Why are the prices so high on the Nintendo eShop and PlayStation Network?

Have you ever noticed that games on the Nintendo eShop and on the PlayStation Network are regularly overpriced?

[OneAboveAll]

Yea, not sure why a digital game still costs as much as a boxed copy. At least shave off a buck or two since we aren't paying for the plastic!

Back in my day we got our monies worth! Your NES/SNES game would come with a protective sleev, a detailed booklet (non of that Online manual crap) and sometimes even a POSTER of the game you just purchased.

[Summons75]

This is why we shouldn't be digital only. Online you have a set price, retail you can get a new game for ten bucks its first week of your a good enough shopper. I miss the old instruction booklets but I'll always prefer physical over digital.

[Christopher]

1. Because we are not at a stage where the Publishers can do away with Brick & Mortar retail units. Not everyone is online, not everyone has high speed, unlimited Internet access. So, the game companies rely a ton on GameStop, BestBuy, Amazon.com, Walmart, and similar B&M stores to get their products to their user base. Most of the 'digital' sales are of DLC or smaller games that are only available digitally.

So, the digital prices can't cut out the retailers. It has to be competitive. At least until a point where the digital market can reach the mass majority (90+%) of the market itself and not be limited by outside elements (bandwidth caps by ISPs, regional lockouts, etc.).

2. Because the price is set by the Publisher, not by Sony, Nintendo, or Microsoft (unless it's a first party title, and typically they follow suit rather than undercutting third-parties).

Having said that: I don't understand why digital titles take so long to go down in price compared to retail games. Typically, after 6 months you can get a game from retail for half the price. Digital copies are still at their full cost.

Side Note: Why does the article writer only bring up PSN and eShop? XBL has the exact same issues. I think the only digital shops that aren't are PC shops that are not tied in any way to third-party publishers (like Steam). They aren't beholden to retailers or a cadre of publishers, they are only beholden to their own desires for profit.

[Swiftfox]

My guess on the digital version staying at full price for much longer is due to limited retail space at those brick and mortar stores.

When these stores buy their copies they do it at a reduced price from $60US(NA) most likely around 20-$35 a copy of the game. They buy enough to satisfy pre-orders to max profits and a couple to throw on the shelves. Time goes on, new games are released, and demand of the older games fade. So they drop the price from $60 to $40 to move the game off the shelf to make room for the new product. If copies still remain after so long they will then be cut to $20 to at least try to break even. It's all based on supply and demand so retailers set the price as demand tells.

Digital copies don't usually follow the normal rules of supply and demand since there are infinite amounts once it's online. There's always enough for everyone and it's always there. So the publishers themselves have far more control over unit price and will keep it high for as long as possible to maximize profits. That's my best guess anyway. =P

[Christopher]

@Swiftfox: I guess that works for stores like BestBuy and GameStop, but I'm not sure it works for stores like Walmart and Amazon.com. Both are warehouse heavy and have no issues with keeping stock on the oldest of games. You can go on Amazon.com and find most major release games from all years on there for new. Even Fifa 06 on all platforms, for example, are still available new there.

[MikeMyers]

Hmmm, let's see. I can buy a retail product that allows me to lend, share and play on multiple systems without the need to stay locked to one account. Or I can buy the digital copy that locks the content to an account that cannot be traded or sold. On top of that often times the digital copy cost the same if not more. The only upside is convenience of getting the digital copy right away.

Great job trying to convince consumers getting into the digital era. They get more money from digital copies due to less piracy and the used market. So you would think they would be doing a better job getting consumers to buy their games digitally.

[cee773]

@oneAboveAll

actually on psn there's no tax so technically it is cheaper than the store its not much but its something and you get 2 copies if you have an additional console so its actually worth it in that regard alone on psn.

[Eddie20101]

The article seems kinda fanboyish since Xbox live is not mentioned. Because they are equally guilty of over charging for games.

The pricing has more to do with the publishers than the networks hey are sold on.

The article should be about over pricing of digital games.

[jimbobwahey]

Yeah I found this rather strange, that the writer makes a point of criticizing Nintendo and Sony for this, yet apparently he thinks it's fine that Microsoft does exactly the same thing? Certainly comes across as very biased.

[Munnkyman]

I have thought of this as well. Your buying a game digitally no box nothing so why pay the full price.

[ravinash]

...and you have to pay for the extra hard drive space or keep taking things off. So it can end up costing you more.

