Wed. Sep 28th, 2022

After announcing a higher-than-normal MSRP of $70 for NBA2K21 on the PS5 and Xbox Series X last month, publisher Take-Two is now suggesting that a higher price may not be the standard for its next-generation console games in the future.

“We will certainly announce prizes by title,” CEO Strauss Zelnick said in an earnings call on Monday evening. “I would just note that there hasn’t been a price increase on the front line in a very long time, even though costs have gone up significantly.”

That’s a fair point: The functional ceiling for high-end games was last raised in 2006 or so, when the standard rose from $50 to $60 alongside the Xbox 360 and PS3 rollout. Adjusted for inflation, the highest asking price for big budget games has never been lower, while development costs have never been higher.

Despite that pressure, however, Zelnick was unwilling to set $70 as his company’s new de facto standard price. “We apply this award in case we think the quality not only supports it, but also requires it,” he said. “Production costs have skyrocketed. But most importantly, the consumer experience is more robust than ever before. And I am absolutely convinced that NBA 2K21 will be nothing short of extraordinary, so I don’t expect there to be any concerns.”

Zelnick’s comments elaborate on a less specific, more anonymous statement from the company in July: “2K’s suggested retail prices for its games are intended to represent value on offer,” a 2K representative said at the time. “With near-endless replay value and many new additions and improvements only possible on next-generation consoles, we believe our updated MSRP fairly represents the value of NBA 2K21.”

An outlier or a harbinger?

While it’s still early in the console’s transition cycle, no other publisher has publicly followed Take-Two in terms of $70 game pricing to date, not even as a trial balloon. In contrast, Yves Guillemot, CEO of Ubisoft, explicitly said in a recent earnings call that his “Christmas games” for 2020 would be sold at the current standard price of $60.

Microsoft’s Phil Spencer evaded the question of the $70 price for games in a recent interview with The Washington Post, and declined to comment on its own pricing for first-party games going forward.

“As an industry, we can price things what we want to price them, and the customer will decide what’s the right price for them,” he told the Post. “I’m not negative about people setting a new price level for games, because I know that everyone is going to make their own decisions based on their own business needs. But gamers today have more choice than ever. Ultimately, I know that the customer has control over the price they pay, and I trust that system.”

Despite publishers’ public silence, some industry watchers see the new, higher price as almost inevitable at this point.

“IDG works with all major game publishers, and our channel checks indicate that other publishers are also looking into increasing their next-gen prices for certain franchises,” Yoshio Osaki, CEO of analyst firm IDG, told last month. While development and publishing costs have risen and prices in other entertainment industries have also risen significantly, next-gen software prices have not reflected these increases. $59.99 to $69.99 doesn’t even fully cover these other cost increases , but it does move it more in the right direction.”

Ultimately, it may be up to gamers to vote with their wallets to determine whether an extra $10 per game exceeds some sort of spending breakpoint. “The typical console gamer only buys a few full-length games a year, so while a $10 price hike may reduce margin demand, I also suspect more gamers will instead just wait for the price to drop, either for packaged games. games or in digital stores up to $60 or $50.” IDC analyst Lewis Ward told Tom’s guide last month, “So the main effect may be to push sales to a later date for some of the gamers with limited purchasing power.”

“We’ll See If” [$70 is] the standard price for full games on these consoles, but my gut is that it will become the norm pretty soon unless there’s a big revolt from gamers,” Ward continued.

List image by Hughes Johnson

By akfire1

Leave a Reply

Your email address will not be published.