Why games are not expensive

5 mins read

A source of endless frustration for me is how often I hear or read the words “games are expensive.” It’s frustrating because frankly it’s a statement or phrase that is economically subjective – what is expensive to one person is a bargain to another. But to address my frustrations in an even more literal fashion, I’ve decided to throw a bunch of numbers out there to prove that games are actually quite cheap.

The first thing that is important when determining value (ie whether something is expensive or not) is to find a formula that allows us to compare the cost of something to alternatives – in this case other forms of entertainment. After all, there’s no point comparing the price of games to cars or houses, but the question about whether a game is expensive compared to a movie is very relevant, because the word “expensive” by definition means in comparison to something else. That is to say something can’t be expensive until it’s compared to something that isn’t expensive.

So to do that I’ve decided the best number to use is the price/ hours division. And remember, the numbers I’m about to use are based roughly on Australian pricing, but the numbers scale roughly the same through the various markets through the world.

So a game in Australia typically costs around $100 new. While games vary enormously in length (some can be done in a few hours, others like Final Fantasy last for over 50, if not 100), let’s make a rough estimate that if you play a game through once and mess around with its multiplayer a little, don’t return the game but don’t get too hooked, you get 20 hours of entertainment out of it.

That works out at $5/ hour.

And time for the comparisons. A movie in Australia costs $25 for the ticket (and this is pretending that you don’t also buy stuff from the candy bar at a premium) for 2 hours of entertainment. $12.50/ hour. DVDs work out at roughly the same assuming you don’t get too invested in the movie to watch it over and over again (and remember, like with games, we’re assuming one play through here).

A music concert is what, four hours from start to finish? A decent act is $100. $25/ hour. And you’re looking at similar pricing for the high arts. Ballet and opera tickets will easily cost $40+/ hour.

It’s not just passive entertainment, either. If you play sport fairly seriously, then you’re also likely to want lessons. Ignoring the green fees for golf or court hire fees for tennis, coaching in a sport can easily set you back $80/ hour.

The only entertainment form that is likely cheaper than a game is the one that, ironically, is complained about as much if not moreso than games. That’s books. A book might take 20 hours to read from start to finish, and cost $30 or so. $1.50/ hour.

What I can’t decide is whether these numbers prove that gamers, as a collective group, have the least interest in supporting their hobby, or whether gaming has become the default form of entertainment for people with no money, and therefore are subjectively expensive. Either way, it’s amazing that people don’t think more deeply about the price of games.

So, in conclusion gamers do need to think a little more about the price of games, because frankly, $5/ hour is not so bad. But here’s a question to the readers: why is the perception there that games are expensive? Is it just the price tag, is it because the second hand shelf right next door has far cheaper prices lulling people into a false sense of value or something else? Let us know!

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  • $60 is expensive. It's as simple as that. Comparing games to an opera or movie is ridiculous. Who would want to watch a 20 hour movie? A 20 hour opera show? When people pay for entertainment they aren't paying for the hours they are being entertained. They are paying for the enjoyment. As long as people feel that the enjoyment they are paying for is worth the price that is all that matters. At the end of the day there are too many good games that come out year after year. So people are now more than ever waiting for prices to drop and buying game of the year editions instead of buying games at launch because they can't afford to buy 7-8 games a year.

  • So how would you measure this "enjoyment"?

    I maintain that anyone who complains about the price of a game after spending 20, 30, 40 hours enjoying said game is simply being entitled. $5/ hour or less for "enjoyment" is good value.

  • I think some places can still safely say "games are expensive". Case in point: Australia. Over here we're paying a recommended retail price of $110 AUS (irrespective of the comparative weight of the Australian dollar). There's no cause for excuses of shipping or Aus market factors, as there is little to no price drop for digital downloads. 

    It's ridiculous; so much so that the Australian government has (finally) announced an inquiry into the prices of games and technology in Aus compared with the international market prices. 


  • Hi Jess,

    Thanks for dropping by and commenting! I suggest you read the piece again, because as an Australian I just explained why even $100 for a game isn't actually expensive 😉

  • Well, according to your logic, I suppose $100 for a game that you get 20 hours of enjoyment out of isn't expensive compared to the other options. (As an aside, where do you get movie tickets costing $25?? The most I've paid is about $17 for a regular ticket! Maybe Sydney prices are higher than Brisbane?)

    Well, I have to say, I still feel Australian games are expensive because I know how cheap they can be bought new from other countries, and I don't see the reason for such a huge hike in price. But no one needs to buy a game the day it comes out, and within a couple of months most titles drop $30+, so economical shoppers can get some pretty good deals (case in point: Tree of Tranquility and Samurai Warriors 3 I picked for $5 each when Myer was getting rid of their game stock, and I've been spending a huge amount of time with them). 

    Perhaps the group of gamers that is loudest about how expensive prices are are in fact the teenage crowd? For someone without a steady income, it can certainly add up fast. 

  • Hey as a kid I got one game for Christmas and one for my birthday. I still didn't see the point in complaining about how expensive they are 😛

    I think Australians also need to remember that their wages are much higher in Australia than, say, the US. The perceived value of our currency is less, because we have more of it. Combine that with the higher logistics prices the vendors need to pay, the smaller number of copies that are sold in this market and the higher wages that the retailers have to pay their staff, and that accounts for most, if not all the price hike.