[Godmars290]

The general excuse is that they don't want to tick off brick and mortar retailers, so they charge the same price online even though they don't have to worry/pay for packaging and shipping. Meaning that's "free" money they just pocket.

What's the deal with games being the same price US vs EU value when EU is higher? That's one Europeans should be asking their politicians. Or better yet not buying those games while publicly stating the reason.

@iamnsuperman:
The offset is still that they're making additional profit from consumers while undercutting retailers with direct availability and convenience.

As bad as it sounds this online retail thing is something they either shouldn't have done or gone all in. Nevermind that they'd be putting specility B&M stores out of business overnight or cutting off a segment of consumers w/o online.

Like the BS that's gone on with game resales there should have been active consideration of all parties instead of the capitalist selfishness that's going on. People are just being openly ripped off in what's become standard practice.

[iamnsuperman]

Also they can't recommend a price to the retailer then totally under cut that price.

[Eyeco]

that's a terrible excuse tho, one word STEAM

[porkChop]

Steam charges the same price as retail for new games so your post doesn't make any sense at all.

[DragonKnight]

"Why are the prices so high on the Nintendo eShop and PlayStation Network?"

Unless they are first party offerings you're talking about, then why not ask the publishers who set the prices themselves? I do know that MS sometimes forces devs to charge more than they want to. Happened with Stranger's Wrath. It was supposed to be $15 for everyone but MS wanted the devs to charge $20 and the devs said no.

[TheLastGuardian]

I thought MS wouldn't allow Stranger's Wrath on XBLA because it came to PSN first.

[DragonKnight]

That's true, but I read up on the reasons Stranger's Wrath wasn't on XBLA and that wasn't the only reason. According to the devs, MS kept coming up with reasons to say no to it and they also made some stupid demands like charging $20 for it when PSN had it for $15.

[iistuii]

They're all at it, inc steam, Origin & Ubisoft. Ok they have sales, but when a new release comes out on steam for eg its as much or sometime more than I can get it from an online retailer, which includes box, book, disk & postage. Rip off.

[Cam977]

An interesting, very detailed and well thought out article!

[mydyingparadiselost]

This kind of thing is why i don't buy digital. The company pays no shipping costs, there is no disc or plastic manufacturing going on but we still pay for it like there is. Also the supply is infinite which in theory should bring with it its own price drop AND resale of said merchandise is pretty much nonexistent, making the high price even more outrageous. Digital should be half or close to half off the regular retail, or at least sold at the price retailers get it for.

[BrianC6234]

Way too much crying in that article for me to bother reading much. Digital prices are too high but if Sony, Nintendo and Microsoft all charged less on their stores the big retailers wouldn't be happy. They have to make sure they don't alienate the companies that sell most of their games. One day maybe everything will be digital and it won't matter anymore.

[porkChop]

Interesting. The article scorns Sony and Nintendo for overcharging on digital games, yet makes no mention of Microsoft who started doing this very thing on XBL well before Sony and Nintendo did. And with the Vita Sony has actually offered their digital first party titles %10 cheaper than retail. The article makes no mention of that either.

And to answer the question, it's simple. Publishers only make $7.50 per sale of a retail packaged game. Developers also take $7.50, and so does the console manufacturer. The rest goes to retail, disc manufacturers, shipment/delivery, etc. When a publisher sells a $60 game online they make roughly $45 as opposed to $7.50 from a retail copy.

[Phoenix76]

i always thought that its the publisher's that set the price for Digi DL's, not the company that advertizes them on their hardware, as in,
(Sony)'you can sell ur product through our stores.... but we want a small cut from the profits that you make'.
(Publisher)'ok then, we'll sell it above the going rate, so you can have a fiver.... and we'll make the full price + a little bit extra on top'.

unless im wrong???

[WeAreLegion]

Most Vita games release at $5 cheaper via the PSN. They have price cuts every week, too.

This guy has no idea what he's talking about.

[DarkZane]

The thing is, 40 euros is the price in retail in europe too. Digital sales have nothing to do with this.

Videogames are just more expensive there, that's all.

[GraveLord]

Digital distribution is a privilege, not a right. If you are looking to save money, buy used or wait for some good deals.

DD was never meant to be a cheaper alternative to buy your games.(Walmart would get very angry)

[meganick]

Digital distribution is neither a privilege or a right, it's a business model. If enough people decide not to buy digital games because they think prices are too high, publishers will be forced to lower prices. Hopefully that will happen with the eShop and PSN. Why wouldn't you want that?