Why are video games so expensive?

[MrHT]

I'm not complaining so much about the games since $60 has been pretty much the standard price for video games for as long as I remember, but $60 is still not a cheap price tag. But I'm also talking about the prices of video game consoles and accessories, which seem to have gone up substantially.

A PS5 is currently $500 and that's just for the console itself. With additional controllers and games, you will be spending an additional $100+. So you're looking at over $600 just to get started.

When I was a kid and got the SNES, it cost my parents $200, but it came with a second controller and a free game (Super Mario World). You got everything you needed to get started. But today, everything has to be bought separately and at an expensive price tag.

After looking at the prices of video games, I ask myself why I complain about the $10+ on Blu-rays and $100 or so on the players when that's nothing compared to the price tag of video games.

So why are video games/consoles/accessories so damn expensive?

[albertbj]

Well, there are a few reasons. The first and most obvious is, of course, inflation. But there's another reason why I think game consoles, in particular, have become so much more expensive in recent years.

In the past, it was common practice for console manufacturers to sell systems at a loss, knowing they'd be able to make up for it in software sales and licensing fees. But that seems to have more or less stopped in the last couple of generations. I remember when the PS3 launched, it was $600 (mostly due to the BD drive), but the per-unit cost to Sony was more like $800-900. Conversely, I remember hearing that the per-unit cost of the PS4 at launch was actually slightly below its $400 price tag. Sony was no longer selling consoles at a loss, and I suspect that became the new industry standard.

You also have to take into account what people are willing to pay. Back in the 80s and early 90s, video games were still seen primarily as being for kids, and it would've been a lot to ask for parents to shell out more than $200 for a new system every few years. But now, the industry, as well as its fanbase, has matured, and people today are obviously willing to pay $500 for a new console. Otherwise, companies would still be doing things the old way. Granted, I don't think we'd still have $200 consoles like we did 30 years ago, but if Sony's market research showed that people would refuse to pay more than $300-400 for a PS5, that's the price they'd sell it for.

[WalsMan]

Originally Posted by albertbj

Well, there are a few reasons. The first and most obvious is, of course, inflation. But there's another reason why I think game consoles, in particular, have become so much more expensive in recent years.

In the past, it was common practice for console manufacturers to sell systems at a loss, knowing they'd be able to make up for it in software sales and licensing fees. But that seems to have more or less stopped in the last couple of generations. I remember when the PS3 launched, it was $600 (mostly due to the BD drive), but the per-unit cost to Sony was more like $800-900. Conversely, I remember hearing that the per-unit cost of the PS4 at launch was actually slightly below its $400 price tag. Sony was no longer selling consoles at a loss, and I suspect that became the new industry standard.

You also have to take into account what people are willing to pay. Back in the 80s and early 90s, video games were still seen primarily as being for kids, and it would've been a lot to ask for parents to shell out more than $200 for a new system every few years. But now, the industry, as well as its fanbase, has matured, and people today are obviously willing to pay $500 for a new console. Otherwise, companies would still be doing things the old way. Granted, I don't think we'd still have $200 consoles like we did 30 years ago, but if Sony's market research showed that people would refuse to pay more than $300-400 for a PS5, that's the price they'd sell it for.

Didn't know about the they selling the consoles at a loss but makes sense........... good point here.............

Although to me it has been a combination of the last point you mentioned (what ppl are willing to pay/matured audience) and technology: yeah back in the 80's/90's you wouldn't see the average 35 yr old spending a great chunk of his paycheck constantly in gaming..... back then it just wasn't a thing (culture was still developing) AND also the fact that technology has gone so far in comparison........ back in the day consoles/games/accessories could do only so much because of technology compared to now where holy smokes everything seems so real.

That's what I always have thought but I'm not 100% sure.

[Doctor Jack]

They aren’t expensive at all. If I’m spending $60 and I get 100 hours out of a game…he’ll even 20 hours…that’s absolutely worth the money. People buy blu rays for $20 and that give you what…2 hours? You get plenty of worth for the amount games cost.

[DVD Phreak]

Originally Posted by Doctor Jack

They aren’t expensive at all. If I’m spending $60 and I get 100 hours out of a game…he’ll even 20 hours…that’s absolutely worth the money. People buy blu rays for $20 and that give you what…2 hours? You get plenty of worth for the amount games cost.

The duration is not as important as the quality of the experience, though. A great 2-hour movie experience beats a boring 10-hour game, or a boring 100-hour game which you wouldn't play for that long anyway. For a good movie or game, length often doesn't matter. No good movie or game is too long (or short), and no bad movie or game is short enough.

[mave67]

Originally Posted by albertbj

Well, there are a few reasons. The first and most obvious is, of course, inflation. But there's another reason why I think game consoles, in particular, have become so much more expensive in recent years.

