Monday, June 13, 2011

Designer Notebook: Price Discrimination

(Note: This was writing a while ago... E3 sorta delayed all this... :P)

Speaking of Digital Distribution, one thing that is really weird to see is the public assumption that digital releases should be under X amount of dollars. I do agree with the general consensus that they should be somewhat cheaper because the cost of manufacturing, packaging and delivery is gone, but that doesn't mean that everything released on services like PSN or XBL should be under $20. I blame Nintendo, MS and Sony for not able to "separate" retail releases to "tiers" of pricing levels: not all games are made equal, and not all of them should be priced the same at the start.

Price Discrimination is a practice that most industries employ on their products, but games have largely stayed away from this for some odd reason. Platform holders had perceived this flexible pricing as "signs of weakness" to the games on the platform, but I'd argue that charging full price on a shorter game is more damaging to the brand and platform. For example, the recent release of Steel Diver on the 3DS was often argued to be lacking in substance, so why release at the same price as all other retail games? By putting it at a slightly lower price, it could have be better received. While most reviews (and reviewers) claim that they don't judge a product based on price, this factor still comes into play for most consumers: evaluating the dollar value of any given product. Hopefully companies will soon realize that not all games are made equally, and shouldn't be priced as such.

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