Ok, here is something that may not play well with some people, but better let it out than keep it bottled up. It deals with future markets for software and games (including east european and asian countries)
Current software (and game) prices are out of whack. Let me give you some examples...
1) Windows 7 costs about $300 for the most featured one.
2) Good PS3 and XBOX360 games can reach $65 dollars on average, then discounted to $40 after selling for about a year. We are talking blockbusters mainly here (not some cheapo ones that are not on anyone's wishlist).
3) Good PSP games come in about $20 dollars less than that. So about $45 for a good game.
3) A good movie costs about $30 dollars to buy nowadays.
5) A good movie costs about $10 dollars on average in the theatre nowadays.
6) A good iPhone game is about $6 dollars, now moving towards the average $1 dollar price point.
All the above use some sort of Digital Rights Management to prevent copying. In other words, you either pay at that price, or don't watch or play at all. No middle ground, not alternative costs (except for piracy and homebrew). Because consoles lock up who can create games for it (via their DRM signing and disc creation process), the manufacturers in turn dictate the average price for games. There are no alternative market for games. Only those approved. Now lets see who is enforcing what prices. Sony and Microsoft are trying up push UP the prices, while Apple is trying to push DOWN the prices. $60 average to $1 average is a 60 times markup.
Now lets look at the market for software. The biggest number of internet users are now in China, followed by the United States and then Japan. We will concentrate on average consumers (the majority of people who buy games and software), which the largest majority segment fits into the lower to middle class.
The average wage of someone in China earns about $150 a month, pushing $300.
The average wage of someone in US earns about $2000 a month, pushing $4000 a month.
Now lets go down the list of prices to match the population market. Starting with Microsoft, you might think they are nuts to enforce non-pirate copies on a nation with average consumer salary of $200 a month. A person would have to go without food or shelter there for a month or more just to buy an operating system. It would be like someone in the United States spending $4000 for Windows 7 (or Vista or XP Professional). If you thought $60 dollars was expensive for a good console game, imagine paying $4000 just for the right to have an operating system, else the OS gets disabled remotely because it is not genuine. A legitimate price in China would be the same as how much you would pay in the USA. $300 in USA would be about $20 in China in earnings rate. Even so, $300 is still too much in the US, as someone would probably balk at paying more than $100. In that case the price in China should be $7 dollars in that country's earnings rate.
What about games? A $60 dollar blockbuster game in the USA would come to about $4 dollars in China.
What about movies? A $10 dollar theatre in the USA would come to about 80 cents in China.
($30 buy to own is about $2.50)
Which we now come to Apple's iPhone game prices: 99 cents, up to $6.00 This price point matches the market for China perfectly as that is the price that meets the earning rate there. Using these prices, converting from China to US earnings rate, you would spend about $12 dollars up to $100 (which is pushing it near the higher end) So the average price should be around 99 cents to $3 dollars.
For all the above we totally ignore the currency exchange to yuan, and everything is done in dollars (using earning power per country to dictate pricing points). Perhaps now people know why some movies and some games/software will always get pirated, or never bought in certain European and Asian countries... It is just simply unrealistic to enforce prices on a country with different average earnings rate.
So here is the conclusion to the topic of this post: if software and games are to be a global phenomena, rather than catered just to a few countries, then pricing based on earning power needs to be taken into account. Sony and Microsoft are catering to US, Japan, and some European countries. Apple's pricing (only on their iphone) can be catered towards all the rest (including developing ones). You might say open source caters to everyone, as it is free.
So what is the average price that console games should be priced at globally?
Current software (and game) prices are out of whack. Let me give you some examples...
1) Windows 7 costs about $300 for the most featured one.
2) Good PS3 and XBOX360 games can reach $65 dollars on average, then discounted to $40 after selling for about a year. We are talking blockbusters mainly here (not some cheapo ones that are not on anyone's wishlist).
3) Good PSP games come in about $20 dollars less than that. So about $45 for a good game.
3) A good movie costs about $30 dollars to buy nowadays.
5) A good movie costs about $10 dollars on average in the theatre nowadays.
6) A good iPhone game is about $6 dollars, now moving towards the average $1 dollar price point.
All the above use some sort of Digital Rights Management to prevent copying. In other words, you either pay at that price, or don't watch or play at all. No middle ground, not alternative costs (except for piracy and homebrew). Because consoles lock up who can create games for it (via their DRM signing and disc creation process), the manufacturers in turn dictate the average price for games. There are no alternative market for games. Only those approved. Now lets see who is enforcing what prices. Sony and Microsoft are trying up push UP the prices, while Apple is trying to push DOWN the prices. $60 average to $1 average is a 60 times markup.
Now lets look at the market for software. The biggest number of internet users are now in China, followed by the United States and then Japan. We will concentrate on average consumers (the majority of people who buy games and software), which the largest majority segment fits into the lower to middle class.
The average wage of someone in China earns about $150 a month, pushing $300.
The average wage of someone in US earns about $2000 a month, pushing $4000 a month.
Now lets go down the list of prices to match the population market. Starting with Microsoft, you might think they are nuts to enforce non-pirate copies on a nation with average consumer salary of $200 a month. A person would have to go without food or shelter there for a month or more just to buy an operating system. It would be like someone in the United States spending $4000 for Windows 7 (or Vista or XP Professional). If you thought $60 dollars was expensive for a good console game, imagine paying $4000 just for the right to have an operating system, else the OS gets disabled remotely because it is not genuine. A legitimate price in China would be the same as how much you would pay in the USA. $300 in USA would be about $20 in China in earnings rate. Even so, $300 is still too much in the US, as someone would probably balk at paying more than $100. In that case the price in China should be $7 dollars in that country's earnings rate.
What about games? A $60 dollar blockbuster game in the USA would come to about $4 dollars in China.
What about movies? A $10 dollar theatre in the USA would come to about 80 cents in China.
($30 buy to own is about $2.50)
Which we now come to Apple's iPhone game prices: 99 cents, up to $6.00 This price point matches the market for China perfectly as that is the price that meets the earning rate there. Using these prices, converting from China to US earnings rate, you would spend about $12 dollars up to $100 (which is pushing it near the higher end) So the average price should be around 99 cents to $3 dollars.
For all the above we totally ignore the currency exchange to yuan, and everything is done in dollars (using earning power per country to dictate pricing points). Perhaps now people know why some movies and some games/software will always get pirated, or never bought in certain European and Asian countries... It is just simply unrealistic to enforce prices on a country with different average earnings rate.
So here is the conclusion to the topic of this post: if software and games are to be a global phenomena, rather than catered just to a few countries, then pricing based on earning power needs to be taken into account. Sony and Microsoft are catering to US, Japan, and some European countries. Apple's pricing (only on their iphone) can be catered towards all the rest (including developing ones). You might say open source caters to everyone, as it is free.
So what is the average price that console games should be priced at globally?
