|QUOTE (gionascm2 @ Friday, Jul 19 2013, 01:26)|
| And even if you're right and digital is not cheaper, that's only at first glance. But if you know the right |
tricks to exploit the system, you can get tonnes of free digital games, which will save you potentially
thousands of dollars in the long run. This alone makes digital much superior to physical copies.
The fact remains that if the pricing of downloadable games was right, you wouldn't have to pull these tricks.
The cost of a videogame is very fragmented: there's developer costs (building, facilities, employee salaries etc.), there's the publisher who wants to see their investments returned, there's the console manufacturer who asks a fee, there's marketing, printing and distribution, the wholesalers who want a cut and finally the retailers. So the $60 price tag has to account for all of that. But that's for physical distribution. If you were to go digital, you can cut off a chunk of that chain, starting with printing and distributing the discs. Wholesalers typically pay around $30 per game. Minus the cost of printing and distribution, co-op marketing and accounting for lost/stolen units, the publisher gets roughly $18 per sold game.
Now, if they were to go digital, you would have to add the cost of server bandwidth and IT personnel. Let's say that's $7 per game (very roughly). That would mean that even if they were to ask $30 per game (as a download), they would still make more profit
($5 in this example).
But they're still
asking the retail price of $60. Now I don't know where all that extra money is going to, but that's the thing. You don't know if the developer ever sees any of that money. For all we know, the platform holder (Microsoft, Sony) and/or the publisher keep all of it. I still see publishers as a necessary evil as most of them are only interested in making the big bucks (and not unjustly so, just look at THQ). In an ideal world, developers would (somehow) get enough funding to get them going and would be able to advertise and publish the games themselves (digitally). But that's a long way from reality.
Right now, a good motivation for publishers and platform holders to drop the prices of downloadable games would be to combat the second-hand market. But they're not doing that, instead they f*ck the costumer in the ass with DRM and other bullsh*t and keep the prices of downloads unreasonably high.