On Video Game Prices and DLC: Greedy Businesses Are Always Trying to Stay Profitable

I worried, for a while, when I realized the time was approaching when I would have no choice but to write the article you are about to read.  I worried that the opinions contained herein would be extremely unpopular.  Then I realized that as a journalist, sometimes it’s my job to highlight unpopular opinions for the greater good.  And even more importantly, I realized that as an increasingly cranky old man my opinions are often facts.  So let me tell you a few things, kids.  I’ve been gaming on home consoles since the industry was but a mere toddler.  I remember a time before anybody knew what a Nintendo was.  I’ve seen the industry shift a lot over the past 30 years, but never have I seen so many gamers so convinced that they were somehow getting scammed.  From gaming message boards to mobile app stores, it seems like “greedy developers trying to make money” is a pretty hot topic these days.  From the $60 price tag on new games to Satan’s own marketing ploy, the dreaded DLC, gamers have their collective panties in a twist anytime anybody tries to charge them money for anything.  And to that ever-growing and ever-more irritable substrata of game enthusiasts, I confidently proclaim, “You are objectively wrong.  Untwist those panties, and stop being wrong, for once in your life”.  Let me help you. 

First, let’s address pricing.  This might be the most popular complaint I see: “Video game costs are too high these days, and we as consumers let this happen!  Boycott new games, this is why I only buy used, this is why piracy exists, abloobloobloo”.  Yes, this is the first console generation to have the sheer audacity to reach a $60 standard price point for software.  Why, back in 1979 when the industry wasn’t trying to make money or be a sustainable business and its only concern was looking cool and being your friend, games cost a mere $20!  Check it out!

See, only $20-unless, that is, you wanted to harness the awesome power of virtual chess or backgammon.  That would cost you $40.  For that price, you got a game made by one or two programmers who did everything, from the graphics to the coding to the sound, over the space of about two weeks to a month.  This game might be fun, or it might barely be playable.  There was no metacritic back then, basically you just rolled the dice with that $20.  The game might not even have single player programming, or like Activision’s Dragster, each play might be under ten seconds long.  If it was a game that the publisher felt might be in high demand, that was justification for a higher price point, like the arbitrary $30 tag on Space Invaders when it first released.  But at least they were cheaper, right?  Wrong.  $20 in 1979 money, after inflation, is roughly equivalent to $62.  Meaning that a primitive chess game without the ability to play against a friend, in today’s money, cost approximately $125.  That’s more than enough to buy a collector’s edition copy of Mass Effect 3 and likely all the DLC that will ever be released for it, or enough to buy a DS Lite.  Or you could buy three copies of Ultimate Marvel vs. Capcom 3 so you can play online with your friends.  But oh man, those sweet 1979 deals.  Those were the days, right?

Now, you might be thinking that this was only in the formative, relatively unregulated pre-crash days.  There was no industry precedent so the industry could do as it pleased, perhaps?  Well, let’s travel forward to the second generation of the post-crash era, to 1992 and the heyday of the much beloved Super Nintendo Entertainment System.  As we all know, Nintendo is all about the modern gamer on a budget-surely they were always a bastion of low costs and regulated pricing!

Look at that!  These prices are all over the board!  There are some great high-profile games in here, so it’s a pretty good cross section.  Looks like in 1992 Super R-Type would have run you $40.  Not bad for a classic of its genre that most people remember really fondly.  Then we have Pit Fighter, a poor port of an arcade fighting game that wasn’t even good for its time, at $60.  Odds are though, if you were a kid in 1992 scoping out this catalog, what you really had your eye on was Street Fighter II.  I know I did!  The game was tearing up arcades at the time, the home port looked amazing, and it was the must-have title that Christmas season.  So of course, it’s the most expensive title on the page, at a staggering $70!  Game pricing was so deregulated in the ’90’s, you wouldn’t even believe it if you didn’t see it with your own eyes.  Literally anything could affect the cost of the game, from popularity of the license (which seldom led to a good game, see Ultraman and RoboCop 3 on this page), to the amount of memory on the cartridge itself, to extra features like the ability to save progress without cumbersome passwords.  And again, just in case you’ve forgotten about our friend the inflation calculator, in 2012 money a Super Nintendo game would cost you, the gamer, anywhere from $64 to an absolutely mind-blowing $113.

