Did you think digital cheap was only giving print publishers conniptions? Think again.
Reminiscent of publishers’ feelings about 99-cent self-published e-books, Industry Gamers has a brief piece based on a talk with Mike Capps, president of Epic Games (the company behind the widely-used Unreal Engine for first/third person shooters) in which Capps suggests that the increasing prevalence of cheap iPhone and iPad games is doing traditional video gaming in.
"If there’s anything that’s killing us [in the traditional games business] it’s dollar apps," he lamented. "How do you sell someone a $60 game that’s really worth it … They’re used to 99 cents. As I said, it’s an uncertain time in the industry. But it’s an exciting time for whoever picks the right path and wins."
Of course, there aren’t any actual numbers behind this statement. Indeed, it can be hard to find valid numbers that take into account digital downloads at all. The NPD Group’s video game sales metrics haven’t until last month, for instance. And there are things that more expensive games can offer that no 99 cent game can hope to match, such as the greater hardware abilities offered by console and PC systems.
But leaving aside the relative merits of games on different platforms, it is true that most people only have a limited amount of time in the day that they can spend on gaming. And every hour they’re absorbed in a 99-cent, or even a $5 or $10, iPhone game is one that they aren’t spending on a $60 console or PC game.
Come to think of it, most people only have a limited amount of time in the day that they can spend on reading, too. And every hour they’re absorbed in a 99-cent self-published e-book is one that they aren’t spending on a $10+ mainstream-publishing-industry e-book or hardcover.
And consumers in both cases are more likely to gravitate toward cheaper titles than expensive ones in this economy. When gas is up to $4 a gallon, who can afford to throw away full retail price on a video game? I’d dearly like to play Portal 2, but I’ll be waiting a few months for the inevitable Steam sales. And we’ve already seen that a lot of consumers are turning away from overpriced e-books and hardcovers alike.
Seems like e-books and e-games do indeed have a few things in common.
The final though is not exactly a new insight:
“Cheap drives out dear.” (If they bring equivalent value)–Sir Thomas Gresham
He may have gotten it from Aristophanes.
This is why publishers are currently shoveling water upstream. They fear this. Ebook consumers, on the other hand, think this is great. But beware, it works on both ends.
Regards,
Jack Tingle
This is of course a lorry load of cr@p. And Mike Capps is indulging in one of the oldest piece of misrepresentation in the commercial book. His company relies on the expensive end of the market and the cheap end is starting to draw away customers so he starts whining. It’s so transparent.
If what he says is true, and that is a BIG if … what is really happening, that he doesn’t like, is that customers are voting with their business to buy cheap games because that is what they want. Bemoaning what the public actually want is a fools game. If he sees what is happening and wants to reverse it then he needs to try harder to attract customers to his product instead of whining about the fact that customers are starting to prefer other people’s product.
The same goes for eBooks. Readers buy what they want. They won’t buy titles they don’t want. They have now discovered that they are enjoying the cheap titles as much as they enjoyed the ridiculously prices titles they use to be forced to buy. Times change. The publishers who are whining are whining because they are losing business and look for find some way to persuade people that there is something ‘bad’ about this change.
There is nothing bad. It’s called market economics. People buy what they want and leave what they don’t want. They don’t give a damn about why the publishers think about the ‘value’ of their product. The arbiters of value are the public.
The problem with spending $60 for a game is that you don’t really know how good it is, or if you’ll really like it until you’ve plunked down your $60. Of course then it’s too late. If I buy a 99 cent app and don’t like it, it’s no big deal. Besides aren’t most of these apps purchased for phones? I can’t see very many people buying $60 games for their phones.
This is what happens when you free up the market. It’s called ‘efficiency’. If game company A can provide the same level and length of entertainment as company B for half the price, and IF A is allowed to sell and publicise its product, then A will make more money than B, as it should.
This is why publishers are fighting copyright law reform tooth and nail: because once we have access to the huge supply of books that have already been written but are still no longer available (other than second-hand at huge markups), their new books will have to compete in a much wider, much cheaper market. Guess how well they will do.
Excellent points Jon.