Make It Big In Games - Latest Comments in Game Pricing, Look Out Below

Re: Game Pricing, Look Out Below

nintendowiigames — Fri, 22 May 2009 22:36:02 -0000

Nice post Jeff.

You are bit off-the-mark here though. We will be heading towards a pricing point where we actually PAY users to play the game... :)

> "When we first started the GarageGames Game download store, I advocated for, and won, a $14.95 price point."
Gotta tease a bit, but did you actually test that price point - or was it won over by argumenting? ;)

Re: Game Pricing, Look Out Below

Jeff Tunnell — Mon, 09 Mar 2009 16:54:06 -0000

I didn't say there not be hits. There will be. How do you make hits? I don't know, nobody does. There are things you can do to improve your chances, but it is too much to put in a comment. Most of my blog is about what you can do to improve your chances.

Re: Game Pricing, Look Out Below

CaRteR — Sun, 08 Mar 2009 13:35:37 -0000

I think you're forgetting one thing. Games aren't a commodity or a piece of functional technology. Their entertainment. As long as entertainment has existed it's been hit-based. Go back one, two, three decades - there was slots of sludge, and yet there still managed to be those rare hits.

It's about making hits. How do you make the hits? That's the question.

Re: Game Pricing, Look Out Below

Gamer Review — Sat, 07 Mar 2009 16:56:03 -0000

The current market can't handle non AAA console games at $60. That's why Call of Duty World at War went down to $50 a few weeks after launch. The lower prices are also caused by the used game market where Gamespot had a huge stockpile of used CoD WoW and they had to lower their prices to get them to sell. This means that Activision, the publisher, is getting less profit from the lower price point and is also getting no money from the reselling of the games by Gamestop for example.

Re: Game Pricing, Look Out Below

Gareth Fouche — Fri, 13 Feb 2009 17:51:58 -0000

Sure, I can see how it would work.

I would argue that MMOs are more inclined to this direction though due to the pressures of their unique market. MMO makers in the west have run into a wall. MMOs aren't like single player games, you're asking people to pay hefty subscriptions. But these games are designed to waste lots of time, to maximize the time you spend subscribed. End result : People choose one or two MMOs to subscribe to at a time then do so for long periods. It's not like an 8 hour shooter where the same shooter customer might enjoy a new title every month if they can get it.

And then you introduce WoW into the equation, the 400 pound gorilla, the game that has 11.5 million subscribers. New MMO makers are realizing that competing with WoW is very difficult, you can't just appeal to that segment with a similar game, you actually have to pull them out of WoW. MMO player's inclination to only pay for one MMO at a time combined with the presence of WoW means you have a real problem as a new MMO trying to "break in".

The freemium method cunningly counters that. Your game is free so people are more likely to try it, you can get them to play your game without forcing them to decide to give up WoW, which is otherwise a huge mental barrier.

The key point I'm trying to make is that, in my opinion, this downward pressure isn't due to a huge supply of MMO titles like it is with casual match-3 games. There are only a handful of MMOs on many westerner's radars. The pressure comes from the subscription payment model which means that the opportunity cost of playing game X is that you have to decide to give up game Y.

I don't know if that translates to single player games directly, they don't have that kind of barrier to overcome. You can make shooter games similar to last year's popular title and expect the same segment to purchase it, assuming it's good. Players can enjoy two games in a short period without having to choose between them. If two good story based RPGs come out in a month I'll buy them both, even though I'd never subscribe to 2 or 3 MMOs at the same time. I don't have to choose to sacrifice one for the other.

Maybe if the market was so saturated with RPGs that I simply didn't have the time to play all of them it would hold, but we are a long, long way from that I reckon. It's not like casual match 3 games. And I don't believe that the MMO model shifting towards free is a sign of imminent conversion to freemium for most of the mainstream genres, it's more due to the problems of the MMO model that I talked about.