I could keep going here, from generation to generation, but I think you see where I’m going with this.  If you honestly believe deep down in your heart that games are too expensive these days as a direct result of publishers or developers getting “greedy” or “money-hungry”, or “forgetting about the gamer”, you are absolutely and objectively wrong.  I’m not even taking into account the monstrous increase in development costs, the addition of voice acting in games that can easily have more dialogue than any film, the increasingly competitive marketplace and rising advertising costs…none of that.  If it took one guy to develop, say, Mass Effect 3, you would still be paying the same price and getting a much better value per dollar than you would have with Pac-Man on the Atari 2600.  And EA/Bioware didn’t pay one guy to make Mass Effect 3, they paid hundreds.  Increased development costs passed on to you, the consumer?  Zero dollars.

Members of THQ discussing the resounding success of their brilliant DLC scam. They later went out for condor egg omelets.

So, my budding junior economists, how are developers and publishing houses to continue to turn a profit without raising sticker prices and inviting the full wrath of today’s angry consumer down upon themselves?  If only there were some way they could give interested gamers the option to pay more.  If there were some sort of content one might download if they felt a game worthy of further investment.  I don’t care when DLC was developed, and I don’t care when it was released.  It doesn’t particularly matter if it’s on the disc or if it eats up a chunk of my hard drive.  Frankly, in that scenario, I feel like on-disc with an unlock key might be preferable.  I might not agree with it all-for example, I miss unlocking new characters and costumes in fighting games instead of buying them-but I understand why it’s there.  It’s hard to look at all the studios closing their doors for good and imagine DLC as a means for those greedy game-developing fatcats to sip 80 year old scotch all day on the front porch of their solid gold mansions.  To keep using Mass Effect 3 as my example, is the much-reviled Day 1 DLC really cause for torches and pitchforks?  Is it important to the story in the main game?  Sure, why would they write a chapter that wasn’t?  Is its inclusion necessary to enjoy the game, especially if you don’t know what you were missing in the first place?  Absolutely not.  The presence or absence of that chapter makes the game no more or less playable, nor does a lack of that content significantly shorten the game’s generous 50-plus  hour runtime.  It is simply there as an option, for people who want more and don’t mind paying more.  Say two people buy the same model of new car: one gets the CD player (I hope this analogy is chronologically relevant…), and one opts for radio only.  Did the person who chose radio only get “screwed”?  Did the evil car manufacturer “rob” him of anything?  No, he simply made his choice and paid less.

As it stands right now, after more or less a full console generation of evolving DLC implementation, you cannot point me to a single case where additional paid content was required to play a game.  Slippery slope arguments have no place in this dojo.  If you bring up EA and “Project Ten Dollar”, which I know you’re going to do, you’re only helping me make my case.  The industry as a whole is reacting to an environment where they are making less and less money at retail in relation to their rising development costs.  If you enjoy video games but honestly feel like you should be able to save yourself $5 by buying used and still be entitled to all the features of a game for which you paid neither the developer nor the publisher, we can’t be friends anymore.  Do I feel like the industry should “lock out” used games in the upcoming console generation?  Absolutely not.  Sealed game costs would skyrocket on ebay, scalpers and opportunists would be the only winners.  Do I feel like the industry would be totally justified in requiring, say, a $5 unlock key to access the full content of a used game?  Absolutely.  Nobody likes working for free, guys.

So next time you’re raging on a message board or giving a zero rating to a perfectly good game on Metacritic (that’ll show ’em!) because you feel so betrayed by the industry that used to swing by your house once a week and give you free games (?), stop and think about it for just five seconds.  Please.  Try to decide if you want to go back to the way things were, paying more in adjusted dollars for less play time and riskier quality levels, or if just maybe we as gamers actually have it pretty good these days.

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About Ryan Searles

I like watching movies, and then talking about those movies. Sometimes I write things about them, which you should read. Other interests include boxed wine, video games, the works of Harlan Ellison and HG Wells, and being a general curmudgeon.

Posted on March 29, 2012, in Video Games and tagged , , , , , , , , , , . Bookmark the permalink. 9 Comments.

  1. Jesus. I remember paying 70 dollars for Killer Instinct Gold. I was trying to forget that.

  2. I’m not feeling the automobile analogy. Let’s say you buy your new car, you’re very excited to drive it. You’ve paid your $23,000 (or whatever) and you’re headed down the road. You start to get a little warm and want to feel the wind in your beard, so you press the button to roll down the window. “Please insert credit card.” The window is there, you can see it, or rather THROUGH it. The button is there, it’s even wired properly. However the manufacturer decided that you don’t really NEED to use that window. In fact, if you want to use the window, you’re going to pay them $3,680. (16% more than what you already paid)

    But really, it’s no big deal. It took hundreds of people to build this car. Millions of dollars in research and development. Gallons of robot sweat were *poured* into this automobile. Really, you’re getting a deal. This car should actually cost $28,000 “because of inflation.”

    My issue is not with the prices of games. My issue lies with paywalls and the arbitrary feature or content blocking and stripping that they create in the hopes of generating an additional revenue stream.

