The Price Gamble

By Rob Fahey Published 21 November, 2009

Does Modern Warfare 2's success mean that Activision's price hike was justified?

Published as part of our sister-site GamesIndustry.biz' widely-read weekly newsletter, the GamesIndustry.biz Editorial is a weekly dissection of one of the issues weighing on the minds of the people at the top of the games business. It appears on Eurogamer after it goes out to GI.biz newsletter subscribers.

1.7 million people in the UK bought Modern Warfare 2 last week, a figure almost lost in the controversy which has surrounded this game for months. Amidst voices raised by the controversial airport level, it's almost possible to forget that a few months ago, it wasn't the content of Modern Warfare 2 that concerned us all - it was the price.

In the end, the higher price-point which fermented so much debate over the summer meant nothing to consumers. While specialist retailers fumed, some supermarkets discounted the game down to £26 and online behemoth Amazon dropped its price tag to £32 a few days before launch. Even considering the buying power of such retail giants, it's likely that some outlets were treating the game as a loss leader.

As such, Activision's £10 price hike was mostly absorbed by retailers, not passed on to consumers - a fact which will give publishers pause for thought in the coming weeks. There has always been a fear that if MW2 was not damaged by the higher price-point, other publishers would seek to drive their own prices up - in defiance of the obvious decline in most consumers' value perception of all media, games included.

Well, Activision pulled it off and delivered the industry's biggest-ever launch - but we're still not much the wiser as to whether consumers would have accepted the move, since most consumers never got to see it in action. Some readings of Activision's figures for the game suggest that the average selling price of MW2 was actually lower than that for Grand Theft Auto IV, which carried a perfectly normal SRP.

For Activision, of course, this is perfectly fine. It's not all that bothered about how much consumers paid for the game - as long as retailers paid the inflated trade price, then the publisher laughs all the way to the bank, regardless of how much those retailers then chose to debase their own margins in order to remain competitive.

One wonders whether this had been Activision's plan all along. From the moment that the price hike was announced, commentators sucked in their breath and marveled at what an immense risk the publisher seemed to be taking with a goose that had previously been guaranteed to lay golden eggs. Yet it may well be that Activision knew perfectly well that retailers would never sell Modern Warfare 2 at full price. Anticipating the price war that broke out between supermarkets and online retailers - with specialist stores unwillingly caught in the crossfire - it knew that it could gouge its "partners" with a higher trade price, confident in the knowledge that consumers would not feel the sting.

If that is the case, then one side of the industry can only take its hats off to Activision's clever manoeuvring, even while the retailers who have just helped to inflate the company's quarterly figures lick their wounds and glower. They'll get their own back, of course - MW2 will turn profits for companies like GAME, GameStop and GameStation for months and even years to come as copies cycle through the second-hand market - but right now, Activision is the victor, having sneakily managed to hammer retail margins for one of the biggest releases of the year into the ground.

However, everyone knows that this isn't a situation which will be repeated too often. Supermarkets will only treat a small minority of extremely high-profile, seasonal releases as loss leaders, and specialist retailers simply can't take this kind of margin squeeze indefinitely. The next publisher to try and shove its SRP up may well find that retailers are not prepared to soak up the difference this time - leaving it in the exposed position of passing the price hike on to consumers for the first time, and almost certainly doing so with a far less attractive and anticipated product than MW2.

In other words, what was seen as the great pricing experiment of 2009 has ended up providing remarkably little data, and what few hints we have regarding consumer reaction to price hikes are totally obfuscated. Any publishing executive in the coming months who refers to Activision's higher price point as a success should be regarded with deep suspicion, either in terms of their competence or their honesty, or both, because the reality is that the market did not bear the higher price - it was simply never asked to do so.

Far from seeing a wholesale uptick in pricing, I suspect that 2010's story will be of continued downward pressure on prices. It's still unclear just how much impact the appearance of "freemium" business models and low-priced software on platforms like the iPhone is having on consumer perceptions of value, but all of the smart money is on a general erosion of the willingness to pay high prices for software.

Consumers who spend hours playing something like Farmville for free will increasingly question the basic concept of spending the same amount on a videogame that they would spend on a night out, especially as web game experiences become more and more complex and involving. The same goes for mobile-phone games, which generally retail for between £3 and £5 - as those experiences improve and evolve, DS or PSP software selling at between £20 and £30 is going to look increasingly ridiculous.

