Stuff That Sucks - A Game's Value
Exactly what determines whether a game should be valued at $60? Greg Burke tackles this difficult question in the latest Stuff That Sucks.
What ultimately determines a game's value? Why are some games that come with dozens (and even hundreds) of hours of content running for $60, while a story running less than ten hours going for the same price? How about the content-filled package for $15? What ultimately factors into a game's price tag?
Shacknews' Greg Burke examines this difficult question in this week's Stuff That Sucks, using one of the best examples out there right now: Fallout 4.
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Shacknews
replyShack Staff posted a new article, Stuff That Sucks - A Game's Value
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Digital goods especially games depreciate rapidly. This is possibly the most important insight Valve had when they introduced Steam sales. They charge what people are willing to pay for older titles. It's not that they're trying to be incredibly generous.
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I'm still amazed at the amount of money other gamers end up costing each other. Fall Out 4 is not "worth" $60 on raw content. We all know this and we know in half a year it will be laughable for that same content to go for $60 (and then there will be mod content and such).
So the digital good depreciates primarily because people will have stopped talking about it (again no supply and demand).
Thus, Shack posting a lot on Fallout 4 keeps it at the $60. Many Shackers might not have even bought it if it wasn't discussed so much here.
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Fall Out 4 is not "worth" $60 on raw content. We all know this
Wait what?-
Same content 6 months, what would you pay for it?
If it is less than $60 and the content is the same, then it wasn't worth it on raw content was it? It is something external that gives it that bonus value.-
I don’t know, but I really want to play it now, so its easily worth $60 to me. Give me a game that im not super excited to play but still want to play I can easily wait 6 months and pay $40 for it.
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But why do you want to play it now? Again, if it isn't because of the content now, then the value is external to the game.
Gamers pay a premium on impatience and our own fickle hype.-
Why does anyone want to do anything now? Because they don’t want to wait. You pay premium not to have to wait. Its not hard to understand.
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Then you understand my point. The raw content is not worth $60.
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But why would you separate out the content from the desire to play the content, they are part of the same package.
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Because I was making the point that gamers create the added the cost by fueling the hype. So the complaints about cost could come down if you simply reduced hype, but no one whines about the cost of unhyped games.
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You arent never going to get rid of that. When people really want to play something, they are going to want to play it as soon as possible. The $60 price point is a point that was found as not being to expensive, but also trying to get max revenue for the company. I see it no different than anything else out there.
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I agree with what he is saying but it is also the reason why I personally look at game length. I am definitely trying to maximize my playtime/dollar paid ratio. I am willing to pay $60 if it is something I want to play now but I definitely look for longer games with more content and longer playtimes first. Witcher 3 and Fallout 4 comes to mind and they go straight to the top of my buy list.
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What about supporting developers who make games you like? If a game is really good and I want to see more like it I'll often buy it on day one (especially for niche products like Reflex).
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That's less applicable to Fallout (which is hugely successful) and its a single player game so its going to be the same in 6 months whereas a multiplayer game may not have many people playing it anymore so its more important to get in when you can get more playing out of it more easily. That said, even games like Titanfall (on PC) that are often declared dead you can still find a game's worth of people with...its just harder and more hit or miss...and smaller games may never get to even that point.
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I would add that I'm probably a crazy person given that I have well over 1000 games on Steam alone (not to mention that I fucking own a consolized NeoGeo MVS, an XRGB mini Framemeister for my beloved scanlines and proper 240p->HD upscaling, a plethora of vintage retro gaming controllers and adapters for said controllers, and even pretend space ships for a hypothetical game).
Gaming is one of my few hobbies and I tend to spend more money than is likely wise on it, but I have few expenses and live in an area where things are generally cheap so it balances out.-
I would say you are probably an outlier then because you spending habits make games have far different values than their market worth for you.
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To think about that better, consider how many people price a game at $60 on a humble sale when they get to put a developer value on it.
If $60 is supposed to include a "because you like us" amount, then it is counting again on something extrinsic to the content value of the game. -
I absolutely agree that I'm an outlier, and I don't always buy games on that "supporting the developer" basis...just games I'm really enthusiastic about and want to see made...I still buy a lot of stuff in Steam sales (part of the reason I have so many games on that platform to a point that a co-worker on my friends list joked that he just assumed that "Vorlonesque already owns this game" was a permanent element of Steam's UI.
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you just discovered that demand dictates pricing power?
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Also, technically the raw content is worthless. People put the value on it.
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Well yes, nothing has value. Human monetary systems...blah blah.
I just mean that at that point where people are only buying the game because they don't have friends playing it or the reviews have all hit and they are not getting any social first purchaser value or something, the price at that time would best reflect the value people would assign to just content.
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This is a dumb thought experiment. If they game was arbitrarily raised to $61 forever, I'd still buy it. Does that now mean the game content is definitely worth <$61? Price to the consumer is arbitrary, you pay what you are willing to, and that is exactly the value it has to any given person.
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This line of reasoning is reductionist and not really useful to the experiment.
Much like people buying concert tickets to put on stub hub with no intention to go, pricing is extremely variable and it is hard to say what something is "worth".
If the price was raised to $65 would we not see a bunch of articles about it? It is certainly an arbitrary thing, but pricing becomes a norm of what people expect is reasonable, sometimes simply because their friends who create the most important hype can still afford it.
