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Feature: 'Game Pricing Strategies: A Hypothesis'

In today's main Gamasutra article, pricing expert Tom Hunter discusses the current and future pricing model for video games. Hunter argues why, in today's modern age, the...
In today's main Gamasutra article, pricing expert Tom Hunter discusses the current and future pricing model for video games. Hunter argues why, in today's modern age, there may be alternatives to charging consumers flat rates for specific content, citing the subscription-based cable industry as a model of particular merit to examine. In this extract, Hunter compares Madden NFL to the Bible, at least in pricing and delivery terms: "In 1708 this Bible was sold exactly the same way this copy of Madden Football was sold 300 years later. The model for pricing games was created for a different industry (book publishing) more than 300 years ago and it has fallen behind the times. In 1708 this Bible had to be printed by hand driven machinery, carried in a horse drawn wagon for at least a day, loaded on a ship to make a hazardous voyage to the New England colonies and travel further by boat, wagon and on foot to reach the buyer. Middlemen had to be paid in cash at the time of delivery; there were no credit cards and no 30-day billing or subscription service. Content was cheap to develop and very expensive to deliver. A single price, single payment model was the only thing that made sense in the world of 1705. It made keeping track of the money and the inventory simple at a time when communication and distribution were very expensive. In 2005 we have exactly the reverse situation. Content is expensive to develop and dirt cheap to deliver. But the pricing model we use most often has not changed since 1705, or perhaps since 1600. The model is old and because it does not take into account the changes in technology and distribution it commits the cardinal sin of bad pricing, it leaves money on the table." You can now read the full Gamasutra feature on the subject (no registration required, please feel free to link to the article from external websites).

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