More importantly, the decisions about pricing are increasingly being taken away from traditional publishers. In the past, the only way that prices would fall wholesale was through a gradual process of competitive attrition with your publishing rivals - who all had the same costs as you, and the same incentive to keep prices high.

Not any more. Facebook game developers couldn't care less if they devalue console experiences. iPhone game developers would dearly love to see the DS fall on its face and move a whole new wave of consumers over to their phone as a gaming device. These new rivals have no reason not to undermine existing business models, and everything to gain by doing so.

Of course, it goes without saying that publishers could not survive if they sold games developed and marketed using their existing business model for a handful of coins rather than a handful of notes. However, this is the challenge to which they must rise - that others are finding cheaper, more effective ways of delivering experiences to a wide range of consumers (including many upstream gamers), and that they must adapt and innovate upon their development processes and business models in order to survive.

There will almost certainly continue to be a market for the monolithic, premium-priced gaming epic, of course - but it would be foolish to underestimate the reach of the new business models which are emerging around the traditional boxed games industry, or the impact they will have on that industry. In that context, we can now view Activision's price hike as exactly what it was - a clever and ruthless way to extract a bit of extra revenue from the launch of a blockbuster, nothing more, nothing less. Anyone viewing it as a valid model for the future of the industry is making a deeply flawed assumption.

For more views on the industry and to keep up to date with news relevant to the games business, read GamesIndustry.biz. You can sign up to the newsletter and receive the GamesIndustry.biz Editorial directly each Thursday afternoon.

Picture of Rob.

About Rob Fahey

Rob Fahey is a former editor of GamesIndustry.biz who spent several years living in Japan and probably still has a mint condition Dreamcast Samba de Amigo set.

Read more articles from Rob by visiting the Rob Fahey archive page.

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Comments (64) Latest comment 2 years ago

Comments threads automatically close after 30 days, but please feel free to continue chatting on the forum!

  • Emmit_Assassin #1 2 years ago

    "Of course, it goes without saying that publishers could not survive if they sold games developed and marketed using their existing business model for a handful of coins rather than a handful of notes. However, this is the challenge to which they must rise - that others are finding cheaper, more effective ways of delivering experiences to a wide range of consumers (including many upstream gamers), and that they must adapt and innovate upon their development processes and business models in order to survive."

    And the first way they will try and 'innovate' is to find innovative ways in which to rip us off with bloody 'micro transactions' and paying extra for online content.

  • BabyJesus #2 2 years ago

    Aslong as no other publisher decides to followsuit and make that RRP the norm I'm happy.

  • RobotRocker #3 2 years ago

    Consumers who spend hours playing something like Farmville for free will increasingly question the basic concept of spending the same amount on a videogame that they would spend on a night out, especially as web game experiences become more and more complex and involving. The same goes for mobile-phone games, which generally retail for between £3 and £5 - as those experiences improve and evolve, DS or PSP software selling at between £20 and £30 is going to look increasingly ridiculous.

    Farmville, Mafia Wars and the likes are a massive scam however. They allow players to play for free but to make micro transactions to get boosts and extra turns that are primarily useless in the long run. Even Free to play games like Pangya and Maple Story at least give players something tangible and unique with each transaction. Its just a ploy to get kids hooked and pay more for playing a game that's going to be more expensive than a DS title in the long run.

    But hey, since the industry likes the current "fuck the customer" model. I don't see that changing any time soon either.

    Edit: Before you start screaming how your farm is better than all your FaceBook friends. I suggest reading this

    [link url=http://www.techcrunch.com/200 9/10/31/scamville-the-social-gaming-ecosystem-of-hell/ ]http://ww w.techcrunch.com/2009/10/31/sca...[/link]
    Edited by 1 at 21/11/09 @ 10:42

  • 4thVariety #4 2 years ago

    It's not about being justified, it's about getting away with it and making more money. No matter how much the people might moan about it, there is no help from the media side as the media only serve their advertisement revenue interests.

    Basic fact is that the industry pays the media's bills, it is not the users, hence the power of the users is dwindling really really fast.

  • trevd72 #5 2 years ago

    if you paid more that £40.....unlucky. everyone I know who have it had every intention to pick it up when the price dropped, and boy did it drop. I mean £26 is a steal.

  • El-Dev #6 2 years ago

    Wasn't Fifa the first game that started the price wars between the supermarkets this year? If so that was released after Activision announced the price would be higher than normal, and Activision surely couldn't have predicted that would happen between the supermarkets. Maybe they just got lucky.

