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The Almighty Buck Entertainment Games

Do Video Games Cost Too Much? 763

Posted by Soulskill
from the depends-how-the-pirate-bay-trial-goes-right dept.
Valve's Gabe Newell gave the keynote address at this year's Design, Innovate, Communicate, Entertain (DICE) Summit about the cost of games, the effect of piracy, and how to reach new players. Valve undertook an experiment recently to test how price affected the sales of their popular survival-horror FPS, Left 4 Dead. They Reduced the price by 50% on Steam, which "resulted in a 3000% increase in sales of the game, posting overall sales that beat the title's original launch performance." They also tested various other price drops over the holidays, seeing spikes in sales that corresponded well to the size of the discount. This will undoubtedly add to the speculation that game prices have risen too high for the current economic climate. G4TV ran a live blog of Newell's presentation, providing a few more details.
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Do Video Games Cost Too Much?

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  • Yes (Score:5, Informative)

    by houghi (78078) on Friday February 20, 2009 @06:07AM (#26926951)

    Yes. That was easy. Next!

    • Re:Yes (Score:5, Insightful)

      by sdnoob (917382) on Friday February 20, 2009 @06:16AM (#26926999)

      yup. the cost of video games is why i quit buying them. and no, i haven't resorted to alternate means of acquisition, either. i just quit buying new ones, content on playing the couple dozen or so that are on my gaming pc.

      not buying any new games has also saved the money that would've otherwise had to gone into hardware upgrades to even play the new ones in the first place.

      $20-30 for a game is much more agreeable to my checkbook than the $50-60 or more some games cost these days.

      and then you have series like the sims, which gets you both coming and going. $50 for the game, $20+ for each addon pack. by the time you pick up the entire "set" for the kids, you're looking at a couple hundred bucks or more.

      • Re:Yes (Score:5, Interesting)

        by thermian (1267986) on Friday February 20, 2009 @06:29AM (#26927063)

        I wait until the games I want are on the bargian shelves then buy them (or cheap on Steam). Ok, this usually means I'm behind other gamers, but new to me is good enough.

        Nor am I starved for quality games, less so perhaps, because by the time I get round to buying, the shit games have been identified, and the gems lauded.

        Diablo 3 may cause me to break this trend, at least for that one game, but everything else is bought cheap or not touched.

        • Re: (Score:3, Interesting)

          by melikamp (631205)

          Yea, friend, you speak the truth. Diablo 3 will be the first game I will seriously consider buying since WoW.

        • Re:Yes (Score:5, Insightful)

          by obarthelemy (160321) on Friday February 20, 2009 @07:28AM (#26927377)

          Same thing here. Like a film, a game that was good 2 years ago is still good today.

          • Re:Yes (Score:5, Funny)

            by Cyanara (708075) on Friday February 20, 2009 @08:36AM (#26927897)
            Until some bastard reveals that Bruce Willis was dead all along.
          • Re: (Score:3, Insightful)

            by theJML (911853)

            I always figured this was one of the main reasons why the PS2 constantly outsells newer consoles... The games are cheap, they're still good, and the system's not that expensive either. It's a great combo and more companies need to realize it.

            Personally, $20 is my sweet spot. I've spent more only once in the last 5 years (ironically when I had more disposable income) and that was with gift cards. I just don't think that they're worth $40-60 a pop. There have been times where I'd though "wow, this game is awe

        • Re: (Score:3, Interesting)

          by c0p0n (770852)

          I know exactly what you mean. I recently bought a PSP which it ain't seeing many new games lately, but it's got a big back catalog of some excellent games I can get on the sub £8 price tag. There's one exception, I've preordered new "Resistance: Retribution" for next month, but other than that, with the existing back catalog, I'll have at least a couple of years of inexpensive gaming.

        • Re:Yes (Score:5, Insightful)

          by fastest fascist (1086001) on Friday February 20, 2009 @07:39AM (#26927457)
          There's an interesting point: Why the need to buy games at launch? It's not like games vanish in a matter of months. If you're constantly, say, a year behind the curve, you avoid having to keep your hardware on the cutting edge and you still get to play as much as you like, since a game released a year ago is new to you. It's not like there's a huge amount of (or, arguably, any) improvement happening in games in terms of how much fun they are to play, the graphics just seem to be getting more realistic.
          • Re:Yes (Score:5, Insightful)

            by Joce640k (829181) on Friday February 20, 2009 @08:05AM (#26927639) Homepage

            Two words: Networked gameplay.

            When you're online you need to be seen playing the very latest game, right?

            I mean playing last year's game is like listening to last year's music - not something you want to be seen doing in public when you're under 25 years old.

            • Re: (Score:3, Informative)

              by sesshomaru (173381)

              Perhaps not, but I'm 39....

            • Re: (Score:3, Insightful)

              by WCLPeter (202497)

              Two words: Networked gameplay.
              When you're online you need to be seen playing the very latest game, right?

              While this might be true for the younger set, I think it also points to the quality of re playability of the game. A good game, where the developers have taken time to craft a thoroughly enjoyable multiplayer experience, will have continue to have players long past the issue date.

