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price point for next-gen games?

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price point for next-gen games?

Old 03-14-05, 06:23 PM
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price point for next-gen games?

Just a couple of general things I've been thinking about. Is there any indication yet about what price the next-gen games will sell for? Is it likely they'll go for $59.99? I was thinking that maybe the release of some of the collector's editions of games was to see how many people were willing to buy a game at a higher price point, maybe to test the waters for the next generation of consoles. Also, historically, has the price of games increased with each generation of console? The bottom line is, would people pay $59.99 for the average game? I think they would price me out of the market at that point. For some reason, $50 is my breaking point, and I only pay that for exceptional new releases.
Old 03-14-05, 06:43 PM
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The price has not increased with every generation. Games were $30 in the days of the Atari 2600, Intellivision, ColecoVision, etc, which is actually over a $64 dollar price point, accounting for inflation.

There was little difference when NES revived the industry.

Only when the Sega Genesis hit did prices jump. I'm sure anybody looking forward to the system can remember seeing $59.99 price tags on many of the launch titles. (That's over $89 today.) Larger megabit 16-bit titles, plus extra in-cart chips on some titles, pushed games as high as $100 [Virtua Racing... the same as $130 today].

The introduction of CD-based systems broke the back of outrageously priced games, enabling the maximum $50 price point. (The $50 on a launch PSX title is equivalent to $60 today.)

As you can see, today's games are cheaper, in real terms, than any time in the industry's history, even ignoring the large number of products debuting at from $20 to $40.

People have become used to the $50 price point in the last 10 years, though. I'm sure much research about video games' elasticity of demand has been done to see whether there's an apparent benefit to try to push it higher.
Old 03-14-05, 07:36 PM
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I could swear my parents spent $50 on Pac Man for Atari 2600 for my siblings and I when it came out. The worst $50 ever spent. And that's late '70s $$$. So I believe some 2600 games even went for that price.
Old 03-14-05, 07:41 PM
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No problem here. I was one of those who regularly paid $60+ for rpgs ($90 in real terms). And this was back when I was in school. In hindsight I don't know how I managed it..

So $60 for an AAA game is no problem. It's only once we start taking about average games that I think I might like, or perhaps sequels that don't add much to the original. These start to fall into a $10,20,30 price range.

Gaming still compares fairly favourably costwise to dvds, movie tickets, etc.
Old 03-14-05, 07:45 PM
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Yeah, I remember when Phantasy Star IV came out and I couldn't afford it because it was so much more than any other game... of course, back then with cartridges, they would come out with new technology on cartridge and charge more.

I doubt that a 60 dollar pricepoint is sustainable in this market. There's so much competition these days that pricing your games above the norm, or making special editions the only one to get, will kill your system. The only ones I can see doing it are EA with their monopoly of Madden... I swear, they could charge 75 bucks for it and people will buy it.

And I think the trend, if any, in reason years has been the budget-priced game, so I don't think those are going away any time soon, especially because with the low cost of media, pressing more games and selling them at a low cost will only add money to your coffers.

Of course, I didn't really expect PSP games to start between 40-50 bucks, so what do I know? The only hope I have is that GBA games were initially as much as 40 bucks, and now even the ones that retail for 35 go on sale for 25 quite frequently.
Old 03-14-05, 08:04 PM
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Originally Posted by gorgo99
I could swear my parents spent $50 on Pac Man for Atari 2600 for my siblings and I when it came out. The worst $50 ever spent. And that's late '70s $$$. So I believe some 2600 games even went for that price.
yeah, that game was the biggest disappointment in all my years gaming.

And I do remember it being over $50
Old 03-14-05, 10:00 PM
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I rarely buy a game at or near launch, so it's not a big deal for me. Though I have to see I couldn't see myself dropping $60 on any game next gen.

But I'm only planning on buying Nintendo's next console, and I can't see their games selling for that point. Maybe some 3rd party games, but I can't see Nintendo's 1st party development costs shooting that high to justify the price increase.
Old 03-14-05, 10:19 PM
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I don't think a $60 price point is sustainable in the market. If you look at the current market, most games drop in price within a couple months, and many reach budget pricing within a half year. I can see the games coming out at $60, especially right in the beginning of the next gen when there isn't much out, but I think they will come down to the market price.

