In a recent interview, the CEO of Embracer Group delved into the topic of raising video game prices beyond the $70 mark. While the current pricing landscape aligns with other publishers, alternative pricing models are under consideration.
For years, the cost of full-priced video games has remained relatively stable, hovering between $50 and $60. However, console players have been accustomed to prices around $70 for some time now. Now, there are speculations of potential price increases beyond this point. Lars Wingefors, CEO of the colossal publisher Embracer Group, shared insights on the current gaming market and its associated pricing policies.
The Potential For Price Increases
"I'm not saying you can't increase the price," Wingefors explained, "But the reality is no one has tried it. If you create an enormous RPG, for example, with 100 or 150 hours of gameplay, very polished and a unique experience, would the consumer be willing to pay more? If they would, they would have more products potentially coming to market. But no one tried it."According to Wingefors, it's conceivable that video game prices could surpass the $70 mark if publishers provide a substantial amount of content for players, even if Embracer Group might not be the first to take that step. Other publishers are also internally and externally discussing the idea of a price hike. In November 2023, Strauss Zelnick of Take-Two stated that video game prices are still relatively low compared to other media. The publisher has yet to announce a price for Grand Theft Auto 6.
Industry Norms: The Complexities Of Price And Content
Wingefors emphasized the challenges faced by developers, stating, "Whatever you produce, if it isn't the absolute best game in that genre or really hitting something unique to the players, it's very, very challenging."Consumer choice is certainly a major factor – a recent Newzoo report revealed that over 60% of playtime in 2023 was spent on games six years old or older. Put in annual releases and other factors, and the vast majority of new games are jockeying for just 8% of people's playtime. Wingefors highlighted this, saying, "Which means if you are doing Alone in the Dark, you really need to nail it because the window is very small."Instead of price hikes, the answer to rising development costs seems to be finding ways to make games for lower budgets. "There is more optimization coming through in the course of the year," Wingefors noted. He also expressed belief in consumer engagement with quality single-player games, stating, "I just believe there are consumers willing to engage in those amazing RPGs and other single-player games, and ultimately they are willing to spend money on them."