              Other games where the re playability is fun, in a take it or leave it kind of way, tend not to have many players within a relatively quick time period of the game launching. As someone who has bought a game a year after release i

            • Re:Yes (Score:5, Insightful)

              by hvm2hvm (1208954) on Friday February 20, 2009 @09:46AM (#26928931) Homepage
              I still play the old Counterstrike, Warcraft 3 Frozen Throne online and sometimes Starcraft with my friends. If the game is good you find people playing it long after it becomes "old". The fact that you can't play a game after 6months means it wasn't really good to begin with. Those are the same as all the commercial music nowadays: everyone is crazy about them for a few months and then no-one even cares about them. So no thanks, I'll stick to the quality stuff, not the consumerist crap. Like others said before, this works for movies, music and other kinds of entertainment too.
            • Re:Yes (Score:5, Informative)

              by cowbutt (21077) on Friday February 20, 2009 @09:47AM (#26928953) Journal

              Actually, there's a more salient point there - older networked multiplayer games tend not to actually get many players. I recently installed my copy of Unreal Tournament on my new machine and went online only to find mostly empty servers. Even when I bought it (budget re-release, and used even) they used to be rammed.

              • Re: (Score:3, Informative)

                The Unreal Tournament series is largely undefended against cheating, and that's a major problem for an FPS. Epic has made their cash, and what's the incentive to resolve the problem now?

          • Re:Yes (Score:5, Insightful)

            by CarpetShark (865376) on Friday February 20, 2009 @08:10AM (#26927677)

            There's an interesting point: Why the need to buy games at launch?

            Many people seem to be unaware of the fact that games, music, films, etc. are all part of popular culture -- a talking point amongst friends, a common thing to bond around, etc. There's a (certainly ignorable, but nonetheless real) need to buy these things at the same time as everyone else, if you want to share the experience.

            And yes, this is part of why information should be free to all, if it can be copied at no cost.

            • Re: (Score:3, Insightful)

              by Hognoxious (631665)

              There's a (certainly ignorable, but nonetheless real) need to buy these things at the same time as everyone else, if you want to share the experience.

              And yes, this is part of why information should be free to all, if it can be copied at no cost.

              I agree, think of the poor fashion junkies who don't know where their next iced-double-chocc-mocha is coming from.

              Enslave game developers now!

              • Re: (Score:3, Insightful)

                by Sponge Bath (413667)

                ...don't know where their next iced-double-chocc-mocha is coming from.

                Two girls, one cup.

            • Re:Yes (Score:5, Informative)

              by daVinci1980 (73174) on Friday February 20, 2009 @12:17PM (#26931449) Homepage

              Are you including games and music in that 'information should be free' quote?

              Because people pay money to develop that information. They feed their families by their ability to make that information, because the companies they work for expect to be able to sell licenses for people to use and enjoy that information.

              Would game developers and musicians just charge for 'support' of their games and music? Does that mean I get to call Billy Idol when his mp3 doesn't play properly in my car? Based on the number of MP3s that haven't worked properly for me in the last 12 or so years, I think Billy might have to find a day job.

              The trouble with good ideas is that people tend to want to overapply them. There's nothing wrong with free information, when it's your choice to discover and release that information for free--I write and release free software. But requiring that all information be free is just as bad as requiring all information be closed. They're opposite sides of the same coin.

              Of course, being as this is slashdot, I expect to be modded down to -9001.

            • Re: (Score:3, Insightful)

              by westlake (615356)
              And yes, this is part of why information should be free to all, if it can be copied at no cost.

              That's quite naive, you know.

              The icons of American pop culture have a disreputable origin.

              There is always a hint of something illicit, exclusive, commercial, the scent of money about them.

              Jazz emerges from the brothel and the Cotton Club in Harlem.

              Where the audience was white and slumming but still dressed to the nines and the booze was pricey.

              Not from the open-air bandstand on the village square.

              The barri

          • Re:Yes (Score:4, Interesting)

            by Anonymous Coward on Friday February 20, 2009 @08:23AM (#26927767)

            Buying games at launch (or near to it) increases the chance a sequel will be made. It is voting with my dollars for what I want the gaming industry to focus on.

            Also, I have the bad habit of actually following gaming news, so by the time a game comes out that I want to play I have already been reading about it for months.

          • Re: (Score:3, Interesting)

            by Sage Gaspar (688563)
            Mostly the only games I buy at launch these days are multiplayer games. There's a difference in the communities of a game that is just starting out compared to after they've been established for a year or two.
        • Re: (Score:3, Insightful)

          by mcgrew (92797) *

          Also, by the time they hit the bargain bin I have good enough equipment to play them on. The PC gaming industry seems geared to the Lexus-Mercedes crowd. Here's a hint - most people work for a living and every penny counts.

          Write games that will play on a three year old Dell and sell them for $15-$20 and you'll make a whole lot more money off of them.

      • by elrous0 (869638) * on Friday February 20, 2009 @09:12AM (#26928369)
        I buy a lot of console games used at a considerable discount (if you're willing to wait for the latest and greatest to age a little you can get a huge discount this way). The thing that REALLY worries me is the move towards online distribution, which would destroy the secondary (used) market. I'm just fine with new games costing $60, as long as I can buy it used a year later for $20-$30. I would much rather have it that way than a download system where a new game costs $50, and a year later it still costs $50 because you can't buy it used.
      • yup. the cost of video games is why i quit buying them. and no, i haven't resorted to alternate means of acquisition, either. i just quit buying new ones, content on playing the couple dozen or so that are on my gaming pc.

        not buying any new games has also saved the money that would've otherwise had to gone into hardware upgrades to even play the new ones in the first place.