I DO think we'll see the rise of micro-transactions as a way to enhance income for the mainstream. Not necessarily replacing the current model altogether though.

Re: Game Pricing, Look Out Below

Jeff Tunnell — Fri, 13 Feb 2009 13:24:06 -0000

I am sure it will apply to much more than casual games. Already I am seeing people convert from paying $15 per month to play WoW to playing free Korean games. I am not saying that free does not mean you won't make money. Freemium is a marketing method and a business model that is taking over the old ways of doing things. If you use the free version of your game to gather in players and then have a method of making money by having them willingly purchase items or access or whatever, you will still succeed.

I do agree this process will take years. In the meantime, if you have a defensible niche that allows you to charge more for your products, that is great.

Re: Game Pricing, Look Out Below

Gareth Fouche — Fri, 13 Feb 2009 12:48:23 -0000

Hmmm, I think this post probably applies to casual games, I haven't really got my finger on the pulse of that market, but from what I see it doesn't apply to another type of indie market and won't in the near future. The market for hardcore, under-served, ex-mainstream niches.

Me, I hang around some fan sites built around old school, hardcore RPGs, it's what I'm making myself. The type of game that takes a long time to make, the ones that are so costly and time consuming to make that the mainstream is once again moving away from them (as they did a decade ago before Baldur's Gate revived the genre). On the sites I hang around there are large numbers of fanatical fans who sit twiddling their thumbs for 2-3 years at a stretch waiting for new titles and complaining about the drought. Then when one comes out, they finish them in 2 months and go back to waiting and complaining. The mainstream is always looking for bigger markets, when these niches don't have the numbers to support them they move on and it remains under-served. Similar niches exist for flight sims, wargames, etc. And I'm seeing indies start to move into those spaces to varying degrees.

But I'm not seeing any evidence of those niches becoming saturated to the point of titles being so interchangeable as to be worth $0. These games are simply too costly to make. Tools can only help to some degree, the huge volume of things like writing and content creation means you can't just whip one up in 6 months easily. And you can't just reskin the old game and expect people to buy it, it would be like expecting people to buy a book when it becomes obvious you've just changed the names of the main characters. Like books, the "soul" that the author puts into it seems to be really important and not easily exchanged or shared across mass produced titles.

I suppose they could end up that way, eventually, but I'd estimate that as being more than 20 years off, at least. And I believe it will be far more likely to become like books are today. Rather than everyone selling for $1, popular studios will sell for $20 and unpopular ones just won't sell.

Re: Game Pricing, Look Out Below

EricPreisz — Mon, 09 Feb 2009 23:29:12 -0000

I think the $0 price tag will be really powerful when PC prices drop more and the middle class of India and China grow some more. Advertising may be more valuable than the up-selling of premium services.

Re: Game Pricing, Look Out Below

Steven Egan — Sat, 07 Feb 2009 18:21:14 -0000

There is a form of in-game advertising that could be a big deal, if done right. The idea is to look at your game and see if there is anyplace where you could make the game better with real things being used properly. Then, see if you can get some interest. John Deer isn't likely to be interested in an Indie Farming game, but Texas Instruments might be interested in product placement in a game where math is a big deal. Product placement is just the tip of the ice burg, however it needs to be worth it for the people you approach.

This is not making games for others. This is not designing a game around a product. This is seeing how your design parallels reality, and asking if related companies would be interested in helping out. Maybe it isn't money. Research can be a great source of design ideas and direction.

Obviously you would want to have something to show that you are serious and will do a good job.

Re: Game Pricing, Look Out Below

Jeremy Alessi — Sat, 07 Feb 2009 15:27:10 -0000

All technology starts out sparse, expensive, and unreliable. It eventually becomes common place, cheap, and polished. Because video games are based in technology they will follow this pattern.

Therefore, I agree with your assessment. However, there will always be room for straight up paid games as long as we have money and a free market.

