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GameStop Worried Digital Games Are Too Cheap

Avallon

Member
Via: Gamespot
Tony Bartel said:
"Industry will need to work together to continue to price goods in a way that sustains profitability."

GameStop is worried that digital games could drive game prices dangerously low, according to a statement from the company's president Tony Bartel in its most recent quarterly earnings report.

Bartel said that GameStop estimates that $100 million-worth of games have been digitally delivered for free as part of hardware bundles like the Xbox One Assassin's Creed Bundle and the PlayStation 4 upcoming Black Friday Bundle.

"We want to help ensure that our industry does not make the same mistake as other entertainment categories by driving the perceived value of digital goods significantly below that of a physical game," Bartel said (via Seekingalpha.com). "When the free digital token programs end, we believe that the industry will need to work together to continue to price goods in a way that sustains profitability and encourages a great innovation that this category needs."

Bartel also said that recent research indicated that the average price a consumer pays for a full, AAA game download is $22. When asked what price consumers expected to pay for a full game digital download, they said approximately $35.

Two important pieces of information that Bartel didn't mention about that study are which platforms did these consumers buy these games for (Console or PC, where platforms like Steam offer regular sales), and how long after the release of these games did consumers buy them for $22. Later in the call, Bartell said that $22 is "clearly an unsustainable price point for a game that physically is at $60."
 

Two Words

Member
Some games are worth $60. Some are worth $22. It's dumb to arbitrarily declare all games are made equal and cost $60.
 

Tenck

Member
I shouldn't have to pay the same price as someone who buys physical. I'm not paying for the disc, booklet (some hardly even come with one anyways), and box.
 

D3RANG3D

Member
j2YGR5OIJArzE.png
 
Budgets will decrease if prices go down, or publishers will seek new avenues of getting your money that are not healthy (isn't it something like 0.5% of mobile users account for 50% of IAP revenue?).
 

danm999

Member
Later in the call, Bartell said that $22 is "clearly an unsustainable price point for a game that physically is at $60."

For the business that is set on charging $60 for every physical release it can, sure.

For the industry? Hell no. Not every game should be that price.
 

fader

Member
Knew this would happened when their sales numbers came in. KNEW IT

They don't care about the "industry" they only care about how to keep themselves afloat.
 

Falk

that puzzling face
I think that since this is Gamestop we're talking about, and how used games sales factor into the discussion about sustainability of the industry, it should also factor into this discussion since I cannot re-sell the game. So let's say digital games should be priced at what Gamestop sells new vs what they sell used, so 10% of retail.

How's that sound?
 

scitek

Member
Why isn't $22 profitable for digital games? No packaging, no shipping, no retailer cut...what am I missing?
 

-MD-

Member
Digital games are the only reason I buy games, I used to just rent everything on consoles cause of how expensive that shit was.
 

Shard

XBLAnnoyance
Not the first time I have seen such concern but I think the debate is immaterial at this point because that genie is out of the bottle and there is nothing to change the overall gestalt of Steam Sales and Humble Bundles. Reminds me of the mobile scene, publishers and Apple never intended to have a race to the bottom and then have the rise of F2P to the point where premium apps are at best a curiosity but that is just the way the market flowed. What does Gamestop intend to do to fight digital sales in the here and now?
 
So basically Gamestop is just annoyed because consumers can't trade those digital freebies back in for seven cents or whatever the trade value is on new releases.
 

Lirrik

Member
"Don't you dare make digital games cheap!"

I think what GameStop is actually worried about is that most people will start buying digital on consoles as right now on PC which means less money for them and no preowned games which means even less money. If preowned games don't exist, GameStop will be close to death.
 

Shard

XBLAnnoyance
"Don't you dare make digital games cheap!"

I think what GameStop is actually worried about is that most people will start buying digital on consoles as right now on PC which means less money for them and no preowned games which means even less money. If preowned games don't exist, GameStop will be close to death.

Yea, pretty cleat that is the real fear given that they just too an earnings bath.
 

Shengar

Member
Not the first time I have seen such concern but I think the debate is immaterial at this point because that genie is out of the bottle and there is nothing to change the overall gestalt of Steam Sales and Humble Bundles. Reminds me of the mobile scene, publishers and Apple never intended to have a race to the bottom and then have the rise of F2P to the point where premium apps are at best a curiosity but that is just the way the market flowed. What does Gamestop intend to do to fight digital sales in the here and now?