    If it really is that much of a problem (it isn't to me personally, I don't mind buying retail games at $100) – then we're lucky to have the Internet and online shopping 😉

  • That's a good point, I always forget the higher cost of living in general due to higher wages here. I guess that's what I get for not working! 😛 

    But as things stand, I definitely import for the most part, and never purchase anything day 1. But looking at new game prices in Japan, they're pretty much comparable to AAA Aussie prices! 

  • I maintain that Australia, of all places, CAN complain about the cost of games. Given the considered value of games in other countries, namely the US, $110 for x amount of 'enjoyment' does not match up.

    We can't solely assess the price of games by a comparison with other forms of entertainment Australia. The value should be equal that of other countries (when compared to the 'entertainment for cost' values of other countries).
    For example, if in the US someone pays $30 for a book and $60 for a game, why are Australians paying $30 for a book and $110 for a game? Surely the entertainment value of a game over other entertainment should be set at a similar level?

    Overall, I believe the reasoning is inflation and the strong Australian dollar. Originally games cost twice as much because it was equal that of the US cost. Now the AUS$ is equal to that of the US$ but the price of games has stayed the same. It can't be justified imho and as such I think it is fair for Aussies to call on the industry's shenanigans. 

  • games are expensive !!! and good example is COD. COD can give us $45-$50 and they are selling about 20 million copy so they wont make any loss . COD so expensive in such a why that u should pay for all the DLC IN SPITE SPENDING $60 !!! i am not asking for all the dlc for free atlest in 6 release make 2 of them for free. not all games are expensive, game like skyrim, u can spend $60,but if they are making every year a skyrim and selling easily about 10million copy, then they should reduce the price. we shouldn't pay for DLC sort of game (COD) for $60, its not fare !!!  OR if its $60 then give us all the DLC for free !!! we cant play for the free service that the company should provide us !!! DLC are free service which at this point we OUR PAYING !!!

  • this logic if broken. I bought a bodyboard for $220 and I've been using the same one for the past 7 years. Does this mean that my bodyboard should cost like $10,000 for the many hours that I have used it? Of-course not! 

    Things should priced according to how much it cost to be produced and the amount of repeated customers expected. Before a dev starts making a game they first create a budget and how much they think the game will sell. Most games these days sell at least 200,000 copies and depending on the budget these sales could be good or they could be bad. And the true is that a 60 million dollars budget wouldn't even be enough for an indie movie with low production values and that was the budget for GT5 after being in development for like 7 years. Which mean that development cost for games developed in a span of 2-3 years should be like half of that (around 20-30 millions or even less), so no matter how you want to see it, games are expensive as ***.

    Games may be longer than movies and they may take longer to produce but the development costs are really really low compared to it. That's why game companies never make their budgets public and when some developer goes under it's because of a combination of poor management and godawful sales. Even if their game were priced at $100 bad sales are bad sales, there is no saving.

  • Games are expensive.

    *grins* I had to, had to start with that, sorry man. 🙂  I think it depends largely on the situation you are in.  I can afford games much more readily now than I could at anhy other time in my life prior.  But even then, a $60 game (and I'm aware that I'm getting it cheaper than you) is still a good chunk of my grocery bill.  I think it also depends on the market.  My kids can't afford to get a game that they really want but maybe once or twice a year with birthday or Christmas money.  So from their perspective, $60 is a backbreaker.  My son's already saving up for Black Ops II.

    I have actually seen this basic argument before, and agree with some parts of it.  That the value of what you are getting per hour works out pretty favorably price-wise, and I do agree with it.  But depending on income, family size, expenses – there are a lot of other factors as well.  Now for me personally – I've been gaming my whole life, and while I do think games are pretty expensive, I obviously find them to be a worthwhile investment.

  • Hi Wel,

    Thanks for dropping by, good to see you again 🙂

    I think you misunderstand the argument I'm making here. I'm not commenting on what games should be priced at, I'm simply pointing out that when you buy a game, typically you're going to get your money's worth.

    The term 'expensive' typically comes with negative connotations. Though it's not part of the dictionary definition typically people use 'expensive' as a term of complaint, with the implication that you're not getting your money's worth (or, at least, that's what I see a lot of out there in the Internet).

  • Good article and oddly enough it is very similar to a post I've been working on.  Have you been snooping on my blogger drafts???  🙂

    I think it's important to think about the overall net cost of, well, virtually anything you buy or consume.  And I honestly go way overboard with spreadsheets and various 1,2+ year usage comparisons and sometimes electricity use but that's just how I roll.

    $60 or $40 (3ds) for a game is still a sizable chunk of money regardless of how much money I have to spend or what the amortized net value is.  Though looking at it like this does help to bring gaming along side your other entertainment/hobbies to provide a perspective of how much it's really worth to you.

    $40 for a game I get 10+ hours out of isn't really a great deal of money per-hour.  At least when compared to other entertainment such as movies, amusement parks (eg; Disney), and other hobbies.

    Though I'll flesh that out a bit more in my blog post at some point.. 🙂

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