PlayerUnknown’s Battlegrounds. Star Wars Battlefront 2. Apex Legends. Call of Duty: Modern Warfare. Anthem.
What do all of these AAA game titles have in common? Well for one, they all are produced by massive AAA developers like BioWare, EA Games, Respawn Entertainment, and Activision. Also, (with the exception of PUBG) all of these titles were highly anticipated, receiving massive attention from gaming media outlets and YouTube personalities. Notice I said were.
Their other common denominator is that they all contain microtransactions, or “loot boxes”. And it’s this common thread that has ultimately led to their fall into irrelevance in the gaming market. Loot boxes have been, and will continue to be, the downfall of AAA titles. They have been correctly identified, by many consumers, as a money grab and at their worst straight up gambling built into the game. But why? Why include a mechanic that has been proven to turn people away from your game with shocking consistency?
Let’s take a look at the history of gaming prices over the past 30 years. In 1990, the price of a game for the NES was approximately $50 USD. When the early 2000’s rolled around, that price was about the same for game consoles like the PlayStation 2, or the Xbox. It wasn’t until around 2008-2009 when the PlayStation 3 and Xbox 360 launched that the price of most titles jumped up to $60 USD. Gamers weren’t thrilled, but the backlash was negligible and people continued to buy games at this new price point.
Now let’s factor in inflation. That nasty component of economics that continually rears its ugly head. If you take a look at that $50 NES title from 1990 and put in the context of today’s money, that same game would have a value of roughly $89 USD. You would be hard pressed to find any gamer in 2019 who would be willing to pay almost $90 for the standard edition of a gaming title. Fast forward 10 years to the 2000’s. That $50 game title in terms of today’s money would come in at about a $60 value (give or take a few cents). So, in reality, the ACTUAL price of a video game has not increased since the early 2000’s. At least not in terms of its value when compared to inflation.
This is important to note because the cost of making a video game has not stayed static like their prices. That number has grown exponentially, especially for a AAA developer. Game design, programming, graphics and artwork, sound design, game testing. All of these are crucial components of making a AAA titles, and usually take months, if not years, to properly develop. You also have to factor in advertising and PR as well, as most of these games are treated like blockbuster movie releases in terms of their media build-up. GTA V, the largest multimedia release ever, grossed $1,000,000,000 USD in their first week after launch. The cost of production for GTA V? $250,000,000 USD. That cost of production does not include marketing and advertising, nor does it include the continued support of the title after launch. That is simply the amount of money Rockstar Games had to spend in order to launch the game.
Obviously, not all AAA game titles are going to cost that much money. But, most of them do clock in around $25,000,000 USD with relative ease. On top of that, you cannot expect every game to garner the kind of attention that GTA V did.
Here’s where the loot boxes come in. Given that the actual value of a video game for the consumer has not increased in nearly 20 years, but the cost of making them has, game developers need more people to buy their game in order to turn a profit. Couple this with the fact that there are just generally more games that are released every year, game developers have to work even harder to try and make sure that you spend your money with them. If only there was a way to have the consumer pay more money after the initial purchase of the game. Not a lot of money, just $5 or $10 would do the trick…
That is the reason microtransactions exist. AAA developers have to ensure that they get enough money to meet their bottom line on a title, and cannot rely on the game’s sales alone. Unfortunately for them, the gamers have spoken; with their wallets.
Just recently, a leak concerning microtransactions in Activision’s new hotly anticipated Call of Duty title, Modern Warfare, has caused many gamers to jump ship. The leak discussed the inclusion of weapons in their loot boxes, not just cosmetic items (which Activision promised would be the only thing in said loot boxes). Almost as soon as the news hit major gaming media outlets, players began cancelling their pre-orders. On top of this, Activision has struck a deal with Sony Entertainment to have certain modes of the game be exclusive to the PlayStation 4 FOR A FULL YEAR. Xbox and PC gamers can access this game mode….if they’re willing to fork over about $200 USD.
Modern Warfare now runs the risk of falling into game obscurity despite the substantial amount of hype that it received upon announcement. So what can be done? To me, the answer seems relatively simple; increase the price of the game outright.
I’m sure that some will see this and balk at the idea of paying more than $60 for a game. That is a significant amount of money for most people and an increase in price would likely reduce the number of titles one could buy every year. However, it would entirely eliminate the apparent need for microtransactions. A jump from $60 to $70 for a game title would mean that the developers and, more importantly, publishers would be making almost 17% more on their investment out of the gate.
To put that in terms of real money, lets look at Call of Duty: Black Ops 4. On it’s launch weekend, the game made $500,000,000 USD. The game was priced at the traditional $60 price point. Bump that up $10 or the 17% I mentioned earlier. That would put BO4 at $585,000,000 USD for launch weekend. That might not seem like a lot. However, the cost of production for BO4 is estimated to be at most $28,000,000 USD. That 17% bump covers that cost, and then some.
As a gamer, I hope that AAA developers get the message that their audience is sending them. Gamers don’t take kindly to being nickled and dimed to play a game (the phrase “Pay to Win” has been very prevalent these days). If I want to buy a title, from a developer that I really like, I’m willing to fork over $10 more to play their title. That’s called brand loyalty and it still very much exists in the world of video game development. That brand loyalty goes out the window when I have to spend another $5-$10 on a game so I can maybe get that cool new gun in the loot box.
Sources:
https://www.gamespot.com/articles/star-wars-battlefront-2s-loot-box-controversy-expl/1100-6455155/
https://www.ign.com/articles/2013/10/15/the-real-cost-of-gaming-inflation-time-and-purchasing-power
https://vironit.com/how-much-does-it-cost-to-make-a-video-game/
https://www.reddit.com/r/modernwarfare/comments/d8t44h/ive_cancelled_my_preorder/
https://agreatbecoming.com/2011/02/08/call-of-duty-black-ops-return-on-investment-is-4350/
