Sacred Symbols+, Episode XXXI: Economics
Added 2020-03-06 17:00:05 +0000 UTCWith news of PlayStation 5 hopefully on the horizon, it goes without saying that a major focus is going to be cost: Cost of the hardware, cost of the software, and the overall cost of doing business, particularly when compared to its competition. Thing is, there's a lot that goes into pricing a console and its games, and this new generation might just turn it all on its head. Games are indeed cheaper than they've ever been; the systems may just get into that range of historic affordability, too. But it's not so simple, not when you take into account inflation, the realities of business, the growing expectations of the audience, and a possible race-to-the-bottom on marketplaces that could potentially crater the entire industry. So let's spend some time discussing the almighty dollar, and figure out where everything stands... and why.
Comments
Who knows what the future may hold? =)
Colin Moriarty
2020-03-27 03:10:02 +0000 UTCDamn, I would have loved to be a guest on this one!
Mike Bacior
2020-03-24 17:08:31 +0000 UTCWell I think I'm crossing wires, but I thought I brought that last point up here, as I usually do, per your point.
Colin Moriarty
2020-03-19 03:57:20 +0000 UTCYeah, there might be quicker price drops, but they might be happy selling fewer copies at a higher price and still outgross what they do now. Who knows.
Colin Moriarty
2020-03-19 03:56:54 +0000 UTCThey can raise the price of games to $100 they just never get new buys from me I will wait to the price drops which won't take long.
Reg
2020-03-11 05:22:48 +0000 UTCI didn't really buy your take on why the games cost more or the same while digitally instead of physically, even though company doesn't have to eat distribution costs any more. Convenience and lack of consumer "knowledge" is weak excuse not even people selling their games digitally would bring into equation as valid reason. The funny thing is you already answered this question before if I recall correctly, and said something that among the lines that seems far more believable; you said that, and I paraphrase - lowering the price for the same game in digital storefront as oppose to; for example gamestop, EB, Amazon et al, would put it in direct competition with itself and distributors would start protesting or flatout decline to sell their games if they had no chance to provide similar prices and compete on an even field.
Zibi Majewski
2020-03-10 10:17:11 +0000 UTCIt was actually done on accident, but no problem. Glad you enjoyed. =D
Colin Moriarty
2020-03-10 00:28:10 +0000 UTCI loved The Witch. Whoever owns 'em has good taste, in that case.
Colin Moriarty
2020-03-10 00:28:00 +0000 UTCThanks!
Colin Moriarty
2020-03-10 00:27:49 +0000 UTCOkay. Hahaha.
Colin Moriarty
2020-03-10 00:27:42 +0000 UTCLOL.
Colin Moriarty
2020-03-10 00:27:31 +0000 UTCJust wanna say thanks to Colin for releasing this episode earlier to “freeloaders” earlier than usual! Much appreciated! 👏🏼👏🏼
Conor Wilson
2020-03-09 11:37:08 +0000 UTCjust a very minor note unrelated to games - A24 doesn't belong to Ari Aster, nor does he have any stake in it as far as I know. they do, however, produce a shit ton of great movies (including 2016's The Witch and more recently The Lighthouse from the same director) and they are extremely quick to VOD services, which is just perfect.
Michal Dudic
2020-03-09 08:41:58 +0000 UTCGreat episode! One of my new favorites.
Will
2020-03-09 07:58:35 +0000 UTCI would like to pick a small bone with you lol You equated Harley Davidson with quality, when they are all but that. They have the illusion of quality because of very genius marketing. They are a brand, a lifestyle. But in reality, their bikes are overpriced dumpster fires. Lawsuits on lawsuits on lawsuits for poor build quality. The CLASSIC "Harley Death Wobble," defective brakes, engines running so hot they burn the rider, and their engines are notorious for leaking oil.
FellOni
2020-03-09 06:27:28 +0000 UTCGreat episode Colin, thanks. What you neglected to mention is that with the additional income publishers would generate with $70 price tags for games, they could actually afford to pay $1 million to everyone in America and still have plenty in the bank to fund pre-production on a sequel.
Ed White
2020-03-09 04:23:10 +0000 UTCThank you so much. I'm really glad you think so.
Colin Moriarty
2020-03-08 22:21:35 +0000 UTCThe only real answer is the economy of scale. Sony is purchasing possibly tens of millions of components, which will drive prices way down. That's the only way any mass consumer electronic device remains solvent and affordable!
Colin Moriarty
2020-03-08 22:21:27 +0000 UTCNo, I think she listens to it at work.
Colin Moriarty
2020-03-08 22:20:35 +0000 UTCYeah, someone sent me this privately, actually. Really shocking.
Colin Moriarty
2020-03-08 22:20:28 +0000 UTCThe Race to the Bottom doesn't refer to money being made; it refers to the broad spectrum (or lack thereof) of people who can or do make money there. If you're a dev releasing a game on iOS, you're not going to make any money. There are like a few dozen companies that make lots of money there. That's what the Race is. These services can cause a similar situation on console. The only saving grace is that console gamers are simply more hardcore and are willing to shell out more bills for products. But there might be a limit.
Colin Moriarty
2020-03-08 22:20:08 +0000 UTCWell, of course it's opt-in, and of course there's a financial benefit to being in the system. The question is whether the money made from opting-in will dry up as the services become saturated, and what kind of sacrifices may be necessary in order to maintain a sound economic model that encourages both new game creation, the purchase of new, premium titles, and the viability of these services. I'm not sold at all that this won't have an adverse effect, but we will see.