Re: Game Pricing, Look Out Below

Jeff Tunnell — Sat, 07 Feb 2009 11:32:19 -0000

Hey, Russ, nice to see you out here. I bet things are crazy for you getting things tied in at Amazon. I think you guys will be able to do a lot for Indies, and I look forward to seeing how this all plays out.

Re: Game Pricing, Look Out Below

Russell Carroll — Fri, 06 Feb 2009 15:25:50 -0000

You make some good points here Jeff. I appreciated your thoughts.

Re: Game Pricing, Look Out Below

Alex Schearer — Thu, 05 Feb 2009 22:30:04 -0000

Tried to do a trackback since this ended up being longer than a comment...

In a nutshell I think that games will continue to sell for some price above $0 as long as there are consoles and other locked platforms. These create an excludable good which I think solves the problem facing the music industry. Anyhow, feel free to read more.

Re: Game Pricing, Look Out Below

jgostylo — Thu, 05 Feb 2009 17:00:50 -0000

I think you assumed something that I was not. I never said anything about making great music or even making a living playing music. There are 4 million bands on MySpace but how many of them make a living at it? I thought we were talking about the aggregate community. I am saying that the reason so many people make a band and have a go at it is because they can find small, fruitful, and closely spaced activities as a reward for their efforts. Very true that so few of them will make it big because that is really hard.

I think the confusion was that my wording was off. I did not mean making a game is more conceptually difficult, but I think THE IDEA of making a game is. Most people don't get even rudimentary training with computer programming or
design concepts when they do get some music training. I think it is hard for people to conceptualize what really goes into make a game because they have never seen a game get made. Many people still consider the computer to be a "magic" box when they innately understand the most basic concepts of musical instruments. And while being able to play an instrument is different than making money in a band, most people know someone who started a band while few know someone who tried making a game.

Mastery of both requires exactly what you have stated but I am trying to say that most aspiring game developers get stopped at the door while 3.999 million MySpace bands spend years getting nowhere with dreams kept on life support by small gigs. I think that is because the idea that I can make a game is more conceptually difficult.

My opinion is that it is easier to make a living making games than being a musician, but I still think more people believe they can be a musician than a game maker.

Re: Game Pricing, Look Out Below

The 1nteger — Thu, 05 Feb 2009 14:14:45 -0000

Yeah, I got the sense that you guys were attempting to take web gaming to the web 2.0 so to speak so I'm looking forwarding to seeing what you guys come out with, especially considering that I moved to flash & a more web strategy myself about 6-8 months ago. Engine sounds interesting too (Box2D was a bit of a pain to get working for the game I have in development currently). I look forward to hearing/seeing more! :-)

Re: Game Pricing, Look Out Below

Jeff Tunnell — Thu, 05 Feb 2009 13:41:32 -0000

I am right there with you on this, Leroy. The eventual goal of Push Button Labs is to have out own portal filled with our own games that people are willing to buy from us at a higher price or at least conversion rate than we can get at generic portals. I will be writing blog posts about this in the future. Great observation!

Re: Game Pricing, Look Out Below

Jeff Tunnell — Thu, 05 Feb 2009 13:38:21 -0000

We did put out our first batch of games at $14.95. We raised them to $19.95 about six months later. GarageGames simply did not have enough traffic to make the lower price point work. We didn't have enough games or critical mass to change the games market the way we changed the price point of game engines.

Re: Game Pricing, Look Out Below

The 1nteger — Thu, 05 Feb 2009 13:29:13 -0000

**Sorry, this is longer then intended :-)
That precisely what I mean. A big part of the reason this price drop is happening is because a lot of games and game developers are becoming too monochrome (I could say the same for myself up until now). They look similar, they have the same sh*tload of other portals games on their site so you can't find their own games, they price the products the same as everyone else, they don't experiment with the status quo, they have same graphics style, they create average versions of games you can get on the shelf etc. Just too samey, not really independent (like those you mention above and below) other then the fact that they do most of the work themselves and bootstrap. In other words as Seth Godin would say, their unremarkable. In that respect unremarkable products should be commoditized and set at fixed/lower price I suppose.

