Crossing the line when it comes to prices

[Freshbite]

Yeah, everything in the gaming world is overpriced here in Sweden. The exact same game at the exact same time would in Germany go for about 80% of the price we have here.

It's that silly.

[Blorx]

I clearly drew out my opinion in the OP. Here in America, that kind of cost is outrageous. Used games are just that: used games. The corporates don't need to be making money off of used games, because guess what: they already made money on it the first time it was bought. Used games keep retail outlets alive so that they can get the money from the games they sell without shitty royalties and stay open for business.

It's a whole different economy than people realize. Pre-orders and sales of new games keep the employees working, used games keep the system running.

[Endoperez]

The corporates don't need to be making money off of used games, because guess what: they already made money on it the first time it was bought.

It's a whole different economy than people realize. Pre-orders and sales of new games keep the employees working, used games keep the system running.

The developer made some money out of the first sale. Do they get enough from just the first sales?
http://venturebeat.com/2009/05/29/inter ... -imagined/

VB: What’s the hardest problem?

CT: The hardest problem is capitalization. I started the company with $120,000. We had five guys in my dining room. I didn’t take outside investment. I wanted to own my own intellectual property, or the game we created. Now it may take $5 million to $10 million to do a worthwhile title. You have to operate in the old music recording industry model. You take an advance against royalties. If you take a 33 percent advance, that means you borrow from the [publisher] at a 300 percent interest rate. If it takes $10 million to make the game, the publisher has to net $30 million. Then you’re even. Developers are really operating in a tough model. If you need the royalties to make a profit, how can you do it?

How many first-time sales are needed to keep the employees working?

Based on the above information, we can calculate how many copies of the game we must sell to break even (that is, for no loss or profit). For each platform, we get:
All consoles: 653,097 copies
PC: 163,274 copies
Handheld: 326,548 copies

http://www.dpfiles.com/dpfileswiki/inde ... Money_Goes

650 000 copies of first-time sales are needed, not to make profit, but to BREAK EVEN.

Let's say that a game breaks even, and that the amount of times a game is sold as a used copy is 50% of the total number of sales. That's 325 000 sales of a used game. If the developer nets 10$ from half of those sales, that's 1 650 000$, before development, server and other such costs. That's more than the profits from a PC game that sells 250 000 copies.

I don't have the REAL numbers so these are just guesses to illustrate the amount of money tied up in all this.

[zoidberg rules]

They make money off the original sale, but then it goes preowned, everybody buys the preowned ones because of the low price, and the company doesn't make as much money because the consumers all go for the preowned version, rather than the retail version. In short, lower the retail price of all games, make more money, remove DRM, make more money because people don't avoid buying it due to the DRM being in place. Keep preowned games though, they will always be cheaper than their retail counterparts, even if only by 3-4 dollars/pounds/other currency.

[Blorx]

Endoperez, in this day and age where FFXIII is selling millions of copies, as a AAA company, if you don't break even, you screwed something up.

[Endoperez]

They make money off the original sale, but then it goes preowned, everybody buys the preowned ones because of the low price, and the company doesn't make as much money because the consumers all go for the preowned version, rather than the retail version. In short, lower the retail price of all games, make more money, remove DRM, make more money because people don't avoid buying it due to the DRM being in place. Keep preowned games though, they will always be cheaper than their retail counterparts, even if only by 3-4 dollars/pounds/other currency.

Sometimes people do that. If you would check up the presentation the second link from my previous post is based from, you'd find out that its writer suggested that developers INCREASE the price of their console games (to 55$. the presentation was in 2005, and it looks like it was listened to) by a few dollars to increase the profits by 23%. 23 %.

Also, the people who buy preowned versions would still buy them even if developers and publishers lowered the prices. They wouldn't gain anything.

That said, the loweirng of prices does happen.

http://www.bloodyelbow.com/2010/6/6/150 ... les-slower

UFC Undisputed 2010 sales slower than expected:

Despite the stellar sales of its predecessor, THQ and Yuke's' UFC Undisputed 2010 is selling "slower than anticipated".

