Studios cautious on freezing minimum prices to avoid the â??race to the bottomâ??
Game studios should have a bigger say on the price of their digital content, a panel of developers have said.
This week’s Develop Jury has returned a majority view that downloadable content for online platforms such as XBLA should be more flexibly priced.
There was however some support for platform holders controlling the costs.
Assyria MD Adam Green said that platform holders are best positioned to determine prices of digital games.
“They are the ones with the majority of the data on sales,” he said, “and therefore in the best position to judge the most suitable price in order to make the highest return, which is ultimately in everyone's best interest.”
However he added that if sales data was more freely available then it would be better to allow studios to determine prices.
“The reality is that the data is largely kept secret and this is unlikely to change in the near future...”
Green wasn’t especially against the idea of fixed online prices, either, saying they prevented “obvious under-cutting which could damage the market for everyone.”
Zoe Mode general manager Ed Daly also explored the issue of how flexible pricing could lead to under-cutting, yet believed there was a greater-good at play.
“While I understand a fear that flexible pricing may mean a race to the bottom, surely the logic and principles around pricing theory that applies to all other forms of commerce hold true for XBLA and PSN,” he said.
“Without the ability to run pricing experiments in a real market we can't learn how to balance unit price and volumes to maximise revenues,” he added.
“Smart pricing tactics should mean more revenue for developers and some great deals for gamers, many of whom would otherwise spend their money on something else.”
Daly’s view was backed by Doublesix studio head James Brooksby, who revealed interesting sales trends from experimenting with digital prices.
“We have had control over our PSN pricing for our games and all the packs, themes, Home contents and have fluctuated prices according to demand and campaigns.
“Our best example of this is that we put Burn Zombie Burn into a half price promotion around the Christmas holidays and sold seven times more sales than the previous month. Now that is good business!
Brooksby added, however, that there should be restrictions in place to limit under-cutting.
“The consumer is already getting great value for money. I would hate to see a price war that ends up with games diving towards zero price points as we have seen elsewhere, there is no business in it.”
Meanwhile, nDreams Patrick O'Luanaigh and Proper Games’ Andrew Smith were strong backers of more control for developers.
Said Smith: “It is widely known that Steam (as well as other similar services) and the information it makes available to developers mean that seemingly crazy sales and weird experiments with free weekend deals has had some credible success. The value of bringing your old game to the front of a digital store and back into the consumer's minds is not to be underestimated.”
While O'Luanaigh added: “I'm a strong believer in allowing content creators to play around with their pricing and see what works. One of the best things about developing for Facebook and other online networks is that we're in charge of the entire finance chain; we can set our pricing as we want, and then watch the money (minus a small percentage to the PayPal or whoever) come directly to us. It's very refreshing.”
Elsewhere in the feature – which you can read in full here - PlayableGames director Owen Daly-Jones discussed the idea of offering discounts to loyal customers.
And Team17 studio director Martyn Brown gave his full support for platform holders’ control of digital prices.
“If your project is being funded by someone else, and likely published,” he said, “then it's difficult to argue that the developer has the right to name the price because they may not be fully aware of all the costs.”