  • lucky_jim #7 2 years ago

    It's been obvious for a while that supermarkets are prepared to use gaming in this way. Sainsbury's did their discounted Wii consoles at the height of the rush for the console (only to see GAME send their staff to buy the stock and re-sell it at their own price, but that's another story), and I'm quite sure last year's FIFA was the subject of similar (though less extreme) discounting as MW2: it was £25-30 pretty much everywhere.

    So Activision have done well out of this, but as the article says, there aren't many companies in a position to follow suit. It didn't take a huge amount of business acumen either, because the signs have been there for a long time, but it did take some balls. When the hike was announced, Activision's line was "we're gonna charge £55 cos we know people will pay it", so someone obviously took a decision to pretend Activision were expecting gamers to pay that much when in reality they knew retailers would take the hit. But that said, Bobby Kotick seems to see winding us gamers up as a sport, and it's a safer one than publicly winding up retailers.

    Edit: Apostrophe abuse.
    Edited by 1 at 21/11/09 @ 10:56

  • secombe #8 2 years ago

    Having recently bought a 360 after being an exclusively Wii gamer for a few years, the prices of games (even online or in supermarkets) do concern me. I've thought long and hard about the 360 games I want to play, Forza 3 was a dead cert for me so I paid the price, but 99% of my 360 purchases will be second-hand or much later in the product cycle when it's cheaper on Play etc.

    £30-35 is my self-imposed limit, which in reality means I'm going to end up playing games a few months after everyone else...which considering I don't play online, is not an issue at all.

    The irony of all that is, the most time I've spent on any game this year was on an iPhone game...that cost me 59p, and yes for me that does bring into sharp perspective the cost of DS games.

  • spenner #9 2 years ago

    It definately would be intersting to see the number of people that paid anywhere near the full rrp. Like mentioned everyone I know paid £26 quid on launch so I guess the only people paying the full amount are the gaming uneducated / ill informed / xmas shoppers.

  • bad09 #10 2 years ago

    I spoke to a retailer yesterday who confirmed the price they were paying themselves at £41 for MW2. I was disgusted at first when I heard of retailers were buying up these supermarket loss leaders but at that sort of trade price can we really blame them. Christ selling it for £45 and they still only make a couple of quid!

    I do hope it is only Acti and no one else follows their greedy disgusting path but we all know they will (some did when it was announced), it's only gonna get worse now. Thankfully I'm stopping the console gaming but PC is still affected.

    Personally unless I trade in (which is becoming less and less now I'm not really console gaming) I think launch games are gonna be a thing of the past for me now. In 2009 the industry finally taught me one important thing about gaming I never really thought of before - I CAN WAIT.....

  • bad09 #11 2 years ago

    "if you paid more that £40.....unlucky. everyone I know who have it had every intention to pick it up when the price dropped, and boy did it drop. I mean £26 is a steal."

    Christ people REALLY don't get it do they. £26 is £15 below cost on MW2 for most retailers, how many games can they sell at that loss?

  • KDR_11k #12 2 years ago

    Sounds like another disruption rolling through to me. Between the Wii and the web it looks like the core game industry is in for a lot of hurt.

    Basic fact is that the industry pays the media's bills, it is not the users, hence the power of the users is dwindling really really fast.

    And who pays the industry's bills?
    Edited by 1 at 21/11/09 @ 11:12

  • agparrot #13 2 years ago

    @bad09

    Christ people REALLY don't get it do they. £26 is £15 below cost on MW2 for most retailers, how many games can they sell at that loss?

    Well not many, obviously, but I don't think the consumer really cares, when the price is this low. Of one thing I'm sure - if the RRP of MW2 had been £55, I wouldn't have bought it, but being able to pick it up for £32 in a nearby Asda made it a no brainer for me. If I'd had a nearer Sainsbury's, I'd have been all over it at £26.

  • superjag86 #14 2 years ago

    Good article. It seems the price hike was an attack on retailers then as neither consumers nor the publisher was hurt by the increase. Retailers may make money on the whole trade in marketplace but I wonder how long this will last.

  • Bagpuss #15 2 years ago

    This sort of price strategy will only work on those handful, and i do mean handful, of titles that have their own momentum, where they have shifted into public conciousness....

    If any mid level publisher, with an average title, which constitutes 99% of yearly releases, tries this level of pricing, they will be committing commercial suicide.

