Modern Warfare 2 Price Hike is Good for Gaming

Kris Erickson • Jul 24, 2009 • Comments ()

This fall, Activision plans to release its hotly-anticipated shooter Modern Warfare 2 for sale in Britain at the price of £54.99 ($90 USD). A special edition prestige bundle will be even more expensive. This has raised the ire of both gamers and industry analysts, who see it as either an example of prices creeping upwards, or bad strategic planning in the midst of an economic recession. For the record, Activision claims that the price hike has to do with the weakness of the British Pound against the Euro, causing goods in that country to become still more expensive. Gamers, always ones to prefer a bargain when it comes to our favorite hobby, have reacted negatively to the news, with some even threatening to "boycott" the game when it arrives at a higher price. The reason, they argue, is that if customers are willing to pay a higher price for a premium game, then other publishers will get the idea that they can charge this new higher price for their own titles, making us all a little bit poorer in the process. The truth is often more complicated, and in this case a price hike for current-generation titles could actually help the industry and gamers. Here's why.

The current UK £45 and USD $60 price point has been in effect for a good while, since at least the waning days of the previous generation. The market settled on this price for new games because it seemed like a fair balance between value for consumers and profit for developers. Many new games sold successfully at this price, because it was what gamers were willing to pay. Other titles, that weren't so deserving of our money were neglected and quickly put on sale to make them more attractive to potential customers.

The problem now is not that developers have somehow become more greedy, seeking to extract more profit from the same old product. The issue is that developers are having a hard time providing us the value that they want to offer at the current price point. Next-gen games were supposed to be bigger, more spectacular, and more interactive than the previous generation. So why should they cost the same amount of money? The $60 price point has actually become a constraint on developers, potentially causing them to cut features from game development, worrying that they will only be able to charge a fixed, last-generation price for the title when it ships.

Modern Warfare 2 will be the most expensive game on shelves in the UK this holiday.

The proof is in the fact that many $60 games are quickly followed up with downloadable content adding new maps, levels, and experiences that couldn't profitably have been included in the main game. Developers are recouping the real cost of game development by nickel and diming us on DLC, a practice that would be curtailed if they included the "full" experience at the price of their choosing to begin with. If we really want to unleash the power of the current generation of gaming hardware, we should encourage publishers to charge whatever they want for new games. If they want to make a $80 or even a $100 game, let them do it. If a game is truly worth $100, we'd love to play it. If not, we'll wait for the price to drop to a more acceptable level.

There is an old aphorism which goes "a businessman could be a millionaire, if only he could find a way to provide a million dollars worth of value." The same is arguably true in the video game industry, where consumers are constantly on the lookout for value, and developers are seeking to provide it to them. There doesn't need to be a fixed "cap" for game prices, because not all game experiences are equal. A downloadable game on PSN or Xbox Live costs less than a full retail release for a reason - XBLA games don't have as many features as blockbuster titles. Adding a new "super game" price point can only be a good thing, as far as we're concerned.

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This fall, Activision plans to release its hotly-anticipated shooter Modern Warfare 2 for sale in Britain at the price of £54.99 (\$90 USD). A special edition prestige bundle will be even more expensive. This has raised the ire of both gamers and industry analysts, who see it as either an example of prices creeping upwards, or bad strategic planning in the midst of an economic recession. For the record, Activision claims that the price hike has to do with the weakness of the British Pound against the Euro, causing goods in that country to become still more expensive. Gamers, always ones to prefer a bargain when it comes to our favorite hobby, have reacted negatively to the news, with some even threatening to \"boycott\" the game when it arrives at a higher price. The reason, they argue, is that if customers are willing to pay a higher price for a premium game, then other publishers will get the idea that they can charge this new higher price for their own titles, making us all a little bit poorer in the process. The truth is often more complicated, and in this case a price hike for current-generation titles could actually help the industry and gamers. Here's why.\n\nThe current UK £45 and USD \$60 price point has been in effect for a good while, since at least the waning days of the previous generation. The market settled on this price for new games because it seemed like a fair balance between value for consumers and profit for developers. Many new games sold successfully at this price, because it was what gamers were willing to pay. Other titles, that weren't so deserving of our money were neglected and quickly put on sale to make them more attractive to potential customers. \n\nThe problem now is not that developers have somehow become more greedy, seeking to extract more profit from the same old product. The issue is that developers are having a hard time providing us the value that they want to offer at the current price point. Next-gen games were supposed to be bigger, more spectacular, and more interactive than the previous generation. So why should they cost the same amount of money? The \$60 price point has actually become a constraint on developers, potentially causing them to cut features from game development, worrying that they will only be able to charge a fixed, last-generation price for the title when it ships. \n\n\n\n $\"ModernWarfare2-screen.jpg\"$ \n\nModern Warfare 2 will be the most expensive game on shelves in the UK this holiday.\n\n\n\nThe proof is in the fact that many \$60 games are quickly followed up with downloadable content adding new maps, levels, and experiences that couldn't profitably have been included in the main game. Developers are recouping the real cost of game development by nickel and diming us on DLC, a practice that would be curtailed if they included the \"full\" experience at the price of their choosing to begin with. If we really want to unleash the power of the current generation of gaming hardware, we should encourage publishers to charge whatever they want for new games. If they want to make a \$80 or even a \$100 game, let them do it. If a game is truly worth \$100, we'd love to play it. If not, we'll wait for the price to drop to a more acceptable level.\n\nThere is an old aphorism which goes \"a businessman could be a millionaire, if only he could find a way to provide a million dollars worth of value.\" The same is arguably true in the video game industry, where consumers are constantly on the lookout for value, and developers are seeking to provide it to them. There doesn't need to be a fixed \"cap\" for game prices, because not all game experiences are equal. A downloadable game on PSN or Xbox Live costs less than a full retail release for a reason - XBLA games don't have as many features as blockbuster titles. Adding a new \"super game\" price point can only be a good thing, as far as we're concerned.\n\n\n\n
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