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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:1, Insightful)

    by Kethinov (636034) on Friday February 20, 2009 @06:08AM (#26926961) Homepage Journal

    Short answer: yes.

    Long answer: the headline got it right when it said from the depends-how-the-pirate-bay-trial-goes-right dept.

    For better or worse, rampant, unmitigated, unstoppable noncommercial copyright infringement committed by ordinary consumers is here to stay and it's getting more and more popular every year. All digital information with any kind of a price tag costs too much when the competition be it legal or not offers it for free.

    That is an economic reality, and no amount of moralizing or legislating is going to make it go away. It's time for us to face this already.

  • 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 they are... (Score:2, Insightful)

    by Racemaniac (1099281) on Friday February 20, 2009 @06:17AM (#26927003)

    i'd rather stress the target audience. the movie going crowd is by far larger than the gaming crowd i think, so there would be the difference imo

    also, honestly, how many games these days are still made for 10+ hours of non repetitive gameplay? even most fps-shooters i read reviews about these days are said to be less than 10 hours to play through...

    20-50 hours, most rpgs and adventure games should reach that, and that's about it i'd say

  • remarkably clueful (Score:5, Insightful)

    by Trepidity (597) <(gro.hsikcah) (ta) (todhsals-muiriled)> 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 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.
  • 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.
  • Re:Hiopcrits? (Score:5, Insightful)

    by cHALiTO (101461) <elchalo@nOSpAM.gmail.com> on Friday February 20, 2009 @06:39AM (#26927107) Homepage

    Well here in argentina the Peso is devaluating (1 peso = 3.52 dollars, last week it was 3.50, and it keeps devaluating), and a game like GTAIV for xbox360 costs 399 pesos at a retail store.
    Now, imagine that salaries are similar to, say, salaries in the us but in pesos (i.e.: where an us worker makes u$s2k a month, the same job in .ar can make ar$2k a month), so it's no wonder everyone gets pirated copies.
    Imagine if you had to pay 399 euro or 399 dollars for a game. If it weren't easy to copy them, most people wouldn't play them at all.

    Ironically, I just bought World of Goo for linux at 20 dollars over the net, which is about 70 pesos.. that's as if you had to pay 70 euros for it, but I bought it for two main reasons.
    1) I wanted to support non-drm, linux native efforts
    2) I really like the game. Not 70-bucks-like-it, but having reason 1) there, I thought the occasion warranted an extra effort.

  • 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.

  • 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 Canazza (1428553) on Friday February 20, 2009 @06:49AM (#26927165)
    Back in the day when I had a commodore 64 games cost £5.99, with the cheap bargain tapes costing 99p... damnit Game Zone, why did you have to turn into a Kilt hire shop...
  • 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.
  • by Anonymous Coward on Friday February 20, 2009 @06:51AM (#26927177)

    I *always* buy the game long after the initial release when it is on sale. Example: I bought The Orange Box for $20 this last December.

    It is important to emphasize that one other reason I waited so long was the DRM. I don't like it and I don't want it. Usually the first thing I do after buying a game is get the no-cd patch, and waiting a while after release gives time for those to appear. However, once the price went low enough I decided to take the risk and give it a try anyway. Maybe if the DRM wasn't there in the first place I would have paid a little more and sooner.

  • 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?

  • 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.

  • 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!

  • 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, 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.
  • by stonewallred (1465497) on Friday February 20, 2009 @07:50AM (#26927527)
    The last six games I have bought are still in the original packaging unopened. Over the years I have spent a small fortune on games, that after purchase turned out to be complete piles of steaming dog crap. I refuse to buy a game now unless I have downloaded it and played it for at least a few hours and enjoyed it. I downloaded Age of Empires and the x-pac for it a few years ago. Played it and thoroughly enjoyed it. Took me two weeks to find the hard copies of the two and buy them, but I did. If the games had a cheaper price point or a return policy, I would buy more of them. Until that happens, it is download, test and then make a decision.
  • Re:Impulse power! (Score:3, Insightful)

    by trillex (1080579) on Friday February 20, 2009 @07:54AM (#26927569)
    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 call it an experience and shelf it.
  • 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.
  • 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: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:Yes (Score:3, Insightful)

    by poetmatt (793785) on Friday February 20, 2009 @08:16AM (#26927711) Journal

    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 in anyone's lifetime. It's well established that companies like EA are far too greedy to realize they could be sensible and make more money.

  • Re:Impulse power! (Score:3, Insightful)

    by tepples (727027) <tepples AT gmail DOT com> on Friday February 20, 2009 @08:37AM (#26927905) Homepage Journal

    If a game can be completed that quickly, then they probably *didn't* like it.

    A WarioWare game can be completed within 2 hours. The original Super Mario Bros. can be speed-run in under 6 minutes [google.com]. Does everyone hate such titles?

