Nintendo Explains Why Digital Games Aren't Any Cheaper

[Lyvric]

I also want to note on my 3ds the bought goods are saved to your device, not your account, so if the device goes - bye bye game. I don't agree on the price being the same for many reasons, but this is the elephant in the room for me. I can at least pop a physical game into a diff. system.

 

[chikusho]

I'm saying that it's the exact same model. People level all kinds of complaints at EA Origins, but because Nintendo is Nintendo, they can get away with doing what they're doing. They aren't really doing anything different at all. So why is one succeeding where the other isn't?

It's the exact same principle, what differs is the products, the execution, the demographics, the branding, etc.
Why it works so well for Nintendo? That's something you should ask an economics professor or a business analyst, really, but I think that a lot of it comes down to Nintendo games mostly competing against other games on their system. If a certain kind of game, like "wave your arm at sports 3!" is usually priced $10, and a major Mario title is usually priced $60, selling the Mario game for $10 could make a consumer equate it with $10 quality and pass it over.

EA on the other hand, competes with Steam as a service, which has already established a standard of insanely cheap game sales. Also EA's catalogue is far less unique and recognizeable, and speaks to a more hardcore and knowledgeable consumer base.

You might not agree, because (spoiler alert) people have different values. It's not rocket science - if I'm not getting a box or instructions or anything extra with the game, I shouldn't have to pay as much. If I value the game more, I'm going to want all the trimmings, so I'll pay more for a physical copy. That's it.

Personally, I'm an educated consumer and know enough about games and my tastes in them to not equate the price tag with the actual quality and/or my enjoyment of a product. But Nintendo isn't using this strategy to sell games to me, because I'm likely a part of a small minority of their customers. (actually, I haven't owned a nintendo product in 10 years, but you get my point).

More like: We are charging retail price because if the games were cheaper they would be perceived as less valuable, which would hurt the product and/or our brand.

CORPORATE SHILL!

Kidding aside, I think a legitimate question is, between the consumer and the industry, who should determine value? Or reworded, whose measure of value weighs more?

I mean, on the one hand, it's always the consumer who determines value, because if the perceived value doesn't equate with the price then they won't buy it.

Left to the consumer, many factors are considered (price, features, quality, etc.). They often tell a truer story than marketing, and out of experience, have to be after the game releases. No one goes around thinking that because a game costs less, it's less enjoyable. Normal people don't go into stores intending to buy the most expensive products, and if the price could be lower for what they've intended to purchase, they'll take that.

I'm guessing their market research suggests otherwise. Besides, if a game is usually priced a certain thing and you see it somewhere for less, you'll jump at it to make a good deal. That won't happen if it's cheap to begin with. Most of Nintendos consumers aren't educated or interested enough to really know everything about every game, so the price tag may very well be a label of "higher quality game".

 

[SinisterGehe]

So digital games are the same price as physical copies cause publishers want more money.

Yet another blinding insight from Nintendo.

Didn't this industry used to be about producing fun entertaining software for the delight and wonder of the general public?

I think their productions are way less fun than what they say to defend their practices. I find that theater act to be worth thousands dollars.

Anyway...
If I understood right so the value of product is based on what we the consumers set it to. For me every Mario games is worth negative, they must pay me to play them. But yet this is not a fact. Neither will a nintendo game's "value" increase to 100?, at least it wont as digital that is for sure.

Companies have realized that when there is development cost + publishing + logistics = $ when you take logistics and retailers out it equals $$. Sadly they have not realized the potential of lover price point by a small margin, say 10 or 20? resulting in $$$$$.
I understand that this industry now days is run by corporate, business oriented people who only care about the numbers of next quarter - well 2 honestly, summer and pre-holidays. And are completely blind to the profit margin of long term.

 

[Dragonbums]

I didn't say they weren't being stupid, but the way comments on this thread is going is less of just being genrally tired of digital copies being the same as retail copies and more or less being like "X company is stupid for doing this what clowns" like they are the only company doing it.

Doesn't make it better, but considering how they are basically reinforcing the standard mentality it doesn't even surprise me at all.