Online retailer Amazon discounted the game $20 to $39 after only a week on sale.

As a result, the analyst expects decreased reorders from retailers, and Lazard Capital Markets is decreasing its first fiscal quarter revenue estimates for THQ by $4 million, considerably below market expectations.

He postulates that other recent releases like Rockstar San Diego's Red Dead Redemption could be "adding some competitive pressure."

Endoperez, in this day and age where FFXIII is selling millions of copies, as a AAA company, if you don't break even, you screwed something up.

I didn't say that. I said that without 500 000+ copies sold, the companies don't make money. The games that sell more than that obviously sell more than that. But what about games that don't? Like, say, UFC Undisputed. Any way, even if UFC Undisputed sells over a million copies, if even the first sales are at 20$ per, a week after release, I'm not sure if the developer is making money out of that. Marketing, sales, cost of producing physical media, storage of the already produced copies... And hey, the previous game sold 3.5mil copies, it's a sport game and an AAA title - how could that NOT sell?
The game is even getting good reviews. If the developers don't break even, where did they screw up?

I have no numbers and the UFC Undisputed might already be making profit, but I don't know. I'm just trying to explain why the companies are worried. If a good game, a sequel to a good well-reviewed and well-received game doesn't turn profits, WHAT WILL?
Tapping to the used games market is one way of getting the money in. Casual games are another. Movie games are big money-makers. Out of these three, I think the serious gamers would enjoy games following the first model.

[Blorx]

Look, it's not a good thing. This "Project Ten Dollar" is hurting customers. Just look at my OP for price comparisons when it comes to used games. I can guarantee that any PTD game that hits the market will have as bad used sales as SC: Conviction and AC2 did new on PC. It's just another form of crappy DRM.

More than anything, it'll probably hurt 360 sales. 360 gamers already pay a steep price for online gaming. This is just adding to that.

As I said, if the publishers are losing money, they obviously are doing something wrong. Especially people like EA and Ubisoft. They're not making any of these games, just publishing.

As quoted from my Econ teacher, "Every time we buy something, we're voting with our dollar." If a game sells well, and the company turns a profit, people voted with a thumbs up for that game. If a game doesn't sell well, and the company cuts a loss, then people voted a thumbs down for that game, regardless of whether or not the game had a cult following. From there, the company has to decide whether it's opportune or not to create a sequel.

I can guarantee that "Project Ten Dollar" is not going to be a solution to anything but satiating greed.

[Endoperez]

Look, it's not a good thing. This "Project Ten Dollar" is hurting customers. Just look at my OP for price comparisons when it comes to used games. I can guarantee that any PTD game that hits the market will have as bad used sales as SC: Conviction and AC2 did new on PC. It's just another form of crappy DRM.

More than anything, it'll probably hurt 360 sales. 360 gamers already pay a steep price for online gaming. This is just adding to that.

It may hurt customers, but you don't seem to get it. The publishers do not care if used game sales suffer.
Unless you think Project 10 dollar lowers first-time sales, you have no argument.

As I said, if the publishers are losing money, they obviously are doing something wrong. Especially people like EA and Ubisoft. They're not making any of these games, just publishing.

Agreed, mostly. What would you suggest they do about the fact that they're losing money? You don't seem approve of their current actions on making more money.

[Blorx]

I suggest they actually listen to customers. Here's a list of things I'd do:

1. Drop DRMs into the deepest pits of hell, where they will subsequently be raped by imps, have their heads cut off and be fed to mongrels.
2. Actually sign on developers that can make games that aren't broken and/or washed up pieces of crap (I'm looking at you, Realtime Worlds. You failed me with APB's beta. I actually had the illusion that things were getting better).
3. Stop charging extra for DLC. For god's sake, not even P2P MMOs charge DLC. Hardly any (coughWoWcough) even charge for expansions these days. Fluff items (costumes, etc [LittleBigPlanet gets it]) are O.K. in my book. Anything else is complete bullshit. I don't want to pay $10 extra for a one hour quest when my original $60 (or less, depending) purchase got me over 40 hours of play. A change from a 10/1 ratio to a 60/40 (3/2) ratio is huge.
4. Stop spending so much goddamn money on making games photo realistic. Spend some more money hiring a designer that actually knows what he's doing. If I wanted a game to look like real life, I'd go outside. I don't want a world that looks just like my own. I want something unique.