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

    by TheRaven64 (641858) on Friday February 20, 2009 @08:39AM (#26927931) Journal
    If a game can be finished within a couple of days and has no replay value, is it really worth buying in the first place?
  • by oogoliegoogolie (635356) on Friday February 20, 2009 @08:44AM (#26927981)

    Considering there's no physical distribution or packaging involved I would expect Steam's prices to be 20% cheaper than a retail store but they are not,and in fact they are the same price. As with you, if I factor in the exchange rate I pay more, but strangely, Steam doesn't ding me with tax.

  • Re:Yes (Score:3, Insightful)

    by Hognoxious (631665) on Friday February 20, 2009 @08:48AM (#26928029) Homepage Journal

    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!

  • by Sage Gaspar (688563) on Friday February 20, 2009 @08:49AM (#26928049)
    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 what you're looking to get from it.
  • Re:Yes (Score:3, Insightful)

    by WCLPeter (202497) on Friday February 20, 2009 @08:54AM (#26928105) Homepage

    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 in the bargain bin and enjoyed the single player, you feel like your missing out on half the purchase because, while you're all jazzed up to try the multiplayer, people have long moved on to something else.

    Now, I tend to buy games that have a strong single player story so that if I can't find any multiplayer, at least I've been satisfied by the story.

  • Re:Yes (Score:5, Insightful)

    by BakaHoushi (786009) <Goss@Sean.gmail@com> on Friday February 20, 2009 @08:56AM (#26928141) Homepage

    Well, for me, there are developers like Valve whose products have demonstrated a truly well-done and polished quality that honestly deserves $50. Some other non-Valve titles I've acquired over the last few years that I truly would not mind having to spend full price on include Persona 3 and 4 (both of which were less than full price), Super Mario Galaxy, Civilization IV, Bioshock, Sam and Max, No More Heroes...

    I think my point is simply that no, the price for games isn't too high (from my perspective)... if the game is actually WORTH that much. The above games were polished and fun. But I've also bought a lot of games not on the above list and when you consider, for example, that Persona 4 provided over 100 hours of very well-done RPG gaming, why should I feel the need to pay the same if not more on a game that will not provide nearly as much satisfaction?

    Of course personal tastes come into play. I don't care for sports, racing, or fighting games. But when most games clearly do not show even close to the same objective measures of quality as others, it seems apparent that people will buy less.

    tl:dr; Some games are worth full price for admission. Most are not.

  • 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.
  • by Saysys (976276) on Friday February 20, 2009 @09:15AM (#26928405)
    Charge a lot at first for the fan boys then less for the masses. This sets the price at the market-clearing equilibrium for both the fan-boy market, which is in-elastic, and the general market which is highly elastic.

    Another way to do this would be to offer the standard edition for $20 and to offer a "collectors edition" at $60 which has some little thing in it that lets you prove to everyone in-game that you paid for the sucker's edition.
  • by Shrike82 (1471633) on Friday February 20, 2009 @09:17AM (#26928435)

    Features like the game disappearing along with the steam servers? Features like needing an Internet connection to run a single-player game you've already installed? Features like a server problem at their end wiping out the save games of you and numerous other gamers?

    All good points, but points that any small amount of research would tell a prospective customer. No-one forces people to buy Steam-based games, and for the vast majority of people this won't ever be an issue.

    I'd guess that most people really into their games have a broadband connection, so online registration (first-time and every time you play) aren't a problem. Offline mode works (though some people report having to go into offline mode while online as a sort of preparation) well enough.

    And hell, if Valve ever went under I'd have no qualms about downloading a patch (offical or otherwise) to let me keep playing the single player stuff.

  • by LordZardoz (155141) on Friday February 20, 2009 @09:21AM (#26928515)

    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 you $4 per hour, and multi-player games even less. A movie costs about $10 per person. That is at worst competitive with movies, and the Sims series goes well beyond 15 hours for those that like it enough to pay for any expansions.

    You need to look at more than just the initial price of the game. You need to consider how much you are actually getting out of it.

    END COMMUNICATION

  • by MadKeithV (102058) on Friday February 20, 2009 @09:22AM (#26928529)
    Piracy on the whole would be expected to affect each player in the industry equally. If you're doing worse than your competitors, it's *not* because of the pirates.
  • Re:Yes (Score:3, Insightful)

    by mcgrew (92797) * on Friday February 20, 2009 @09:23AM (#26928553) Homepage Journal

    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 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.
  • Re:Yes (Score:3, Insightful)

    by Sponge Bath (413667) on Friday February 20, 2009 @09:38AM (#26928817)

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

    Two girls, one cup.

