Current Events > The HARD truth of video game prices : The Industry has NO pricing power

(+) Yeah! (+)

Think about an article like this. Why does a huge publisher whine and discuss what they THINK games should be priced at?
Why don't they just....price their games at what they think it should be?
Take a moment, consider it.

https://exputer.com/news/industry/gta-6-publisher-games-priced-per-hour/

GTA 6 Publisher Believes Games Should Be Priced Per Hour

"That doesnt necessarily mean that the industry has pricing power."

During the earnings call for Take-Two Interactives Q2 2024 period, CEO Strauss Zelnick expressed his stance on how video games should be priced on a per-hour basis. The GTA 6 publishers CEO elaborated on the statement by going over how the algorithm is designed when talking about entertainment properties and the customers perceived value of the product.

"In terms of pricing for any entertainment property, basically the algorithm is the value of the expected entertainment usage, which is to say that the per-hour value times the number of expected hours plus the terminal value thats perceived by the customer in ownership if the title is actually owned, not, say, rented or subscribed to. And youll see that that bears out in every kind of entertainment vehicle. By that standard, our frontline prices are still very, very low because we offer many hours of engagement.

Moving on, Zelnick talked about how the industry provides a fantastic price-to-value opportunity for consumers overall. They went on to say, That doesnt necessarily mean that the industry has pricing power or wants to have pricing power. However, there is a great deal of value offered.

They know they can't just price games however they want and....have people still buy them.

So publishers go on HUGE tirades to CONVINCE gamers to buy into the idea that...games SHOULD cost more.

Because NOTHING is stopping them from pricing games higher other than gamers saying "I will pay that much"

So far many gamers (intelligently in my opinion) have said I won't pay more. We see this with how SUPER fast games drop in price nowadays. This is a response to TONS of copies sitting on shelves not moving because...the PRICE is too high for people and the BUYING IS THEIR OWN PERSONAL DECISION AND FREEDOM!

So what happens then is the industry realizes it doesn't have the pricing power. The product isn't essential where they can just manipulate it without blowback. It isn't something even super in demand. The product more of a "if you want it, when you want it, as you want it on your own time". Not even FOMO associated like with "limited edition" things.

So they have to spend long hard hours to CONVINCE

CONVINCE

to make you DECIDE TO BUY into and argument that games should cost more.

Do you buy it?

The industry has pricing power, they've just been shifting the cost elsewhere these days. You used to have a million different costumes that could just be unlocked through normal gameplay in games and now that's a separate purchase called DLC.

You want to play online? Only PC doesn't charge you an annual fee anymore.

Tropicalwood posted...

The industry has pricing power, they've just been shifting the cost elsewhere these days. You used to have a million different costumes that could just be unlocked through normal gameplay in games and now that's a separate purchase called DLC.

You want to play online? Only PC doesn't charge you an annual fee anymore.

Wouldn't call that pricing power. That is an attempt to milk those who bought in to make up for those who did not as they felt entitled to a certain amount of revenue and didn't get it.

The more they do this, the less people who buy in causing the need to do this more and more and aggressively and eventually you go too far and lose even those who buy in as they shift to indie games or ethical devs who don't do this. See BG3 and the response to it

I agree they really should start analyzing games and why people continue playing them long past their release date. Some games release with no replayability and take 5 to 10 hours to beat, making it a one hitter, why should that cost $60 or $70? Ubisoft, Rockstar, and to an extent Blizzard have all gotten people to continue playing their games months, years, and even some, decades after their releases. Part of it is the live service model, but other parts are just the sheer amount of things you can do.

A problem that can arise from this though is companies lazily padding the length of their games with mundane activities rather than fun and exciting ones.

A great feature in the Bethesda Fallout games is the inclusion of random events, so getting from a to b on a map isn't boring and dull, you may get shot at by a space ship, encounter a special group of mobs, or even have a silly encounter with cultists. At least it's entertaining and keeps you busy. GTA tried this but it didn't seem to work well, it was always someone trying to rob you or you chasing down a stolen purse. I believe RDR2 did a far better job here. The point is though, despite these things not actually progressing the story or objectives, it still gave you a sense of immersion and lengthened your experience.

