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Forums - Gaming Discussion - Dear PlayStation Fans: Trickle-Down Economics Isn't Real!

I paid CAD 159.99 for FS2020 and CAD 90.34 for Stalker 2! /flex

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JWeinCom said:

Were there any significant number of people flexing about paying more for games? Seems like OP was just looking for something to be outraged about.

I never (or at least rarely) buy ps4/5 games day 1.  Give it 6 months after launch and most games are half price anyway.  I end up spending more on Switch games as a result of prices staying at MSRP.

Shadow1980 said:
DonFerrari said:

I guess the discussion is market growth being almost zero, still having steady revenue stream, but increasing cost. How long will that be healthy?

Nothing can grow forever. Real development costs are slowing in growth and will plateau. The current average appears to be around $60-80M, only three or four times of what the nominal average was just two generations ago. Meanwhile, from what I've read, the average nominal development costs grew upwards of 10- to 20-fold from Gen 5 to Gen 7. If budgets kept ballooning at the same pace they did prior to Gen 7, we'd be staring down the barrel of a billion dollars per game on average by next generation. To break even on just the development costs (to say nothing about marketing, etc.), a billion-dollar game would have to sell over 14M copies at $70 per copy. Clearly, developers and publishers are not going to throw that much money at the average AAA game.

There are some obvious limiting factors. The biggest contributors to the increase in production budgets over time appear to be A) the increase in the size of development teams, and B) games taking longer to make. In the 8-bit era, a team of a dozen or less people could create a quality title in just a few months. Now it takes teams of several hundred people working on a title for around 2-4 years. But team sizes and development times can't grow forever. It's unrealistic to think that a next-gen game would have to have a dev team 5000 strong working six years just to make the average AAA game. At some point, things will have to stop growing. A steady-state industry like the console market isn't just going to keep letting expenditures grow at an unsustainable rate.

SvennoJ said:

@Shadow1980 I'm talking about software revenues. The hardware cycle will still reset, yet gaming revenues is where the real money comes from. The hardware doesn't make much profit, especially not with the R&D costs that need to be payed back.

Yeah. I know I've been going back and forth between software and hardware. But software sales are doing fine.

On Nintendo's end, I mentioned that they are posting some of their best figures ever. Sure, they're not where they were back in 2007-2010 when combined Wii & DS software sales were at their peak, but those years were clearly anomalies, and the past two fiscal years still ranked 5th & 6th places for Nintendo software shipments for all years going back to at least 1992. While I still doubt the Switch will become the new #1 system ever, it is still on track to sell more software than any single Nintendo system ever and has an absolutely outstanding software tie ratio, one that stands a good shot at beating the GameCube's tie ratio, which is the highest of any Nintendo system to date. Clearly, the unification of their handheld and home console efforts into a single unified hybrid system has not hurt them any.

As for Sony, the PS4 has sold over 1.4B software units as of last count, more than any other system besides the PS2, and their own first-party software sales were better on the PS4 than on any prior PlayStation console. So, they're clearly doing fine for now.

And on MS's end, apparently Xbox software revenues have been highest over the past few years than ever before. Not sure if that includes XBL and GP subs or not.

Yes, newer revenue streams like premium DLC and subscriptions have helped a lot, and the increased popularity of digital has increased the per-copy profitability of specific titles, but it's clear that the console industry is not struggling or otherwise showing signs of being unhealthy, either in terms of hardware or software sales. Just because the market isn't growing doesn't mean it's dying.

Yep, keeping the pace would unsustainable and unhealthy so at some point since revenue will stabilize the cost will have to as well either by devs becoming more efficient or the progression of graphics and etc being slower based on maturity of process without pushing much the envelope (can't say it is unhealthy, but well it is a change).

On SW sales, PS4 probably already overtook PS2. And profit wise it have done years ago =p

duduspace11 "Well, since we are estimating costs, Pokemon Red/Blue did cost Nintendo about $50m to make back in 1996"

Mr Puggsly: "Hehe, I said good profit. You said big profit. Frankly, not losing money is what I meant by good. Don't get hung up on semantics"

Azzanation: "PS5 wouldn't sold out at launch without scalpers."

JWeinCom said:

Were there any significant number of people flexing about paying more for games? Seems like OP was just looking for something to be outraged about.

