OT: Video Games too expensive?

[Tico0001]

I don't know much about economics and cost of production for videogames... but doesn't it seem that videogames (for all platforms and PC) are too expensive??

I would think that movies are more expensive to produce and they sell for 20-30 dollars. Then why are videogames 50 bucks???

I realize that movies make money at theaters but games have like 4 systems for releasing their games.

I find myself not being able to justify spending 50 bucks on a silly videogame... and in the past i have resorted to downloading

Does anybody know why the price?

thanks,

Tico

[Hikuro]

I remember video games being around the 40-50 dollar range since hmmmmm I'd say since Playstation started ruling the market. So for half a decade or so games have been getting expensive and its mostly due to the content within the game. Hyped up 3D graphics, voice acting in the cut scenes, long hours of play time....all these factor into the costs along with this simple fact.

A designers gotta get paid SOMEHOW and it ain't just pushing in just the hours. Based on the games sellings I would think the designers as a group get a certain percentage of the cyber pie.

I know I have ALOT of trouble bring myself to purchasing a 49.99 game let alone something that has extras turning it into a 59.99-89.99 dollar game cause you get a free damn shirt or mouse pad or some other loose end bull.

The last game I bought was Starwars EP III that was 49.99, I don't think it was a 49.99 game, it can be easily a 39.99 or a bit less, but never more than that....I do feel I was ripped off for its poor content and 8 hours of game play.

But if you want something worth your money and can stomach it, Xenosaga Episode 1 was diffenetly worth everyones money, 49.99 and you had over 80 hours worth of story, course most of it was cut scene after cut scene....but many said that's one of the few games worth the 50 dollars and just having it for 20 or less is a blessing compared to Episode 2 which only had a third of the time of gameplay Episode 1 had.

[Jemstone]

Hey, were you around in the SNES days when some games were $75? Just curious.

[Prime]

The simple answer is that video games cost millions to make and only a certain number are sold. To recoup the costs and make a decent profit games tend to be sold around the $50 mark. This means that top selling games make a lot of money but the majority of games produced sell a lot less units and only make modest profits or even lose money.

Movies tend to cost more, but they can gain much of that back at the theatre. So when it comes time to sell DVDs they don't have to charge as much to make up the difference. In addition, DVDs are cheaper to make (overall costs). I don't know for sure, but I would also guess that top selling movies would sell more copies than top selling video games.

In the end the cost difference comes from the ratio between production costs and units sold.

[Nightbat]

Here in holland the Half-Life of videogame prices is longer than Tsjernobyl

Here if a game is 6 months old it's still €50,-, while it's been reduced to €10,-

in germany

Nice detail is that german games come solely with german dialogs

while dutch games usually are in english, french, german, spanish and italian

anything BUT dutch dialog

[Hikuro]

Hey, were you around in the SNES days when some games were $75? Just curious.

That would explain why I didn't have that many SNES games

[bandit29]

Hey, were you around in the SNES days when some games were $75? Just curious.

Ya Chrono Trigger was around 75.00 IIRC.

I usually don't drop 40.00-50.00 on game right away. If I have some extra money or ebay money I will. With so many games coming out the prices usually drop in a few months to make room for the new games. That's when I get them.

[mikeszekely]

With the rising cost of development, some companies (EA and Activision, most vocally) want to charge more for next-gen games.

Personally, I'm okay with most games costing around $50. Sure, there are some, like Star Wars Episode III, that are rip-offs at that price, but for the most part it keeps me from buying too many games that I can't enjoy them all. Also, I've been paying $50 for games since the original PlayStation... I'm kind of used to it by now.

[ewilen]

They're not too expensive if the price doesn't scare away so many consumers that it hurts the manufacturer's profit.

Personally, I wouldn't pay $50 for a videogame, but one of the benefits of getting into console gaming late is that I can start with the classics which now sell for $10-$20.