Games, much like film and TV, are too expendable now. Play it, watch it, move on to the next thing. They need to figure out how to keep you engaged with the game.

WingsOfGood posted...

Wouldn't call that pricing power. That is an attempt to milk those who bought in to make up for those who did not as they felt entitled to a certain amount of revenue and didn't get it.

The more they do this, the less people who buy in causing the need to do this more and more and aggressively and eventually you go to far and lose even those who buy in.

I'm just saying they've avoided directly changing the prices through shifting that cost to DLC and online subscriptions. Because in the grand scheme of things, the price of games really hasn't gone up even cartridges were a thing. Which the prices were upwards to $60 in the 90's for N64 games from what I've found.

I will pay $3.50 for GTA 6.

I will say that I am exceedingly glad that enough people have the mindset of "I'm not paying full price for a game" that I can frequently purchase games at a discount.

what

BloodMoon7 posted...

I will pay $3.50 for GTA 6.

Found the loch ness monster

How does Nintendo get away with it. If OoT was still in print it'd still be $70

why is ratchet and clank rift apart $70 on the ps5

royic posted...

How does Nintendo get away with it. If OoT was still in print it'd still be $70

Ngl this is why I haven't played a Nintendo console since Wii.

It's tough to try and convince people to buy $70 games when the most popular game on the planet is completely free to play.

GTA is one of those games people will spend money on but that list gets smaller with every passing year.

$60 games are the hill i will fucking die on.

games should be 40 or 50, max, for new.

GuerrillaSoldier posted...

what

T2's CEO is basically saying games need to factor in if they'll have an estimated 200 hours of playtime for the player. But he can't really do that because nobody will pay $200 for GTA6 at launch when games have been $60 since forever.

They targeted gamers.

Gamers.

We're a group of people who will sit for hours, days, even weeks on end performing some of the hardest, most mentally demanding tasks. Over, and over, and over all for nothing more than a little digital token saying we did.

We'll punish our selves doing things others would consider torture, because we think it's fun.

We'll spend most if not all of our free time min maxing the stats of a fictional character all to draw out a single extra point of damage per second.

Many of us have made careers out of doing just these things: slogging through the grind, all day, the same quests over and over, hundreds of times to the point where we know every little detail such that some have attained such gamer nirvana that they can literally play these games blindfolded.

Do these people have any idea how many controllers have been smashed, systems over heated, disks and carts destroyed 8n frustration? All to latter be referred to as bragging rights?

These people honestly think this is a battle they can win? They take our media? We're already building a new one without them. They take our devs? Gamers aren't shy about throwing their money else where, or even making the games our selves. They think calling us racist, misogynistic, rape apologists is going to change us? We've been called worse things by prepubescent 10 year olds with a shitty head set. They picked a fight against a group that's already grown desensitized to their strategies and methods. Who enjoy the battle of attrition they've threatened us with. Who take it as a challenge when they tell us we no longer matter. Our obsession with proving we can after being told we can't is so deeply ingrained from years of dealing with big brothers/sisters and friends laughing at how pathetic we used to be that proving you people wrong has become a very real need; a honed reflex.

Gamers are competitive, hard core, by nature. We love a challenge. The worst thing you did in all of this was to challenge us. You're not special, you're not original, you're not the first; this is just another boss fight.

Tropicalwood posted...

But he can't really do that because nobody will pay $200 for GTA6 at launch when games have been $60 since forever.

Not the right way to look at it. The argument doesn't exist within itself, it is not a vacuum.

Rather the thing is GTA6 on the shelf at $200 and Elden Ring at $20 and BG3 at $40.

That is why GTA6 will not sell at $200. It isn't because "games always been cheaper".
Also many will not even think about those and will just say GTA6 not worth $200 for no other reason than they said so.

Hours of playtime is a pretty shit way to price a game. There's a reason MMOs don't do that anymore and opt for monthly subscriptions. >_>

Meanwhile I can get countless hours of entertainment from a notebook and mechanical pencil. Thank jeebus that nobody in the office supply industry has thought to start charging those by hours of potential use. <_<

St0rmFury posted...

They targeted gamers.

Gamers.