    Besides, what would have been the sales figures if MW2 had been £55 everywhere, no exceptions, whilst still huge, not 1.7million.

  • spudsbuckley #16 2 years ago

    Odd, i bought the game for €45 rather than the usual €55-60 that you'd usually pay here in Ireland :/

  • Metalfish #17 2 years ago

    26 quid from Sainsburys for me. If they're happy to sell it at that price, I'm happy to buy it from them. As consumers, we don't have to worry too much about this ourselves (unless they bring out "fair trade" games or something).

  • FooAtari #18 2 years ago

    Next year I am giving myself a monthly budget on entertainment of £50. I need to try and get what I spend on entertainment under control and also buy less games/movies/music that I am not getting full use of and effectively wasting my money on. (buy so many games that I probably play for less than 5 hours)

    I didn't buy MW2, and had not intentions of. However any game at £55 would mean I wont be buying it. Instead I'll wait for the price to drop, or forget about it and never buy it all.

  • Mr_Fiddler #19 2 years ago

    Surely "spending the same amount on a videogame that they would spend on a night out" implies the opposite of what was intended, i.e. that the game is the better value for money (assuming that you play it for more than one evening) ?

    Personally I can't see that they raised the price for any other reason than greed. They pretty much were guaranteed to get very high sales and high profits were surely never in any doubt even at the standard RRP. I don't see many other games getting away with this, people will just wait a few months until the price inevitably drops.

  • local_celebrity #20 2 years ago

    Great article and perceptive as ever. But how can the trade price of MW2 possibly be £41? If that's true, Sainsburys effectively handed over £15 to each customer. I find that hard to believe.

  • Machetazo #21 2 years ago

    @agparrot: interesting point you make about neither the consumers, nor the publisher having lost out due to Acti's decision.
    Another consideration would be, I think, that it's also utterly devastated the trade-in value of MW2. Once you have a copy, you may as well hold on to it, and chances are that you'll get a copy, because a lot of other people did (the visibility's right there, any time you sign in and see the friend's list), if for no other reason.

    Is this a realistically repeatable/smart way for publishers to combat pre-owned, though. I don't think so, because I doubt that retail would continually take the loss.

  • lucky_jim #22 2 years ago

    I scrolled to the bottom of the comments to see a banner ad for MW2 at shopto, proudly proclaiming "£42.99- save 21%". Heh.

  • Lee_Morris #23 2 years ago

    I fear that we're only going to get more 'epic' games on console and these games will continue to get blander and more americanised to hit the widest possible demograhic. sigh

  • whoslotte #24 2 years ago

    The only reason I bought MW2 was because asda priced it low. At full price there was no way I was going to buy it.

  • HermitArcader #25 2 years ago

    Post deleted at 09:17:39 22-12-2011

  • JohnnyWashnGo #26 2 years ago

    If the price had not been reduced from RRP then I would never have bought it.

    As it was, the £26 deal at Sainburys meant I could try it, find out I didn't like it and trade it in for a profit.

    I never buy games at full price, its just not economically sound at this point in time.

    For example, I really wanted to play Infamous but didn't want to pay full price. This week it hit £14.99 at hmv.co.uk so I bought it. If it had never hit that price, I would never have played it but seeing as it did, I will give it a shot.

  • HermitArcader #27 2 years ago

    Post deleted at 09:17:39 22-12-2011

  • GreyBeard #28 2 years ago

    I wonder what percentage of buyers have paid less than the usual RRP (£39.99) for MW2 so far? From talking to people I know with the game it seems like nearly all of them got it at a heavy discount.

    I dunno, but it seems to me that for a lot of people MW2 was ultimately cheaper than average. Now I know that's just an anecdote, but to be realistic I can't see too many people paying over the average for it after its been on the market for a few weeks.

    People expect prices to fall over time on games, not go up, and certainly not for a game like this where its core audience wants to be online gaining perks and combat experience as soon as possible.

    Just looking at the way it was reported, MW2 apparently shifted as many as 1.2 million units on day #1, but by the end of the week it had "only" (lol) risen to 1.7mil. That's a heavy, heavy drop-off.

    If the prices generally return to ATVI's desired RRP I can see that decreasing sales trend getting worse as competing titles start looking like better, cheaper, deals.

    MW sold very well for a long time, but will it be the same for MW2?

