Microsoft has joined a growing list of companies who have argued that AAA video games are becoming more expensive to create and increasing prices is warranted where it makes sense.
In a recent earnings call, CFO Tim Stuart was asked about Microsoft’s plans in this regard, to which he said that the company will announce its pricing model “in due time.” However, he added that publishers have to “make the right decision for their content.”
From a consumer standpoint, if you’re a game creator, games are getting more expensive to create. They’re driving revenue growth as well, and they’re looking for opportunities to go create more monetization for the support of that content creation. And that’s when you see a little bit of the game pricing going up.
I think we’ll look at publishers to make the right decision for their content. If they can drive a premium price point or a higher price point, I think that’s warranted. And I’d say, your point is exactly right. Prices have not gone up in – what, for a couple of generations now, so it’s not unheard of to see things like this going on.
And to the point earlier, content creation costs go up. And these publishers and content creators, including ourselves, want to make sure you’re driving the right gross margin profiles, the right earnings profiles of what it takes to build these new, awesome, amazing games. And you want to make sure you have a good top line to support that.
Stuart’s comments don’t necessarily indicate that Microsoft will increase the prices of its first-party games like Sony already has. However, the company certainly believes that at $70 price tag is justified.
[Source: Seeking Alpha via Games Industry]