Tag Archives: Money

Proving Some Sort of Point about Video Game Pricing

I published a post about the $15 MMO subscription price… it feels like a while back because I wrote most of it in April and then didn’t get around to posting it until the middle of this month… that went on about Moore’s Law, software, and how the cost of everything in tech doesn’t really go down over time.  It is mostly just the capability of hardware versus price that keeps changing.  The same dollar buys you twice the computing power every other year.  It doesn’t affect the cost of food, gasoline, or rent.

The primary question in the whole thing was whether or not the $15 a month subscription price for MMORPGs… and, by extension, the $60 box price for AAA games… was really a reasonable expectation 20 years down the road from when they were set.

Daybreak subscriber prices

Raph Koster has opined on the cost of making video games for years and has data to back up what he says.  That linked post came from a discussion that started in the comment thread on a post on this blog.

Given the small, rather niche audience that this blog has, I was interested to see what responses, if any, I might get.  The responses were a bit nuanced, though I would say there was a bias towards not paying any more than the current $15 a month.

And then Massively OP picked up on my post and asked the question of the staff and their own wider audience and… well… I can see why Raph Koster said that studios don’t dare raise prices from the current set standards.

Seriously, the staff and most of the comments come across not just against any raise in price, but often insisted that we should be paying less.

A couple of reasonable souls allowed that the overall rate of inflation might justify something like $17-20, but most people were adamantly against any such thing, often for very subjective reasons, like feeling that this game or that isn’t delivering as much content as they once did.

Is it reasonable to expect, as example, Lord of the Rings Online to deliver as much content when they’ve gone from making $100 million back in 2013 to something around $14 million in 2020?

It doesn’t matter, people feel cheated, that they’re paying as much or more due to cash shops and are getting less for their money.

No need to put a bullet in price rise idea, it is clearly dead already.

Of course, as I opined in the thread, the video game industry hasn’t exactly done itself any favors.  The wealthy Bobby Kotick or Tim Sweeney are the poster boys for greed, making obscene amounts of money while keeping pay and benefits for the people who do the work well below what comparable ability would earn a person other tech segments.  When Kotick’s compensation is cut in half and still looks obscene, that says something… it says that video game companies are making plenty of money already, thank you very much.

And the fact that Steam added 10,263 games to its online store in 2020, a storefront long complained about by developers both due to the regular sales that have cut the average sales price for titles and the 30% tariff Valve takes off the top of every sale (something the rent seeking Tim Sweeney wants a cut of, which is the only reason he is battling with Valve, Google, and Apple… it certainly isn’t the concern for gamers he professes),  seems to indicate that there are a lot of developers out there that are just fine with the situation as it is.

I say that because, in a rational economic situation, self interest would drive some, if not most, of those developers to seek better paying jobs in industries where their talents would earn them considerably more in compensation.  But video games are emotional, a “dream job,” that people will sacrifice to pursue.  (Or is it the corrupt developer career path they are seeking?)

Then there is how consistently two-faced various companies have been about monetization in the face of their inability to raise box prices.  It is always fun to call out EA for saying dumb things like that their pseudo gambling lock boxes are ethical and fun surprise mechanics as they target children by advertising in a toy catalog, but the industry group that represents them tried to upstage the FTC hearing on industry practices by holding a press release where the promised, cross their heart hope to die, that the industry could regulate itself even as Activision patenting game matching algorithms that would pair cheapskates up with those who paid to win to get superior gear so that they would feel the need to spend in order to compete.  As I said previously, this is all a very strong approach to getting the industry regulated.

And so I suppose I cannot really blame the people commenting that they should be paying less for games.  The big players in the industry have cultivated an environment where the whole thing feels like… a business?

Wait, that can’t be right, can it?

How Long can the Fifteen Dollar Subscription Hold Out?

I remember, way way back in the day, a user review for EverQuest that was an all caps exercise in outrage over the fact that, on top of the purchase price for the game it required you to pay a fee every single month you wished to play.  It ended with a call to boycott the publisher of the game to put a stop to this complete rip-off of a business model.