Nintendo, Microsoft, Sony, any company is stupid if they seriously claim that digital copies somehow must be the same price when they cost them less to produce.

Nintendo's mistake here was commenting on something that is clearly a cash grab by publishers. You're quite right that this is the status quo though. But what does it being normal have to do with us not ridiculing them on it? As long as we're equal opportunity ridiculers then let us do that all day long.

In general, I honestly felt it was beat to death overall.

Not this particular thread with Nintendo, but the whole thing in essence.

It's like "X company not reducing price of digital games" and at that point I'm just like whoopee, what else is new.

As I said to another user I'd be more interested in them reporting on game companies that do indeed release their digital versions cheaper. See how much more successful (or not you never know) they are doing that, as opposed to doing the norm.

Hype that up a whole lot (and we are really good with causing shit storms so this not working would all be on us) and eventually one of those studios are going to say "okay, let's actually try that out"

At this point it's like another article stating that EA is trash.
Yeah we all get angry about it, but honestly what is the big deal anymore. EA did a stupid. Move along to the next article.

I understand that this issue is beat a lot. But we need to keep doing it. If we buy games digitally then we deserve to have a price reduction. The publishers and the platform get to have a much higher cut and have much lower distribution costs.

This is the number one reason I buy dozens of more games on Steam than I do on consoles.

I don't think buying during sales help at all. Companies like to do self fulfilling prophecies. To me, when you buy during sales, all it tells them is that you just nabbed people who didn't want to buy it full price because [insert other reasons not related to refusing to buy a digital game full price]

I think the only way to send a message to them stating that this works better is if a company were to make a digital copy of the game cheaper than the physical product from the get go, and more or near more consumers buy the digital copy than the original one.

 

[Kittyhawk]

A steaming pile comes out of Nintendo's mouth. Truth is they do not believe in making a loss at all, even to offer the consumer a better deal (especially in Japan). It seems clear that Nintendo haven't been watching what's going on PC with Steam, and the fact Steam sells more games because of its well known sales act as a stimulant.

For every generation of Nintendo they've been singing this poor 'because its worth it' song to help line their coffers. As a result each generation, I ended up buying much less games on a Nintendo system, than I wanted to buy, purely because of high prices. In contrast to that with Xbox 360, the reason I have nearly 200 games is because of sales and price drops, allow me to pick up sweet gems of gaming for a swansong.

And long may such continue, and down with full priced games forever across a consoles life.

Gamers should be making a saving on digital sales, no doubt about it.

 

[Fox12]

So basically "heightened value" meaning they want to suck as much value out of people as possible.

This is the first time I've said this, but fuck you Nintendo.

 

[Slash2x]

I didn't say they weren't being stupid, but the way comments on this thread is going is less of just being genrally tired of digital copies being the same as retail copies and more or less being like "X company is stupid for doing this what clowns" like they are the only company doing it.

Doesn't make it better, but considering how they are basically reinforcing the standard mentality it doesn't even surprise me at all.

Nintendo, Microsoft, Sony, any company is stupid if they seriously claim that digital copies somehow must be the same price when they cost them less to produce.

Nintendo's mistake here was commenting on something that is clearly a cash grab by publishers. You're quite right that this is the status quo though. But what does it being normal have to do with us not ridiculing them on it? As long as we're equal opportunity ridiculers then let us do that all day long.

In general, I honestly felt it was beat to death overall.

Not this particular thread with Nintendo, but the whole thing in essence.

It's like "X company not reducing price of digital games" and at that point I'm just like whoopee, what else is new.

As I said to another user I'd be more interested in them reporting on game companies that do indeed release their digital versions cheaper. See how much more successful (or not you never know) they are doing that, as opposed to doing the norm.

Hype that up a whole lot (and we are really good with causing shit storms so this not working would all be on us) and eventually one of those studios are going to say "okay, let's actually try that out"

At this point it's like another article stating that EA is trash.
Yeah we all get angry about it, but honestly what is the big deal anymore. EA did a stupid. Move along to the next article.