        $20-30 for a game is much more agreeable to my checkbook than the $50-60 or more some games cost these days.

        and then you have series like the sims, which gets you both coming and going. $50 for the game, $20+ for each addon pack. by the time you pick up the entire "set" for the kids, you're looking at a couple hundred bucks or more.

        There are many game that quite frankly, are not worth the $50 or $60 price that they cost at launch.

        However, even if you consider games that fall only in the center of the bell curve for quality, a typical video game will provide about 15 to 20 hours of entertainment value. (Yes, I know some like Portal are just short, and others like Civilization will consume months, I said typical).

        How many forms of entertainment can provide you with 15 hours of entertainment? On a per hour basis, a $60 game is costing

      • Re: (Score:3, Interesting)

        by Kevin Stevens (227724)

        If you look at the real cost of games over time, they have come down greatly. I remember paying about the same for NES and SNES games in the 80's and early 90's for games as I do today. $40-60 was some serious coin in the early days of the NES. Nowadays, $50 is a days work at minimum wage ($6.55). Through most of the 80's, minimum wage was 3.35, meaning it was almost two full days of work to buy a video game. Hence, the real price among one of the main markets for video games (teens who generally make aroun

    • Re: (Score:3, Insightful)

      by poetmatt (793785)

      As another to add to the inevitable statistic, I shall say that anything over 20$ for a game is too much.

      If the expansions are 20$ too, after 2 expansions you're back at $60 again. Lots of companies try to turn this into micropayments at which point most of us say fuck that. However, 60$ upfront and then 60$ for expansions? I'm looking at you, everquest.

      Meanwhile, 10$ or 15$ for a game? I'd buy it if it looked decent.

      Will businesses realize the charge less = more overall profit due to volume? Hell no. Not

  • Yes they are... (Score:4, Interesting)

    by xtracto (837672) on Friday February 20, 2009 @06:07AM (#26926953) Journal

    Considering that a $200 million "film" [wikipedia.org] can be obtained in DVD for USD$20 at most, I am sure that there is no way a Wii game should cost more than that... (currently 50 euro!)

    • A fair point but part of the equation is also that a film gives you two hours of entertainment whereas a game gives you perhaps 20-50+ hours.
      Personally, I'm reasonably OK with prices - a new title in the UK is around GBP40 but quickly falls to GBP20 or less after a few months. There are some titles which are GBP50 and that's just too much for me though.
      • Re:Yes they are... (Score:4, Insightful)

        by DrgnDancer (137700) on Friday February 20, 2009 @09:54AM (#26929109) Homepage

        I think the even better argument than the amount of entertainment you get is the number of units that company is likely to sell. Game companies tend to argue that they sell far fewer units than movie companies so they need to charge more per unit. The anecdotal evidence that the article presents suggests that they may be artificially limiting themselves. If you cut your price in half and sell 4x as many units (assuming reasonable distribution costs, which is generally the case in this industry) you've increased your profit tremendously. Valve noticed a 3000% short term increase. That's probably not sustainable over the long term, but it suggests that they could make a lot more sales if they went toward the movie industry model of cheaper, but sell more.

        Remember that games share an important economic reality with movies. They are all upfront cost. When you pay $10,000 for a car, it probably cost $5000-6000 to make and ship; that's $4000-5000 per unit to split between profit and recouping the R&D and other upfront costs. When you buy a $50 game, it only cost say $1-2 to "make and ship" (as in pressing the CD, making the box, printing the manual, etc). Most of the money was spent upfront writing the game. That mean that if you sell a lot more units at a cheaper price, you make a lot more money. The main cost for you isn't in producing "units" it's in creating the content. That price was already fixed when the game went gold. I'm ignoring some stuff like ongoing support costs, but in general a game manufacturer makes something approaching "pure profit" (not profit per se, a lot of it has to go to cover costs incurred during development, but you get the idea) on every unit sold. I doubt they would even need to triple their sales to make double the money at half the price. Preliminary evidence seems to indicate that could do a good bit better than tripling their sales with such a price cut.

        • If you were to graph the price on the X axis and the profits on the Y axis, it creates an inverted parabola. If you charge too little, you get a lot of sales but you earn less money. If you charge too much, you lose so many sales that you eventually lose out on profit. What TFA is saying is that games have overshot the peak of the parabola, and he's hinting that it's by something like 3x.

          This completely agrees with what I think is happening. In my experience, there are only a few games I'd be willing to
    • Re: (Score:3, Funny)

      by Hognoxious (631665)

      Considering that a $200 million "film" can be obtained in DVD for USD$20 at most, I am sure that there is no way a Wii game should cost more than that... (currently 50 euro!)

      Considering that beer is 94% water, and water is free from the tap, there's no way a pint should cost three quid.

  • Impulse power! (Score:4, Interesting)

    by Anonymous Coward on Friday February 20, 2009 @06:07AM (#26926955)

    My psychological maximum for impulse buys for games would be about 20$. Keep games around that and I would have a hell of a lot more.

