[Jon Weaver]

I have been saying for ages, that I believe Sonys PSN pricing model is flawed.

Everything is too expensive and the net result is that they probably only sell a few 1000 of each title. Since there are no manufacturing costs almost everything they make from PSN Purchases is profit (other than the cost of 'bandwidth' (and I guess licensing costs with regards to DLC (Singstar, Rockband, Guitar Hero) so lets not get into DLC). With this in mind, why aren't they knocking stuff out cheap and selling 1000s of times more?

Lets assume that for the sake of argument, they sell 10,000 copies of given game at £8. That gets them a whapping £80,000

But if they dropped it to say, £4, they might sell 30,000.. The cheaper it gets, the more people will be and I believe that this would be exponential. So if they make it 'rock bottom' (i.e £1) then surely they would sell millions and consiquenty make many times more money than they do right now.

I for one would buy almost everything of the PSN store, IF it were a give away price...

There just doens't seem to be any logic charging £8-£10 for a download for what is often a 'shareware' quality game.. For this sort of money, people are bound to read reviews and only buy the stuff which actually appeals. I can't believe that they are making much money with the current pricing model.

So why did I mention Apple, well it appears that they (or atleast one of their developers) has tried an experiment:

Kotaku - $1 Peggle "Hacked" The iPhone Store - Peggle

Peggle is a great game.. its out on the NDS at a price of, what? £30?? But on the iPhone it was 59p.. The net result of this was that they sold 100,000s of copies AND more importantly, it self pepetuated? Because it was popular, it appeared in their 'Top 25' so more people saw it and more people bought it.

This EXACT model I believe Sony should be using (i.e price it cheap, and have some kind of 'chart' to show whats popular).. I am 100% sure that they would make MASSIVELY more profit than they do now!!

I just frustrates me that there are loads of reasonable PSN games out there, which I (and many (the majority perhas)) will never buy, becuase its simply too expensive.. I just think they are missing a trick.. There has to be a price point where people will just buy it, irrespecitve of whether is good or bad and this would be better for everyone!

But we are talking Sony here, so I guess I am wasting my breath and am not really expecting anything to happen!

Jon

[BenchyUK]

I completely agree 100%

I've said this to TedTheDog on the official PS3 forums about the price of items in Home.

They charge a whopping £1.59 for a virtual t-shirt. Surely if it was 3rd the price, far more people would buy them and potentially make more money.

Their whole business model baffles me

[Darth_terra]

I Wonder how much developers / publishers have a say in the pricing it may not all be Sony's fault when it comes to pricing PSN games, but if it is then they need to have a rethink

Home that is all Sony and there is no way I would pay what they asking for the t-shirts etc.. if they were maybe 20p / 30p a pop then i would give it a serious look, but not £1+

[r4zb3rry]

Totally agree regards the pricing in home, I simply refuse to buy anything as it is ridiculously expensive.

Hats for £1.19!! I wouldn't pay more than 50p for even something that i really wanted like the full GB costume, at the end of the day it's just a virtual item.

R4z

[theshabster]

PSN games are often overpriced.

HOWEVER ...

... If each PSN game had a demo, then I believe that this would be a step in the right direction to increasing sales @ current pricing.

Lower the prices AND offer demos for all games, then Sony & the game devs would be onto a winner.

SIMPLES!

[BenchyUK]

I still believe that the only reason that Sony are sticking with Home is that all the income on virtual items is what will keep the PSN free which i don't mind. They said it was roughly 20% of the people on Home buying 80% of the content, so thanks to those people.

Just wish they would sort their priorities out as everything on PSN only seems half done.

More demos on PS Store is really needed but i think the issue there is Sony charging a lot for the bandwidth.

[Powderfinger]

Well, the sales figures you gave for products at £8 or £4 were of course plucked out of thin air, and most of the stuff on the iPhone app store 1) cost nothing to make so does not need to recoup big costs, or 2) is ripped-off the people who did spend a large amount of money coming up with the idea and delivering it, or 3) is a product which has long been out on other platforms and has already made money for its developer/owner or 4) is shovelware crap that is selling well because iPhone owners are hooked on the temporary app store obsession fuelled by the media and moronic, self-important corporate shills like Stephen Fry.

Also, comparing the price of a download to that of a physical disk or cartridge with marketing costs, production costs, distribution costs and retailer costs is misleading.

And the appearance in the top 25 is completely irrelevant. You will have a top 25 whether or not your prices are high or low (and let's be clear here, you and others are asking for all prices, not just a select few for certain games, to be low). If everything was a thousand pounds, the most popular things would still appear in the top 25. Again, you're asking for all prices to be low; so this point is not applicable at all.

