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From a pure mathematical standpoint, if you buy more than ten games new per generation, it would be more cost-effective to buy the console at $600 and the games for $40. However, if you buy fewer than ten, it would be more cost-effective if the console cost $400 and the games cost $60. Once you buy ten games, you would reach $1000 spent in either pricing scenario. Of course, the prices of hardware and most individual software releases decline over time, so for this rule to remain true both hardware and software prices would have to remain proportional over time in both scenarios.

Regarding platform royalties for third-party titles, the most common estimate I've seen cited is $7 for Xbox & PlayStation titles. It's unclear if that's an average and that the royalty fees are variable amounts negotiated separately on a publisher by publisher or game by game basis, but so far I haven't seen anything claiming that a third of the cost of a $60 third-party game is the royalty fee paid to the platform holder. So, waiving platform royalties is not likely to knock $20 off of the price tag. And regardless of if they were waived or not, the savings to the publisher would almost certainly not get passed on to the consumer. The last time savings in the cost of making a major game were passed on to the consumer was in Gen 5, where the PS1's disc-based games cost less than the N64's cartridges, both in terms of manufacturing costs and costs to the consumer. Of course, PS1 games cost $60 when the system was still relatively new, so perhaps the only reason PS1 games started to cost less than N64 games was because of a strategic decision to undercut Nintendo's prices. It's worth pointing out that digital distribution, with its absence of manufacturing and distribution costs, hasn't resulted in cheaper games, as AAA titles still cost as much digitally as they do physically (and in the long run they arguably cost more, as physical software prices decline more "organically" than the planned, periodic, short-term sales issued for digital games).



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In accordance to the VGC forum rules, §8.5, I hereby exercise my right to demand to be left alone regarding the subject of the effects of the pandemic on video game sales (i.e., "COVID bump").