    Well, that and wine compatibility but that is a whole 'nother story :)

    • Re:Impulse power! (Score:5, Insightful)

      by Elrond, Duke of URL (2657) <JetpackJohn@gmail.com> on Friday February 20, 2009 @06:44AM (#26927131) Homepage

      Also, the ability to return a game that I do not like.

      It used to be that this was a given, since before the media companies forced their will upon the rest of us, games were treated like any other merchandise. When I could return a game I didn't like, or that didn't work, to the store in the mall (at the time it was Software Etc.) I bought many more games than I do now. I could take a chance because the risk to me personally was extremely low.

      I would frequently browse the shelves holding PC games (which were far more numerous back then). Hmm, that looks like it *might* be fun/interesting. I'll buy it and find out. Maybe it is, maybe it isn't, but I'll soon know first hand.

      Publishers constantly whine about the risks of developing new IP because it is very hard to know how it will do in the market. If I, as a customer, have the ability to make low risk purchases, I'm far more likely to try new games.

      As it stands now with the draconian return policies, I almost always wait for a stack of reviews to be published before I make any decisions. This hurts the developers and publishers in a number of ways. First, I have to take the initiative to find these reviews which all but eliminates the chance of an impulse buy (or even a semi-researched buy). And second, I am relying on the reviewers subjective opinion. I know that I am getting filtered information and that my views on what is good/bad are likely different from that of the reviewer, but what choice do I have?

      Demos can mitigate this problem, but only a little. They still eliminate the chance of an impulse buy. Plus, I find I give a demo much less time to "win me over" than I do something I have paid for. And, of course, depending on what genres you like, the availability of demos varies greatly. Adventure games, strategy, RPG/JRPG? Good luck finding demos.

      • Re:Impulse power! (Score:4, Interesting)

        by Blimey85 (609949) on Friday February 20, 2009 @07:04AM (#26927257)
        Yes, yes, yes!!!

        I've bought several games that were great in theory but that I just couldn't enjoy if you paid me. I recently went through about 20 demos and found that of all of them, I only really liked one. These were 20 games that I would have otherwise just bought and hoped for the best, only be to be disappointed in the end, and quite a bit poorer considering that new xbox games are $60 each. To make matters worse, the actual games does not always match the demo. Conker Live & Reloaded was great in the demo. I couldn't wait for it to finally come out so I could play the whole thing. I picked it up on release day and raced home. Popped it in and immediately noticed that the game play was quite a bit different than what I had played on the demo disc from some magazine.

        It's one thing to buy a game and end up not liking it. It's quite another to play a demo of the game only to buy the full game and find out that the game company decided to make some major changes to how the game was played. Of course I couldn't return the game so I was out $$$.
      • Re: (Score:3, Insightful)

        by trillex (1080579)
        I have a grudge against people who think they can be refunded after having played/watched through an entire game/movie. It's a bit spoiled - "I leave a deposit here and you will hear from me if I do not like it". What's to stop one from just saying it was shit anyway and get a free experience out of it? Games cost a bit too much, that is true - but you've probably bought junk food, snacks or something for more than what a regular PC game costs. Just accept that you take a bit of a chance with a game and ca
      • Re: (Score:3, Interesting)

        by revery (456516)

        Take this with a grain of salt (possibly lithium salt), but I have found the following technique to work for returning the occasional horrible game (Spore? anyone?):

        Go to the store and tell them that you had "problems with the game" and would like to exchange it for an new copy. In most cases, they will give you an unopened copy which you can then return for a credit. If you buy from a chain that there are multiple of in your area this works a little bit better. (Get the new copy at Target A, return it at T

  • Hiopcrits? (Score:4, Interesting)

    by deejay1 (578230) on Friday February 20, 2009 @06:13AM (#26926987) Homepage Journal
    Well, but he didn't mention the situation with Valve's store in Europe where prices are much higher for two months now as they used to be. And there's no answer at all from Valve even though there's a massive thread over at their forums and even sites are being created about this issue. Just take a look at http://steamunpowered.eu/ [steamunpowered.eu] or http://www.steamrepowered.eu/ [steamrepowered.eu]
    • Re:Hiopcrits? (Score:4, Insightful)

      by neokushan (932374) on Friday February 20, 2009 @06:52AM (#26927183)

      Valve's store is too high anyway, particularly for new releases.

      As an example, I opened up steam and checked out the first game that appeared: Dawn of War 2.

      On steam, it costs £34.99, about the RRP of a retail PC game. http://store.steampowered.com/app/15620/ [steampowered.com]

      On play.com, it's only £22.99.

      http://www.play.com/Games/PC/4-/5380006/Warhammer-40-000-Dawn-Of-War-II/Product.html [play.com]

      Do you honestly mean to tell me that the cost of manufacturing the box, pressing the disk(s), pressing the manuals and then sending them out to Jersey is actually more than £10 cheaper than throwing it on a server somewhere and having someone download it through the internet connection they pay for?