Most of the things on PSN are priced fine in my own view.

[jabintendo]

I do feel that they should continue with a special price for one game every week as it will definately make me pick up more games then i usually would.
Losing £2 on a bad game is not that bad, but i am sure i am not alone in not wanting to take a plunge on a £8 game, especially with most them having no demos and no trailers.

[Workshed]

I agree with a lot of what Powderfinger says.
A lot of whats on the App store is disproportionately cheap, which I personally think is because there's also a lot of rubbish on the app store which is cheap and has pushed down the price of the decent apps as they fight to get recognized.

Also the development costs are significantly different:

App store - a mac and a $99 license
PSN - a PS3 or PSP development kit costing several thousand pounds

Having said that I do think the PSN store is a little overpriced. When the PS3 launched all the games on the store were quite a lot cheaper than they are now, I seem to remember Fl0w being £3.50 which at the time I thought was a spot on price, on the other hand Fl0wer just seems too expensive for what it is and so I haven't bought it yet.

[Jon Weaver]

Your arguments are valid.. Of course the figures I came up with were plucked out of thin air just to make an example.

I didn't want to get specific... The point I was simply making was that at some point, by reducing the price, they would make more over-all, whilst people more people at the same time.

If you price something high, it will sell to a small number of people and will make 'X' profit.. if you make it too low, you will sell it to everyone and make 'Y' profit (which may be no more than X)

BUT there is a point where you will sell to lots of people whilst still making reasonable profit per purchase and ultimately make more money...

I dont believe for a second that some of the games (priced at £8) are selling more than a few 1000 copies.. Where as if the price was dropped, they would sell more (and in my opinion a LOT more)!

Jon

[Workshed]

Yeah I agree, there's a lot more I would buy from the PSN store if it were £4 instead of £8 (which to me seems to be how it was when the system launched and then the prices gradually got bumped up...)

[jonnyc]

Originally Posted by Jon Weaver

If you price something high, it will sell to a small number of people and will make 'X' profit.. if you make it too low, you will sell it to everyone and make 'Y' profit (which may be no more than X)

BUT there is a point where you will sell to lots of people whilst still making reasonable profit per purchase and ultimately make more money...


Jon

I agree but if the game has online support/mp would server costs needed to be added to the overall price?

[Resarf]

I agree the prices should be cheaper. In as much as RB and GH content goes, their hands are tied as the pricing needs to be in line with the 360. I think the fact a large portion of downloadable games are multiplatform now has helped cause the prices to increase accross the board on PSN, so there aren't huge price differences between PSN games. Back when the prices were cheap much of the content on the PSN was exclusive and so this wasn't a consideration. The Iphone store doesn't really have any other equivelant so the publishers have more say on the pricing of their games. Apple obviously aren't taking that much percentage of royalties as these cheap games are profitable, whereas Sony take quite a large fee per title sold (don't have any numbers to back this up but it's common knowlege).

I have pretty much all but stopped buying games on PSN now. Partly due to the price hikes, but also due to the fact retail games seem to drop in price so quickly now. I get much more entertainment for my money, buying retails games a couple of months after they release than buying overpriced downloadable games which for the most part don't hold my interest that long.

[fanpages]

FYI: "Interview: What Price An iPhone Game?"

By Edge Staff
July 3, 2009
---
With the recently released OS 3.0 for iPhone adding features like embeddable maps, peripheral support, and push notifications, the variety of products in the iTunes App Store is increasing by the day. The same can be said of its prices.

In the June edition of its iPhone App Store report, mobile distributor Distimo identifies an upward trend in prices directly linked to OS 3.0’s release. While the most popular price remains US$0.99, burgeoning tiers include $1.99, $4.99, and $9.99. Medical apps command the highest prices (US$8 on average), while business, navigation, productivity, and reference apps average half that amount.

On the gaming front, Exient Entertainment has seen particular success with the launch of X2 Football 2009, which marks a departure from its years of developing high profile DS and PSP ports of top EA Sports titles. It costs a mere £3.99, yet already there are calls for a price cut. We ask company founder and technical director Charles Chapman to make sense of it all.

What’s driving the price fluctuations post-OS 3.0?
The biggest thing I’ve noticed recently is applications can drop in price massively, presumably in order to get into the top 25 or top ten. Once they’ve established a nice position, the price is increased. Peggle is a great example – it was sitting somewhere well outside the top 25, and then the price was dropped to 59p for a week. By the end of that week, it was at number one pretty much all around the world. Then came an increase back to £2.99. It’s now down at 87.