The audience of portals seem to take their games as a commodity rather then a luxury. When that happens (combined with an increase in volume of cooks in the kitchen) the value/price perception naturally drops. If you can get your product or brand to stand out as an unique piece of independent work (much like successful independent boutiques/store owners do), it doesn't matter how many supermarkets or similar genre products you have around you, you can still sell your brand of product at your set price (provided your customers believe in it as you said).

It's just a shame that those products that deserve more or better may to be just put into the bunch because most people do what everyone else does rather then what is right or works. It's gonna take some balls and confidence in these times to price your game accordingly when everything else is telling you to give it away or price it the same as Amazon and the like.

I believe some of my criticisms is true of myself also, so hopefully I can take some of my own and other's (like yourself) wise words and use them effectively, because I don't really want to be what I see as a commodity cog-wheel developer. Of course this is no criticism to those that do.

Re: Game Pricing, Look Out Below

GameDiviner — Thu, 05 Feb 2009 12:40:12 -0000

Ah - what I gathered from this particular post was that the entry point for making games was getting lower and lower - not that a small number of people could viably compete with AAA-titles. You do make that point a lot in some of your other posts which is very inspiring to start-up indies like me.

Though much can be blamed on the economy, I think it's another scapegoat (like piracy) for bad and unsustainable business models. Metal Gear Solid 4 had to sell on 50% of all PS3s within the first couple of days to make back it's production costs. I believe that Final Fantasy XIII is looking more and more like the arranging the chairs on the deck of the Titanic in terms of production cost versus profitability.

I think that despite lower price points, in terms of profitability, small developers are killing the big companies not in sheer profit gross, but in profit margins. PopCapGames for instance is rolling in it while the big companies like EA are cutting jobs like crazy.

Re: Game Pricing, Look Out Below

Jeff Tunnell — Thu, 05 Feb 2009 12:17:54 -0000

I'm with you Josh. It takes 4-5 guys a year to make an "album" worth of music. Games are not much different. One big point here is that even when your game or album is complete, there is no guarantee it will sell. That is why you should not quit your day job.

Just to be clear, Reflexive was actually one of the last to adopt this pricing structure. Yahoo Games, BFG, etc. already had it, but disguised as a "club" you could join.

Re: Game Pricing, Look Out Below

Jeff Tunnell — Thu, 05 Feb 2009 12:11:27 -0000

You may be a musician yourself, and you are certainly entitled to your own opinion, but I have to disagree here. As a former professional musician myself, and the father of a son that is currently attempting to make a living as a professional musician, I don't agree at all with your statement that it is conceptually harder to make a game than to make great music. I find that statement elitist and ill informed. It is kind of like saying it is easier to write a book than create a painting. Creating great music is every bit as hard as making a great game. It takes dedication, determination, guts, practice, and sacrifice. In fact, most of my observations of the game business come from comparisons of my experiences in the world of music and games.

I agree with your observation about piracy. I think piracy is a straw man problem held up by big publishers that are in trouble and need to point fingers for their failures to reasons beyond their control. If you set up the correct business model there will be no such thing as piracy. You will want people to "pirate" your game in order to get them in to the paying parts of your game.

Re: Game Pricing, Look Out Below

Jeff Tunnell — Thu, 05 Feb 2009 12:01:44 -0000

I think you have a point here and do not disagree at all. If I understand your post, you are saying that one way to survive in this market of incredibly low priced games is to make some great games and establish your studio as a high end brand. That will be one way to be successful. This is definitely not an approach that will be available to everybody, but it is one method that will work. This is already happening with developers like Jonathan Blow, 2D Boy, Jenova Chen, etc. As a developer you can attempt to set your brand at the high end, but in the end you will have to create products that deliver on the promise, and users will have to agree. If you do achieve this status, you are golden, because people will look forward to, and seek out, your next games.