  • remarkably clueful (Score:5, Insightful)

    by Trepidity (597) <delirium-slashdot@@@hackish...org> on Friday February 20, 2009 @06:18AM (#26927005)

    The points he makes in the Gamasutra summary [gamasutra.com] sound remarkably clueful for the co-founder of a semi-major media firm. He seems to essentially "get it", that when selling content you're in a market, and if you're failing to sell as much as you'd want, the best solution is to figure out how you're failing to succeed in the market rather than whining about pirates.

    Basically:

    1. Price points are not given from God. There's a supply/demand curve, and if you price things higher, you'll get more profit per item but sell fewer items. What shape this curve takes, and where you ought to locate yourself on it, can vary on a lot of factors, and it's your job as a company selling things to research that, rather than decide "games cost $50/$60, and that's that". Maybe they should cost $20, maybe they should cost $100, maybe it varies based on the game and your goals.

    2. There are a lot of people are willing to spend money. Some people will always get your stuff off Bittorrent purely due to the price (because it's free there, and you want money). But this is, contrary to what many media firms think, not the only or main problem. There are a lot of people who are willing to spend money on a lot of things. You'd do best to ask yourself if your company is doing something wrong that's keeping even people who would be willing to give you money from doing so (e.g. region-locked DVDs making it impossible for them to buy a legit copy).

    3. Along the lines of #2, DRM can be counter-productive, by making the legit copy seem like a bigger hassle than the cracked copy off Bittorrent. People who are willing to give you money for something they like may not be willing to give you money if you come off seeming like you hate your customers.

    Of course, #3 is slightly strange since Valve does in fact use DRM on Steam to authenticate your account to a particular machine. I suppose in their defense it's not nearly as draconian as much DRM, so they at least seem to be making efforts not to piss off their customers. And the existence of Steam in the first place, several years before any other major companies did anything similar, seems to indicate a certain understanding of, "if you make it easy for people to buy your things, they might do so".

    • by Chaos Incarnate (772793) on Friday February 20, 2009 @07:57AM (#26927587) Homepage
      Steam is DRM. But it's a) DRM that generally works hassle-free (or at least, does so with a far higher success rate than SecuROM/Starforce), and b) DRM that adds value to the purchase (download again anywhere; they're also working on features like making your saved games available on any machine you play on). The latter can actually make it more attractive than a true DRM-free copy on DVD would be.
  • by clickclickdrone (964164) on Friday February 20, 2009 @06:18AM (#26927009)
    Back in the day when I had an Atari 800, games were typically GBP35 with the odd extreme one being GBP80 (Some SSI or Avalon Hill game, War in Russia I think?).
    My monthly pay at the time was GBP120 so that was basically a weeks money per game.
    Bearing in mind how much more effort goes into a modern game, it's amazing prices have effectively dropped. That said, I had more fun then with those old 8K games except the very occassional title that really grabs me now like Bioshock.
    • Re: (Score:3, Interesting)

      by AlterRNow (1215236)
      Okay, I've seen people say that Bioshock was a title that stands out in the midst of other games but my personal experience of it was hugely disappointing. However, I only played up to the part where you have to go to 'Neptune's Bounty'. I was in the big room with all the ways leading off and one said "Neptune's Bounty" so I headed towards it. There was a big incident, the antagonist made his first appearance and that way got blocked so I had to go "around" via the medical bay ( IIRC ).

      This would have bee
      • by clickclickdrone (964164) on Friday February 20, 2009 @06:50AM (#26927171)
        >Does it get better after this or something?
        Probably not much! I just loved the look, feel and vibe of the game, the whole 1930's art-deco gone bad thing. Strip that away, the music etc and it's just another run/collect/shoot game. That art-deco twist really made it for me.
      • Re: (Score:3, Insightful)

        by Sage Gaspar (688563)
        Not really, the whole game is very linear. There is no real free exploration, you get led by the nose from checkpoint to checkpoint and predictably at every juncture something goes wrong that you need to finish a sidequest to solve. The story is okay, but I didn't find it that interesting. The people that sold it as a successor to System Shock were pretty far off-base. Atmospherically though I found it very compelling, and there are some moments and characters that really stick out. I guess it depends on wh
  • by lostandthedamned (907167) on Friday February 20, 2009 @06:19AM (#26927015)
    If Sony & Microsoft didn't try to make money by selling their consoles at a loss and making the money on games sales then this proof would never have been nessessary. If you sell a PC game then it's generally priced in line with the console release, which is inflated by the console markup. Rather than blame themselves for pricing games out of peoples spending brackets, both are trying to blame the second hand market for reducing sales and work out ways to kill it. Pro Evolution Soccer on the PS3 is the start of the slope. If you buy a second hand copy you can't play it online if it has been used online before. It won't be long before disks brought in shops only count as a "non-transfereable licence to play" rather than ownership of the game and it'll still be at the current prices.
    • This is an excellent point and one which I think too many people overlook.

      It's certainly true that many games cost a whole hell of a lot of money to produce, but the fee that the console makers charge is astronomical for exactly the reason you give.

      The only exception is Nintendo since they do not take a loss. So why are their games not substantially cheaper? Simple: they don't have to be. As long as they charge developers less and Wii games cost less than 360/PS3 games, customers will recognize the less expensive choice.

      Personally, I'd be extremely happy if PC game prices were uncoupled from the console prices. There are no licensing fees since there is no central authority. I'm not sure if the "Games for Windows" logo/certification costs anything. Some publishers might want it because it makes their game look more official, but on the other hand Microsoft needs that logo on more boxes to make Windows seem more attractive. At any rate, it's not a significant portion of the cost.