Yep, at most I have seem people explaining why it happen or accepting that it happened but saw no one celebrating they are paying more.

duduspace11 "Well, since we are estimating costs, Pokemon Red/Blue did cost Nintendo about $50m to make back in 1996"

Mr Puggsly: "Hehe, I said good profit. You said big profit. Frankly, not losing money is what I meant by good. Don't get hung up on semantics"

Azzanation: "PS5 wouldn't sold out at launch without scalpers."

SegaHeart said:
Chrkeller said:

I never (or at least rarely) buy ps4/5 games day 1.  Give it 6 months after launch and most games are half price anyway.  I end up spending more on Switch games as a result of prices staying at MSRP.

Back in 2016 - 2019 I bought most games 60$, I might be low on cash these days. But 70$ is not that bad. You guys should check N64 launch games they were 80$ -100$ before gonna down to 60$ I bought Shadows of the Empire for 85$. Don't get me started on SNES I remember I think Mario ALL stars being 150$ + tax on SNES and several 100$ SNES games Though I did approach discount aisle too I bought Mickey Magical adventure for 20$ brand new. and bought Super Scope 6 game Battleclash for 1$ brand new . Modern games are not as cheap as 1$ or as expensive as 150$ for base version unless you buying collectors edition. Modern gamers wouldn't last in 4th Generation SNES prices I think?

We do have those special editions for 100+ but those likely sell very little.

And I do remember in Genesis gen myself being able to buy only 1 or 2 games a year, used and very old still needing to use all the money I received on Xmas and Bday. New games were really out of range for me.

duduspace11 "Well, since we are estimating costs, Pokemon Red/Blue did cost Nintendo about $50m to make back in 1996"

Mr Puggsly: "Hehe, I said good profit. You said big profit. Frankly, not losing money is what I meant by good. Don't get hung up on semantics"

Azzanation: "PS5 wouldn't sold out at launch without scalpers."

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The universe always loves going the opposite direction I anticipate... My threads are normally dead af lol...

I'm going to have to just do general replies, again, since I can't be out here quoting 7 pages worth and hoping to even remain capable of tracking all the posts and replies. We already saw how hard that was last time... Yes it will be a novel, but it's the best I can do with limited time.

Bandorr said:

Yeah this thread feels like a disaster in the making.

"Acting happy to pay that extra isn't the flex PS fans think it is." Gonna need a source for that. No one is flexing. They are understanding what it is going towards and appreciating that.

It starts costing more. Then the price goes down. The features stay added, the cost goes down - so I don't care at all.

"It's a good thing there's such a tiny Sony fandom presence on the forum... ... lol" This feels like Sony bait.

I didn't watch your video. You did a bad job in getting me to watch it. You made outlandish claims, put no thought into what you wrote, and very much come off as baiting people.

You've also had complaints in previous threads so I'm curious if your strategy is to just bait people into bumping your threads. If so - stop it.

Site admin: if you want me to leave, then just say that or ban me. It's not like I can't handle being told that I'm not welcome: this is a gaming forum, I came here by choice and I can acknowledge the outcome. Gaming communities and forums are always extremely sensitive to anything even remotely offending moreso than pretty much any other forums I've been on. Do what you want, pushing me out over a thread or a video that isn't directed at you or anyone (or even VGChartz for that matter) that irritates you doesn't change how my food tastes or how much horsepower my car makes. Moving onto the rest, though...

To those who think I'm making up the argument: there's no way you could be spending any significant amount of time around PlayStation fans and haven't seen them reply to people griping about the $10 price increase with (and I've literally seen these replies verbatim) things like, "it's just $10, get a job", and "tell me you're poor without telling me you're poor". Now, what's probably true is that I was seeing the loud minority, but I'd rather that loud minority never catch on. Poor shaming others and flexing how "I'll happily pay $10 more for quality" just isn't it. Now I do admit there has been a shift in the mindset of PS fans between when I recorded the video and when it went up and now, so to say that there's almost no one saying it anymore does seem relatively true just based on the last several days of gaming news. Mostly with that whole MS/Acti thing that really has PS fans' panties all up in bunch and how PSVR2 is not backwards compatible with PSVR games lol... This kind of goes into the idea that people will "know" when things are unreasonable, and I hate to break it to you, but it is a known human problem that consumption is poorly controlled (or basically, most people are NOT financially savvy and do not exhibit good self control). I'd dare say most people do NOT know when to stop: all you have to do is look at NFTs and you have this massive market of tons of money flowing around with little-to-no logical sense at all. The average person is KNOWN to be bad with money, it's what most of the companies RELY on... "Make them want it and they'll pay anything for it" and "there's a sucker born every minute" are all colloquialisms based on the general idea that "a fool and his money are soon parted". I mean, tell me about Diablo Immortal and this general money sense you believe "gamers" have lol