I guess it isn't that big of deal what price games start at, I don't pay anywhere near full price currently, and I won't in the future. I think I will still be able to keep my $10-$15 average per game next gen, might just have to be patient.
Old 03-15-05, 10:23 AM
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paid $50.00 for asteroids for atari, so no complaints here about today's price....
Old 03-15-05, 11:18 AM
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There is mention about competition but it's not like competition found in most industries. EA carries so much weight that they could affect what prices are based on where they set theirs.

There is a push for discounted prices right now but that's because we're coming towards the end of a cycle. This happens every time. I think Sled Storm was released for $15 in 1999 (maybe 2000) for the PSX followed by a lot of other games at lower prices. Developers can make games cheaper since they aren't figuring the system out and there are a lot of engines developed.

I don't expect games to be priced over $60 and more than $70 would be tough.
Old 03-15-05, 12:33 PM
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Interesting that you brought this up. I just saw this article today:

From Investor's Business Daily
Video Game Makers Finally Have Chance To Raise Their Prices


The next generation of console video games will boast high-definition graphics -- and higher retail prices.

Analysts say the transition to new consoles offers a long-overdue opportunity for publishers to raise prices. New games that sell for $50 now could go for $60 when the consoles come out, starting in November.

"Everybody (in the industry) wants to see a price increase," including game publishers and retailers, said Arvind Bhatia, an analyst with Southwest Securities. "So now it's a matter of 'Let's try this out and see how consumers like it.' And if it sticks, then you'll see a bump."

Activision (NasdaqNM:ATVI - News), the maker of top-selling games featuring Spider-Man and skateboarder Tony Hawk, intends to raise its wholesale prices by $10 for next-generation software. Consumers will be getting more hours of entertainment for the extra money, says Robert Kotick, chief executive of Activision.

"We haven't raised prices as an industry in 20 years," Kotick said. "Look at the movie business as an analogy. You're not getting any more hours of entertainment -- it's the same two hours of a motion picture -- and yet you're spending twice as much as you did 10 years ago."
Full article is here: http://news.yahoo.com/news?tmpl=stor...bd/2005314tech
Old 03-15-05, 01:21 PM
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Ugh. So what this article is saying is don't buy games at release, because I'll be sending game companies the wrong message.

How exactly am I going to be "getting more hours of entertainment for the extra money?" Are they going to make the games longer now because they're on new systems? Or are we going to see what we've seen at every system launch, games that try to take advantage of all the new visual tricks of the system, but because of time constraints to get it out by the launch window, are usually either shallow or very short.

I'm not too worried about Activision, though... if they're the only ones to raise prices, they're going to get screwed. It's if everyone gets this mentality, or if the big boys like EA do it. I still say if they ONLY released overpriced collectors edition of Madden, Rockstar's GTA, or Bungie's Halo 2, people still would have bought it up. Some games can have price increases. Others can barely keep at the 40 dollar price point for a month before being heavily discounted...
Old 03-15-05, 01:29 PM
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I can't imagine there would be many games I would buy at $60. If not for the GameRush trade in deals to get new preorders for $29.99 last year and $34.99 currently I probably would have bought very few new games recently. The price increase makes sense i guess. They are charging $50 for most PSP games so I would imagine PS3 games would be more.

They can launch em at $60, but I will be waiting for them when they drop in price.

As far as them giving us more value for our money I seriously doubt it. A bigger polygon count will not change the fact that most of the games released are crap. There will be plenty of amazing looking games with very little actually fun gameplay or good games that are just way too short. If anything the quality will probably be worse with the next generation of consoles, especially in the first year or two.

Last edited by darkside; 03-15-05 at 01:33 PM.
Old 03-16-05, 07:17 PM
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I can barely bring myself to pay $50 for games now, let alone $60. That being said I don't think the price jump is that outrageous. I still think the sweet spot was the psx price range of games with many of the new titles coming out at $35-$39.
Old 03-17-05, 12:56 PM
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http://www.gamesindustry.biz/content_page.php?aid=7480

Videogame prices set to rise on next-gen consoles
Rob Fahey 15:37 17/03/2005

$59.99 or higher being eyed as a potential price point for next-gen launch titles

Software for next-generation home consoles looks set to be more expensive than current titles, with comments from leading publishers such as Take Two, Activision and THQ all pointing to premium price points for AAA next-gen titles.

