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The Price is... Right? - A College Student's Opinion

 A paper I wrote towards the end of last year. I am open to feed-back. The sixty dollar game, also known as a game with a price tag of fifty-nine, ninety-nine, is a controversial topic in the United States and has been for the past few years. Many people argue the price should be lowered. However, gaming producers argue that the sixty dollar value, of most brand new games, did not come out of thin air (Is, par. 5). As there is a reason to everything, the reasons people use to argue that the price should be lowered did not come out of thin air as well. A vast amount of knowledge, from diverse factors, should be considered when making an effort to rationalize this set price. Some of the factors include: competition issues, cost issues, psychological issues, and business issues. Due to such determinants, the following question appears. Is the sixty dollar fixed game price necessarily right? Modern Warfare 3, a top-selling first-person-shooter game available on multiple platforms: Play Station 3, Xbox 360, and PC, is a great example of the commonly known sixty dollar game. The consumers believe that such games should not cost as much due to the fact that many other top-selling games are cheaper and can even cost as little as a single dollar (Greenhill, par. 1). Angry Birds, a mobile mini-puzzle game, is a good example of the massive one dollar game collection out on the market today. Now, of course it is impossible for games such as Modern Warfare 3 to cost only a dollar or even close to a dollar. It is understandable that a substantial amount of money is invested in a sixty dollar game to produce and develop; therefore, they cost more. The real question is, with the competition out there, should sixty dollar games really cost sixty dollars and not less?  Despite such competition in the market due to lower priced games, the specific background that belongs to each category is significantly different in various ways. In general, the cost to produce sixty dollar games is exponentially increasing in the millions of dollars (Is, par. 7). On the other hand, one dollar game investments vary but are nowhere near as much as the investments put into sixty dollar games. Not only that, but the expectations of a one dollar game and sixty dollar game are quite different. Logically, both games should not even be compared with each other to begin with, especially cost-wise. Even with the comprehension as to why sixty dollar games and one dollar games should not be compared, what is in the best interest of game developing businesses? Obviously, profit. The number of sixty dollar games being sold has been declining slowly over the past few years. To be specific, there has been an approximate eight-percent drop last year in sales (Greenhill, par. 2). This is due to competition being cheaper, therefore sixty dollar games being purchased less; there are even games that are free. So why not lower the cost? If sixty dollar games were cheaper, there would be more customers, an increase in sales, and profit would be balanced out naturally as well (Qualls, par. 2). There would be more satisfied customers who complained less, not only because of the price drop, but due to expectations being lower. More recommendations and reviews would appear too, boosting the game developing businesses reputations abroad. Simply said, it would be killing two birds with one stone. Although simply lowering the overall cost could be a good fix in the sixty dollar game system, there is more to it than that. According to the president of Namco Bandai, Takeo Takasu, the gap between profit and loss is small (Is, par. 7). Around five-hundred thousand, sixty dollar game copies must be sold to even start seeing profit, and only six-hundred thousand, sixty dollar game copies are sold on average per game title. With such a little margin for error, altering the sixty dollar game business system is vibrantly looked upon. The psychological viewpoint of cheap games being worse in a sense of quality is present as well, leading to fewer customers (Loftus, par. 19). On the other hand, why not make games more expensive? Psychologically, consumers would think the games to be superior due to an increased price, and a price increase is usually not one of the factors that hinder a wiling individual to buy a game (Loftus, par. 22). The gaming hobby is not cheap. With the minimum wage being slightly above seven dollars, gaming can cost a person an arm or leg (Is, par. 8). Sixty dollar games are already financially abusive to the casual gamer; increasing the price does not seem smart at all. Yes, a price increase usually does not hold back a willing customer from purchasing a game, but a price increase will inevitably obstruct gamers that can now afford such games but will not be able to afford a higher price. Another factor includes the losses a company endures due to piracy, illegally downloading and using copyrighted material without paying its price. Each year, over three billion dollars are lost by gaming industries in Canada and the United States due to pirated video games alone (Video, par. 1). This is equivalent to around one-fifth the total value of these gaming industries. With such immense losses to piracy, gaming businesses purposely set their game prices high, in this case sixty dollars, to make up for it (Greenhill, par. 5). Acknowledging how piracy comes in place is huge when understanding the sixty dollar game price. But again, what causes piracy to be such a gigantic issue to start with? The price. Companies state that the set game price is calculated with the piracy factor included. Why not just eliminate the factor? The reason piracy is so colossal, by common sense, is due to the expensive starting price of a game. Therefore, lowering prices would lead to less piracy as well. Again, this all leads back to lowering the price, and the gaming industries rebuttal against it.  