I do always find it funny when people say "bait" when it's usually something that might offend someone. Most of the time, these same people watch their favorite YouTubers or content creators doing plenty of "clickbait" headlines but don't care because it's on their side. I've been around long enough to see the term "clickbait" and "bait" be used far outside their proper meaning anymore. It's clearly used to define something offensive or disagreeable as opposed to its more appropriate meaning of using deception or hot topics to draw people in without actually having anything to do with it. I KNOW some of you know what actual clickbait is, there's no way you haven't seen videos using top content creator's names or topics that are hot just to get someone to click it only to find out it has little to with or doesn't even bother to address it... You ever see those articles with headlines where the actual article itself is just ads and maybe ONE line after 10 pages of scrolling that purposely NEVER gets to the point? Yea... so again, not clickbait if I literally talk about the topic in the headline and address it directly. Disagreeable? Offensive? Controversial? Annoying? Heck, even WRONG? Sure! Clickbait? Nope: I don't do clickbait. I don't deceive anyone, I literally talk about exactly what the headline says. The CLOSEST to clickbait I do is the video thumbnails on reviews now that are just me making a quip based on the image in the thumbnail... which is actually experimental in nature since I've never done that before and I want to see what affect it has, if anything.

Inflation is always a fun topic, but not in an actual fun way. People love to go the easy route: if the inflation rate calculates that something back then costs twice as much now, then it was twice as expensive back then and we should all shut up about how much "cheaper" things are, now. That's not how inflation actually works because there are an absolute shit-ton of other factors. One cannot simply use inflation rates and say a game from the 80s would cost $90, now. That's just not how it works. People handily forget that economic VALUE is a key factor in inflation, not just the price tag. It's not correlated as a simple "value of the dollar" because proper correlation includes the "value of the good or service" against the market and economic status of the target demographic. Then you also have the change in core living costs and wages (though let's all agree wages have NOT kept up with inflation). Inflation has long been used as a corporate method for hiding the actual target which is, "we want to keep our profits up so the people at the top can get richer".  Inflation is real, but not in how its presented by corporations.

As time goes on, commodity items get cheaper right? It's accepted that Nintendo's a bit of an odd one and still sells 3-4 year old games at full price. Everyone else is normal, and over time, most commodities (like TVs or whatnot) slowly drop in price until it's off the market. This is the counterpoint to inflation: if inflation was exactly how many of you think it worked, things would never drop in price because inflation inherently makes it cheaper. But that isn't the case because the market value of the good/service drops over time, further increased by market growth and competition. Things SHOULD drop in price over time because it's losing VALUE despite inflation already making it "cheaper". And this is the point about market value: a game back then would not simply be $90, now, off some simple calculation. The reality is we don't actually know what it would cost now, NOT without the necessary access to data us peons can never get that groups of people within these massive companies literally spend full time hours everday getting paid well to calculate while using market data and historical data combined with the inflation rate. The average person justifying price increases only understands inflation rate and nothing else. The reason the price went down is because these calculations were being made based on the market situation (sales), growth, and economic capabilities of the target demographic. The reason gaming had a "crisis" before (quite visible in that graphic someone posted that also conversely makes the point about how BIG the gaming market now is) was because the cost of gaming was misaligned with the economic situation, and the companies had no choice but to correct or go out of business entirely. This is where we could be heading again if these big companies keep raising prices to keep their profits up. It WILL implode if they're/we're not careful.

And yet, this is STILL a complex situation that no one can fully answer because you have to also account for LIVING costs. Necessary costs to be able to survive properly are a factor in the market value of commodities like videogames, and this is the funniest thing I usually tell just friends: "gamers" often loathe casuals, but in my experience, the casuals are often the most normal and far more intelligent people. Casuals can easily decide NOT to buy God of War Ragnarok because it's not in the budget since food/electricity got more expensive, and these casuals usually have more disposable income than "gamers", too. They buy videogames if they want to, and only IF. So when people talk about how the record profits of the pandemic have worn off and there's a dip due to inflation, it's likely more due to the fact that a bulk of the market (casuals) have simply changed priority. This segues perfectly into the next thing...

