Ask any gamer how much a new video game costs and you’ll generally get the same answer: 60 dollars. $60 bucks had been the price point for video games for almost 20 years now, and if that sounds impossible, it’s because it should be. Whereas the price of just about everything has increased with inflation, gaming has remained immune. And it’s been the driving force behind some of the scummiest practices in the industry. So are video games about to cost 70 dollars? Hopefully. Let’s dive in and check it out.
Why don’t video games already cost 70 dollars?
I grew up a gamer in the ’90s. I was 7 years old when the Nintendo 64 released. While I had a Sega Genesis before that, N64 was where I truly became a gamer. Every birthday and Christmas, when asked what I wanted, the answer was always new N64 games. In that era, a new Nintendo 64 game was typically $49.99. However, as games transitioned to the PS3 and Xbox 360 era, games made the jump to $59.99. That was in the mid 2000s and is where it remains today.
That would be fine if the cost to develop games remained stagnant over the last two decades. However, the exact opposite is true. As new hardware allows for bigger, deeper experiences, the cost to develop games has ballooned out of control. Gone is the era of a new game costing 40 million with production and marketing. Nowadays, a AAA title will easily spend over 100 million dollars and sometimes up to a half-billion dollars.
However, despite new systems coming out and the gaming experience getting better, the cost of games has remained relatively the same. You would at least think the cost would have adjusted for inflation, however, game companies have been terrified to move off the $60 price point. And with good reason. Anyone who tried to do so in the late-2000’s was met with a huge backlash that actually tanked the release of some games. So developers had to look elsewhere to monetize.
Micro-transactions and Games As A Service
Which leads us to some of the darker practices in gaming today. Unable to increase the base cost of their games and still facing the rising cost of development, companies have had to look elsewhere to make money. One of the first examples of this was paid DLC. The era of digital distribution has allowed developers to make content for a game after it releases and sells it separately. One of the earliest examples I can think of is Halo 2, which sold a CD containing new maps for the game. Of course, these efforts are far more robust today than they were back in 2004.
The other major concept we’re seeing now is “Games As A Service.” Drawing off the old MMO model, the idea behind games as a service is to charge a repeating fee to play the game while the developer continues to churn out new content for it. This has worked so effectively that many new games don’t cost anything to buy, you only have to pay the monthly subscription. Some games have even gone so far as to give you all the content for free, but charge you for aesthetic changes to the game. (League of Legends and Fortnite follow this model.)
Whether it be DLC, games as a service, subscription fees, loot boxes, or any other form of monetization, it’s all built to answer a single question. How do we charge more than 60 dollars for our game? And don’t get me wrong, many long-time gamers like myself HATE the concept of micro-transactions. But in many ways, they’re a demon of our own making.
Does this solve the problem?
So now here comes the part where I tell you that the increase to $70 dollars solves all our problems and micro-transactions go away forever. Right? Sadly, no. The increase to $70 dollars was the solution in 2010, not 2020. If you wanted to look at a realistic price increase that would bring the price point in line with the development costs and inflation, you’d be looking at $99.99 for a AAA release.
But even if gamers were willing to stomach that price point, which they aren’t, it wouldn’t be enough. In many ways, the genie is out of the bottle. Games as a service and free releases with micro-transactions have shown itself to be a golden goose. The development cost on a game like Fortnite is obscenely low, and yet it brings in billions-with-a-B dollars. Let’s take a look at League of Legends for an example as to why this model isn’t going anywhere. A top tier skin for Lux, a light-mage champion in the game, comes out. Of the 80 million monthly League of Legends players, let’s conservatively estimate that about 2 million of them play Lux.
From that 2 million players, let’s conservatively estimate that 10% of them buy this skin. I believe that’s an obscenely low amount and that it’s probably closer to 25%. For a 25 dollar skin, that would still work out to 5 million dollars for a digital product that costs nothing to manufacture beyond its initial design and implementation. You see the problem? It makes too much money. It’s so much money that doing things any other way doesn’t really make sense.
So what now?
We live in the era of games as a service, and that model isn’t going anywhere. The increase to $70 dollars will hopefully slow the pace of gaming practices getting more scummy. The gaming community had a major hand in creating this problem, and we’re going to have a major hand in fixing it. Policing companies for wrong-doing is absolutely going to be the responsibility of gamers. Our government doesn’t yet have an understanding of how the gaming industry works, nor how to regulate it.
So it falls on us to watch-dog the industry for wrongful practices. We’ve seen it before. EA stepped way outside the bounds of what was acceptable with Battlefront II and they were slapped down hard. Massive boycotts, admonishment from gaming media across the globe, and eventually an investigation by the US government has dramatically reduced the prevalence of loot boxes in gaming. Even if they weren’t outlawed, it became a dirty word in the gaming community and companies stepped away from it.
The trick is to understand that not all micro-transactions are inherently evil. On the contrary, the way Fortnite and League of Legends handle their micro-transactions is actually doing it right. The items you can purchase only change the game aesthetically and don’t give you any sort of advantage over other players. As much as I feel like a shill for the gaming companies by saying this, we need to embrace the $70 dollar price point. Frankly, we needed to embrace it a decade ago.
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