Are $60 games here to stay?
- November 01, 2007 16:00 PM PST
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The conventional "rise in development cost" argument doesn't always add up -- here's why.
When Microsoft released the Xbox 360 on November 22, 2005, it marked the first time that console gamers would be treated to high-definition graphics in all their detailed glory. It also marked the beginning of an era where major game publishers would impose a $10 next-gen tax -- $60 per game instead of the usual $50.
Rumblings of a price increase for video games began in 2004 as publishers non-exclusively decided that a $10 price hike would help offset the rise in production costs as more and more money was being spent on big budget games. The move, in theory, would help mitigate the high risk of releasing video games. Microsoft and Sony obliged with the manufacturer's suggested retail price (MSRP), but interestingly not everyone got on board.
The best argument for justifying $60 games is the inflation of other mass media entertainment. Since 1984, the average cost of a movie ticket has nearly doubled. A hardcover book costs 30-50 percent more than it did in the same year, and cable prices have nearly tripled for the same period. Console video games, by comparison, tarried at a steadfast $50 per game for more than 20 years.
Like it or not, very few products endure without eventually feeling the sting of inflation -- video games are no different even if there was a price standard for two decades.
But what about a rise in development costs -- the primary argument publishers used back in 2004 when first exploring the $60 game standard? While games undoubtedly cost more to make today than they did 20 years ago (think: HD visuals, voice acting, online support, motion-capture), the application of a $10 price increase is inconsistent at best.
Case in point: Several high-profile PC games still launch for the last-generation price point of $39, whereas the Xbox 360 or PS3 counterpart retails for a whopping $20 more. Assuming console usage fees didn't increase by more than $10 over last generation, some publishers have some explaining to do.
Take EA's Madden NFL 08 for example. The blockbuster game released in Aug. cost $59 for both Xbox 360 and PS3, but $39 for a PC version with near-identical graphics and production values. The same pricing differential is shared by several other titles. Are PC games immune from the alleged rise in development costs, or does rendering a game for Xbox 360 or PS3 really cost that much more?
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