The Myth of Higher-Priced Games

Spend any time on a message board or in a videogame store and you're bound to hear people complain about the high cost of new videogames, most specifically X360 and PS3 games that retail for $59.99. Sure, I agree that the jump from last generation's standard $49.99 to $59.99 came as a bit of a shock and yes, it has led to a reduction in the number of games I buy. And I know a lot of people who cite it as their number one reason for leaning more heavily on rental services like Gamefly and also on the used-game market. While I don't buy used on principal -- developers and publishers never see a cent of that sale and it only furthers the need to pre-order new games since stores like Gamestop and Electronics Boutique prefer to sell used -- I did actually have a Gamefly subscription for a year or so. I finally cancelled it on account of not playing the games I would rent and now, instead, just make damn sure I really want the game I'm going to buy. That, and I spend most of my time with the X360 playing games on Live Arcade where the games only cost $5 to $15.

I have long believed that $40 was the sweet spot for videogames. You can sell a lot more games -- both good ones and bad ones -- at that pricepoint. There's a little switch in our gamer heads that sees that $40 sticker and thinks it's a value. We see $50 and we hesitate a little, we shop around a bit more, and we start to think about buying used. At $60 we take a much lengthier look at our finances for the week, we consider renting first, or worse yet, we simply put off that purchase for several months... and then buy it used or once it's been marked down. Remember the year NFL 2K Football was released at $19.99 and completely trounced Madden in sales? EA's responded not by making their product better to justify the $49.99 sticker or get into a price-war, they instead spent hundreds of millions of dollars securing an exclusive license with the NFL. We often forget what led to that, but it was the low, low price of 2K Football. I like what 2K Sports was doing when they undercut EA that football season, but they went too low and it cost everyone.

Game publishers and retailers were starting to come down from the rigid $49.99 price point halfway through the PS2/Xbox/Gamecube generation. If you looked around, you could regularly find brand-new games for $40 or less. That was a great time to be a gamer too, because there was a lot of good stuff coming out. I regularly bought 2-3 games per month back then.

But what about now? We see the $59.99 pricetag on the games in the stores and we cringe. Do we really have any right to? Well, of course we have the right to voice our displeasure at what appears to be a 20% jump in the sale price of the games, but historically games have always been this expensive. Actually, they've been even more expensive.

Kristin came home from work last night with a Kay-Bee Toy Hobby flyer from April of 1993. She found it stuffed in a box in her company's storage area. The circular heralds the anticipated release of StarFox for the SNES. It was on sale for $54.99.

Here's a few other SNES games listed in the flyer:

• Super NBA - $64.99
• Mickey's Magical Quest - $59.99
• Super Star Wars - $56.99
• Bulls Vs Blazers - $54.99
• Madden '93 - $54.99

And, last but certainly not least is Street Fighter 2 listed at a whopping $69.99.

This was in 1993, folks. It's been over 14 years and only in the past 12 months have game prices risen again to what they cost in the early 1990's. Sure, I know there's some wiseguy out there who wants to blame the high-price of games back then on the manufacturing costs associated with cartridges instead of CD-ROMs and DVDs. There's no doubt that cartridge-based games cost more to manufacture. But, there's also no doubt that today's games cost millions more to develop and market than games back then did. I'm sure whatever the manufacturing difference between Mickey's Magical Quest and, say, Gears of War was, it was exceeded 1000 times over by the higher development costs of the latter. Yet, the games cost the same. Factor in inflation, and the 2006 Game of the Year, Gears of War, cost us less to purchase than Turtles in Time, a particularly forgettable SNES game that retailed for $54.99 back in 1993.

Okay, so we can forget about blaming the higher costs on the different media. Now I'm sure some would like to point to Nintendo's exorbitant licensing fees being the reason for the higher prices. After all, both Mario Paint and Super Mario Kart are listed below $50 in the flyer. I'm sure this does have something to do with the higher cost of the third-party SNES games back then, but it's also not my problem. It was what it was. Regardless the reason, the price was still the same (or higher) for games in 1993 than today. And SNES games weren't the only ones.

Here's some prices from the flyer for Sega Genesis games:

• PGA Golf 2 - $54.99
• NHLPA Hockey '93 - $54.99
• Battle Toads - $49.99
• X-Men - $49.99

and, of course, there's one that would make a shopper blush even today, Streets of Rage 2 selling for the price of $64.99.

And heck, even many of the Sega Game Gear games were all listed at $36.99. A far bit higher than the standard $29.99 that many of todays Nintendo DS and PSP games cost.

There's no denying that the elevated price of many of today's new games is changing people's buying habits (and quite probably a contributing reason why so many people buying the Nintendo Wii) but before you complain about the price, think about it how it used to be. I'm not saying it's good or that they wouldn't sell more games at a lower prices, just that it's not as unprecedented as people make it sound.

Link to Page 1 of Kay-Bee Toy Hobby Flyer.

Link to Page 2 of Kay-Bee Toy Hobby Flyer.