      • Re: (Score:3, Interesting)

        by Winckle (870180)

        If this "console coupling" a USA thing?

        In the UK the average price difference between console and PC versions is about £10-£15.

        • Re: (Score:3, Interesting)

          Hmmm... I guess I wouldn't say it's a hard and fast rule of pricing. But in my experience, the price of so called "triple A" titles varies little between PC and consoles. Still, I suppose it could just be that my sample is not indicative of the situation as a whole.

          On a slightly different note, I am more certain about the parity of downloadable games versus boxed games. They really should be much cheaper, in my opinion. For example, I want to buy Mirror's Edge. The retail PC box is about US$50. The pr

    • Re: (Score:3, Informative)

      by Blimey85 (609949)
      That's the beauty of the 360. You can't lock a game to a single console because the consoles break so damn often. Although to be honest, I've had mine for nearly 2 1/2 years and it just broke a month ago after which it was less than 2 weeks turn around on getting it fixed by Microsoft at no charge. Didn't even have to pay for shipping so I think they are handling the issue as well as they can. They should NOT fail as often as they do, but what's done is done I guess.

      Anyway, I recently got into Fallout 3 o
  • by Gonoff (88518) on Friday February 20, 2009 @06:28AM (#26927061)

    I did this in Economics long ago. Have a look at http://en.wikipedia.org/wiki/Income_elasticity_of_demand [wikipedia.org].

    I think, it means that when stuff costs less more (or less) people buy it differently. It works differently for different stuff. Fuel, for instance probably is not very elastic because it is not a discretionary purchase - you have to get it. I think some really expensive stuff might actually sell more because it is expensive - caviar anyone?

    A game is a highly discretionary purchase and so it will be very elastic. Proper capitalism should mean that you try and maximise your profit by lowering the price and increasing sales. Obviously, you can only cut the price so far because you need to make some profit per unit but the theory is sound and fairly obvious to me.

    The idiots in charge in the industry seem to see the whole thing differently. Obviously MBA/parasite economics is not the same as real economics.

    • by Aladrin (926209) on Friday February 20, 2009 @07:35AM (#26927427)

      I've often wondered if they had a clue about economics. But they probably do. It's not like the developers are doing the pricing, it's the MBA at the top that's doing that. And if he doesn't get economics... Well, the company has pretty major problems.

      So then the answer comes down to: They already know how to set pricing, and they've already done it. They need to cut costs if they want to make the product any cheaper, and cutting costs would make the product less 'cool' in the eyes of the consumer.

      Cutting costs in software means 1 or more of the following:

      Fewer flashy effects.
      Shorter game.
      Less polished gameplay.
      Less testing. (And therefore more bugs.)
      Less media hype.

      There are probably more ways yet, but they all (except the last) boil down to 1 thing: The game won't be as good. The last one means they'll sell less copies and has probably already been balanced anyhow.

      So at the same time gamers are yelling 'too many bugs', 'not long enough', etc, they are also yelling 'too expensive'.

      The company has to balance all that out.

      And BTW, casual games are a response to this as well. Some companies noticed that games want to buy cheap (sub-$20) games and have fun and they were willing to have less in the game to do it.

      • by TheRaven64 (641858) on Friday February 20, 2009 @08:59AM (#26928191) Journal

        Shorter game.

        You can make a shorter game with more playability if you release a good set of tools for expanding it. Think about the original Quake. I don't think I ever did more than the first of the four parts in single player (and was pretty bored by the end of it), and that was in the shareware release. At one point my quake directory was around 500MB, while the original game was only 50MB. All of the rest was provided by third-party mods. We played Team Fortress, QTank, Quake Rally, Air Quake, and a load of other mods regularly at LAN parties. Of the total time I spent playing Quake, at least 90% was spent playing various mods.

        If you want to cut costs, look at the modding scene for a similar game and send the people who make the best ones complimentary pre-release copies of your game. Give them a few months to play with it and see what they come up with before the official launch, and you'll probably end up with more third-party content available than there is in the original game.

  • by TuaAmin13 (1359435) on Friday February 20, 2009 @06:37AM (#26927093)
    I wouldn't draw a hard and fast line on how much games should cost. If every PC game was $25 new, I still wouldn't buy every game I was interested in on release day.

    I bought L4D this past weekend because it was a steal. Great game (all my friends have been raving about it), and I thought I would like it (it reminded me of counters strike a little bit). Would I buy Mirror's Edge for $25? Probably not. Crysis? Maybe once it hit $15-20, but that'll be much faster than starting at $50
  • Inflation (Score:5, Insightful)

    by ledow (319597) on Friday February 20, 2009 @06:47AM (#26927151) Homepage

    A lot of people say that this price increase is due to inflation etc. and that the prices we all remember are impossible today.

    I can only think of the games that come out for Spectrum - 1980's, £10 for a "full-price" game, 99p for a budget game (rising to £1.99 and then £2.99 before the end of the 80's). Let's ignore the high-end stuff for a while, because people buy stuff just because it's full price and just came out - they are the people who are stupid.

