The video game industry is no stranger to debates surrounding the pricing of video games, especially in recent years as Sony, Microsoft, and Nintendo, among others, started charging $70 for their games. But, shortly after Capcom claimed that today’s video games are cheaper than they should be, it appears that another company feels the same.
The recent comments made by Take-Two Interactive CEO, Strauss Zelnick, have reignited the conversation.
During an earnings call, Zelnick expressed his belief that video game prices are “very, very low,” considering the value they offer. This perspective, coming from the CEO of the company behind the highly anticipated GTA 6, carries significant weight and has sparked a broad discussion among gamers and industry observers alike.
Zelnick’s viewpoint hinges on a unique valuation model that considers the expected entertainment usage of a game, a process involving multiplying the per-hour value of a game by the number of expected hours of engagement, plus the perceived terminal value if the game is owned rather than rented or subscribed to. By this metric, Zelnick argues, the price of video games offers a substantial value proposition, given the lengthy hours of engagement and high-quality content they provide. He contends that the gaming industry, as a whole, presents an excellent price-to-value opportunity for consumers, despite the absence of significant pricing power or the desire to wield it.
This position aligns with other industry executives, such as Capcom’s president Harushiro Tsujimoto. He also believes that given the rising costs of game development and wages in the industry, a hike in unit prices is a healthy business option. The recent move to $70 for certain frontline products marked the first major price increase in years, suggesting restraint in pricing despite the escalating costs of game development.
However, this is a one-sided argument. A game’s value shouldn’t solely be measured by its length or development cost. Just because a game took hundreds of millions to make, this doesn’t mean it should fetch a high price. The same goes for games that take hundreds of hours to complete.
The quality of a game should not be judged solely by the number of hours it provides. A compelling story, memorable characters, and emotional impact can be just as valuable, if not more so, than raw gameplay length. This is especially true for gamers who prioritize a meaningful overall experience over playtime metrics. Moreover, focusing on shorter, high-quality games could potentially reduce development costs, which is probably why Sony won’t be slowing down with its single-player games anytime soon.
Furthermore, the discussion often overlooks the significant revenue generated by microtransactions in games like GTA Online, where these post-launch monetization strategies have proven highly profitable. This aspect of modern gaming business models adds complexity to the debate over base game pricing. The success of these strategies also raises questions about the need for price increases when additional revenue streams are already being exploited.
We don’t need to look further than Mortal Kombat 1 or one of Take-Two’s best-selling games, NBA 2K24, as examples of premium-priced titles criticized for exorbitant monetization strategies.
Nevertheless, the consensus among gamers is that developers and publishers should prioritize creating engaging, and, to be more precise, more enjoyable games, that offer value through their gameplay and narrative rather than through extended playtime or graphical prowess.
While executives such as Zelnick and Tsujimoto are advocating for higher prices based on perceived value, a more nuanced approach that considers the diverse factors contributing to a game’s worth is necessary. As the industry moves forward, these discussions will undoubtedly continue to shape the future of game pricing and development strategies.
Speaking of Take-Two, Zelnick recently teased that GTA 6 could use AI while confirming that it won’t be affected by a strike should it happen. Finally, GTA 6 will be officially revealed at some point in December.
