The video game industry is heavily leaning towards subscription services. But, despite the proliferation of such services, subscription fees remain on the rise.
Sony just increased the price of its PlayStation Plus 12-month subscription last month. The roughly 30% hike covers all subscribers worldwide and across all tiers. A 12-month subscription for the PlayStation Plus Essentials is up from $59.99 to $79.99, the PlayStation Plus Extra from $99.99 to $134.99, and the highest-tier PlayStation Plus Premium from $199.99 to $159.99.
The console maker gave a brief statement when it announced the price hike, saying, “This price adjustment will enable us to continue bringing high-quality games and value-added benefits to your PlayStation Plus subscription service.”
In a recent interview with Barron’s, Sony defended its recent price hike, saying that it had to adjust to prevailing market conditions. According to Sony Interactive Entertainment’s Head of PlayStation Network Eric Lempel, the company had no choice but to raise the annual subscription fee for PS Plus.
“Like practically everything else in the world, we have to look at our pricing and we have to adjust to market conditions,” Lempel explained. “We want to make PlayStation Plus great. With our reboot last year and introducing the tier system, a lot of consumers have recognized that there’s a lot of value in PlayStation 5.
He adds, “I’m happy to say, unlike a lot of other subscription services out there, we haven’t touched the PlayStation Plus pricing for 85% of the world in many years. So, this was the first time we did something there.”
The cost of subscription services for games has been on the rise for several months with both Sony and Xbox getting a price hike. This comes at the heels of an increase in subscription fees for streaming platforms like Apple TV+, Netflix, and Disney+. Most companies cite unfavorable market conditions and the rising cost of producing content as the main drivers for the price increase.
In the video game market, we have seen that games are getting more expensive to produce. During the recent hearings for Microsoft’s acquisition of Activision Blizzard, the CMA reported that some major developers report that their AAA titles can cost over $1 billion to make. Activision’s Call of Duty: Modern Warfare 2 already costs $300 million to develop, and when you factor in the hundreds of millions for marketing, the total bill could easily reach $1 billion.
While most of Sony’s AAA titles do not arrive on its PS Plus subscription services on Day 1, many AA or indie titles do. And even the cost to develop lower-budget video games is getting more and more expensive. Sony does need to pay for these titles to be on its PS Plus service so it is somewhat understandable that the company just wants to keep its profit margins.
What do you think about the most recent price hike? Is it still worth subscribing to the PlayStation Plus with the new pricing theme? Let us know in the comment section below.
