Higher prices - Are we to blame?

[THATinkjar]

I've had this theory running through my head for a little while now, so I may as well put it out there for public condemnation. Are we - game collectors - to blame for the high pricing of video games?

For ages, I've bought a lot of games at full price, not long after they have been released. I've somewhat prided myself on doing this. While my collection may be small in comparison to others, I've probably spent a heck of a lot more than most. Obviously, when I think about this, I realise how incredibly stupid I sound. And yes, I have started to change how I buy video games, and hopefully that'll continue.

But if we hold out until the price for a game drops (into budget territory) - and a lot of us do - aren't we somewhat responsible for the higher mark-up of next-gen games? The Xbox 360 games, for instance, are retailing a fair bit higher than previously. And when they do drop in price, they'll only fall in line with current-gen prices. We'll be waiting twice as long for a game to fall to a price we deem acceptable.

And isn't the above because sales as a whole are down, as people wait for a price reduction? I've seen plenty of sales data to suggest that, as a whole, sales aren't what are being forecast. If we were all buying games on the day of release, at their recommended retail price, I can't help but think we wouldn't be witnessing the price hike we've seen for the 360.

Any thoughts?

[jdc]

If you're into handhelds, you've probably noticed the much higher prices of EA games on the PSP and DS. Burnout DS is practically unplayable but it will sell like hotcakes for Christmas. It's a shit game, EA knows it, but they also know that it will sell at a higher price than norm because it's a hot franchise.

[kevin_psx]

If Soul Calibur comes out at $50 - then dropped to $30 one month later - of course people will wait. Common sense.

What gaming companies do = scalping. They know some want the game right now so companies charge them $20 more than the actual value. Scalping.



Plus many forget about inflation. The $50 NES game in 1989 is equal to a $150 game in today's dollars. In REAL dollars - inflation-adjusted - games are now cheaper.

[Cantaloup]

But if we hold out until the price for a game drops (into budget territory) - and a lot of us do - aren't we somewhat responsible for the higher mark-up of next-gen games?

I would think that the major factor in pricing for the next-gen games is greatly increased development costs.

[THATinkjar]

But if we hold out until the price for a game drops (into budget territory) - and a lot of us do - aren't we somewhat responsible for the higher mark-up of next-gen games?

I would think that the major factor in pricing for the next-gen games is greatly increased development costs.

Well, sure, I'll buy into that. But I'm also talking about current-gen prices, too. Would they be lower if more of us were buying at the time of release, and not waiting months and months for the price to drop? I think they might.

[crazyjackcsa]

I think a lot of it has to do with the Quantity of games out there. Think about it. Looking at my system collection, Often buy about the same amount of games for each (not allowing for collecting after a new generation comes out) The number is about 15-20 games a generation, I'm sure there are other people like me, I can't afford to go out and buy every game the industry tells me is the next big thing. Now there are FAR MORE games per system then there used to be. Just look at the rarity guide for this truth. That means there is less time between "big" releases. That means less time to charge full price before the next big thing comes along. If the industry released less games, they would sell more copies of the fewer titles they produce. That's actually why I like the Gamecube. The library is smaller than the Ps2 Library but about the same size as the SNES one. The games have more staying power becasue there are fewer of them.

[THATinkjar]

That means less time to charge full price before the next big thing comes along.

That is spot-on, sir. There is a buzz word for this. But for this, and for system launches, they are targeting people with plenty of green dollar to spare.

[syd]

Higher prices? Give me a break! Those who think $50 for a game is a high price should be shot! LOL

I remember when Donkey Kong Country 1, 2, and 3 were out for the SNES. Every year I got one for Christmas, and every year my parents had to fork out at least $90 CAN for each one (which is about $80 US). Personally, I think we've got it pretty good right now, considering back then you couldn't easily pirate an SNES game. Now pirating is in full force with modchips and the like, and game prices have gone down. So much for the companies that say increased pirating increases the prices. :/

[Mangar]

It's basic economics. The rule of Supply and Demand.