[Prime]

Personally, I wouldn't pay $50 for a videogame, but one of the benefits of getting into console gaming late is that I can start with the classics which now sell for $10-$20.

That's really the way to go...

[Nightbat]

With the rising cost of development, some companies (EA and Activision, most vocally) want to charge more for next-gen games.

Rising cost of development and thousands of differen games sold with the same graphics-engine....

I'll pay that amount when every game uses it's own unique engine!

('till that time, I'll just wait 9 months to buy it from the bargain bin)

[Eternal_D]

back when I was into gaming, I'd drop $120 for a super famicom game without blinking. now I look at $25 games and I don't think it's worth it. I usually get my games used now for $15-$25 and buy 2 get 1 free.

for the HC gamers, $50 aint nothing...and I'm almost certain the price is going to just get higher in the coming years/new consoles.

[Jolly Rogers]

Tico, you might want to check out this site:

Cheap Ass Gamer

It's the CNN for deals on games.

The usual rule of thumb is to wait for game price to drop and never buy them new upon release. Most games eventually drop to $19.99 or less as long as you are willing to wait.

[Knight26]

Games upon initial release have almost always cost around $50.00 to buy. I remeber a few years ago I was watching a special about the production of an early 80s video game, and even back then the games retailed for about $40-$50 USD. SO, taking in economic factors the price of video games, while fluctuating and currently on an upward incline, has actually dropped.

[JsARCLIGHT]

I remember paying abput $50 for Pac Man and other Atari 2600 games back in the early '80s... if you consider inflation and the loss of value of the american dollar technically games are cheaper today than they where when I was a kid buying $50 Atari games. $50 was a ton of loot back in 1981, $50 today is nothing.

[mikeszekely]

I remember paying abput $50 for Pac Man and other Atari 2600 games back in the early '80s... if you consider inflation and the loss of value of the american dollar technically games are cheaper today than they where when I was a kid buying $50 Atari games. $50 was a ton of loot back in 1981, $50 today is nothing.

That's one of the reasons the publishers think they can get away with charging more. Personally, I don't think it'll happen, though. On the retail side, do you have any idea how many people come to buy a game for a loved one around the holidays, pick up the hot new release, and yell out "$50?!? For a GAME?!?!" Gamers are willing to pay $50 for a good new game, but not really more than that. Casual gamers and parents seem unwilling to pay even $50. To that end, I don't see how publishers expect to sell games at $60 or $70 a pop.

[Commander McBride]

Actually, if you've got a local Fry's, Initial Release is a good time. For the first week or so, at least with PC games, Fry's prices them at $40, or even sometimes as low as $35, for a brand new $50 game.

[do not disturb]

PS2: i just wait for it to be released as a "greatest hits" for $20 or i trade them in for new games.

PC: i borrow most, if not all, of my PC games when my friends are done with them. i don't really play multi-player cause you end up playing forever.

[mikeszekely]

Actually, if you've got a local Fry's, Initial Release is a good time. For the first week or so, at least with PC games, Fry's prices them at $40, or even sometimes as low as $35, for a brand new $50 game.

I always hear a lot of board members talk about Fry's. I wish we had one here (around Latrobe, PA... yes, the home or Rolling Rock. If you're still unfamiliar, about an hour or so east of Pittsburgh).

On the bright side of things, sometimes Target runs games on sale the week they release, too.

Edited May 17, 2005 by mikeszekely

[MGREXX]

Personally, I think that the industry is just plain greedy.

Most movies cost over 10 million dollars to make and you don't end up paying more to see a movie from a weka studio than you do for a movie from a successful studio.

Games should be around $25.00 and if the developers and publishers get burned, then they should make better games. That's what the movie studios do.

[Hurin]

Well, I skimmed and didn't see anyone really say this (ewilen came close). So, allow me to once again spout off on Free Market/Capitalism Rule #1 once more:

The final price of an item has very little to do with its production costs. In a free market, the price is set by how much people are willing to pay and how many items are available. . . period. Though, the production costs may help to set a price "floor" below which the producing company will usually not go (unless they have a long-term strategy of gaining market, etc.).

