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Last July, Take-Two announced that NBA 2K21 would be the first game to claim $ 70 for the Standard Edition on “next-gen” systems (ie PlayStation 5 and Xbox Series S / X). Last week, Take-Two CEO Strauss Zelnick doubled down on the move, saying the market was ready for a de facto price cap increase for the game.
“We announced a price of $ 70 for NBA 2K21, our opinion was that we offer a range of amazing experiences, a lot of replayability, and the last time there was a frontline price increase in the US was in 2005, 2006, so we think the consumers were ready for it, ”Zelnick told the Morgan Stanley Technology, Media & Telecom conference (as transcribed by Video Games Chronicle).
This is not that surprising, considering the source of the quote. But we shouldn’t have to take his word for it. Four months have passed since NBA 2K21 launched on new consoles, and six months have passed since its launch at a lower price of $ 60 on the PS4 and Xbox One. This should be enough time to determine if gamers as a whole were willing to spend the extra money on a big name ‘next gen’ experience, and if Take-Two’s pricing experience is worth it. be repeated, right?
In fact, answering these questions is not that easy at this point.
Ask again later …
Much of the problem with analytics NBA 2K21The $ 70 price tag is that the game was also available in a $ 100 “Mamba Forever Edition”. This special edition included both the latest gen version of the game and an upgrade to a next gen version, as well as a number of digital giveaways.
“Many people who have purchased later-gen versions of games are now playing them on their new consoles after upgrading the game. [through the Mamba Forever Edition]”Mat Piscatella, video game market analyst for NPD, told Ars Technica.” However, the original sale is still attributed to the older generation version. I’m not even reporting platform splits, link ratios, or connection rates for these new consoles as these data points are currently unreliable. “
Another problem, says Piscatella, is the small sample size. After NBA 2K11 very publicly moved to $ 70, only a few other major franchises have followed suit, including Activision Call of Duty Black Ops: Cold War and a handful of first-party PlayStation 5 exclusives. Most of the other big publishers stuck at $ 60 for this holiday season, many of which were offering free next-gen upgrades to gamers purchasing games on older consoles, further complicating comparisons.
It’s even hard to judge any of these new titles against expectations so far, Piscatella says, in part because supplies for the PS5 and Xbox Series X / S have been severely limited in the New Year. . “Given the small sample size and the challenges of upgrade versions and limited hardware supply, the data does not yet suggest a particular answer,” said Piscatella.
Lessons from history
Things got a lot worse the last time console game prices saw a significant intergenerational increase. At the end of 2005, it was Activision breaking the game’s $ 50 price cap, asking $ 60 for Call of Duty 2 on the brand new Xbox 360 at the time. The increase was even more noticeable given that Activision had charged $ 50 for the PC version it launched a month earlier.
Unlike today’s price hike, however, the 2005 price hike was an immediate and undeniable success. In December, IGN cited NPD data showing that 77% of Xbox 360 owners had purchased Call of Duty 2, even at the increased price. With such a performance, it’s no wonder that every other major publisher felt comfortable doing the same in a matter of months.
“They were selling so many copies of Call of Duty 2 at $ 60 that the rest of the industry was like, ‘Well, damn it, if it’s going to be $ 60, let’s go to $ 60,’ “Piscatella told The Ringer.
Thanks to inflation, of course, a game worth $ 60 at the end of 2005 was worth more than $ 78 in dollars at the end of 2020 (according to the BLS inflation calculator). But apart from inflation, the industry has undergone many changes that could make a higher price more difficult to swallow these days.
“There is a lot more [price] general variability compared to launches of previous generations, many games released at all types of price, “says Piscatella.” [console] generations, we would have maybe 2 price points. “
Then there is the rise of subscriptions to be taken into account. On Xbox platforms, for example, Wedbush analyst Morgan Michael Pachter tells Ars that sales of new software are generally down “because 50% or more of new Xbox owners subscribe to Game Pass, and they are 18 million subscriptions. ” It’s too early to know if those subscribed players will be much less willing to buy a major game at a price of $ 70, Pachter said.
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If you wanted Streets of Rage 2 from Electronics Boutique in 1993, you’d better have been willing to pay extra.
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By 2008, high-end disc prices had stabilized at the current standard of $ 59.99.
A higher initial price might also make less sense for games that make a large chunk of their money from post-launch microtransactions. A big name game like FIFA could do more initial revenues from a price tag of $ 70, for example, but it could still hurt EA if “it impacts back-to-back income from in-app spending,” Pachter said.
Looking to the future
Real proof that the $ 70 price tag is here to stay will come later this year. By then, the market as a whole will be able to digest the performance of the current crop of $ 70 games compared to expectations. If they do well, you can expect to see a good number of copiers in the fall, Pachter said.
Even so, however, Pachter sees the $ 70 price tag as more of a “game-by-game decision” than a de facto new standard for all big-budget games. “People will pay [$70] for some games, [but I’m] I don’t know if they will do it for every game, “he said.” Most editors will watch and see what Take-Two does and if it works. And even Take-Two’s Zelnick said that the $ 70 price would be on a per-title basis. “
Piscatella agreed that “price sensitivities are changing” these days and that a price tag of $ 70 won’t work for all major titles. “My guess is that the biggest franchises that generate the highest demand shouldn’t have big hurdles with that $ 70 base price … and many will choose even more expensive versions with additional content,” Piscatella said. . Ultimately, “it’s all about the individual game”.
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