I think it would be smarter to cut down that margin per-unit and see a 10x increase in sales.
With the dlc and microtransactions model most games are employing this is likely to happen to some extent.
I think it would be smarter to cut down that margin per-unit and see a 10x increase in sales.
which is why they should be cheaper
Likely, but how close to stock shipped to stock sold are Sony likely to be?
It cant be more than 1-2 million at worst.
And in previous years, MS has been anecdotally reported to stuff channels in the US at least during the christmas period. They over shipped last december for sure, as there wer e Ass Creed bundles bleeding out of warehouses everywhere according to GAF posters in the know,.
So what are your personal guestimates?
iTunes albums are generally $3 or so less than CDs and a solid $10-25 less than records.Not sure if thats possible, wouldn't this undermine brick and mortar stores? Feels like its against competitive regulations...but this is my gut feeling, would be nice to find out.
I'm beginning to think XB1 numbers really fell of a cliff this year.
I hope we get some new numbers this year
If consoles go all digital who's gonna sell the hardware? Shelf space is at a premium in big box retailers, and console hardware margins aren't exactly baller for the stores.
Lol what? Why would a company devalue there own product AND undercut there brick and mortar partners?
An items price is optimized base on how much it takes to produce AND how much people are willing to pay for it. A cheaper distribution method doesn't nullify the fact that companies seek profit, on top of covering all of their other operation costs.
Just because it's cheaper to ship a digital item doesn't mean that item is worth less to consumers.
Brick and Mortar retail is on the decline as well. More and more people are shopping online. I rarely ever buy anything in a store. It appears at my front door and I didn't need to leave the house. Caring about what a fading relic is doing much less letting them have so much control over the industry is silly to me. The quicker more people shop online and buy digital goods the quicker we can move on from this outdated model.
iTunes albums are generally $3 or so less than CDs and a solid $10-25 less than records.
Lol what? Why would a company devalue there own product AND undercut there brick and mortar partners?
An items price is optimized base on how much it takes to produce AND how much people are willing to pay for it. A cheaper distribution method doesn't nullify the fact that companies seek profit, on top of covering all of their other operation costs.
Just because it's cheaper to ship a digital item doesn't mean that item is worth less to consumers.
It is worth less though, once purchased a digital product has no resale value verses a physical one.
It is worth less though, once purchased a digital product has no resale value verses a physical one.
Another way of phrasing this is to say: If consumers are dumb (read: passive) enough to keep buying something, keep selling it. It's business. Publishers don't owe consumers anything whether we like to create that illusion or not. 'Fairness' is a word you likely won't find in many consumer electronics business models.
It will always feel icky though. The only way it would ever have changed is if consumers (read: general consumers) were informed enough to realise they were paying over the odds. Too late now though
Those are all questions for the hardware designers to answer for themselves, I'm merely pointing out where it could lead.
It really isn't that much of a leap considering Microsoft has subsidized the cost of their hardware for three straight generations via Xbox live, and now Sony's on that gravy train too.
What's to stop them from one or two gens from now offering a locked version of their next system at 200$ down with mandatory payments each month to gain access to the online ecosystem to both download and access your games? The infrastructure is already there, really.
The XB1 would have been dead of arrival if they stuck to their original plan. They would have done significant damage to the Xbox brand and would have been used as proof that all digital is a negative thing. It wasn't a good plan and they did a terrible job convincing gamers that it was. They would have been the opposite of a driving force for change.A lot can change in 6 or 7 years
Hell, Microsoft can flip the switch and return to their original vision 4 years from now, they should have kept that decision and been the driving force for change, they had they money to take that hit....but no
They probably lost even more money because they are too busy trying to be number one instead of thinking long term big picture
Brick and Mortar retail is on the decline as well. More and more people are shopping online. I rarely ever buy anything in a store. It appears at my front door and I didn't need to leave the house. Caring about what a fading relic is doing much less letting them have so much control over the industry is silly to me. The quicker more people shop online and buy digital goods the quicker we can move on from this outdated model.
Brick and Mortar retail is on the decline as well. More and more people are shopping online. I rarely ever buy anything in a store. It appears at my front door and I didn't need to leave the house. Caring about what a fading relic is doing much less letting them have so much control over the industry is silly to me. The quicker more people shop online and buy digital goods the quicker we can move on from this outdated model.
20% right from a horse's mouth. But wow at the margin expansion. Extra content sales show how publishers are really monetizing core users. Pretty smart and maybe cynical. I'm not sure.
But with Phil Spencer they could do it, I tweet him about it every 3 months, when I have free time I'm going to make s thread about the original vision.The XB1 would have been dead of arrival if they stuck to their original plan. They would have done significant damage to the Xbox brand and would have been used as proof that all digital is a negative thing. It wasn't a good plan and they did a terrible job convincing gamers that it was. They would have been the opposite of a driving force for change.
There are people on here who work in retail that still regularly hear customers telling other people not to buy XB1 because it doesn't support used games. They delivered their message so poorly that inaccurate statements like that became fact. Even Jimmy Fallon said the PS4 was the only one that supported used games to an audience of millions.