You are seeing a price increase not because it's due, but because people at the top continue to want to see more money (yea, greed). What goes up must come down, the market will always fluctuate as the economy itself does, but the funny part is: their profits may be down (across all of gaming, in fact), but at what point does that equate to Sony LOSING money/shrinking in size or being in danger of dropping out of the gaming market? That's right, it doesn't: they can EASILY afford to weather the ebb and flow of the market. They don't WANT to, and these very-well-paid people are trying to be sly, taking inflation and the rising costs of living as the perfect opportunity with their strong position in the market to focus on keeping profits up. PROFITS, the profits that the worker bee game devs aren't getting paid from, just the higher ups. And if the dip was too hard, you know what's really sad? The worker bee devs get laid off, the executives aren't going to take the hit. And yet here some of you are, saying this is "due". Nah, not like this it isn't, not for the PlayStation division. You think they raise prices and suddenly all their game devs who have to deal with "inflation" magically get the necessary pay raises to fight their increased living costs? You're absolutely crazy if you think that. This is why the video is titled "trickle down economics isn't real". And to drive that point home: inflation affects the common worker the hardest, the common worker is NOT lifted up by company profits. These multi-billion dollar companies see common workers as expendable. Let the company's profits drop, and while that may also cost some people some jobs, they'll find work likely at competing companies and the inherent "struggle" will force said company to rethink it's strategy in favor of consumers again because *dun dun dun* that's where the money comes from. I'd rather everyone manage to work together to keep game prices down and affordable, not "accept" it so handily not realizing that the increased prices aren't helping the people hurting the most from inflation.

And heading into something I didn't see touched upon: the increase of cost in game development not being in actual game development. I can't even find the article anymore because it's as old as when I found out the following, but let me start with this old example: The Witcher 3 cost MORE TO MARKET than it did to MAKE. That's right, they spent more money SELLING the game than actually making it. This ratio is pretty much every AAA game and has only gotten worse. What I'm struggling to find is the article around that same time about The Witcher 3's marketing budget that stated the marketing budget for games has nearly quadrupled (I think that was the approximation, I mean, this was seven years ago lmfao). The corporations HIDE this from you because they want you to think making games costs more, but what they're not telling you is that the primary increase in cost is the marketing. So if you ever wondered why your AAA games seem to often come out less polished than it should be, just know that it's because they spent more money trying to sell it to you than to make sure it worked good. Since I can't find that oldass article, this is a "source: dude trust me" but for real.

And now there's also the tertiary topic of the actual volume of sheer games available to people. Think about it: in the old days, someone might buy a SNES and have hundreds of games available to choose from. Now, there are easily thousands on varying platforms. In fact, I mentioned porn games in my previous video, and I wonder who (if at all) is tracking that market. If you take into account the sheer volume of games available between devices, indie devs, etc., you quickly realize just how sizable the gaming market is, now. To say its stagnant isn't true unless you look at a narrow set of values to define it. There's demand in nearly every possible facet of gaming from hardware to accessories to indie/porn games, and as the mobile market grows, it demonstrates a lack of need for dedicated gaming hardware (think about it, just about any modern phone can play Genshin, so Genshin has no required hardware other than the fact that PlayStation is paying for console exclusivity and popped Aloy in there for it). I don't think the market has reached a saturation point, it's reaching an overwhelming cost point. In order to enjoy all there is in gaming, one probably has to spend FAR MORE than ever before. So proportionately speaking, despite inflation, despite any of that talk, more people are buying games and gaming stuffs now with more disposable income available to buy it with in larger amounts than ever before. The reason gaming companies have diversified their gaming income sources is because they recognize demand in other areas and want to capitalize on it. Of course, that's how capitalism works, and I think it's less stagnant and more capitalist society reaching an unreasonable cost position as a consumer may find gaming hard to enjoy when one now has to buy more hardware and/or more games to "truly enjoy it" that they simply don't have time for. As a person who has dabbled in many things, sometimes something can be unappealing because of how much there is to it, not necessarily its cost. But since I mentioned captalism...