    I have no problem with DLC in general. If you can create additional content that is worthy of my purchase, I will gladly do so. (Red Dead Redemption: Undead Nightmare, Borderlands expansions, Call of Duty maps, Oblivion: Shivering Isles, etc. are all examples of worthy DLC)

    But if you’re simply going to take the content of the game that’s normally there and put it behind a paywall… then yes, I’ll call that greedy. Looks like a duck and quacks like a duck.

  3. Mike, I feel like the window comparison is that slippery slope logic I mentioned towards the end. It’s the “one day turning left will be DLC” or “out of ammo! would you like to buy more bullets?” argument. It’s part of the expected and base functionality of the car.

    Like I said, no DLC thus far has been required to render a game fully functional. It’s exactly what you say in the last paragraph. Extra purchases for people who deem it “worthy”. Is your average Gears of War player going to care about $20 worth of weapon skins? No, probably not. But some do, so it’s there. A bacon cheeseburger at Five Guys costs like a dollar more than a regular burger. That bacon is *right there*. I can see it behind the counter, I can even smell it. It was cooked and ready to go at the same time as my burger. Is charging more for it simple corporate greed? No, it cost them money to acquire and prepare that bacon, so it costs you more to get it added on.

    Peter raised a good point in response to this article on facebook, there’s no way of knowing what sort of “paywall” content simply didn’t fit into the expected production budget of a game. So they throw it in as an extra feature. If you want it, cool. If you don’t, that’s your call. But how can you really dictate what should “normally” be there? Is day 1 DLC “locked” out content that sits behind an arbitrary paywall, or is it something that was developed after the normal development cycle of the game? I found a graph online made by a Bioware employee that shows how drastically post-release content has altered the time that a specific team stays assigned to one title, and it’s not unreasonable to look at day 1 content as a natural result of that. I’ll try to find the graph again and send it to you, because I don’t remember the exact details right offhand.

    And what’s up with putting “because of inflation” in quotes like it’s not a valid point? Any way you look at it, video games are pretty much the least inflation-affected source of entertainment out there. In adjusted dollars, which are a real concept and not something I made up, they have done nothing but decrease in retail price while production costs have gone through the roof. I don’t think there’s any way to realistically deny that. All I know, and all that I think can be factually proven without speculation, is that post inflation Atari Backgammon cost twice as much as Skyrim, and if that doesn’t prove a decrease in the overall value of games today, I don’t know what will.

    Also note that this article is directed just as much if not more at the huge number of people out there who do feel that $60 is an “unfair” price to charge for video games as it is at the DLC alarmists.

  4. I would also like to add that while the practice of having to wait for the “real” version of fighting games to come out might get tiresome, it’s certainly another thing that’s preferable to ye olden days. If I could have paid $20 to get a bunch of new characters, stages, and modes thrown onto my Street Fighter II cart instead of paying $70 for that and another $70 for each upgraded version, I assure you I would have without complaint.

    I’m not saying the industry is or ever has been perfect, but the prevailing attitude of “we’re all getting screwed!” is a little ridiculous.

  5. Hmmm… burger anaolgy, let me see…

    Do you get cheese on your Whopper sandwich? Have you EVER complained about having to pay extra for it?

    I do get cheese and have complained about it and will continue to complain OR I will stop buying Whoppers. Because that’s my right as a consumer. Paywalls for cheese on a flagship sandwich, it’s preposterous. 🙂 Bacon, yeah… that’s add-on DLC.

    I’m certainly not saying I’m getting screwed. I have every right not to buy any of this shit. I simply don’t like paywall DLC.

  6. Electronic Arts has been making games since the cartridge era. Their profits have steadily increased in the following decades. If development costs continue to skyrocket and they aren’t charging any more (inflation adjusted dollars) for their product, how do they possibly continue to remain profitable?

    It’s BECAUSE of inflation. Inflation goes both ways. People have more money, make more money, spend more money. Development costs are clearly higher, production costs on the other hand, clearly lower. Billions more dollars are spent on the industry as a whole than there were when Atari Backgammon was sold, so I don’t think it’s fair to look at the price of Atari Backgammon (inflation adjusted) and the price of Skyrim. The two industries are simply too disparate. Pre-crash vs. Post Crash. Unstable gaming market vs. stable gaming market. Cartridge vs. Optical Media. So on and so forth. Apples and oranges, so to speak.

  7. Whoppers are terrible even with cheese. 🙂 Again though, the extra charge for standard features comparison will become apt when Call of Duty requires a paid gun expansion unless you just want to use a knife, or Street Fighter characters don’t include special moves.

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