    Even taking into account inflation, etc. that is a hell of a markup. And these people formed teams like Codemasters etc. (Two brothers started out programming Spectrum and C64 games under the name Codemasters and soon built a company out of it before the Speccy era had ended.) so it's not like they didn't profit from it.

    Now, let's look at the Wii... not the newest console but a good seller. The cheapest "new" (not used) game I can find in an average shop is £10 and it's an unpopular title. The average "budget" game (i.e. a popular game that has had it's run and needs to sell more units) is around £20-30. The "good" games can cost up to £60, not including other hardware bundled with them, and stay at that price for YEARS.

    The 99p - £1.99 - £2.99 was a fast expansion of price - 300% inflation within 10 years. But since then, we've seen nearly 1000% inflation in 20 years (£2.99 in 1989 -> £20-30 in 2009), just for budget titles. That's exponential growth. Real inflation in developed countries hangs way under the 5% a year mark, so even with the best maths in the world (you can't really necessarily just "add up" the year-on-year inflation for the last ten years), it's not anywhere near 300% and certainly not 1000% inflation over 10 or 20 years.

    Prices will be set to whatever people will pay. Unfortunately, people are stupid and a lot of parents spend this ridiculous sort of money because they think they have to. But for, say, half a dozen new (but been out for a while) games to cost a week's wages for the average person, that's just stupid.

    However, the prices of the hardware are relatively static. The Spectrum cost £100-200 when it came out, the same price bracket as the Wii. The hardware has inflated a little but not anywhere near as much. Considering that is bound by real-world economics like availability of parts, bulk-orders, raw material prices, I expect it to model inflation quite well and it does. But the software seem to be nothing but pure profiteering - probably based mostly on the fact that once you've bought the hardware, you "have to" buy games for it.

    Steam's sales are great. I haven't bought myself anything on Steam in years (I bought my brother a birthday present of Half-Life 2 when it first came out, and nothing before that at all) but I went on there the other month and ended up getting about 12 games for about £25. That's perfect for me, and they were all games I wanted, all big names, two Half-life 2 episodes, the entire GTA and UFO series, (but not GTA4) etc. I could easily have bought another 12 games for around the same price. But when I look at the "normal" prices of some of that stuff, I shriek in horror. £30-50 for a game? Come on, that's *4* DVD's even at "brand-new" pricing, and there's no way that a Rainbox Six game costs as much to make, even taking into account the difference in the amount of final sales, as four Hollywood movies. £50 is a LOT of money. That was once-a-year birthday-treat kind of money back when I was a kid and I could make that run to games, films, books, magazines, etc. for ages. Now that's the price of one game (which isn't guaranteed to be a blockbuster). Inflation hasn't grown that fast.

    The scales aren't right - software is far too expensive, especially for the effort that goes into updating and supporting most of it. Multiplayer games are left to die after a few years, patches dry up a matter of months after the initial release, support is non-existent fo

  • by Seth Kriticos (1227934) on Friday February 20, 2009 @06:51AM (#26927179)
    It's really a question on who you ask.

    If you ask the gamers: Yes, way too much! I better pirate it.

    If you ask the studios: How much can we squeeze the most out of the costumer? Can we put into legislation, that games cost 100$ and every one has to buy one at least once a month? Can we also put an additional tax on everyone, because everyone is pirating anyway?

    If you ask some folks how don't feel gaming is of mush value, and do it only as passion: They cost enough to keep me away from buying them. And cool, I have a lot of time I can use for something useful.

    Because every game is a monopolistic product by it's definition, you really can't compare it like for instance cheese. It's also not utterly required for survival. At this point it is only a question on priority. Probably the software houses can increase this priority (demand) of third group costumers and increase the legal purchase of the first group by producing better quality games and/or lowering the price.
  • Not surprised... (Score:3, Insightful)

    by hitmark (640295) on Friday February 20, 2009 @06:59AM (#26927219) Journal

    Close to all games i have bought over the last 5 years or so have been out of bargain bins.

    With shops having a no return policy, for fear of those pesky pirates buying a game, make a copy and then return it, comboed with the average price, its just not worth it.

    Thing is that no matter how many review one read, view or similar, the only real way to tell if one like a game or not is by spending a day or more playing it. And if the prices are like they are, one cant really afford to buy, play and then shelf the ones one do not like.

  • It depends. (Score:5, Interesting)

    by Xest (935314) on Friday February 20, 2009 @07:00AM (#26927241)

    I bought Dawn of War 2 yesterday for £24.99 which personally I don't mind paying for a game.

    But then I got home and tried to install it and it requires you install Steam and Games for Windows Live and activate the game via Steam. I tried to activate it and was told I can't because it's not for sale in my country- presumably because although some shops are selling it THQ decided the actual release date was today.

    So yeah, that changed my mind, £24.99 is fine for a game I can play when I want and whatever system I want but it's far too overpriced for a game I can only play when they decide I'm allowed to play it whilst also having to give away a bunch of personal details to Valve for Steam and Microsoft for Windows Live.

    The box at least said an internet connection and registration was required to play but it still said nothing about having to give away details to register to Valve AND Microsoft and it certainly said nothing about them being able to choose when I can and can't play the game.