  • UKLL #29 2 years ago

    MW2 isn't just a game it's a phenomenon, you only have to look at all the hype, coverage and sales it generated to see that it's unique. If the industry tries similar price hykes with the majority of other games then people will either buy less games, wait for the price to drop (and game prices do drop quickly) or they will buy them secondhand.

    I bought it at somewhere selling it full price but I had a ton of store credit I had to use up so I only forked out £16 in cash.

    I'll probably only buy a couple of games before the next COD is released.
    Edited by 2 at 21/11/09 @ 14:32

  • hilts #30 2 years ago

    I believe it is back up to around £45 in most places now - no doubt it will still sell plenty in the run up to Xmas - so doesn't that show that their model has worked , given that most other releases will be around £40

  • Jonny5Alive7 #31 2 years ago

    I think the article is reading too much into Activisions price rise. Everyone knew it was going to be massive seller regardless of the price going up a tenner, so they were just being greedy. I really don't think they were bothered if the consumers got hit with the rise or not.

    Theres no way other games will be able to get away with a rise like MW2. The game would already have to be an established popular brand for sales still to be as good. Plus games prices always tend to drop in the 2nd half of a console's lifespan, so I don't think they will be increasing much any time soon.

  • dsmx #32 2 years ago

    For me I paid £30 for COD4 the week it came out on the PC. When MW2 was coming out they said there would be price hike so at that point I sat on the bench about should I get it, then 2 weeks before launch news started leaking out about features in the PC version that have been removed from COD4. I started thinking why am I paying more for a game that has less features in it than the previous version? Then when it launched but you could get copies for £26. By then though I was pissed off at IW trying to suggest that p2p is an improvement of dedicated servers, then saying the maps weren't balanced for lean and saying mouse control and text chat is a feature for the PC version. That was the best thing they could come up with for features on the PC version, something that has been in every PC multiplayer shooter since, well since multiplayer shooters went online.

    Currently I'm happily playing l4d2 and bf2 which I bought with the money that was going to go towards MW2.

    Overall I struggling to see why you would buy MW2 on the PC, I just can't see why.

    Edited by 1 at 21/11/09 @ 15:09

  • Lukey__b #33 2 years ago

    Got it for £22.50 when I traded in MW1. As it was my brothers MW1, I think thats not a bad deal.

    I've played it for 10 hours total online so far..... thats £2.25 an hour. Less that a pint. Even if it was £32 from Amazon thats 'steal' a good deal..... plus im gonna play it alot more that 10 hours in the future.

    I would have never paid anymore than £35 for it, regardless of activisions price hike or what not. £35 is my ceiling for games... unless its a one off special (like a FF game, or Fallout... or some other IP I love) and COD has never lived up to the hype for me. That doesnt mean I don't really enjoy it and dont think its a 9/10 game (whatever these scores mean).... but its not as special as the press, hype, fans make out. Although I think MW2 is an improvement over the last.

  • k4rl #34 2 years ago

    what price hike, I got mine for £24.99 from morrisons. Actually cheaper than World at War

  • davisorle #35 2 years ago

    I didnt read the article. I got irritated just from the titles question of the price being worth or not. Lets just say that if each title's pricetag has to fit with the product's quality they owe us all some serious fucking money for every other titles of activision and any other publisher that passed us so far. I wont get to answer if MW2 is worth its price since they already stated themselves that they didnt sppend the budget that Activision was willing to do so for the game. Thats another factor for them. For me its all the same. I dont think its convinient even for Activision to be pricing by product quality, at all actually. Cause if you check the stats I havent seen any record breaking title or company till now do it twice so if you ask me, they are bound to have lower than the regular price for the next game of theirs since it wont be as good or whatever it might mean.

    This whole thing is plain stupid if you ask me. Not to be offended to any of the ones with a clear, different or not opinion of their own but I am not willing to even read the article nor comments on this subject. The game is good. It's online would be good if it wasnt as if you play on PSN by P2P and even my PC version is lagging like crap when I havent had worst quality on connection on my online games ever since... I cant even remember actually which is pathetic. Other than that the game is good.

    P.S. they can shove the price tags up their ass. I would much better kow it was for charity or a purpose and id pay even twice,

  • metalangel #36 2 years ago

    Wasn't interested in MW2 until the £26 drop. Was then interested but still have not been able to actually find it anywhere for that price. Interest fading fast, everyone on my friends list playing (and indeed finishing) so reckon I've missed the boat and just won't bother.

  • Quixz #37 2 years ago

    This is a distributor's problem than a consumers one. They are the ones that can tell Acti:Bliz FUCK YOU we aint selling your shit at a loss.