If a game comes out and 50$, and nobody buys it - Then the price will very quickly drop to a level in which people will.

However - If game comes out at 50$ and sells consistantly, it will not drop until sales ease off. It will continue to drop in price as sales start to slow at it's current level, usually to a low of 9.99 or 19.99.

If you buy games at higher prices, then technically you are to "blame." - If you are the guy who is waiting for drops and buying at that level - You are not.

[THATinkjar]

If you buy games at higher prices, then technically you are to "blame." - If you are the guy who is waiting for drops and buying at that level - You are not.

Or, another way of looking at that statement: Publishers or retailers will keep it at the higher price until enough people have bought it at the full whack. But then if enough people are buying it at top dollar, why would they bring the price down?

It is a bit of a circle, isn't it?

[Captain Wrong]

I think this point has kind of been made, but I don't think it's collectors. It's everyone who has bought into the "I must be the first on the block to own this" mentality. I always wait on a game because the price usually drops. People are willing to pay a premium to have a game when it first comes out and companies are more than willing to charge them for the privilege.

I also think it's just plain old capitilasm at work. People bitch and moan about the cost of games, yet they still pony up for them. If people stopped buying games at the first run price point, the price would come down.

[THATinkjar]

I think this point has kind of been made, but I don't think it's collectors...

I tried really hard to read what you wrote, but your damn cat pictures just kept attracting my attention... so cute!

But yes, I completely agree with you. I've started to change recently, and I hope I can keep it up. Though, as a gamer and a collector, sometimes it is hard to pass on a game I really want to be playing just because I know - at some point - the price will drop. And anyway, Nintendo games hold their prices incredibly well so none of this applies to them.

[Tanis178]

i think content should have some part in it as well, i'm seeing plenty of games coming out that cost as much as 40+ hour ones, and can average less than ten (ultimate spiderman anyone?) or mechassault 2.

but i think that has alot to do with concentrating on online content versus single-player, sega seemed to make that point when discussing the upcoming phantasy star universe, and went out of their way to promote the huge single-player expierience.

[Griking]

Personally I think the increase in game prices is somewhat (though not totally) related to the fact that many people are willing to spend an extra $10-$20 on the "Collector's Editions" of popular games. When these higher priced versions of games sell it tells the game companies that people are willing to pay more than the $49.99 that's been standard for years. If people are willing to pay that much for a game then corporate greed dictates that's how much they'll charge us for it.

Other than that i'm sure the growth of the used game industry doesn't help much either.

[googlefest1]

I would say yes

if everyone stoped buying games at 50$ then they would most likely go down in price -- hopefully not in quality

[Rob of the Sky]

Hype can cause prices of games to rise. People are more likely to want the newest games, so they generally cost more than the older games. This practice is hardly limited to the gaming industry. Hype can cause the price of anything to rise. A good example of hype causing a rise in price is the gasoline price after hurricane Katrina. Even before Katrina hit the US, the media was making a big deal about how there might not be any gas when Katrina hit, due to the fact that it destroyed a major oil refinery in the gulf of Mexico. So, more people than usual decided to fill up their gas tanks. This resulted in many gas stations running out of gas. It got so bad that at one point there were gas stations in my area charging upwards of $6 for a gallon of gas. The point is that hype causes high prices in many industries, including the gaming industry.

[shoes23]

If Soul Calibur comes out at $50 - then dropped to $30 one month later - of course people will wait. Common sense.

What gaming companies do = scalping. They know some want the game right now so companies charge them $20 more than the actual value. Scalping.



Plus many forget about inflation. The $50 NES game in 1989 is equal to a $150 game in today's dollars. In REAL dollars - inflation-adjusted - games are now cheaper.

Inflation isn't that out of control. Actually a game that cost $50 in 1989 would cost $77.94 in todays currency. (Numbers pulled directly from Milton Friedman's website.)