As ewilen said, companies set their prices as high as they can. . . so long as they aren't so high that it drives off customers who would have bought at a slightly lower price (thereby increasing profits overall).

Soda fountains are a good example of this. When you fill up that Big Gulp at 7-11, you've probably used less than five cents in paper/plastic cups, water, syrup, and carbon dioxide (for carbonation). Yet, you pay up to $2 for the drink! Is that highway robbery? Should you only be paying $.04? Of course not! Because, if we were all only willing to pay $.04 for a Big Gulp, there wouldn't be any Big Gulps for sale!

Okay, rant over.

[Southpaw Samurai]

As others have stated, I'm actually amazed games have stayed relatively the same price over the years. Old catridge games used to run $39-79 back in the '80s. Floppy disk games for the Commodore 64 and Amiga would generally run $19-39 (though I miss the old crappy but fun Mastertronic $9.99 games...).

So, all things considered, the relative cost value for 'a' new game has decreased. What HAS increased over the years, however, has been the average price for your middle to obviously poor games. Back in the day when Electronic Arts meant innovative, creatively unique garage games that came in 'record album' like sleeves, a new EA game generally ran @$29. These days, just about any EA game, whether a really well done game worthy of EA back before it became a corporate monstrosity or a crappy little game, will set you back $49. Games released in the $29-39 range are often avoided by people because they figure they're 'bargain games' (I've actually seen people avoid a new game because 'if it was any good they'd ask more for it').

There IS a push coming up to increase the price though. A lot of the few 'super hyped' releases the past year or so have been $55-65 at the outset as a test to see how many people would be willing to pay more and all the 'special editions' where $3 or less worth of goodies are tossed in for a $10-15+ price increase are all market tests to gauge whether the community will support a general $5 to $10 price increase across the board)

Frankly, I wouldn't mind paying $50 or even more for the really good games I enjoy and would be happy to be spending such if I knew that I was giving the money back to the guys who made the game (or paying off the publisher's upfront payment to the developers), but all too often the credits for game grow longer and longer and not just from the need for fifty graphic artists as opposed to the two in the past, but from the fifty to a hundred corporate people behind the publishing company. Those people need to eat too but it seems like a lot of the 'costs' involved with modern games are for people who support the people who support the people who support the people who make the games. Ah...the Corporate World.

[Tico0001]

WOW.... thanks for the replies guys... at least now I know what many ppl think of this issue.

I had no idea that SNES games were $70 back in the day. At that time I lived in Chile... this explains why my parents never got me any games and why there was so much piracy down there. The piracy still exists because most chilean can't justify paying $60 (the price for games there) for a game.

I was thinking about getting Guild Wars. I have always wanted to try these Massive Multi whatever whatever games but I didn't want to pay $50 plus a monthly fee. Since with Guild Wars you only pay the initial $50 I think I'll get it. Any thoughts on this game?

Thanks,

Tico

PS. No Fry's in Baltimore I've been to one in California. That place is like Heaven!)

Edited May 17, 2005 by Tico0001

[jwinges]

Fry's Electronics does have an online store ya know.

[Jolly Rogers]

Initial reviews for Guild Wars were very positive. It wasn't ridiculous on system requirements and people liked the variety in customization options. I hope they release a Mac version soon.

[Gaijin]

Yes, games are expensive. Yes, production costs have risen too. That being said, I remember Atari 2600 carts being $45 in the days; Super Famicom carts were $75-100 US dollars. And the 'ol 200 Meg Neo Geo Carts were $250! And I shelled out for them (well, except the Atari...I was young then so I begged my parents for them).