We're a group of people who will sit for hours, days, even weeks on end performing some of the hardest, most mentally demanding tasks. Over, and over, and over all for nothing more than a little digital token saying we did.

We'll punish our selves doing things others would consider torture, because we think it's fun.

We'll spend most if not all of our free time min maxing the stats of a fictional character all to draw out a single extra point of damage per second.

Many of us have made careers out of doing just these things: slogging through the grind, all day, the same quests over and over, hundreds of times to the point where we know every little detail such that some have attained such gamer nirvana that they can literally play these games blindfolded.

Do these people have any idea how many controllers have been smashed, systems over heated, disks and carts destroyed 8n frustration? All to latter be referred to as bragging rights?

These people honestly think this is a battle they can win? They take our media? We're already building a new one without them. They take our devs? Gamers aren't shy about throwing their money else where, or even making the games our selves. They think calling us racist, misogynistic, rape apologists is going to change us? We've been called worse things by prepubescent 10 year olds with a shitty head set. They picked a fight against a group that's already grown desensitized to their strategies and methods. Who enjoy the battle of attrition they've threatened us with. Who take it as a challenge when they tell us we no longer matter. Our obsession with proving we can after being told we can't is so deeply ingrained from years of dealing with big brothers/sisters and friends laughing at how pathetic we used to be that proving you people wrong has become a very real need; a honed reflex.

Gamers are competitive, hard core, by nature. We love a challenge. The worst thing you did in all of this was to challenge us. You're not special, you're not original, you're not the first; this is just another boss fight.

https://www.youtube.com/watch?v=6xUnSVTh8fI

BloodMoon7 posted...

I will pay $3.50 for GTA 6.

Id love to pay a stores "bring in a copy" price vs actual retail price. Worst part about running a retail dept is seeing what the company pays to bring in each copy of a game and then having to pay retail price for it.

BTW. Game prices are about the same as they were +30 years ago. I was paying $80 for games on the NES & SNES back in the day.

LeadPipeCinche posted...

BTW. Game prices are about the same as they were +30 years ago. I was paying $80 for games on the NES & SNES back in the day.

Due to inflation they're actually much cheaper now. And the average price is also lower due to all the Indie games and small publishers releasing at $10-30.

LeadPipeCinche posted...

BTW. Game prices are about the same as they were +30 years ago. I was paying $80 for games on the NES & SNES back in the day.

irrelevant

only people who point this out are GREEDY SELFISH ENTITLED Publishers and Developers,... and sadly gamers who got TRICKED

RECORD PROFITS are being reported
but wait HOW!?!?
How can they have made MORE MONEY THAN EVER when inflation is going up and games prices aren't
HOW!!!?!?!!?

https://gamefaqs.gamespot.com/a/forum/9/98e5ed01.jpg

The answer is VERY
VERY
VERY SIMPLE

30 years ago you sell a $60 game and less than 1 million people buy it

today you sell $60 game and 5 million buy on release
5 million more buy at like $40
and then several million more when it is like $20
but tbh price drop DOESN'T matter because they make the money from the store's purchase not you

so they sell like 12 million now

say store buys game at like $25 per copy
difference: $25 X 1 million = 25 million
$25 x 12 million = $300 million

imagine your profits increasing that much and whining about it

how fucking greedy must you be?

WingsOfGood posted...

The answer is VERY
VERY
VERY SIMPLE

30 years ago you sell a $60 game an less than 1 million people buy it

Actually that's not quite it. The physical games cost much more to make back then. Per unit costs are extremely low now. Some games had their prices increased just to compensate for the cost of extra storage or performance chips in the cartridges. Development costs are higher now but the per unit cost is negligible now (it's actually mainly the cost paid to Sony, Nintendo, Microsoft, Valve, etc. for a sale on their marketplace).

You're making the assumption that those record profits are coming from traditional video games and not because of GAAS and mobile games. Live services make up 73% of EA's revenue.

Why the gaming industry is so profitable? That means the gaming industry is making more than three times as much money as the music industry and almost four times as much as the movie industry. One of the main reasons for the gaming industry's success is the increasing popularity of mobile gaming.

Let me REPEAT that for you

the gaming industry is making more than three times as much money as the music industry and almost four times as much as the movie industry.