Speaking at the Banc of America Securities Consumer Conference yesterday, representatives of all three companies indicated that higher prices for software are inevitable on the next-gen platforms - the first of which, Xbox 2, will launch later this year.

Price points of $59.99 or higher were mooted for AAA games on the new consoles at launch - but other titles may be priced less expensively, with THQ acknowledging that its children's titles may not be able to sustain a $49.99 or higher price point, while Take Two simply said that its next-gen games would be priced higher "where appropriate".

This strategy is likely to see a two-tier structure emerging for game pricing, where premium titles command a premium price point of $59.99 or more, while less important games are sold for between $39.99 and $49.99 - much closer to the current price point.

While the cost of developing next generation games will undoubtedly be higher than current development costs, the proposed price hike is less to do with development, and more down to a desire among publishers to expand their margins - with the hardware transition apparently seen as a perfect chance to accomplish this by bumping up software prices.

Leading US retailer Electronics Boutique, which also presented at this week's conference, also acknowledged that prices were set to rise in the coming year - but like the publishers themselves, made it clear that the market would only sustain premium prices on certain products.


Chris
Old 03-17-05, 02:36 PM
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$60? No thanks. I'll only buy at $20 or less just on principle.

When the media costs less than a dollar, I can't pay that much towards development costs. Game companies, stop dumping money down the toilet.
Old 03-17-05, 02:49 PM
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I thought prices were high enough. I don't like this one bit but I see it working at first since there are quite a large number of people that'll jump at getting the latest/greatest things no matter the price. After that, I'm sure it'll die down and we'll see prices vary as they do now.
Old 03-17-05, 05:30 PM
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I think $50 is most people's limit, and outside of a few "must-haves", very few people will pay more for a new game.

I make pleny of money and can afford whatever, but I just won't spend more than $50 on a new game. I think this is going to hit the industry hard, and they're going to see a huge drop in sales due to this.
Old 03-17-05, 05:45 PM
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I don't know, I think the percentage of tight asses in this forum is probably higher than average. I think the average gamer will still fork over for a madden, warcraft, or final fantasy at launch and not think much of it (they are already for certain exclusive "big" titles).

I'm sure if everyone only bought games at $20 or 2nd hand then the game industry as we know it would collapse, so thankfully that hasn't happened just yet .
Old 03-17-05, 06:01 PM
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I don't know how ready people are to accept higher prices... after all, the common person doesn't care how much more production costs are. After all, we've seen nothing but decreases the past few years: even with 50 becoming the standard price, Sony started releasing all of their titles at 40, and started the 20 dollar GH line. Now we see non Sony games start at the 40 pricepoint to help them sell.

Look at the GBA: prices started at 40 for new 3rd party games. They quickly went down to 30 in a few months, and I have to believe it's because the old price point just wasn't selling (something I hope happens to the PSP pricepoint).
Old 03-17-05, 06:05 PM
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And who's to say what a "premium" game is and what isn't. It's mostly subjective. That's like charging more for a "blockbuster" movie and less for an idependant movie. It might make sense on paper, but in practice, it is totally ridiculous.
Old 03-17-05, 06:50 PM
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Eh they're already doing it, Warcraft III, Doom 3. Both million sellers.
Old 03-17-05, 07:57 PM
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? Warcraft III was only 50, wasn't it? I know they had that overpriced deluxe edition, but I thought the regular one was a normal price... (have no idea about Doom, though I do remember Half-life 2 and WoW coming in regular and deluxe editions as well). I have no problem with them selling some special edition for a higher price, as long as I still have the option of picking a regular edition up.

As far as blockbusters: I could see them charging more for the can't-miss series. Stuff like GTA, Halo, Splinter Cell, Metal Gear: all would sell. But then what would happen with a series like KOTOR, which seemed to come out of nowhere? Would they just base price on how much they spent on the game? That would be ridiculous, because a lot of high-budget games play like crap. And then you have the occasional sequel that turns out to be a dud (Devil May Cry 2, anyone?)
Old 03-17-05, 09:14 PM
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The only games i would ever pay that price for at launch would be major 1st party Nintendo releases and a some Xbox Live games. Thats pretty much it.
Old 03-17-05, 11:53 PM
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60 bucks and a likely entry point of over 250 bucks for the hardware....I have a good job, but I also don't like bleeding money.

Remember the old days when you could get the Atari for "Under 50 bucks!!"

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