That's just a short list. We all know (or should) that out of that $50 mil budget, over half goes into graphics design and a good portion goes to marketing.

Any input?

[Grayswandir]

Look, it's not a good thing. This "Project Ten Dollar" is hurting customers.

...Customers who buy used games.

Personally, I like buying games new. Because I know its a new, complete package with everything in it. Those smudges on the disk? Those are my smudges on the disk, not someone elses. I'm the one who gets to crack open the case and flip through the rather lack luster, non-descript manuals for the first time.
Sure, I have to save more to buy a new game, and it takes a little longer to save up, but hey, its my copy...and because I'm buying new for 360, I don't have to deal with DRMs, I get the "VIP" codes for all the stuff they make the people who buy it used pay for (and yes, I know I'm paying more, but at least I'm getting the complete package without having to whine about it. I might as well buy it new so I can get everything at once), and I get the new game smell, all in one package.

More than anything, it'll probably hurt 360 sales. 360 gamers already pay a steep price for online gaming. This is just adding to that.

Xbox Live isn't really that expensive, its only about $8 a month if you include tax. As it is, Sony and Nintendo are considering charging for their online services as well.

As a current 360 owner, while I don't like paying to play online (who doesn't like free stuff?), its optional, they don't keep you from getting game updates if you don't pay, and I use it enough that it makes is a reasonable cost. They don't hold you to some agreement either, so you can cancel whenever if you find yourself not using it and they just drop you back down the Silver until you upgrade to Gold again.

[zoidberg rules]

Yeah, they're pretty good like that, but I can never get a hookup for any length of time, so I only ever go for it when they're doing an offer, or when I get one of those gold trial thingies...

[Endoperez]

I suggest they actually listen to customers. Here's a list of things I'd do:

1. Drop DRMs into the deepest pits of hell, where they will subsequently be raped by imps, have their heads cut off and be fed to mongrels.
2. Actually sign on developers that can make games that aren't broken and/or washed up pieces of crap (I'm looking at you, Realtime Worlds. You failed me with APB's beta. I actually had the illusion that things were getting better).
3. Stop charging extra for DLC. For god's sake, not even P2P MMOs charge DLC. Hardly any (coughWoWcough) even charge for expansions these days. Fluff items (costumes, etc [LittleBigPlanet gets it]) are O.K. in my book. Anything else is complete bullshit. I don't want to pay $10 extra for a one hour quest when my original $60 (or less, depending) purchase got me over 40 hours of play. A change from a 10/1 ratio to a 60/40 (3/2) ratio is huge.
4. Stop spending so much goddamn money on making games photo realistic. Spend some more money hiring a designer that actually knows what he's doing. If I wanted a game to look like real life, I'd go outside. I don't want a world that looks just like my own. I want something unique.

That's just a short list. We all know (or should) that out of that $50 mil budget, over half goes into graphics design and a good portion goes to marketing.

Prototype $1,000,000
Development - consoles $20,000,000
Marketing $6,000,000
COGS/platform royalty - consoles $9,000,000
COGS - PC $375,000
COGS/platform royalty - handheld $4,500,000
Total Cost $59,600,000

I skipped some stuff, but according to these numbers out of the $50 mil budget less than half goes into the actual development and only $6mil into marketing. COGS is "cost of goods sold", which I assume is what it costs to have the physical DVDs and packages and manuals and such made.
Source is still Where the Money Goes, so they're from or before 2005.


