The companies that sell video games are all staying relatively quiet about whether they plan to universally hike game prices from $60 to $70 with the launch of next-gen consoles later this year. But of the more vocal ones, massive publisher Take-Two Interactive has flip-flopped in its public statements of late, causing a bit of confusion in the process.
After initially becoming the first company to say it would hike the price of next-gen versions of NBA 2K20, CEO Strauss Zelnick now says that may not be the company’s plans for all of its next-gen titles going forward. “We’re definitely announcing pricing on a title by title basis,” Zelnick said in an earnings call Monday evening (via Ars Technica). “I would just observe, there hasn’t been a frontline price increase for a very long time, although costs have increased significantly.”
Video game companies appear wary to hike prices up to $70 per game
Zelnick echoed that sentiment in an interview yesterday with Gameindustry.biz, saying that rising development costs may influence pricing in the future. “There hasn’t been a price increase for frontline titles for a really long time, despite the fact that it costs a great deal more to make those titles,” he said. “And we think with the value we offer consumers... and the kind of experience you can really only have on these next-generation consoles, that the price is justified. But it’s easy to say that when you’re delivering extraordinary quality, and that’s what our company prides itself on doing.”
Game companies can sell their products for whatever price they like, and there’s plenty of justification for raising prices by $10 per unit considering major publisher games have both stayed the same price for nearly 15 years and become much more expensive to make. Many publishers and developers have offset those rising costs by treating games as services and adding in new forms of monetization — like microtransactions, battle passes, seasonal content, and other digital goods. But some games don’t monetize as well as Fortnite or Call of Duty, and so it makes sense some companies would consider a price hike.
The only issue is that it seems no one company wants to be the first to take the official plunge. Take-Two has been the most vocal, but even then, it only said it would raise the price of one game, and only for the PlayStation 5 and Xbox Series X versions. Ubisoft has said it would keep its next-gen releases this fall at $60, as those games are already up for preorder now and also involve cross-gen releases for existing platforms.
But the large platform holders are also remaining silent. Nintendo hardly ever comments on pricing, and Sony hasn’t even greenlit preorders for next-gen third-party launch titles for the PS5. We came close, with Xbox chief Phil Spencer’s comments to The Washington Post. “As an industry, we can price things whatever we want to price them, and the customer will decide what the right price is for them,” Spencer said in the interview last month. “I’m not negative on people setting a new price point for games because I know everybody’s going to drive their own decisions based on their own business needs. But gamers have more choice today than they ever have. In the end, I know the customer is in control of the price that they pay, and I trust that system.”
But Spencer’s comments suggest it will be up to publishers and developers to make this decision on their own. Of course, when one company does it, others will likely follow — so long as there isn’t a harsh and vocal rejection from consumers. Take-Two, which owns Rockstar and other popular subsidiary studios, can certainly get away with being the trailblazer here if it wants. But it seems like even Zelnick is a bit wary of a full-throated commitment to the $70 video game.
So we’ll likely have a much better idea of the pricing strategy come this fall when the launch slates for both next-gen consoles are more solidified, unless publishers decide to punt on the decision and wait until next year.