Plus, we had to buy our games at a store that was 73 miles away and swim in lava to get to the store, then jump start the console with an old car battery, and play the game using a rock and a pair of chopsticks and we had to share the chopsticks. Sorry, couldn't resist.

There's always game rentals... I rarely buy games nowadays...I'll rent if anything, or wait until they go the $20 route. Last thing I bought new I think was AC5 with the stick and that was an exception.

[Graham]

I would have thought that piracy would have something to do with the high cost of games. Games publishers must lose so much money to pirates, that they have to bump up the cost in order to make a profit.

I don't know about the situation in the rest of the world, but here in Hong Kong, piracy of PS2 games, PC software and DVD movies is a huge problem. Hardly anybody buys original games here, as it's so easy to buy bootleg disks for just a few bucks in virtually every part of Hong Kong.

Graham

[Apollo Leader]

No one mentioned it, but the Genesis Virtua Racing and Phantasy Star IV retailed over a $100 back aound 1994/95. All things considering, it's been great that the retail price of CD and DVD games have been around consistantly $40 to $50 for a decade.

[akt_m]

yes it is very expensive. ps2 and xbox original games here in my country are only imported, in the end each game would cost almost the same amount of money that the cleaning lady or the guy that collects the garbage would win in a month. that´s why almost everybody here only buy non original copies. i also don´t own a video game because it is not cheap here, if anyone wants to donate one for me i would gladly accept.

[Mr March]

Given the incredible increase in video game budgets, I'd say that not only is the sale price acceptable at the current level, it is amazing that the cost to the consumer for the average video game has not tripled or quadrupled in the last decade.

The production costs for flagship titles like Valve's Half-Life 2 or Bungie's Halo 2 are so high, they are comparable to the budgets of mid-range independant films and high-end television episodes. We're talking millions of dollars here...for a video game!

Granted, the buying power of the consumer is always falling because of the lousy performance of the economy (I'm refering to North America here, for all you international members). So naturally, we all feel like everything is too expensive...which isn't far from the truth, but in a more roundabout way. Things could always be cheaper and we could always have more money, but such is life.

Personally, I've always thought that gamers in general (and I mean both PC and console fans alike) spend far too much money on crap games as it is. So many of my friends have come up with lame excuses for the utter garbage they buy, I really can't say I have all that much sympathy for the money spent on such games.

"I need a new game"

or

"I gotta buy enough games to make my console/PC upgrade worth the money I spent"

or

"Oh, I know dick about this game, but the box looks cool".

In my entire life, I think I can safely say my failure rate with game purchases has been less than 5%. I can also say that a good 90% of the games I purchased, I've played twice or more. At least half I've played half a dozen times or more. Some games I've played for so long, I should have been paying royalties I played Unreal Tournament online for nearly two years straight. TWO YEARS on $56 CAD. CounterStrike, Quake II, Jedi Knight, Starcraft, Doom, Dom II, Mechwarrior II and IV, and several others have also seen extensive online play by yours truly. I sometimes go six months to a year between purchases. I think it's much more a case of what you get out of the games you buy rather than the number of titles you play. Make wise decisions and buy only what you really want; you'll notice games aren't really all that expensive.

In fact, you may even come to realize that video games pack more value into a $40-$50 price range than almost any other form of entertainment.

Edited May 18, 2005 by Mr March

[Akilae]

I find that MMOs save a lot of money... if you're a rational buyer.

After the initial 50 I paid for WoW, I'm only paying the monthly fees for the account, which is substantially less than what I would otherwise spend if buying individual games. Sometimes timesinks and grinding can be a GOOD thing

Now if only I could find a way to save on PS2 games... the prices on those dang things just don't drop fast enough!

[SpacePirateNeko]

Wow you gotta be kidden me games are so cheap these days compared to what they once were. I remember it being a big deal getting mario bros 2 back in the day because of its 55 dollar price tag.