Ummm... I read most of this thread and noticed that EVERYONE seems to have misunderstood, at best, Steam pricing.....

http://www.gamestop.com/xbox-360/games/batman-arkham-origins/109022
http://store.steampowered.com/app/209000/

and in most cases Steam gives you a discount if you preorder a game with them. Ghost was $49.99 USD before launch... I do not know about the past but moving forward Steam seems to be getting what we are looking for in pricing.

 

[Scrythe]

Because when I payed $30 for Human Revolution (or any other AAA title) instead of the full $60, that somehow cheapened the experience for me. Sure, I enjoyed it, but I could have enjoyed it more at retail price.

Nintendo logic.

 

[Banzaiman]

You what?

Surely it wouldn't devalue the property itself if you just shaved off the savings from not having to make physical copies off the cost of the digital ones? Wouldn't that be keeping status quo? Of course, what do I know about business, because Nintendo has it all figured out and I could never hope to understand their reasoning.

Seriously, I like Nintendo, but they can seem a bit thick and clueless sometimes...

 

[TheSchaef]

We decided that, since the contents are the same, the company would offer the software at the same price, be it the packaged version or the digital version."

Except the retail price includes physical distribution costs, and the reseller's piece of the pie.

Selling direct cuts out all those middleman costs, and even then, brick-and-mortar stores have sales and special deals and things like that going on all the time.

I seek out digital for specific reasons: ease of library maintenance, and my small children have been systematically destroying my physical discs. And for that you're charging me more than I would pay if I went down the road to the Gamestop, especially when I could potentially sell the game back to them later for credit, whereas digital copies are stamped on my Wii U forever.

Not to mention even a 10% shave on the price would incentivize people to buy direct rather than through a reseller and you'd put all the extra profit in your pockets.

 

[Therumancer]

Yes, well, as I said for years during the growth of digital, even when it was just arriving, that this was going to be a problem. In general big business never actually delivers on lower prices when they promise it. Half the point of going to a digital format was that is was going to save us all a ton of money and reduce the price of games by a crazy amount. This was supposed to be "our" benefit as consumers for the amount of control the companies would then have over the content. Of course with no safeguards, and a lack of customer foresight, we pretty much had the control of our products taken away from us, and we're being charged the same thing we always were, albeit that now includes a higher margin of profit due to the expenses being cut out.

Basically Nintendo's attitude is that since they have you by the nuts, they have no real reason to cut you a deal. You either pay what they ask for, or you go without.

That said, on the surface there is a legimate issue here, if Nintendo plans to continue producing hard copy media they do not want to wind up with a situation where they have a bunch of carts they simply can't sell because people buy nothing but digital when the price difference is that vast. In general Nintendo's audience includes a lot of kids whose parents might not want them to have a ton of digital access, and prefer them to do as much as possible with physical media, that way there are no concerns about them buying things unexpectedly through the online stores, being stalked through a connection, or whatever else parents might be concerned about nowadays (real or imagined). It could create an awkward situation if such a consumer asks why they should pay 10x the digital price for a cart.... I mean I sort of see what he's saying, but honestly I don't think that's an excuse for keeping the prices on the digital content that high, I mean it makes the most sense to simply explain about the cart costs and lower the digital prices... well unless your greedy in which case your attitude is: "we want to keep our brand name value high, people have shown they will pay this for one of our games, so that is what we will charge even as we reduce costs because you know we can".