  • jambo74 #38 2 years ago

    Prike hike, never paid that hight price. There were places offering the game for £30

  • Spooke #39 2 years ago

    I stopped paying for DS games a long time ago, 99% of them are simply not worth £20 with only the excellent GTA and Nintendo staples even coming close.

  • makeamazing #40 2 years ago

    I think £26 was probably too much for this over priced peice of junk :)

    But on a serious note, do you think retail will take such a high loss on a game thats not likely unless its a big game. I also dont see publishers risking rising the price too much as it could easily put the risk of no sale over it.

  • Sunyavadin #41 2 years ago

    It's an interesting alternative to download-only availability in order to avoid the money the publishers mistakenly and greedily see themselves as "losing" through the second hand market. Charge extra to the retailers the first time round, and you recoup the tenner they'll make selling the game on second hand when the initial buyer returns it.

    I for one prefer it to ideas like Sony's new PSP. But I can't help worrying what the long term effects will be...

  • makeamazing #42 2 years ago

    Charge extra to the retailers the first time round, and you recoup the tenner they'll make selling the game on second hand when the initial buyer returns it

    Maybe, but games are traded in much more than just once, so they lose more than just a £10 longer term. Ive read somewhere on here that one game was tracked and traded in 8 times. Thats alot of cash.

    Games need to add more locked in content, that means a player is less likely to trade in. We are seeing that already, with single use codes in games where you can download something. Doesnt stop a user trading in but certainly means theres less value to someone buying *well if they know it includes such an item.

  • Grayvern #43 2 years ago

    Whether the supermarkets took the price hit or not depends on how much it cost them from the distributers. It's unlikely but distribution middlemen could have taken a hit.

  • TheGuvernor #44 2 years ago


    Has it not occured to these greedy muppets that lowering their exorbitant prices for video games might REDUCE piracy & actually increase their profits.

  • makeamazing #45 2 years ago

    Whos being greedy in all this though....

    When you spend anything between 10 and 100 million to make a game, you probably want to make the money back.. Remember the consumer buys with their wallet, no one is forcing them to buy. So if they pay a certain amount then they are telling the game creators that is ok. If no one buys and they have to drop the price, then the same can be said again.

    Lets not go down the route of dropping the prices will reduce piracy, many people pirate because they dont want to pay, it has nothing to do with cost.

  • biru #46 2 years ago

    "In the end, the higher price-point which fermented so much debate..."

    I believe you mean 'fomented'. Wouldn't want to imagine what a fermented debate is like!

  • secombe #47 2 years ago

    I guess, like FIFA 10, this will be one of those rare games that actually rises in price over time. Once the initial buzz dies off, the supermarkets hike the price up.

    It doesn't seemed to have harmed FIFA, it now costs at least a tenner more than it was at launch, and ironically second-hand prices are still even more than you could get it new originally.

  • Xerx3s #48 2 years ago

    "If that is the case, then one side of the industry can only take its hats off to Activision's clever manoeuvring"

    Yes because what they did was good. ¬_¬

  • chrisola #49 2 years ago

    Blockbuster has MW 2 for £42.99 pre-owned, or £44.99 new, i noticed it when I went in today to rent Left 4 Dead 2.

    Thats a pretty high profit pre-owned price, knowing Blockbuster they gave £25 trade as part of their chart release + £14.99 for a new release deal (as most of their new games were £39.99). MW 1 has FINALLY dropped in price to £24.95, it seems to have been £39.99 since day one.

    The trouble is the public seem to think that games and entertainment companies owe them something for nothing, and that these companies have infinite pools of money to make AAA rated games which cost millions of £'s to make. Well, they don't. If we paid £19.99 for every game, then every platform's release schedule would devolve into shovelware pretty quickly.

    So what if some iphone games are 59p? People with time and the skill can code one in their bedroom with little in the way of overheads, whereas a big studio cannot run this way. We are heading back to the homebrew days again and that's what makes these little games special.
    They have their place, as do the XBL games like Trials or Shadow Complex, and their place is alongside the big hitters like Call of Duty, GTA, Fifa etc, you can't directly compare them. You play your latest iphone app on the bus home from picking up MW2, you don't rush home all excited, grab some beers, put the kids to bed and settle in for a night with your iphone :p


    Of course, there is a point where a premium price for a premium product turns into greed, and yes i think Activision are getting there. I paid £44.99 for MW2, and do not regret a single penny. But, moving forward if they are planning to use micro transactions then i'd stop paying. I'm happy with the price because the single player gave me 8 hours, and the multiplayer will give me until the next version comes out, which could be 2 years worth of playing. However, i'd have felt ripped off if £44.99 got me SP only and i was then expected to pay £9.99 a month for the multiplayer, i just wouldn't pay it.