  • Re:Hiopcrits? (Score:3, Insightful)

    by Ogive17 (691899) on Friday February 20, 2009 @09:40AM (#26928857)
    I'm hoping you got your figures backwards. By your example, GTA4 would cost $1,404.48 USD. If you got them backwards it would only be $113.35 USD, still very high but not insanely high.
  • 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:3, Insightful)

    by theJML (911853) on Friday February 20, 2009 @09:51AM (#26929039) Homepage

    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 awesome" and I probably would have spent more on it if I'd have known before I got it that I'd be playing it for years, but I just don't know that before I've played it for years. Which is why I'd rather buy a game for $20 and then by extra content or expansions for a few bucks here and there. Something that the Rockband series has proven to me, as well as a number of FPS. The content tends to expand the enjoyment if done right.

  • 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.

  • 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.

  • But! (Score:5, Insightful)

    by superbus1929 (1069292) on Friday February 20, 2009 @10:58AM (#26930161) Homepage
    Let's also not forget inflation. Let's compare today's games to the games of the 80s and 90s.

    A top-priced game costs $60 today. But then consider the budget that goes into making the massive 3D graphics, including modern rendering and lighting techniques, R+D, possible budget for voice actors (and unlike the 90s, they can't just rely on local talent, some of these games require big names), etc. All that budget is being used on games that cost $60, surely, but adjusting for inflation, a game that costs $60 in 2009 would equal half-price in 1989.

    Let's stick with 1989. Back then, new games for the NES typically went for $50. Then, consider that proportionally, game budgets were much, much smaller - even when you adjust for inflation - and then affix 2009 inflation to 1989 prices; that $50 game cost about $85 when adjusted (calculated here: http://data.bls.gov/cgi-bin/cpicalc.pl).

    Plus, once you get into subjective arguments, you can argue that the quality of games today has gone way, way up; yes, there's a lot of crap out there, and like some of you, I haven't fully evolved from my 80s self and aren't very good at 3D action/platformer games, or FPS titles. Taken on the whole, the average game today is much, much better than the average game of the 80s was; the crap is still crap, but the ratio is much better today than back then.

    It can be argued that the American per capita income hasn't adjusted properly with inflation - that's an argument to itself - but I think that the main point stands: we're getting more games today than twenty years ago, we're getting better games, we're getting them comparatively cheaper than we did in the 80s, and companies are making less money than they did in the long run (on average).
  • Re:But! (Score:5, Insightful)

    by DrLang21 (900992) on Friday February 20, 2009 @11:59AM (#26931155)
    And this exactly illustrates why I never owned more than 3 NES games ever. This is a matter of supply/demand curves, not comparative cost. If halving the retail price raises sales by 3000%, if the increased sales more than make up for the lost profit per unit, then games are indeed over-priced in a bad way for the game companies. Keep in mind, increased sales mean higher volume and thus less cost per unit to produce the physical media.
  • Re:Yes (Score:3, Insightful)

    by BakaHoushi (786009) <Goss@Sean.gmail@com> on Friday February 20, 2009 @12:01PM (#26931195) Homepage

    If I may be allowed to brown-nose Valve for a moment longer, let's not forget the FREE stuff they do throw in. Team Fortress 2 being the best example, they make new maps and modes themselves, select some choice community-made maps and add them to the official roster, are bolstering characters and adding weapons/achievements on top of patches and support. Compare this to other games where you're lucky if you get a patch to fix the known-bugs at release.

    Granted this process can be frustratingly slow, but I can't really argue with the results.

  • Re:But! (Score:3, Insightful)

    by drsmithy (35869) <drsmithy.gmail@com> on Friday February 20, 2009 @12:33PM (#26931697)

    Let's also not forget inflation.

    Let's also not forget a few other things about games today vs back then:
    * massively higher distribution volumes
    * much lower distribution costs (not just because of things like Steam, either - used to be all games came with a nicely printed manual, plus other goodies, and much larger boxes).

  • Re:Yes (Score:4, Insightful)

    by mcgrew (92797) * on Friday February 20, 2009 @02:14PM (#26933137) Homepage Journal

    Computers are not expensive anymore-- they are a prime example of the wonders of economies of scale. Anybody can build a computer that will play nearly all the newest games, for under $500

    Odd that the price of computers have dropped to 10% of what they once cost, but games haven't gone down a bit.

    When VCRs first came out movies were $100 each, now you can get them for five. I'm starting to think of game companies as the new RIAA. Overprice your crap and blame pirates when it won't sell.

  • Re:But! (Score:2, Insightful)

    by SCPRedMage (838040) on Friday February 20, 2009 @04:12PM (#26934805)
    Ah, but in the case of Valve's Left 4 Dead sale, there was no physical media involved. The sale was on Steam only, meaning you purchased the game online, and then downloaded it. Meaning the only cost was bandwidth, which is dirt cheap compared to physical media and packaging.
  • Re:Yes (Score:3, Insightful)

    by westlake (615356) on Friday February 20, 2009 @05:07PM (#26935509)
    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 barriers to entry, the sense of danger, the envy you inspire, the money you spend, are all part of the experience that cements the bond.

"Our reruns are better than theirs." -- Nick at Nite

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