Imagine buying into the idea that game prices stagnated and poor publishers aren't getting a fair cut

HOLY

MOLY

https://www.vintageisthenewold.com/game-pedia/how-profitable-is-the-video-game-industry

In 2022, the video game market size in the United States was estimated to be 97.67 billion U.S. dollars, setting a new all-time industry record.

The Global video game industry is valued at $159.3 billion in 2020, with 2.7 billion gamers worldwide. 75% of US households have at least one gamer. Global trends: the impact from the pandemic has driven sales, with the U.S. seeing a record 31% increase in consumer spending on video gaming and subscription services.

record being broken

money outclassing HOLLYWOOD ITSELF

and WHINING FUCKING BABY PUBLISHERS

GREED GREED GREED GREED GREEDGREED GREEDGREED GREEDGREED GREEDGREED GREEDGREED GREEDGREED GREEDGREED GREEDGREED GREEDGREED GREEDGREED GREEDGREED GREED

Punished_Blinx posted...

You're making the assumption that those record profits are coming from traditional video games and not because of GAAS and mobile games. Live services make up 73% of EA's revenue.

Yep:
https://vgsales.fandom.com/wiki/List_of_highest-grossing_video_games

The traditional games on there are largely arcade games from the Golden age which basically operated off microtransactions.

Punished_Blinx posted...

You're making the assumption that those record profits are coming from traditional video games and not because of GAAS and mobile games. Live services make up 73% of EA's revenue.

https://www.crunchyroll.com/news/latest/2023/5/11/elden-ring-game-sells-over-20-million-copies

Bandai Namco's financial results finished out strongly for fiscal year 2022 thanks to Elden Ring's popularity, reaching $7.3 billion in sales for the previous fiscal year ending March 31, 2023. This compares quite favorably to fiscal year 2022, which reached a total of $6.6 billion in sales revenue, representing an 11 percent increase in revenue year-over-year.

Elden Ring, one of the most expansive games of the current gen, is thought to have made about 1 BILLION in profit

maybe don't make bad games?

something IMPORTANT to point out also

when you buy say Elden Ring directly from Namco digitally, they make the full $60 off you

so in this way games HAVE GONE UP
just from a distro perspective not customer facing

as in if you bought it at walmart they would have made like idk $25

this is highly important to consider

WingsOfGood posted...

https://www.crunchyroll.com/news/latest/2023/5/11/elden-ring-game-sells-over-20-million-copies

Elden Ring, one of the most expansive games of the current gen, is thought to have made about 1 BILLION in profit

maybe don't make bad games?

Did you see the link I posted? Those games aren't bringing in the big profits you think they are. The greed part is right, but the profit is in live services and micro-transactions. From Software has a niche of basically making a good traditional game without the bullshit that is standard now, but that's not bringing them the insane profits mobile games and live services are for other companies.

WingsOfGood posted...

https://www.crunchyroll.com/news/latest/2023/5/11/elden-ring-game-sells-over-20-million-copies

Elden Ring, one of the most expansive games of the current gen, is thought to have made about 1 BILLION in profit

maybe don't make bad games?

You do not make a billion dollars in profit when you sell a billion dollars in video games. Steam alone will take 30%, your cost to make said game was lord knows how much not including publishing and you still have to pay the taxman.

Tropicalwood posted...

You do not make a billion dollars when you sell a billion dollars in video games. Steam alone will take 30%, your cost to make said game was lord knows how much not including publishing and you still have to pay the taxman.

all that is figured into the billion dollars google it

https://gamefaqs.gamespot.com/a/forum/5/56234a29.jpg

source: https://www.resetera.com/threads/history-of-worldwide-video-
game-industry-revenue-since-1971-
by-sector-arcade-console-handheld-pc-from-bloomberg.96568/

which they got from

https://www.bloomberg.com/news/articles/2019-01-23/peak-video-game-top-
analyst-sees-industry-slumping-in-2019#xj4y7vzkg

Why do you keep ignoring the fact that most of the money is coming from mobile microtransaction and live service games?

Elden Ring made a billion in profit? Cool, Dungeon Fighter made 22 billion. And it's just shit microtransactions.

https://gamefaqs.gamespot.com/a/forum/3/39beddc7.jpg

ssjevot posted...