Later on in the snes days i saved up enough for the release of ff3 ( 6 ) and then when i got to the store it turned out to be 80$ because it was a rare initial low stock release...i had to borrow 20 bucks.....was still worth the price at the time

i payed 75 for ocarina of time when it was released ....was a last copy and no more were to arrive until after christmas and that was over a month and a half away

I dont know i see many new releases going for 40 bucks these days and i can generally walk into a gamestop or EB and pick up a game thats only a month or two old for 20 bucks... 4- 5 months old for 15 bucks

its funny though when you think some of these games you can now download in seconds and emulate once cost 50 bucks each back in the late 80s

imagine paying 50 dollars for balloon fight

[ewilen]

Many interesting comments to which I'll add a few drive-by observations/comments/BS--

1) Not only are games cheaper in constant dollar terms (due to inflation) but arguably they've improved compared to their predecessors. Yes, I know, Star Raiders was kickass on the Atari computer and all that, but who can doubt that the brilliance of those golden oldies would be lost on all but a few afficionados compared to the top tier of PS2/Xbox/GC games. Therefore, by the econometric method of hedonics, the price of games is deflating even faster.

2) As our good friend AgentONE would point out, market research should allow companies to forecast the profit from prospective game projects based on multiple variables including retail price and production costs. That is, (a) the more you spend on making a game, the better it will be. (Not always true, sure, but it's a plausible relationship.) (b) The better the game, the higher the demand. (c.) The higher the demand, the more you can charge for it without hurting gross sales.

The calculations can also be done backwards so that game companies can work backwards from the price of games to find the optimum investment to maximize profit.

Among other things, this means that, all else being equal, keeping prices up is a way of keeping quality up as well.

3) But for flagship games like the Halo series, there are other factors which probably keep the price down. These are "killer apps" that help popularize consoles, so the console manufacturer has a strong interest in making them affordable. I have little doubt that Microsoft accepted a less than optimal profit (maybe even a loss) on the Halo series, and Sony would be smart to subsidize the publishers of certain games as well.

4) About piracy, one might expect that raising prices also increases the incidence of piracy, which could make price increases self-defeating. But in some markets, piracy may thrive even if prices are nominal, below the minimum needed to support even minimal game development, and "honest" buyers may be unlikely to turn to piracy regardless of price (although they may opt not to buy).

Conversely, it's not clear how many additional copies of a game would be sold if piracy was impossible. Certainly not as many copies as there are bootlegs--essentially the same argument that's going on regarding mp3's.

So it's really pretty difficult to assess the impact of piracy on sales, and from that, to pricing and profitability. If we accept that games are cheaper in real terms than they were in the old days, we can note that piracy was harder back then (since games used cartridges not discs) but the prices were higher. Hm...

[Hubert]

if you dont have money, dont buy games. The fact is I know people who buy very powerful PC, who change video card and everything often, and they complain about video games prices. If you play on PC then you re able to buy games. If you have a old PC, the games cant work and the old games are cheap.

I had a period : cool I can copy cd, let's have a lot of games. bad idea.

1. i dont have time to play all the games.

2. too many games kill the games, no time to value one.

3. it takes a lot of place for nothing

I dont buy many games, the last games I bough was resident evil 4 on gc and i dont need 10 games each year.

If you look for the number of hours you play a good game, it's not too too expansive. with rpg and online games, I bet it's less than 1$/hour.

Now there are more and more people involved for making a game. Considering also the evolution of the cost of the life, the price did not really raised.

About the price, it's the same problem as dvd and cd. One of the problem about theprice is that it gets cheap fast and it has no real value. Wait 4 years and they almost give you games. The question is, shall I wait or shall I buy now.

Nowadays, I prefer buy expansive toys who will stand on the shelf during years with the same great look and maybe more value with years, than a video game.

[Beltane70]

Another factor that I didn't see anyone mentioning was that advertising and market research also contributes to a game's cost, not to mention packaging.

Hopefully, I just didn't repeat what anyone else has said.