1) No DRM

How will this improve their profits. Citations, please, and examples.
I know of Stardock and of the Gamers' Bill of Rights they established. I also know of Good Old Games.
Did you know that Stardock's Impulse is still selling titles, from both Ubisoft and EA, that require an online connection to play? As one commentor on their forums said, "if Stardock turned their beliefs into a religion, I'd be out of here. I have better things to do than support companies who play favorites. When people do it, it's understandable. When sellers do it, I leave."

2) Better developers
Er, the guys I know who've played APB didn't think it was broken or a piece of crap. Granted, it was a while ago.
Any way, which developers would you most like to see laid off? Say, the makers of Demigod and Supreme Commander 2, because those games didn't sell well? That'd be Gas Powered Games, lead by the guy behind Total Annihilation and Supreme Commander, who worked with Stardock to release a DRM-free game and advocate open game design. Who should you hire in their stead? The guys behind the most selling games of the current generation, perhaps? The list is here:
http://gamrconnect.vgchartz.com/thread.php?id=87629 , dated in 9/2009. That means it's not listing some surprises released after that, such as the Avatar movie game, or Just Dance.

First, most of the big names are all casual. Guitar Hero, Mario games, Nintendogs, Brain Age, Lego games, Wii fit/play/sports and so on. Is that you want? They're not photorealistic, and are all made by designers who know what they're doing. However, what those designers are doing might not be what you wanted.

Now, the non-casual list is closer to what you might want:
Call of Duty 4: Modern Warfare, Grand Theft Auto IV, Call of Duty: World at War, Halo 3, Call of Duty: Modern Warfare 2, Assassin's Creed, FIFA 09, FIFA08, STAR WARS The Force Unleashed, Madden NFL 09, Gears of War 1 and 2, Legend of Zelda: Twilight Princess, Kung Fu Panda, Grand Theft Auto: Liberty City Stories.

However, there's a trend there. ALL of these are parts of a series, except Kung Fu Panda, which is a movie game. A developer that manages to score a hit, makes sequels.

So which kind of non-broken games you'd like, the casual ones or the sequels?

3) Free DLCs
Did you ever wonder why "P2P", or "PAY to play", games offer players free incentives for them to keep playing? That's right - because to keep playing, the players will pay them any way!
DLC that only gets you one hour of play for $10 is clearly not something you'd want to pay for. I suggest that you don't buy those. If no one buys them, developers won't make them. They won't stop making them just because you're poor, though, if there are other people who do buy them.

4) spend less on realistic graphics
Are you against realism, or against graphics in general? The designer that knows what he's doing, should he design the art or the gameplay?

[WallyWorld]

Companies charge for DLC because they want to keep making money off the IP without having to spend the huge amount of money to make another game. I don't really paying for it, if it's good content, the issue is most DLC isn't good content, its just filler so they can keep you busy and get some money out of you too. Then pump out the next game in the series that is basically the same game with different skins...

No DRM makes people not cringe at the thought of buying their game. That means more people buying it because they would rather give money to a company that actually cares about the game, and the people playing it. It doesn't increase profits directly, it builds a base of customers who are willing to buy your product, and come back to buy it again when you come out with something new as opposed to buying from your competitors, or not paying.

[zoidberg rules]

I want good graphics, great gameplay, and all of the DLC to be free (or at least dirt cheap).

On the DLC front, I thought that the whole "Cerberus Network" thing with ME2 (I know, another reference to it) was going to give you all of the DLC they made for free, since, at first, only the preorderers and people who (like me) bought it on the day of release could get access to it. In my opinion that is what they should have done, then released all of the rest of their DLC as paid or CN DLC, but no...Within days of release, a load of fuckweeds complained, so now you can buy the Cerbeus Cetwork, which gives you access to a whopping 4 pieces of free DLC, and yep, you guessed it, all of the rest is paid! That's right, buy a way to get the DLC, then buy the DLC on top of that!

Get your ideas straight Bioware, you money whoring FUCKS!

Sorry about that, that's my daily rant out of the way, and its 20 to 8 in the evening, I think I did well to not rant for this long into the day. I meant for this to be a few lines of a post but umm... I got talking and...Well, I'm sure you know the rest.