-

On a side issue I think we do need to see more attention being paid to digital business in order to protect consumers, both in terms of ensuring the rights of a purchaser to the product they buy, and also to ensure that the content remain available in perpetuity. Basically if something is sold digitally the people involved (not just their corporate identity) should be held responsible for ensuring that content remains available until the stars go cold. Already we're seeing issues with people losing virtual property and such on MMOs that go out of business or shut down. I'm of the opinion that anything sold digitally should need to be backed by a trust put in place to ensure it's continued existence. That way if say someone wants to play an MMO in 30 years while in the old age home, they should be able to
do it and access any and all content they paid for decades ago given access to the needed hardware. A company retiring a product, or even disappearing, should be no excuse. A trust fund is basically a large pile of money that generates a constant stream of interest, that interest can be drawn upon to be used for a stated task. Some rich people set up trusts for their kids so they will never have to go without money, and won't be able to just squander a fortune while they are young. In the case of digital property, associated trust would exist to generate money to ensure the perpetual operation of game servers and someone to watch them/maintain them at least part time separate from the company, even if nobody continues to expand, or even use the game, or whatever the property in question is. Done correctly you could pretty much keep any virtual item/property alive pretty much limitlessly even after the technology involved became totally obsolete. Such a trust should need to be established per product as part of a development budget. When your already seeing tens of millions of dollars spent on video game development and god knows how much profit that is generating, putting aside a million or so for each product to set up a trust sufficient to keep a server running off the interest is quite doable... and frankly could probably be covered by the money being saved in packaging, shipping, etc... for a lot of products to begin with. Such in my opinion at least.

 

[Grospoliner]

Ahh... So THAT'S why PC games are ludicrously expensive on Steam, just like in retail shops. Oh wait... No. No they're not. Most of them aren't even CLOSE to expensive on Steam. Huh. Guess all those discounted games and IPs are completely worthless by now, hey Nintendo?

Oh totally worthless. Like you can get Symphony of the Night on PSN for 10 bucks. How could anyone make money off that? It's just a totally untenable position. ;P

 

[Guitarmasterx7]

Are digital games usually cheaper? Theyve always seemed to go for the same price with occasional sales/price adjustments and such

 

[keniakittykat]

Remember back in Gamecube times how proud Nintendo was at it's inexpensiveness? Even going as far as saying how great their low prices were for the gamecube trophy in smash bros melee? I even remember an action they had back in the early 2000's where they had a limited supply of pokemon gameboy colors and were selling them for just 100$ a piece along with a game of choice.

Yeah, that was great. Especially for a poor kid like I was. What happened, Nintendo?

 

[keniakittykat]

Because when I payed $30 for Human Revolution (or any other AAA title) instead of the full $60, that somehow cheapened the experience for me. Sure, I enjoyed it, but I could have enjoyed it more at retail price.

Nintendo logic.

It's like saying "I'm glad I bought these pants for 70$! I could have spend just 40$ if I bought them at that other store that doesn't package their pants in a fancy box, but My ass feels way better in this full-price pants."

 

[Shuu]

Don't insult us Nintendo. Don't think we can't cut through the corporate-speak and see what you're essentially saying here: "We're afraid that if we make games more afordable, people will stop buying them."
In which case there are only two explenations.
A) You, Nintendo, a multinational entertainment firm, do not understand basic monetary incentive.
Or B) You are lying through your teeth.

Unbelievable. "Mario Galaxy 3?! I've got my $60 put aside;D Oh what? I can have it for half that price? Egh! Well I don't want it then!"
Just admit it's because you're too scared to charge any less than you know you can get away with. I'll at least respect your honesty.

 

[Maliheim]

The more I read the more I am sickened by what I see. It's blatantly obvious that the real reason isn't "we want people to value our products." They want the money, and for those that say they need the money to produce more games you probably don't know how much money they make, and how little it actually costs to make reboots of the same games. For those of you, like myself who has played the Pokemon franchise it is the same map, story, and characters nearly every time. The only thing that truly changes are additional Pokemon. So why haven't we just been getting one game every Gen with Pokemon expansions? It's not because they want us to value their products, it's because they want more money than an expansion would give them. This is no different. They want the money, and they know you will let them pick your pockets with every new reboot of your favorite childhood game.

I'm not trying to sound like a hardass, and am not trying to offend anyone. Hell, I'm guilty of letting them do it too, but to believe their lies would just be pure ignorance. The prices for their Handheld Games are nearly as expensive as the big name AAA Playstation and xBox titles even if you buy the hand held games over the nintendo eshop. That is just ridiculous, and then they wonder why people try to pirate their games? It is because they don't value your games that much, and they never will.

They want to pick the peoples pockets, most people will pick theirs back until the prices are lowered. Yet their arrogance, and pride is too large to realize this.

If you have made it this far thank you very much for reading, and have a nice day.