Why do you keep ignoring the fact that most of the money is coming from mobile microtransaction and live service games?

Elden Ring made a billion in profit? Cool, Dungeon Fighter made 22 billion. And it's just shit microtransactions.

look at the graph

mobile is ADDED onto the total industry value

so console games are still making record profits and continuing to climb and explode

WingsOfGood posted...

look at the graph

mobile is ADDED onto the total industry value

so console games are still making record profits and continuing to climb and explode

What do you think the most popular games on consoles are?

Punished_Blinx posted...

What do you think the most popular games on consoles are?

?

No one should have EVER been paying fucking $2M for Mario 64.

Most will ignore this video, but dont. Its good shit

https://youtu.be/rvLFEh7V18A?si=c-O_yNQPmoJPq6ho

[LFAQs-redacted-quote]

Greed is greed

CE_gonna_CE posted...

No one should have EVER been paying fucking $2M for Mario 64.

Most will ignore this video, but dont. Its good shit

https://youtu.be/rvLFEh7V18A?si=c-O_yNQPmoJPq6ho

smh

publishers at it again

It all make perfect sense. All you have to do is not have a so much fucking money to inflate this shit to where it makes absolute no fucking sense.

WingsOfGood posted...

look at the graph

mobile is ADDED onto the total industry value

so console games are still making record profits and continuing to climb and explode

The most profitable console game is Grand Theft Auto online. A live service microtransaction shit fest.

It's not that high of a growth. Compared to the inflation rates and the general size of the industry growing, a lot of smaller studios are not that profitable in the slightest, and a lot of mid sized studios mostly died out 10 or so years ago or absorbed into one giant entity to survive.

The thing is, people are massively misunderstanding the figures. Overall growth looks large, and that's almost entirely in mobile. Mobile games don't have fixed pricing and a lot of microtransaction. In terms of value in economics, it's not that this or that doesn't matter, it's that one pricing model is simply superior to another. It means live service type games, unhampered by fixed one time buy pricing or having to go on sale after a few months, are simply the actual representation of value of games

$60 in live service games don't really get you a whole lot. If the average player is spending $300 (example) for a live service game, that's actually the true worth of a game, given it doesn't die out. That means most of the non-live service games that have similar quality of production value, staying power, and the same number of actually paying customers, are also theoretically worth $300. The cost of production of cds and carts may have gone down but the manpower and technology required have gone astronomically up. There's not a whole lot of reason most games are still $60 and going on sale a few months later to less than half the price

Nintendo is living proof that depreciation, when immediately drastic depreciation isn't an expectation, can be curbed.

As far as discretionary spending goes video games are incredibly cheap per hour of entertainment and have increased in price very little so I'm not sure where the outrage is coming from. The anything it should be coming at the number of people losing jobs in the industry despite the record profits.

royic posted...

As far as discretionary spending goes video games are incredibly cheap per hour of entertainment and have increased in price very little so I'm not sure where the outrage is coming from. The anything it should be coming at the number of people losing jobs in the industry despite the record profits.

Price went to $70.
They still lost their job. Why?

Same reason publishers whine about game prices. Greed.

Tropicalwood posted...

You used to have a million different costumes that could just be unlocked through normal gameplay in games and now that's a separate purchase called DLC.

People keep saying that, but what game decades ago had a ton of costumes? The only games that I can think of are the Tales of games and there werent that many anyways, the amount went way up when they realized they could monetize it.

WingsOfGood posted...

Price went to $70.
They still lost their job. Why?

Same reason publishers whine about game prices. Greed.

That's 16% inflation over almost two decades when groceries, housing, and education have more than doubled for the people making them. I guess it's nice that game consumers are not the victim of the greed.

Because people use their own hardware, electricity, and monitors to play. So obviously a per hour charge would only apply to subsidized streaming.

what also takes away their pricing power is the fact that 20 year old games are still fun as hell to play, and can be played offline. We have and endless collection of games that one person couldnt possibly play. These days im more interested in those compared to the slop studios have been producing. And when I hear about their scummy plans to move us all toward streaming I spend even less money on new releases.