the cost of games would make it less idea to be an asshole and make mad profits, but ...it also could destroy those companies who aim high and have the cash to spend like crazy. Like say.....Rockstar. They spent 100 million on GTA4, so they'd have to sell 1.6 million. (THey sold 6 million... but this is just an example.)

Sounds fine I guess right? I mean you hear about games selling a million copies all the time. ..1 million copies makes your game considered a huge hit, or a blockbuster. Under a million even makes some games get the "player's choice" label, or something similar.

Cost efficient is really relevant. The only solution is some sort of regulating body that separates games into tiers, if our budget is X, then your game's price must be Y. so, 100 million dollars can be 60, 50 million sells for 30 or 40.. (profits must be made)

But that won't happen. Just all I could think of.