In the past, it was common practice for console manufacturers to sell systems at a loss, knowing they'd be able to make up for it in software sales and licensing fees. But that seems to have more or less stopped in the last couple of generations. I remember when the PS3 launched, it was $600 (mostly due to the BD drive), but the per-unit cost to Sony was more like $800-900. Conversely, I remember hearing that the per-unit cost of the PS4 at launch was actually slightly below its $400 price tag. Sony was no longer selling consoles at a loss, and I suspect that became the new industry standard.

You also have to take into account what people are willing to pay. Back in the 80s and early 90s, video games were still seen primarily as being for kids, and it would've been a lot to ask for parents to shell out more than $200 for a new system every few years. But now, the industry, as well as its fanbase, has matured, and people today are obviously willing to pay $500 for a new console. Otherwise, companies would still be doing things the old way. Granted, I don't think we'd still have $200 consoles like we did 30 years ago, but if Sony's market research showed that people would refuse to pay more than $300-400 for a PS5, that's the price they'd sell it for.

consoles are on rise since ever.

[ps3bd_owner]

There's a rumor that Sony will be merging PS Plus with PS Now so it'll be a lot like Xbox's Ultimate Game Pass bundle. Meaning, people who don't want to spend too much, but play games can do through these services.

Although I doubt Sony would add GT7 day one or any other. But hey, Sony might change.

[buck135]

Sony and Microsoft don't need to include games the way needed Super Mario Bros to help sell the NES or Sega needed Sonic for the Genesis to catch on. A year after launch and people still can't find a PS5 or Xbox X. I'm actually surprised how cheap the systems are considered the demand.

As far as the games themselves, there are so many people that work on them for such a long time. When a game is released, they still aren't done patching, updating and working on DLC. Like the systems themselves, I'm surprised games aren't more expensive.

[MrHT]

Originally Posted by buck135

Sony and Microsoft don't need to include games the way needed Super Mario Bros to help sell the NES or Sega needed Sonic for the Genesis to catch on. A year after launch and people still can't find a PS5 or Xbox X. I'm actually surprised how cheap the systems are considered the demand.

As far as the games themselves, there are so many people that work on them for such a long time. When a game is released, they still aren't done patching, updating and working on DLC. Like the systems themselves, I'm surprised games aren't more expensive.

Not to turn this into a SNES vs Sega Genesis debate, but I've never understood why anyone thought Genesis was the better system. I had both systems and SNES was, by far, the superior system. Super Mario World, Super Mario Kart, Donkey Kong Country and Super Metroid were such amazing games that you could not play on Genesis. Yeah, you had Sonic, but that was only good exclusive Sega game and doesn't come close to the greatness of the 4 games I mentioned.

And PS5 is hard to get moreso because of a chip shortage and not so much because of demand....
https://www.cbsnews.com/news/ps5-res...5-video-games/

[buck135]

Originally Posted by MrHT

Not to turn this into a SNES vs Sega Genesis debate, but I've never understood why anyone thought Genesis was the better system. I had both systems and SNES was, by far, the superior system. Super Mario World, Super Mario Kart, Donkey Kong Country and Super Metroid were such amazing games that you could not play on Genesis. Yeah, you had Sonic, but that was only good exclusive Sega game and doesn't come close to the greatness of the 4 games I mentioned.

And PS5 is hard to get moreso because of a chip shortage and not so much because of demand....
https://www.cbsnews.com/news/ps5-res...5-video-games/

If I remember correctly, the EA Sports games were better on the Genesis. I never owned the SNES, so I cannot deny or confirm. I did like the feel of the Genesis controller better than the SNES.

The chip shortage definitely doesn't help, but I think the new consoles would still be difficult to find this holiday season.

[Batman90]

Originally Posted by buck135

Sony and Microsoft don't need to include games the way needed Super Mario Bros to help sell the NES or Sega needed Sonic for the Genesis to catch on. A year after launch and people still can't find a PS5 or Xbox X. I'm actually surprised how cheap the systems are considered the demand.

As far as the games themselves, there are so many people that work on them for such a long time. When a game is released, they still aren't done patching, updating and working on DLC. Like the systems themselves, I'm surprised games aren't more expensive.

They wouldn’t have to worry about patching a game if they would make sure they work before they release it. I don’t see how $60 isn’t enough every other studio seems to be able to make a ton of money on games that are $60. These studios want $70 to be worth it then they need to step up and do it right the first time and stop delaying games just cause only games come out at the same time. If people want a game then they won’t came what other game comes out at the same time and they will buy that game that they want.

[emailking]

I think they should cost more actually.

[Bigdog]

Games were 60-70 dollars from what i remember as a kid for nes or sega master system games at toys r us in the 80's.