I’d say that this type of ‘dynamic pricing’ is a good strategy for creating a false impression of how popular your app is and gaining prominence really quickly. You can easily argue that using a cheap price point to gain a high chart position and then upping the price means that newcomers will still see the app ranked high, think it must be there due to its quality and therefore worth the re-adjusted price. You could even say that early adopters and iPhone gaming site readers reap the benefits of this approach, while an ‘average joe’ consumer, who relies solely on the App Store for guidance, is completely oblivious.

There are only a handful of apps in the top 100 which are more than a couple of quid and there’s nothing over £1.19 in the top 15. I think there’s always room for premium product, but with the way that the App Store works, that premium product is often not getting the prominence it deserves.

What are the theoretical limits for the new, higher prices?
I don’t really think there are limits – the app at number 45 in the UK is £52.99 – and it’s good value at that price, too. For games, I think things will struggle to get over the £5.99 mark, and so long as there are enough developers able to create product and sell for 59p, that market will remain. The App Store is a bit like a high-volume supermarket at the moment – most things there are low price, reasonable value, and reasonable quality. There are a few premium products, but on the whole the platform is dominated by the cheap and cheerful. This also has the knock-on effect that consumers come to expect to pay a certain ‘average’ price for satisfactory content and need real enticement to spend beyond that perceived (and wholly artificial) boundary.

On that note, we’ve had a few emails from people saying they’d buy our game if it came down in price a bit. That’s amazing really, as X2 Football is £3.99 – you couldn’t buy a beer for that in some parts of the world, and to buy a similar game on DS or PSP you’d be paying at least eight times that!

Do the higher prices purely reflect the increased costs of R&D, or are publishers adding a premium?
The pricing takes on artificial trends as they don’t really reflect the actual production costs. I expect many iPhone titles by professional development companies will struggle to break even. The additional work in supporting 3.0 and 3GS features, which will be necessary in order to compete, will probably make that situation worse.

I’d say another issue is that traditional pricing models from retail sell-in don’t really apply – guessing an app’s first week and lifetime sales and using those estimates to set per-unit pricing doesn’t really work, as real-world sales figures can be so unpredictable. You also have a situation where a game’s price can fluctuate wildly over the space of a couple of months, going both up and down according to the producer’s whim. This is pretty much unprecedented.

What can we expect from licence-holders like EA? Will they be pushing for full 3.0 support from their collaborators, and will their prices rise accordingly?
I expect the big players will support everything they can. They know they’ll get featured on the App Store, and that pretty much guarantees reasonable sales. Ultimately quality shines through and supporting more features will become a big part of that. The App Store is actually a great democracy for quality – if you’re charging a high price then there’s no excuse for a bad product, and if the product is poor then it’s right there for all to see and it’s all reflected in user feedback. It would be like high street videogame stores displaying Metacritic ratings next to all the boxes on shelves – there’s no hiding behind the marketing and brand if the quality isn’t there.
---



PS. Also see:

Two (of many) published articles from March this year discussing why some of the PlayStation Store prices may be high(er than anticipated):

"Someone pays: Sony charges publishers for PS3 bandwidth"

and

"Sony Now Charging Publishers For PS3 Downloadable Content, An Unpopular Policy Shift"


BFN,

fp.

[CurryMad]

@John Weaver - Nice post, some good points made.


From the other comments it looks like the general feeling is that if the PSN store reduced it's prices, then more people would consider paying to download stuff from it.

I was just commenting about Ragdoll Kung fu in another post. (Actually full marks to who ever had the idea to create a free to download demo). Nice little game, would probably buy it, but £8 seems a bit much (also considering it was free in the US PSN store?).


Also, on PSN, there are full PSP games - but these also seem over priced. Maybe this is the foundation being laid for the new PSP, as in theory there will only be the PSN where a new PSP owner (i.e. no UMD) will be able to download games?

I already mentioned that the likes of Pursuit Force 2 are on PSN for £14, and that technically it should be cheaper to download them off PSN when there is no physical packaging, no cut for the retailer and losing out on 2nd hand sales to the likes of Game etc?

It's already been mentioned in previous posts, but I agree with the other posters that if games (GTI club is an example) were priced at a few pounds, then they would be more appealling.

Think the guy who mentioned selling stuff at a cheaper price, but actually managing to sell more - He's hit the nail on the head.


Just seems like the Sony pricing mantra is to err on the side of expensive.

[nehalem]

I think the pricing is set by the developers themselves. The business model is such that Sony charge developers to be on the platform PS3/PSN ( thus they foot the bill for bandwidth costs) but the developers keep the massive majority of the revenue from their games. Thats certainly how its been for previous generations of PS consoles.

Thus its not down to Sony to set pricing.