MS was nowhere near prepared to make any positive changes for anyone.
It is worth less though, once purchased a digital product has no resale value verses a physical one.
Of course it is. But we are in the informed minority.The vast, vast majority of consumers aren't armed with that level of knowledge though.
Why do they have to be dumb? Why can't you just recognize and appreciate that people value things differently , and any smart company will position their products to capitalize on people values, whatever they maybe.
I haven't resold a game in 15 years. Why? Because I stopped buying games that I don't want to play for a long time. By the time I'm done with my games, they have no resale value. So resale value means jack shit to me. Does valuing the ability to carry all my games with me on a single hard drive make me a dumb customer? Or valuing the ability to pre-load. Or not having to worry about my discs failing or being lost or stolen? Or the ability to share games with my brother 500miles away?
Sheesh
I am simply pointing out that selling digital products for less than physical doesn't represent some sort of illegal activity or go against any regulations as the previous poster indicated it might. Digital movies are all sold much, much cheaper than physical as well for the record. It is the norm in every field but video games.Apple has fucking redonkulous markup on their products though. Hence retailers loving to sell Apple products because they make money up front on each device sold.
Sure they don't make any cash from iTunes, but Target or Best Buy already brought the cash in.
Consoles on the other hand have always had notoriously shitty margins.
Plus Vinyl is a niche market. Companies know this and price/produce accordingly.
I am simply pointing out that selling digital products for less than physical doesn't represent some sort of illegal activity or go against any regulations. Digital movies are all sold much, much cheaper than physical as well for the record. It is the norm in every field but video games.
Then reduce the damn prices to drive greater volume. When are they going to understand.
We already knew they were making a bigger profit on digital.
It's worth less TO YOU because you value the idea of reselling a physical copy over the convienience of digital. Not everyone feels that way. That's why there are options.
If companies lowered the cost of digital to bring it in line with YOUR INDIVIDUAL values, they'd be devaluing their IP potential as a whole.
I clearly said "Dumb (read: passive)" for a reason. Yes perceived value plays a part, but its an unarguable fact that a physical copy of a game costs more to produce, ship, stock and sell than a digital copy. This comes down to consumer knowledge. It's not a slight against consumers, its just the average consumer has no need to think about that.
Every field but video games doesn't have proprietary device hardware IE the PS4 or Bone or Wii U that is sold at razor thin margins.
You can't just do half the comparison.
Do you think sales would increase ten-fold, if the prices were cut by.. say 50%?
This is based on what?
I don't think there is anything to back this up whatsoever.
With the dlc and microtransactions model most games are employing this is likely to happen to some extent.
Firstly how can ANYONE know 100% that a digital purchase will be worth it, it's a risk and physical gives you the option to not take a ~£50 'leap of faith' (not to mention I can buy the thing physically cheaper anyway.
Secondly, how is it devaluing the IP by making less (instead of the same) profit? If I go to a wholesaler I expect not to pay retail, is that devaluing a product? No, it's paying a fair amount because I've cut in one level before another layer of profit is added.
I'm just asking for fairness in digital pricing, you're making it sound like I want it half retail price...and I can assure you I'm not alone in this thinking.
Everything you've said is completely irrelevant to any discussion of regulatory issues.
Who said its about regulations?
The whole thread is about the move to digital and the hurdles that are out there.
Seriously who the fuck in this thread is talking regulatory nonsense?
Not sure if thats possible, wouldn't this undermine brick and mortar stores? Feels like its against competitive regulations...but this is my gut feeling, would be nice to find out.
All this tells me is all the publisher whining about needing to nickel and dime gamers constantly because they aren't making money is all BS. Their profits are already increasing under the radar because of the demographic shift towards digital.
iTunes albums are generally $3 or so less than CDs and a solid $10-25 less than records.
Lol what? Why would a company devalue there own product AND undercut there brick and mortar partners?
An items price is optimized base on how much it takes to produce AND how much people are willing to pay for it. A cheaper distribution method doesn't nullify the fact that companies seek profit, on top of covering all of their other operation costs.
Just because it's cheaper to ship a digital item doesn't mean that item is worth less to consumers.
Knowlegable consumers should know that the cost to produce, ship, stock, and sell an item is not what determines the upper limits of its price. Those things are essentially irrelevant to the value of an item when compared to other factors like, supply, demand, and development costs.
No one bases prices on how much it costs to distribute them. It's based on how much people are willing to pay. That's how you run a successful business.
In this situation, that's exactly what it means. In terms of monetary value, it's literally worth nothing as soon as you buy it. The physical one drops maybe 10% if you sell it close to launch. I bought BlopsIII for £40, then sold it for £35. If I'd bought it digitally I'd have lost £40 and been stuck with it.
New digital only console in 4 years time. Believe.
- Last quarter for EA full-game downloads represented 20% of all XB1\PS4 copies. Expect the share to grow to 40% over the next 3-4 years.
If you could "resell" or "trade in" digital sales would probably reach 40% next year. It's usually the only thing that really holds me back from going 100% digital.
I think the retail industry is a lot more powerful in the videogame space than in the music space.