Re: Game Pricing, Look Out Below

Jeff Tunnell — Thu, 05 Feb 2009 11:55:45 -0000

Great post, but actually I don't think i missed the point of smaller teams using better technology and techniques to make better and better games. In fact, that was kind of my point for the entire article. I think a team of 2-3 great game developers using modern tools and augmented by a world wide system of contractors can beat the huge teams imprisoned in the halls of the big publishers. World of Goo, Flow, Braid, and Castle Crashers are just the start. Out of the millions of people that will want to make games, we will see superstars emerge, and, you are right, the few pennies a certain percentage of the world wide audience throws their way will make them rich and famous. This noticed fame and fortune will be a big driver of all those that love making games and hope that someday they can can money too.

Re: Game Pricing, Look Out Below

GameDiviner — Thu, 05 Feb 2009 10:42:52 -0000

I think that one of the major points that are missing is that development teams will get smaller as more technology and better integrated development tools become available. IDEs like Flash, Torque and Unity already shrink the size of the development team by providing incredibly accessible tools at the onset.

Even AAA titles like "Little Big Planet" had a relatively small team of 31 persons. And currently the artistic push is away from realism to more artistic expressionism in games and focus on gameplay. Games like "Aquaria" and. "World of Goo" were made with 2 people.

The "garage band" of a small number of developers is become a more apt analogy because it is getting increasingly easier for a small number of people to create what used to take teams of people with highly specialized knowledge.

What it comes down to in the end is that people will pay for quality work and entertainment.

Game creation will become akin to being a street musician. There will be many onlookers who enjoy what you do but won't pay a cent. There will be many who will be generous and give some money for your performance - and may even pick up a CD that you published yourself.

But the Internet is a much much bigger street with millions of onlookers. If you are able to garner their attention, even a few coins tossed your way could be work a lot to a small band.

Re: Game Pricing, Look Out Below

The 1nteger — Thu, 05 Feb 2009 08:54:49 -0000

Very interesting post this one.

I don't know if I fully agree with the movement though. I agree with a non fixed price point based on content, platform and delivery (ie less for dload version, smaller price for less content/game type etc).

But I think some indie games/indie brands are underpriced and don't differentiate themselves from mass market flash/casual (and some core) games. A lot of pricing is perception and content. I mean while the iphone games are cheap (although now there doing a higher tier), that can certainly cannot be said for Apple's products and they get away with it via new ideas, content, delivery and unmatched execution. The perception is higher value. Everyone talks about pricing down, where are the indies where you actually say, 'whoa, that's expensive' or 'man, that's high priced', as I'm sure many say with about the Mac or iPod compared to it's cheaper/standard price competitors.

I think there are types of indie (and AAA) games that can (and should be) like Apple, a higher price product that despite perhaps being available in cheaper forms/clones elsewhere, the customer sees value in paying more. I think this is a great opportunity to stand out in pricing and perception of product by NOT pricing down your (assuming it is) unique independent creation like every other portal/mass game producer and desperate indie out there currently is. Yes, even in this climate!

Maybe I'm crazy, but it seems to work for Apple, fashion brands, Nike, AAA, Other independent goods providers etc. It's especially true in a show I watched about an expert helping independent store owners deal with supermarkets mass low pricing. 8 out of 10 times it was about perception and differentiating yourself from mass products that helped then gain more profit and customers, before they were shorthanding themselves and playing their game by pricing the same as them or offering the same mass amount of products as them (how many indies sites have I been to where it's hard to tell which games are theirs and which are the same c*ap I see on 100's of the same sort of sites).

Maybe you just need to set the right perception regarding your brand and product, of course, you'll need a good product too.

I don't really like the idea of $0 and we all go and starting charging via MMO methods alone, although I not opposed to new methods of getting paid for your work. That's not to say it's not happening...