Looking at all this from a totally different point of view, many sixty dollar games cost sixty dollars only as their starting price. To elaborate, several gaming titles have additional content created after the release of a game, and must be purchased in order to use. Some companies even holdback additional content to be sold after the release of a game just to see additional profit (Kohler, par. 7). With this in mind, the total game price of a sixty dollar game can be well over sixty dollars depending on the amount of additional content that is released, between eighty bucks and over double the starting price. For one complete game, that is astonishingly expensive. Psychologically overwhelming, lowering the sixty dollar game price seems and should be mandatory now. Then again in most cases, it is important to understand that additional content needs separate investments as well. Without additional investment, additional content is impossible to create. Therefore, setting a separate price to additional content is allowable by common sense. However, should a complete game be as costly as it is today out on the market regarding the information above? No. Price-fixing, the inflation of prices done by indirect means such as preventing export sales to make certain games more expensive in other countries, is another problem we have in the gaming market. For example, Nintendo was fined as punishment with approximately one-hundred and forty-seven million dollars in the year of 2002 for price-fixing (Sinclair, par.2). With some games having higher prices than what they should have, the sixty dollar retailed game price should be considered to have a price drop. Of course not all games have expensive prices due to price-fixing, but when companies illegally create higher prices, not only should they be fined by law, their retailed prices should be lowered. However, not all gaming industries are caught price-fixing and it would not be fair to take such actions by law. After all this quarreling, hopefully I do not come off as an individual that absolutely despises the sixty dollar price for all sixty dollar games. I believe some games are well worth the sixty dollars I have spent. I just do not believe most games are worth sixty dollars in the sixty dollar game category, thus trying to obtain a solution from a fair perspective. Numerous others in the community have beliefs along the same lines as well (Qualls, par. 3). Since lowering the price of all sixty dollar games is more hectic than thought. Could there possibly be another solution to this controversial game pricing system? Possibly, yes. If one has not noticed thus far, all sixty dollar games are set at sixty dollars despite the actual difference in investment per game title. Till now, the main argument over lowering the set price was neglected due to the specific, yet broad reasons that applied. Now, the specific reasons are understandable, but having them broadly applied is not. One example is as follows: regardless of how good a car functions depending on the time, effort, and money put in, all cars are set to a thirty-thousand dollar retail price. Adjustments are expected to be made with the business system since it is inconvenient to customers, not being user-friendly. This is why each and every car has a distinct starting price depending on diverse investments. The sixty dollar game system can be found to be in the same situation, and should be changed accordingly. Finally, a somewhat simple alternative to the sixty dollar game system is found: the getting rid of the fixed sixty dollar retail price. Besides the fact that it will be inconvenient for the gaming industries, setting separate retail prices for each and every game, no real argument is found to refute the proposed alternative. Either way, it can even be beneficial to the gaming industries as it is to the customers. As it gives the producers the chance to set games at a cheaper price or even the opposite, customers would be given a wider range of opportunity when selecting games. As no individual dislikes freedom of choice being expanded, the natural population of gamers would grow as well. Overall, the satisfaction rate of customers would increase, and that is a good statistic for any business. As mentioned, lowering the sixty dollar game price is most likely not happening due to increasing costs of development and production. However, altering the concept of the fixed pricing system itself is a totally different issue altogether. Separate games matched with separate prices, the true alternative where two birds are killed with one stone. The price isnt right? Make it right. Works Cited Greenhill, Rich. Why the End of the $60 Video Game is Near. Yahoo Games. Yahoo Games, 18 Apr. 2012. Web. 06 Oct. 2012. Is the $60 Dollar Price Point too Much? Editorial. New Gamer Nation. New Gamer Nation, 9 May 2011. Web. 06 Oct. 2012. Kohler, Chris. Videogames cant Afford to Cost this Much. Wired. Wired, 13 Apr. 2012. Web. 06 Oct. 2012. Loftus, Tom. Top Video Games May Soon Cost More. Msnbc Digital Network. NBC News, n.d. Web. 06 Oct. 2012. Qualls, Eric. $60 for Next Gen Games is too Much. xbox.about.com. Xbox Games About, n.d. Web. 06 Oct. 2012. Sinclair, Brendan. Nintendo Challenging Price-fixing fine. Gamespot. Gamespot, 20 May 2008. Web. 24 Oct. 2012. Video Game Piracy Statistics. Havoscope. Counterfeit Goods, n.d. Web. 06 Oct. 2012.