You also fail to recognize the changes that have happened in the United States economy since 1989, including two minimum wage increases. Additionally, the average household income has risen by ~$12,000 since 1989 to present day (inflation has been already been figured into the equation).

Neither inflation nor price gouging have occured. So what has occured? This:


I would think that the major factor in pricing for the next-gen games is greatly increased development costs.

That is exactly the reason and many companies have already stated that their software is going to come equipped with a high price point as a result. The days of a few indiviuals devoloping games is over, and today rooms of people are needed to design, code, and publish software.

[Vroomfunkel]

LOL ... well, I am certainly not to blame. Can't remember the last time I bought a full price game. It just doesn't happen.

It's like buying a brand new car - they lose such a ridiculous proportion of their value as soon as you take them out of the shop that it seems ludicrous not to wait and grab a used copy.

I also refuse to spend more than £100 on a game console. The last console I spent that much on was a Megadrive, with two games. When I was 14.

I'll let everyone else fight over the X-Box 360s, and PS3s and Revolutions and whatever, and throw money at each other until they're blue in the face.

Meanwhile, I'll mop up all the cheap Megadrive classics that are going for nothing because all the 'hardcore' gamers have blown their budget on wizzy new overpriced crap.

Vroomfunkel

[swlovinist]

I definately do not blame collectors for the higher prices of games. While many collectors as myself wait to buy used games, I also am the first to buy games that are collector's editions and budget titles. The truth of the matter is that game prices have not gone up for a long time, although the medium of making discs vs carts is much cheaper. I have been watching the game industry very closely for the last 10 years, and I blame game saturation and lack of quality in a sea of medicore tiltes for the price hikes. With the glut of games people see every holiday, why not wait for a price break? The truth of the matter is that you have $50 sequel game being sold right next to thier $15 original counterpart without much new to offer. While this does not apply to every franchise, it does play a part.
Another consideration about the rise in prices is the dangerous fact that making a poor selling game is more than bad for a video game company these days...it is near certain death for a small to medium game company. Consolidation is everywhere in which small companies are being gobbled up by bigger ones. With development costs skyrocketing, you are going to see higher video game prices. This is not good for anybody, and I dont think it will go well for the mainstream public who has a hard time already with a $50 price tag for a new video game.


The bottom line is that the video game industry has done it to itself by milking sequels and flooding the game market. I welcome a recession.

[XianXi]

Higher prices? Give me a break! Those who think $50 for a game is a high price should be shot! LOL



Dont forget the Neo Geo AES, games were up to the $200-300 mark

[EricRyan34]

Of course we are the ones to blame. Sales of video games have been increasing every years since the Atari days, so companies that release the games CAN have them at a high price, because we will still fork over the money for them no matter what.

[kevin_psx]

Inflation isn't that out of control. Actually a game that cost $50 in 1989 would cost $77.94 in todays currency. (Numbers pulled directly from Milton Friedman's website.)
Thanks for correcting me. As I said - Games are cheaper now than they were in the NES days. Topic title assumes games are more expensive - they are not - they are cheaper.

$78 then - $50 now.

[Diatribal Deity]

Higher prices? Give me a break! Those who think $50 for a game is a high price should be shot! LOL

I remember when Donkey Kong Country 1, 2, and 3 were out for the SNES. Every year I got one for Christmas, and every year my parents had to fork out at least $90 CAN for each one (which is about $80 US). Personally, I think we've got it pretty good right now, considering back then you couldn't easily pirate an SNES game. Now pirating is in full force with modchips and the like, and game prices have gone down. So much for the companies that say increased pirating increases the prices. :/

Average cost of blank dvd/cd (before game) = $1-5

Average cost of blank nintendo cartridge (before game) = $15-30

Average cost of Neo Geo cartridge = ???

Combine these with exclusive licenses, packaging, development costs and marketing...don't fool yourself into believing its anything else.