    The recent Activision BS about gamers demanding micro transactions is absurd and someone in their company is approaching it the wrong way...the evidence they are looking at actually means: gamers love their existing games and will pay for additional content like map packs because they add more to the existing experience.

    If you take away the existing experience and try and charge for it bit by bit, then people won't pay for it for long.




  • Lemming81 #50 2 years ago

    You know what this industry needs? Guilds. Look at the movie industry. Guilds keep things like costs in check.

  • Collymilad #51 2 years ago

    Surely the fact that the price hike was most absorbed by retailers means the whole thing means nothing?

    If it's true that it was absorbed by them (which from what I can see, it was) then MW2 does nothing to prove that a higher price point is viable, unless publishers think that retail is going to put up with this as standard... if not then it will be passed onto consumers, THEN we will see whether they can get away with it.

    I didn't pay £45 for MW2 let alone £50 or £55, and I know no-one who did.
    Edited by 1 at 22/11/09 @ 02:12

  • canIdoyabombsforya #52 2 years ago

    "So what if some iphone games are 59p? People with time and the skill can code one in their bedroom with little in the way of overheads, whereas a big studio cannot run this way."

    No, because the bosses have big houses and Ferraris to pay for. They're in it for the money. There's a lot of bedroom coders who make games because they love games and get/or want very little out of it financially.

  • RobotRocker #53 2 years ago

    If we paid £19.99 for every game, then every platform's release schedule would devolve into shovelware pretty quickly.

    Bull. Shit.

    If anything it would make companies try harder to stay competitive in the market since there would be much more consumer impulse buying and more minor games would stand a chance at market. Bionic Commando died standing on its legs at retail. What if it was released at £19.99? More people taking a chance on it as an impulse and less disappointment if it turns out to be less than great. Might have saved GRIN too.

    We are conditioned to accept that games are £40+ when released thanks to Nintendo's price fixing shenanigans in the 80's and 90's and the main three have ran with it instead of realising that they should try stay competitive with other media when the cost of manufacturing games went down. Now we have a bloated mess of an industry desperately trying to muscle into the big boys of entertainment while not realising that in the long run, the prices they are looking for entry are going to cause the industry to crash and only the iPhone and Shovelware developers will be left standing.

  • 4thVariety #54 2 years ago

    The nice thing about selling games for 60€ is that you can still sell them for more reasonable prices LATER. Don't underestimate the money made off the platinum series releases.

    To a degree it is the customer's fault, why do they want to have everything on release day? Why is a whole generation falling for dirt cheap marketing tricks?

    If you are a fifth grader trying to be competitive about who is first in the class room and shouting "first" at every corner then that is in good fun. If you grow up to do that with any commercial product, then you will get exploited and publishers will laugh their ass off while you stand in line at midnight believing only preordering guarantees you will be able to own some plastic disc made in China.

  • beckyh #55 2 years ago

    Of course it was not justified because Activision still have not explained the reasons for their greediness. You can only have a jusrification when there is a reason offered and so far they have failed to do so.

    As for the customers not being affected by the price, well I think that is more down to good luck than good management. At the time of their decision they had no idea that many retailers would suck up the price. For all they knew, the total cost would be passed to consumers.

    As far as I can see, until Activision properly justify their actions, they will be seen as a blood sucking company trying desperately to milk a cash cow and not givng a shit about the end user. It will be an even bigger insult when they publish their annual profit margin. I cannot wait for the comments on here when that is released.

  • chrisola #56 2 years ago

    "No, because the bosses have big houses and Ferraris to pay for. They're in it for the money. There's a lot of bedroom coders who make games because they love games and get/or want very little out of it financially."


    If this iphone coder creates the next Tetris, and he sells tens of millions of games, will you turn on him and say he shouldn't be able to buy a house and nice car with his profits? Will you then say all games should be free because the creators are not allowed to make money?

    Is John Carmack in it for the money? Is he not allowed to have a Ferrari after working for years to bring us some of our favourate games? How about Gabe Newell? Wasn't he already loaded when he co-started Valve with his own money? (although i suspect you are attacking Bobby Kotick here?)