Mobile market and Steam+Humble Bundle is different. The former have default low price, while the latter requires you to wait before you can save worthwhile pennies.
 

//ARCANUM

Member
Console bundles have been around since at least NES. The only difference is that instead of including a physical copy of the game, they're including a digital copy. GameStop is just pissed cause it's less copies that people will trade in.
 
Digital console games are too expensive.



Exactly. They should be cheaper than physical games imo. Not every game should be and is worth $60 and publishers are generally sticking that price on literally all releases regardless of their quality or if they are complete or not.
 

Shard

XBLAnnoyance
Mobile market and Steam+Humble Bundle is different. The former have default low price, while the latter requires you to wait before you can save worthwhile pennies.

They are different but for how long can the console market resist the influence?
 
In the EU region, digital games are totally insane, both PC and consoles. The utter insanity that Steam charges in EU seems like a plot to keep retail PC alive.

Consoles are even worse because there are no third party key sellers. Amazon US's PSN key store is completely pointless because it very rarely price matches its retail sales.
 
So this basically boils down to GameStop whining, and saying "Bew Hew Hew! Publishers and developers aren't brown-nosing us as much as they used to, and people are getting actual good deals on digital platforms like steam months later down the line, while we stubbornly freeze our prices and refuse to budge the value of our games outside of second hand games, oh woe is us, waaaah!"

Besides, have they ever actually had a look at the console's digital storefronts? Games are often more expensive digitally than they are in the shops! Most of the games in the UK MS store for example are £5-£10 more expansive than in retail these days
 
Is colluding on price points to artificially inflate the cost of the good illegal? Isn't that basically what he's saying?

I'm not a lawyer. It could be perfectly legal.
 

Tenck

Member
In the EU region, digital games are totally insane, both PC and consoles. The utter insanity that Steam charges in EU seems like a plot to keep retail PC alive.

Consoles are even worse because there are no third party key sellers. Amazon US's PSN key store is completely pointless because it very rarely price matches its retail sales.

Actually complain to the right people? Publishers are the ones who set the price.
 

drgambit

Banned
Cover art: $
Art Department: $
Disk to put the game on: $
Manufacturing costs: $
Box to put it all together: $
Manual: $
Shipping Costs: $

...etc

I could go on, digital games need none of these, and should be cheaper as a result.
 
Actually complain to the right people? Publishers are the ones who set the price.

Valve recommends prices to publishers, which includes the "you are in EU so you pay more, fuck you" tax. Publishers can choose not to follow Valve's advice, but most indies aren't going to bother to find out the exchange rate for twenty different currencies that Steam operates in, trusting Valve instead.
 

FlyinJ

Douchebag. Yes, me.
The slow, agonizing death of GameStop is going to be so fun to watch.

Lashing out, trying to grab onto anything to stay relevant.

This is going to be a great show. Looks like it's finally starting up in earnest.

Please, do go on GameStop... what was it you were saying? Digital games are too cheap?

Remember a few months ago when they were saying that publishers were going to partner with them to re-sell digital games? That was a good one too.
 

Tenck

Member
Valve recommends prices to publishers, which includes the "you are in EU so you pay more, fuck you" tax. Publishers can choose not to follow Valve's advice, but most indies aren't going to bother to find out the exchange rate for twenty different currencies that Steam operates in, trusting Valve instead.

Recommending isn't enforcing.

Exchange rates are a Google search away, so I don't buy your excuse. They want more money, that's what it is.
 

scitek

Member
The slow, agonizing death of GameStop is going to be so fun to watch.

Lashing out, trying to grab onto anything to stay relevant.

This is going to be a great show. Looks like it's finally starting up in earnest.

Please, do go on GameStop... what was it you were saying? Digital games are too cheap?

Remember a few months ago when they were saying that publishers were going to partner with them to re-sell digital games? That was a good one too.

Once Gamestop's gone, I'll literally have no dedicated gaming shops near me.

Sad to think about :(
 

Tenck

Member
http://i.imgur.com/aaIpz0a.png

Imagine this, but with 10 more boxes. Either trust Valve who conveniently fills in all the boxes for you, or manually enter every single price just to be fair.

Yeah like I said, the developer wants more money. There's no point in blaming Valve when their only hand in the pricing is the suggestion. If the developer wanted to be fair they've got a powerful search engine that brings up currency exchange rates in less than 2 seconds.

Blaming Valve for greedy developer seems odd.
 
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