There has been quite a bit of complaining on the Interwebs as of late regarding the high retail price of video games. Myself, I feel that these prices have remained pretty stable over the last 20 years or so, and as a result they are fair when you factor in inflation.
However, if you do feel that the prices of games are gauging, then it may be the result of Sony (I’ll throw in Microsoft and Nintendo as well, since the report I’m looking at only talks of Sony) sell its consoles at a loss or near loss. According to IGN, IHS has revealed a teardown analysis of the PS4 that shows the cost of assembly and components hits Sony with a $381 bill. This is just $18 below retail. Factor in retail profits and there’s not much left over for Sony.
IHS analyst Andrew Rassweiler stated in an interview with AllThingsD:
It looks like once again, when it comes to profits, it’s all about the game titles.
I think Sony did a great job of remembering the outcry the price of thegenerated at launch. That unit sold for $599, while it cost Sony $805 to build the damn thing. That’s a $206 loss. Sony managed to make a superior machine while reducing its cost to build and passed the savings onto the consumers. I guess some gamers might wonder why, if Sony has reduced the cost over the previous console and isn’t operating in a loss situation, the company can’t reduce the price on games. Well, economics doesn’t work that way; once the price of something goes up, it rarely comes down.
So, there you have it, a very rough explanation as to why games cost 60 bucks.
Rock Hard \m/