    What do you do for a living? I don't think you or your bossess should be paid anything above minimum wage, no matter how good you are at what you do, or how much money you make doing it. The people who pay for the goods\services you work with\provide are being ripped off so that you can enjoy a decent living and play games! -- nice attitude to bounce back at yours eh?

    "If anything it would make companies try harder to stay competitive in the market since there would be much more consumer impulse buying and more minor games would stand a chance at market."

    Ok, so lets see what new releases recently came out and started at this fair price point of £19.99 (i've just searched Amazon for release in last 30 days, £10-£20 price):

    Madagascar: Kartz (Xbox 360)
    The Biggest Loser (Wii)
    CSI: Crime Scene Investigation - Deadly Intent (Wii)
    NHL 2K10 (Wii)
    Madagascar: Kartz (Wii)
    Singstar: Take That (PS2)

    See a pattern here? There were other new games selling at £19.99 but with a RRP of £24.99 too, for an extra fiver you could have one of these AAA titles:

    Cars: Race-O-Rama (Wii)
    SpongeBob: Truth or Square (Wii)
    Fairytale Fights (Xbox 360)

    Sure, GTA Episodes was £24.99, but that was only a new story using existing tech, similar with Halo: ODST. I seriously doubt either of those releases could have been created from scratch to be sold at £24.99 price point without causing the studio some problems financially.

    Bionic Commando was a lower price game which was sold as full price one, also, it wasn't very good (having rented and played it through to completion) and based off an IP which nobody really cared about anymore apart from a retro buy of the updated side scroller on XBL. That is why it died at retail.

  • superteddy #57 2 years ago

    Remember alot of special editions were bought for £69.99 , £99 , and £119, At the midnight launch more were been bought than standard copies and by hardcore gamers as i stood and watched. On the subject of supermarkets i like their special offers as well, but lets face it all morrisons sell are the top eight , game shops would not last long if all they sold was eight games.

  • Bremenacht #58 2 years ago

    Great article, but I don't think it's the last we've seen of suggested £55+ prices. Some company will still want to know if consumers will pay that price, without any discount - most likely another plump 'untouchable' franchise, like Halo Reach or Gran Turismo. I can see consumers paying that price too, thus guaranteeing a future £55+ price tag for any 'premium' IP.

  • ps3owner #59 2 years ago

    I bought mine on Ebay, £32 (price for recored delivery included). Has nobody bothered with ebay?! I didn't even bother bidding. that was the "buy it now" price. loads of ppl seemed to be bidding and ended up with more than £32... don't get it :)

  • Nephirion #60 2 years ago

    I think that they considered the price rise justifiable based on previous success and demand. If you look at it from was the hike justified based on new content and improvements I would say no. It uses the same engine, has actually less features than the previous game as is alot easier even on the hardest difficulty. I don't think that this game will hold the same market value as Modern Warfare based as the longevity multiplayer element has been dramatically reduced.

  • penhalion #61 2 years ago

    In the end I think it's going to be pressure from stores like Game and EB that drive the price back down to a normal level. These stores recieved a major kicking when MW2 came out, as they were the only stores (both here and in the states) that were selling it for the new inflated prices. As a result they recieved a much lower slice of the pie than they are used to and cried foul against the supermarkets and online retailers as a result.

    The only people gaining, in the short term, were Activision. A certain someone sold their shares on the back of this, knowing that the experiment was a complete failure. \the net result is that places like game and eb will most likely order much less stock of activision games at these new prices, now that they know the consumer isn't willing to support them. The supermarkets will continue to steal business from the dedicateds by loss leading too.

  • Smugglarn #62 2 years ago

    So why oh why is it 60€ on Steam?

  • jefranklin18 #63 2 years ago

    Consumers who spend hours playing something like Farmville for free will increasingly question the basic concept of spending the same amount on a videogame that they would spend on a night out

    Wish my nights out were that bloody cheap...
    Edited by 1 at 23/11/09 @ 17:58

  • DirtyDubs #64 2 years ago

    Without a doubt it was justified. At the end of the day they are a private company who are in the business of making money for their shareholders. The price hike hasn't stopped people buying the product so it was therefore priced correctly to make the most money it can.
    Also huge profits can allow for more development in future niche products, products which may be priced lower due to a smaller target audience.
    At the end of the day it's pure business and if people weren't happy about it they should not have paid for the game.