    It's been said here many a time that pirates provide a copy of a game cheaper (free) and that you can play without restriction when you want and where you want. If companies want to increase sales then perhaps they need to accept that they have to beat pirates on at least one of these levels, by either matching them on price (not gonna happen) or by beating them on product quality. Whilst they continue to do neither they wont get anywhere.

    As for me and DoW2? I file a complaint with UK trading standards and will be returning the game tommorrow and they can damn well take it back even if it is opened because as far as I'm concerned if I don't have the guarantee of being able to play it when I want and have to hand over personal details to two third party companies to be able to play then it's faulty or simply misadvertised. Just as I got burnt with Spore's DRM I've now been burnt with Dawn of War II's. You see when I was young I used to pirate games because I couldn't afford to buy them, now I make plenty enough to buy these games I do so, just as I *gasp* bought a copy of Windows for my most recently built PC. I also bought music from iTunes only to find the only music on my iPod that would play on the game Lips on the 360 for my girlfriend was downloaded MP3s and none of my legally purchased music would work. Some may think it's not a big deal having to wait a day to activate but my concern is that they can revoke my access just as easily as they've prevented my access to a game I've legitimately bought.

    What they need is a change of attitude and price is only part of that, I wont buy brand new XBox 360 games at £39.99 but at around £29.99 I don't mind because at least the restrictions are pretty obvious when you buy the game and console. It's not ideal that there restrictions exist but it's light years ahead of the unadvertised 5 install limit with Spore on release and the "Valve gets to choose when you can and can't play" with Dawn of War 2. So whilst I'll buy 360 games, I wont buy music, I wont buy PC games, not even if they were £9.99 anymore it's not just worth the hassle.

    So yeah, even Valve with their "Hey look at us guys! we think DRM is silly, we love piracy and think it helps! hell we even do great discounts sometimes!" are still the scum of the Earth and as bad as EA when it comes to draconian DRM in that they prevented me playing a game made by the company THQ and bought from the company GAME and could just as well prevent me again any time they wish.

  • by wild_quinine (998562) on Friday February 20, 2009 @07:22AM (#26927351) Homepage
    This is a gross publicity stunt from Newell, not a recalcitration of industry pricing tactics.

    I remember being SHOCKED at the prices of games on Steam. They sold, and still sell, at the exact same price as games at MSRP, which as we all know is more than most stores, let alone online retailers. Yet, apart from the expense of running steam's servers/bandwidth, it looks very much like Gabe Newell just eats up what would have been the costs of distribution, media and the retailers approx 30% cut on top!

    Why is this not coming back to us, at least in part? When we were told that one of the advantages of online distribution was a reduction in costs, were we expected to celebrate a rise in profits for industry players? I think we all rather expected online distribution to make games cheaper! Hell, Bioshock RAISED the price of games when it was released on Steam.

    When you combine this with the fact that Steam has cut users off from their games who have LEGALLY saved on the price by buying from a different country, and you've got one of the biggest contributors to the high cost of games preaching about how games should be cheaper. To quote the movie Airplane: What an asshole!

    • by nobodyman (90587) on Friday February 20, 2009 @10:14AM (#26929447) Homepage

      Obviously there is a huge potential for for Valve to cut costs and maintain the same level of profits by selling direct to the customer, and they would probably *love* to do just that. The problem is that retailers tend to get pissed off when they are getting undercut by the wholesaler.

      Think about it: you pay valve $32 for a copy of L4D, and you turn around and mark it up to $50. A month later valve turns around and sells that game --directly to the consumer-- for $25. Hell, that's $7 less than what you paid! You'd be a tad pissed, right?

      I imagine that valve is walking a bit of a tightrope here. Pricing L4D at $25 wasn't so much a gamble in terms of whether it would boost sales (thats obvious), but of how retailers would react. It may be a test of whether valve can just write off retail altogether and go it alone with digital distribution.

  • by DragonTHC (208439) <Dragon@NosPAM.gamerslastwill.com> on Friday February 20, 2009 @08:29AM (#26927813) Homepage Journal

    I remember when $44.95 was really expensive for a game.

    Now, console games cost $60.

    I just wonder, why would the same game cost $10 more on consoles than PC? probably because PC gamers won't pay $60 for a regular edition.

    That said, Steam really is great for me. They have sales all the time. When they lower the prices, people buy.

    I prefer digital distribution now. Going to the store is bothersome. Having a box and DVD to worry about is too much hassle.

  • by Necreia (954727) on Friday February 20, 2009 @09:35AM (#26928755)
    DRM schemes in the last several years have turned games into rentals (3 uses then beg us for more!). Dropping the price like this is what's needed to justify these games anymore.
  • by Benfea (1365845) on Friday February 20, 2009 @09:41AM (#26928861)

    When VCRs first came out, buying a movie on videotape cost what? $50? $60? It took Hollywood years to learn that they made a lot more money selling a very large number of movies at $20 apiece than they made selling a small number of movies at $50 each. One has to wonder why it's taking the game industry so long to learn the same lesson.

  • by Jackie_Chan_Fan (730745) on Friday February 20, 2009 @09:59AM (#26929199)

    ALL of these developers could easily sell more if they lowered their prices.

    We've been saying it for years and finally someone has the balls to try it.

    The Result: PROFIT.

    Will anyone learn from this? No.

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