A $100 video game is missing the point

There’s been a 200+ page report from a game industry analyst making headlines recently stating, among other things, that Grand Theft Auto 6 could do a lot of good for the games industry by ripping off the Band-Aid and selling for $100. Which sucks. 

The idea is that by releasing GTA6 at $100, it could give permission for other games to sell at that price, relieving some of the financial pressure on publishers and studios. By increasing the price of your typical AAA game, studios may receive more money, thus being more cash-positive, more sustainable, and more layoff-proof (in that order). Publishers, of course, would get their cut as well. 

The notion of dropping $100 on a video game when returning a digital product is arduous and live service backends are unceremoniously canceled is hellish, especially in this economy. Raising the price of games to $100 is an idea, but it sure doesn’t feel like a good one. 

I also think that raising the price of games to $100 misses the point of why companies may want to raise the price: increasing shareholder value. 

Let’s start with the obvious: GTA6 could very well raise their price to $100 for a standard edition of the game and it’d probably still make a cool billion in its first year. This post isn’t about GTA as much as it’s about every other company hoping that GTA opens the floodgates and takes the big hit.

No, I think the big opportunity to be “exploited” (as a guy with a blog and specifically not a big business boy with a corner office) is to make more smaller games for the same price. It seems like Sony is halfway there with their constant remake plans (Days Gone Remake when?), but if you make Horizon 3 a third of the size of the previous two games, that has to (generally) cost less money to make, right? Less locations, less art, less unique enemies, smaller skill trees, the whole shebang.

It’s not that clean obviously, but this past year has shown the massive publishers and studios have two problems: money and time. Shareholders expect constant growth, but as projects get more detailed, bigger, and longer, the weight placed on a game like Insomniac’s Spider-Man becomes unbearable. It takes longer and longer for Sony to see “value” from all that development effort and, as we’re seeing now, genre fatigue can move swiftly: developing a live service game may take the full length of the genre hype. Budgets are ballooning, but player counts aren’t.

The games market itself doesn’t seem to be able to bear games getting more expensive either. Games spending is down, games console spending is down, and the number of people making games is down too. These are real market forces indicating that people cannot afford a $100 buy-in for entertainment. But our dumb human brains can handle five $20 pieces of entertainment.

It feels like there’s really only a few options for the too-big-to-fail-but-big-enough-to-layoff-ten-percent-of-the-workforce companies: lower costs (to increase profits), shorten development time (to increase output to increase profits), or raise prices (to increase profits). Smaller games for the same money.

It won’t work out every time, but wouldn’t you have a better shot of retaining your workforce and increasing shareholder value if you just released more smaller games? We’re watching Ubisoft put out Assassin’s Creed Shadows, a Japanese evolution of their open world style games as their share price plummets. Did the more constrained Mirage or Prince of Persia save them? No, but neither did the Star Wars license.

It’s impossible to know what would’ve happened had Ubisoft kept releasing Assassin’s Creed 2 sized games, but it’s clear that making bigger and bigger open world games isn’t working. Ubisoft has a massive stable of development teams capable of making some incredible games (looking at you, Prince of Persia), but because of the ballooning size of their open world template games, they’re treading water instead of celebrating small successes. The small games are too small because the big games are too big.

I think we’re starting to see this shift towards more focused games with the upcoming Doom: The Dark Ages. The team explicitly is not making a multiplayer mode in favor of putting those resources into the single-player mode; I wouldn’t be surprised to see the opposite from Call of Duty in a few years under Microsoft. By reducing the scope of these games, you could see reduced costs and shorter timelines, while not missing out on what makes these games so popular.

The teams working on Doom are making smart decisions meant to trim the time from inception to release, lowering development costs, lowering risk, and, over the long run, possibly raising profits. Shorter development time means more releases means more chances at hitting the shareholder value lottery. We simply don’t need life-like, bespoke puddle reflections for the entirety of digital Manhattan and Queens.

It just really feels like this industry is hurtling towards dangerous territory, especially when 25,000 people were laid off in the last 24 months. I doubt raising prices to $100 will help much, especially when it’s possible for line go up with more tighter, smaller games. After all, everyone could use an editor.