News
Riccitiello: Software prices must come down
Tim Ingham Nov 1 2007, 10:39am
Comments (4)
Whole industry needs to alter revenue model for continued success, says EA boss
Electronic Arts CEO John Riccitiello has predicted that video games’ pricing model will be forced to change in the next decade – and said that EA may be one of the first to experiment.
Speaking to Berkley Haas School of Business, Riccitiello said the standard next-gen software price of $59.99/£49.99 would have to be restructured for the industry to remain truly lucrative, according to a Forbes blog.
Riccitiello predicted that the model will change in the next half-decade, which will be largely prompted by the proliferation of online gaming content.
“In the next five years, we’re all going to have to deal with this,” he said.
“In China, they’re giving games away for free. People who benefit from the current model will need to embrace a new revenue model, or wait for others to disrupt.”
In the same interview, the EA boss hit out at the wider media, accusing it of having a penchant for characterising video games as violent.
“The desire by the media to censor games amazes me,” he said.
Comments
“Interesting”
Posted by: FS - Nov 1, 12:53pm
If ******* the blood out of retailers, countless cheap sequels and re-releases is not enough to pay the rent, maybe EA should move into the textile industry.
“Re: Interesting”
Posted by: Bob - Nov 1, 1:54pm
Yeh I find it quite hilarious that an EA exec is saying that prices need to come down when its EA games that cost more to buy in for retailers then pretty much ever game.
"EA may be one of the first to experiment."
Good! about time, I wonder by this do they mean that their games will be the same general price of other now instead of the rip-off they are.
“Re: Interesting”
Posted by: Bibby - Nov 1, 6:10pm
Errrr...I think he's indicating that, when the revenue model changes (as it will) it will happen in part as a result of retail no longer being required as a delivery channel.
Eliminating the 40%+ margins, 'marketing contributions', returns provisions and preowned market that retail (and I mean BIG retail, not indies BTW) demand will certainly go a long way to reducing prices and driving value for consumers.
“Re: Interesting”
Posted by: stu - Nov 2, 7:51am
Software is far too expensive, and i dont understand why software companys dont realise, (along with film studios for dvds, music studios for CDs) if you want to stop piracy, you should release it cheap in the first place, so cheap it wouldnt be worth copying your game/film/cd, We all know how cheap you can get blank cds/dvds, a few pence, so to a company stamping out thousands and thousands o***ame , it certainly not the physical product you take home from tesco that your paying for, just the data. Then take microsoft for example, spent millions producing Halo 3 and millions promoting it, and well really it just aint that great..... i fell for it, i bought it, but its not much different to the other 2, but i'd rather they didn't spend millions on producing and advertising and that they sold it for half the price instead, if it got good reviews people would have bought it anyway.....
Its always better to sell double at half the price than alienate loads of people who cant afford to just waste £40/50 so just get a pirate where no money goes back to the companies involved.
Anyway waffled randomly there........
EA are *****, the sims never gets reduced, but then only women/girls want it anyway