I'll never understand greed, and I've said it before: my time in gaming is finite. Outside of the channel, I barely buy videogames, maybe 3-4 games in an entire year at MOST (and that would be because of key titles like God of War or Tears of the Kingdom) since gaming is a commodity and deep down I'm more of a car guy. Videogames remain a part of my childhood I wish to keep, but it's never enough to get personal and attack people over which leads me to my final statement.

Mods and people actually discussing legitimately: I do appreciate those of you trying your best to keep things focused on the discussion and not on personal attacks. I still can't wrap my head around why someone would watch a video that doesn't even name them or have anything do with them directly and respond with personal attacks or denigrate the person over it. Will I get personal if someone gets personal with me? Sure, but I've been in gaming long enough to have seen, watched, read, heard thousands of things I don't agree with, and never once have I responded directly to it with personal attacks. So just know I appreciate those of you who recognize it and know that even if you don't agree with something (or even like me for that matter!), unless it's specifically about said person, there's absolutely zero need for personal attacks.

Gaming Mindset:
"I prefer mangos over bananas, I like the tanginess"
"Wow, you are so fucking stupid, bananas are way better and healthier and cheaper, tanginess is bullshit"
---> fighting happens

Normal People:
"I prefer mangos over bananas, I like the tanginess"
"Why other than the tanginess? Bananas are a good source of potassium and are also cheaper/easier to buy since they're virtually always in season"
---> learning happens

Check out my entertainment gaming channel!

I agree, personal attacks are not right. However I can't say I agree with pretty much anything you wrote up there about inflation, economics and the gaming market.

You can keep pushing the greed argument, but that has little to do with it. Forecasting, planning for the future, adjusting to fluctuations in exchange rates, production costs, wages, is what drives up prices. You can blame gamers for flocking to be best advertised, best bull shotted games. That's why graphics and marketing get priority, because it sells games. Simple as that. To stand out in the competition you need the best looking best advertised games.

And yes, more games get sold than ever before. However at an lower average price, since how else is game sales revenue not climbing at the same rate? All those extra games have their own costs. In the end costs, either due to marketing, better graphics, simply higher volume of available games/competition, keep going up, while revenues aren't keeping pace.

"a consumer may find gaming hard to enjoy when one now has to buy more hardware and/or more games to "truly enjoy it" that they simply don't have time for."
Err, so a consumer might find watching TV hard to enjoy because they can't possible watch everything to truly enjoy watching tv? That does not make sense at all. Gaming is cheaper than ever and there is so much choice nowadays it would be really hard not to be able to find something to truly enjoy.

The last month I truly enjoyed Factory Simulator on Roblox, didn't cost me a cent.

It even runs on my 15 year old Windows NT machine (I had 4 accounts going in co-op lol, can run 2 per windows device)

Very easy to truly enjoy gaming. Say bye to FOMO and just play what you enjoy playing.

70 bucks for a digital download game seems like fleecing the top layers of the market. I remember $50 being normal for physical copies. Thems 40% inflation and  reduced service.

You won't convince that audience. They want to continue to defend price hikes and while if Xbox or Nintendo raised their prices instead, they would be the first ones to assault the idea. Its a sad reality and is why these companies will continue to get away with it.

ZyroXZ2 said:

I'm noticing it, and maybe you are, too: PlayStation is showing increasingly greedy signs. But the one I continue to take issue with is the $10 increase in their game prices. Acting happy to pay that extra isn't the flex PS fans think it is.

No written version, but because I'm avoiding it, but because this is more of PSA video.  It's a good thing there's such a tiny Sony fandom presence on the forum... ... lol

You claim you cant blame Inflation, because in 2022 more people are spending money buying video games than ever before.
Do you have a source for that? Like are you sure, game sales are higher in 2022, than in 2021? 2020? 
20 million consoles is little compaired to the 100m+ PS4s out there, like Im sure they where makeing money selling games in years before.

Meanwhile global inflation is like 8% on avg now (in 2022) and will likely go up by another 8% in 2023.
That alone is like 5$ increase justified (8% of 60$) (next years inflation, 70$ will be the same as last years 60$).

How long will it take before Microsoft and Nintendo up their prices? and will you make videos about that, next year (if it happends then)?

Also theres something to be said about quality of titles, and their types vs prices to make them.
Ofc a huge story telling 1st party game, costs more to make than say a nintendo platformer or a MS online shooter or such.

Sony obviously felt they needed to increase prices, and arnt just doing it for greed (I assume, why assume the worst?).

Last edited by JRPGfan - on 17 September 2022