Colin Moriarty
2020-03-08 22:18:43 +0000 UTCI can't speak to productivity, but I'm speaking to how many people work in these fields, which is half as many as in 1979. I mean, there's nothing to really argue about. No one wants to make shit here because it costs too much.
Colin Moriarty
2020-03-08 22:16:40 +0000 UTCMe too, but I don't know that they will. It's more likely they will than they won't, but that's as far as I'm willing to push it!
Colin Moriarty
2020-03-08 22:15:12 +0000 UTCI'm here to make you remember random and useless shit!
Colin Moriarty
2020-03-08 22:14:55 +0000 UTCI've used quite a few. None of them are as good as PS4 for me.
Colin Moriarty
2020-03-08 22:14:45 +0000 UTCBut what if you have the virus? =\
Colin Moriarty
2020-03-08 22:14:25 +0000 UTCEnjoy. =)
Colin Moriarty
2020-03-08 22:14:12 +0000 UTCSacred Symbols + has been killer the last couple weeks.
Tanner Brant
2020-03-08 06:17:36 +0000 UTCI unexpectedly really enjoyed this episode. In fact, it's probably become one of my favorite. I'm starting to come around to the notion that Sony's going to offer PS5 at $500. Though, I do not believe the "sources" at Bloomberg that suggested they're manufacturing PS5s @450 a pop. If you told me to build a PC that can render 4k natively and as a standard, supports Ray tracing natively, aims for 60hz framrate, and possesses a 1TB or higher solid state drive all for $450 bucks- I'd tell you you're insane. I know the retail market generally costs more, but for all of those features to be built into a custom PC would run you over $800. However, I can totally see Sony possibly AIMING for a $450 manufacture cost, which would allow them to price their system comfortably at $500. Maybe that's where the Bloomberg source might have mixed up? Anyway, I can totally see Sony launching the system at $500 , even if it means severe loss Thanks for the great episode! -Jack
Jack Sibert
2020-03-07 14:40:23 +0000 UTCDo you ever catch your mom listening to the podcasts? 😄
NeO JD
2020-03-07 13:54:44 +0000 UTCEA does actually make more money on FIFA's micro transactions than they do on FIFA itself. Here's a source: https://metro.co.uk/2019/07/25/ultimate-team-microtransactions-now-make-money-fifa-10461286/
TheBufferPiece
2020-03-07 11:12:46 +0000 UTCThe podcast is called PSXP. Their YouTube channel is PSVG. There is a link to it on Colin's Twitter.
Jeff Pollard
2020-03-07 07:26:55 +0000 UTCWhat's the other PlayStation podcast you were a guest on?
Kyle Goodrich
2020-03-07 04:27:04 +0000 UTCColin, why is it you say we shouldn't worry about the $70 game business model, but we should worry about the Game Pass business model? Seems to me that you are tendentiously suggesting we shouldn't scrutinize your theory of the future of game prices, but should scrutinize the theory that game prices will go down because of services like Game Pass. You constantly use the moralistic term "race to the bottom" in your analysis too, as if tons of money isn't still being made on mobile. I know you don't want to see overall console game quality go down (I don't either), but that may be where the market is headed whether you like it or not. And you should be honest about the possibility the market may be headed this way with your listeners.
Jake Z
2020-03-06 22:10:26 +0000 UTCColin, I disagree somewhat with your assessment that Xbox Game Pass might be encouraging a race to the bottom. In a recent article I read where a developer described the typical (not always) process: Microsoft pays a fat lump sum upfront to put the game on the service for 6 months, then there are sometimes bonuses attached for hitting certain user numbers within a week, total gametime played, etc. So it’s totally a consensual opt-in thing, the developers get payed well (well to them, at least) no matter what, and the game doesn’t usually stay there forever—it’s a window, and that window is usually after the game has been out for 6-12 months at least and made most its money, so it’s just making more on the back-end or advertising for an upcoming release, essentially. Not to mention people might buy the DLC after playing it. Then as the service grows, which it’s doing with millions of subscribers, Microsoft can afford to pay out more money. My 2¢. Great episode btw! You possess a lot of knowledge haha.
Caleb Greer
2020-03-06 20:51:34 +0000 UTCThe manufacturing sector is bigger than ever in the US. Now it just requires fewer, higher-skilled workers. Productivity has risen quite a bit because of technical innovation. The same thing that happened to farming is happening to manufacturing. This is the standard view in economics.
Jake Z
2020-03-06 20:43:52 +0000 UTCI really hope these consoles come out this year.
Anthony J Sanchez
2020-03-06 20:16:21 +0000 UTCImagine trying to tell your friends that you own a Mac...
Adam Barnes
2020-03-06 20:05:01 +0000 UTCI'm 34 years old and I totally forgot about that deodorant box thing, thanks for the random reminder Colin.. these are the kind of facts I listen for lol
Craig Carter
2020-03-06 19:58:40 +0000 UTCHey colin what kinda tv are you using to have a issue with the smart tv interface? I have a samsung and it’s litterally like the smart bar on the PS4.
Adamthm
2020-03-06 19:54:43 +0000 UTCFun fact: You can max out a Mac Pro desktop for like $50,000.00. Lol
Will Hahn
2020-03-06 19:36:20 +0000 UTCIt’s Friday my whole office is home scared of the virus. If only it was 8 hours long to get me through the waste of a work day haha. Cheers to the weekend CLS!
James Galos
2020-03-06 17:15:14 +0000 UTCDitto
Johnny Rosado
2020-03-06 17:10:45 +0000 UTCFinally, I couldn’t wait any longer!
Finn
2020-03-06 17:02:55 +0000 UTCBeen waiting for this notification all morning!
Vaughn Allison
2020-03-06 17:01:29 +0000 UTC