Really when you think about it, games have become cheaper not more expensive, especially considering the development and resources put into aaa titles today vs. the 2 month 4 man teams that made most of the titles back in the 80's and even 90's! You can also now downloaded patches and fixes, that didn't exist back then, broken games remained broken!

[DVD Phreak]

The true cost of gaming (or any use of tech products) is in the hardware upgrades you have to do periodically. That's how the industry is able to keep prices constant for games, Blu-rays, DVDs, etc. for decades. Look elsewhere, and it's not hard to find (frightening) price increases. Did graphics cards use to cost $500+? Did you need to buy smartphones every few years? Back in the early 90s did you need to pay monthly Internet fees? These and many other tech gadgets, services, etc. filling up our homes are where the cost increase is, my friends.

[Bigdog]

Originally Posted by DVD Phreak

The true cost of gaming (or any use of tech products) is in the hardware upgrades you have to do periodically. That's how the industry is able to keep prices constant for games, Blu-rays, DVDs, etc. for decades. Look elsewhere, and it's not hard to find (frightening) price increases. Did graphics cards use to cost $500+? Did you need to buy smartphones every few years? Back in the early 90s did you need to pay monthly Internet fees? These and many other tech gadgets, services, etc. filling up our homes are where the cost increase is, my friends.

Actually tech hardware in the 80's and early 90's was far more expensive then what we have today imo. Not sure if you were alive back then but i was, and i remember average home pc's cost in the 2-4 grand range. I remember my uncle buying one of the first macs, cost him near 4 grand with all the addons and such, his gateway a few years later was over 3k!

Today 3k, even in this insano inflated covid market can build a top notch rig!

[DVD Phreak]

Originally Posted by Bigdog

Actually tech hardware in the 80's and early 90's was far more expensive then what we have today imo. Not sure if you were alive back then but i was, and i remember average home pc's cost in the 2-4 grand range. I remember my uncle buying one of the first macs, cost him near 4 grand with all the addons and such, his gateway a few years later was over 3k!

Today 3k, even in this insano inflated covid market can build a top notch rig!

My last post was more about the totality of tech usage today compared to decades past instead of the prices of any particular types of products. Nowadays, there is no question we use and buy way more tech products than decades past such as, as I mentioned, smartphones, Internet services, streaming boxes, home surveillance, etc. And it is my opinion that all that money from the consumers has prevented certain products, like games, movies, etc., from price increases. Sometimes, prices are directly raised, such as subway/bus fares, medical premiums, and college tuition. But sometimes they are indirectly raised.

Yes, I was alive in that era which I often (fondly) look back on because of the fast and frequent tech innovations that absolutely mesmerized me as a child, and made tech field my lifelong vocation (I recently retired after 30 years as IT manager). I started working in the early 90s and my company used very little tech then. Our production used pencils and paper, and our secretary used a typewriter! As time went on, the tech expenses grew: products, services, consulting fees, etc. -- as you would expect. I had to train people to do simple things like using word processors (adding to the tech expenses).

To your point about expensive tech prices in the past, there were plenty of low-cost tech products too at the time. Unless you bought only early-adopter types of products, cheaper versions could always be had. I remember Apple released a motherboard-only version of its computer for builders. And there were plenty of ma-and-pa brick-and-mortar computer shops that built PC compatibles that were much cheaper. There were plenty of low-cost gaming devices too, like Nintendo's Game & Watch. But one thing's certain: WAY fewer people bought tech products then than they do today. And that goes back to my original point. Home PCs and all that stuff didn't become a phenomenon, didn't become must-haves for every family, until mid-90s and after. That was one reason why stocks were booming in the late 90s. And now smartphones have become the latest must-haves. A few years ago I laughed at my neighbor for being paranoid and installing home surveillance ("What, are you wanted by the police?"). Now everybody uses it including myself.

[R3P0]

Lets look at the cost of building said games.

GTV its estimated that game cost 265m to research and produce

COD MW2 - 250m

Knight's of the Old Republic - 200m

Shadow of Tomb Raider - 125m

Final Fantasy VII (1997) - 115m

Halo 2 - 120m

GTA IV - 100m

Red Dead Redemption - 90m

[wangyuan]

I agree with this view. The first and most obvious is, of course, inflation. But there's another reason why I think game consoles, in particular, have become so much more expensive in recent years.

[jetjaguar4]

Considering the price of a Neo-Geo and 3DO back in the days, I think $500 for a PS5 is a fair price.

[defwarrior4000]

I remember when the N64 came out and some games like Mortal Kombat Trilogy and Wayne Gretzky Hockey cost $80 and I think Killer Instinct was $75. This was in 1996. PS1 games were mostly $50-$60. Cartridges were expensive to produce.