So the whole point of my discussion was to show how much of that value gamers create among themselves when there is little to actually justify that premium if the true value is what it goes for without hype.
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Not useful to your experiment, which has some ill-conceived notion of hype. Your assertion that "we all know this" is a flawed generalization, I'm guessing to garner support for your point of view.
I will buy this game in 2 weeks when it is still full price, simply because that's when Bethesda will have fixed some shit. I have 0 interest in buying the game to tell stories to other people or share my playthrough. I want to play a game from a publisher that has a track record of extremely fun sandbox games in a setting that I don't find fleshed out this well very often. The value of that is directly related to my current economic well-being and nothing else.
Literally nothing of this game's "value" to me is contingent on things gamers create among themselves. There is no time value premium in the $60, and I'm probably willing to pay a whole hell of a lot more for it, given that my purchase decisions are pretty much internal and I could afford to.
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Or we could go the other way and say its popularity is why it costs as little as $60. The raw content cost millions of dollars to produce, but because the game has been so "hyped" I can acquire that millions of dollars of content for only $60.
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Also I don't think you went far enough. The raw content is actually worth $0 because it will eventually go into the public domain and then I won't have to pay for it at all.
Of course I'll also be dead then, but that's a small price to pay for saving $60. -
Except we know the is not true either. The market will not sustain much higher prices or they would price that way. (DLC pricing has been worked to get around this problem since games are fairly cheap considering inflation and content/labor required to produce that content in games today).
Certainly it could be "worth" more if you simply look at the cost of production.-
No more would the market sustain selling a game at whatever sale price you can get it for a few years after release, but according to your point that's what the "raw content" is worth.
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It isn't that deep or nuanced.
I am simply arguing.
Take the max price the market seems to think a AAA game release is worth (currently $60).
subtract out the hype and peer pressure (so imagine buying this game in a world where there are no other people).
and then you have the max price the market will sustain for the content alone.
Of course people would buy it cheaper and some people would buy it at a higher price, but neither of those are useful. This method lets me guess (because we have steam sales and such) what the content value is by seeing the price offered once the external hype and such has dissipated.-
So you're "content value" is just how popular a game is 6 months from now? Because that's more or less what the steam sale price of a game tells you.
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Possibly. Since there is little else to assign worth, that is probably a good starting point.
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No, because people will still pay more for it than that. The point is that currently there is no added excitement/hype value added to what people will pay. Valve believes this is currently around $4.99.
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by this logic nearly everything is worthless as the value depreciates to $0 over time
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You can certainly justify it, but you could justify it at a higher price too... 50 cents per hour compared to say a movie is very cheap entertainment. Compare to a 6-10 hour SP game it is still very cheap.
But, what you are really paying $60 for is not the level of content, but filling hours with gaming that you can talk about with your friends and get a sense of belonging out of the hype. That's what sets the value more than anything.
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Its not just the shack. Its very popular all over atm.
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But this is his community, which is notable. There are lots of games that are really popular that no one here really cares about. Purchasing pressure on those is considerably lighter.
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Us poor, foolish gamers. If only we would all just collectively pretend we didn't care about new releases, we could buy them for significantly lower amounts of money!
So the digital good depreciates primarily because people will have stopped talking about it (again no supply and demand).
I think this only applies to entertainment goods.
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Nice vid I totally agree man, its wrong how the companies with a reputation & r considered AAA get the automatic $59.99 no matter what, you basically are only paying for their reputation. Even if the game sucks and is only 4 hours long its always going to be $59.99.
On the flip side its sad that indie games and a no name games that could be 50 hours + and better quality than AAA games have to pretty much charge only $20.
Its a broken system but I can't see it changing even though I wish it could. Your right about DLCs it really jacks things up and doesn't help with the situation.
All well not much you can do, but I agree it sucks :( that is for sure. You sure as hell know Shovel Knight 2 is not going to be $59.99 all of a sudden when it comes out.
2 - 5 years of insane work that sell for $20 or $59.99 is mental if you really stop and think about it, but that is for another discussion hey. -
Let's talk about negative value...
I typically wait until a game gets on PS+ or a sale before buying, or I'll pick it up second hand if I can, but now and then I buy games at full price, but almost never AAA titles. I picked up a PS4 a few months ago and got Destiny with it - now arguably I got it "free", but I still invested in this particular SKU because it included a AAA title that was still selling at full price brand new (in June), and some other nice extras - so for me it was still valued at full price.
Then I played it and as dumb as the singleplayer was, I really enjoyed the MP. Now I'd not gotten into all the shackhype about the game so I didn't know anything about the coming Year 2 expansion with TTK. When that hit, I was thinking it would be a DLC-type expansion cost, but that my general experience otherwise would be untouched. What I didn't expect is that my general experience would deteriorate. When TTK launched just a few months later, suddenly I could no longer select mission types for MP, and when I jumped in, I was a) on a rotation map so I had no choice between type or map, and b) I was fighting alongside and against much higher rated players than before, with zero chance to compete without shelling out for TTK.
I don't know whether anyone else bitched about this - it seems that my having been in a vacuum about the game has left me not realising this was coming, but I am a little dumbfounded that we're to accept this. I was not told "you will enjoy this until exactly Sept 15 after which your experience will be very different". -
The game is called capitalism. You charge the maximum price you think you can get for your product. Your brand helps a lot here. That's why big companies can get away with charging $60 for most any game and indies can't. What is in the game in terms of content and hours of playability don't really factor into it.
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