I think EverQuest was $9.95 a month back then too.  It wasn’t even to the $15.00 mark we’ve come to accept as the norm.

Daybreak subscriber prices

But we’ve been at that $15.00 mark, with a discount for purchasing multiple months, since before the launch of World of Warcraft.  The fact that WoW adopted it pretty much set the price in stone.  I recall Mark Jacobs being soundly rebuked when he suggested that maybe Warhammer Online would cost more, a premium price for a premium game and all that.

We have been conditioned by Moore’s Law to expect tech items to cost less over time.  While the law itself specifically concerns itself with the number of transistors that can fit in a given space, the corollary effects include the iPhone 8 in my pocket outperforming a 1970s Cray supercomputer for a tiny fraction of the former’s original price.  We get better, cheaper hardware all the time.

And some of that has been reflected in other pricing.  It used to cost an hourly rate to log onto the online services of the 80s like GEnie and CompuServe.

GEnie Price “cut”

Now most people in urban and large suburban areas have access to some form of high speed internet and the web, while splattered liberally with ads, is mostly free.

But that is mostly hardware and bandwidth driven.  Software is different for many reasons, though the immaturity of software development methodology and the constant need to update due to security issues and defects has a lot to do with it.

The outsider view is that you write your code and, having written, move on.  The reality, which I can harp on about ad nauseum, is that a development group on a mature product can easily find itself spending most of its time dealing with problems that come up simply due to changes in the environment the code lives in.  Every product manage wants more new features to sell and hates to hear the dev team talking about the need to upgrade outdated libraries or other maintenance functions.

So we are in an unnatural situation when it comes to video game software, with their pricing stuck in time. (There was a good discussion of this in the comments on a post here a few years back.)  Triple-A titles are $60.  MMORPG subscriptions are $15 a month.  And so it has been for coming on to 20 years.

Enterprise and productivity markets have long since gone to annual licenses and even Microsoft wants you to rent Office365 from them rather than buy the hidden, but still available, stand-alone Office package. (And, having just moved an Office 2013 license from an old machine to a new one, let me tell you that they are keen to throw a lot of chairs in your way to get you to give up and get on board their rental bandwagon.  But I don’t think many of the products in the Microsoft Office bundle have change enough since the 90s to warrant a rental fee.  If I could still use Microsoft Word 5.1a, I would.)

But video games seem stuck.  Worse than stuck in the case of MMOs, where free to play has become the norm and only a few strong titles can afford to hold the line on requiring a subscription beyond what is essentially a demo period.  My headline is a lie in that the fifteen dollar subscription hasn’t held… but in the opposite way that I meant!

Stymied on the box price and subscription front, video game studios have ventured out in other directions.  So now we have cash shops and DLC and season passes and cosmetics and pets and mounts and character boosts and special servers and game time tokens and skill points and xp boosts and anniversary editions and premium editions and collector’s editions and even a $250 “friend’s and family” edition, all to eke out a bit more cash from the end users who inevitably shout “Greed!” and “Pay to Win” at the first hint that they might feel mildly incentivized to make one of those purchases.

It isn’t that I want to pay more for any of these games.  I have a kid in college, and education is one front where people haven’t been shy about raising prices.  And I have been notably prickly about some of those items listed myself.

But even though these games I play were launched in 2007, 2004, 2003, and even 1999, the people who work on them have to pay rent, buy food, medical care, and everything else here in 2021.  And stuff has not gotten cheaper.  It feels like eventually we hit one of those “you must pick two” scenarios where the options are:

  • Don’t pay more for games
  • Don’t have Pay to Win in your games
  • Your game stays in business

So I wonder when we’re going to have to pony up some more cash to pay.  Until then I try to temper my ire when companies do things they said they wouldn’t do or trot out packages or plans that seem ludicrous to me.  If they don’t pay the bill then there isn’t a game to be played.