The launch of Nintendo’s Switch 2 this year came with the normal level of hype for a new gaming console, but there was also something distinctly sour about it: the price.
The $450 price tag for the console, a $150 jump from its predecessor, was a lot for gamers to swallow.
Not to mention the $80 Nintendo was charging for some of its new games, like “Mario Kart World.”
Add to that price hikes for current generation PlayStation 5 and Xbox Series consoles — along with the long steady $60 price for games consistently hitting $70 and $80 — and it has left a hole in gamers’ pockets.
Much of the blame has been placed on tariffs implemented by the Trump administration, but experts say the reasons games have gotten more expensive are more complicated — and more specific to the gaming industry.
Tariffs have undoubtedly played a role in raising the price of gaming hardware like consoles. Sony and Microsoft have indicated as much.
But the harsh truth is that the gaming industry has been headed in this direction for years, says Bob De Schutter, a game design professor at Northeastern University.
“What has happened now is that games are just trying to really squeeze every last bit out of the development team to make the experience as immersive or as lifelike as possible if you’re looking at big AAA titles,” De Schutter says.
“To be perceived as something novel — because novelty still drives sales in a lot of ways — is so much harder nowadays. Because of that we’re just seeing budgets getting bigger and bigger and bigger.”
However, bigger production budgets mean studios need to sell even more copies or make even more money off in-game monetization to satisfy publishers and shareholders.
At the same time that budgets have increased, the outsize investment in gaming that occurred during the COVID-19 pandemic has tapered off, De Schutter points out, leaving some investors “more reluctant.”
The money and growth that many saw occur during the pandemic “didn’t really happen the way that it was anticipated,” he says.
Lingering in the background has been the steady shift from physical game sales toward digital sales, a trend that game producer Ryan Maloney says is subtly responsible for the unease around game pricing.
“Online digital sales in general have made people more used to paying less for games,” says Maloney, who has worked for Epic Games, Blizzard Entertainment and Demiurge Studios.
“That’s not necessarily a bad thing, but it does mean that when it comes to big blockbuster titles, now companies and publishers need to figure out ways to get returns on their investments.”
For the past five to 10 years, the answer for many studios was making live service games. These games, like “Fortnite” and “Apex Legends,” are often free to play while encouraging players to spend real money on cosmetic items. They get constant updates with new content, giving players a reason to continue playing for years.
However, the recent failure of live service games like “Concord,” which shut down shortly after launching, has proven that the well is drying up in the live service space, Maloney says.
Meanwhile, for studios making the kind of big-budget, immersive experiences like Nintendo’s Zelda games or Sony’s “God of War” and “The Last of Us Part II,” in-game monetization has become a backlash-inducing faux pas. The answer, it seems, has become pricing.
Most major releases have adopted the $70 price tag over the last few years, but Nintendo “ripped the Band-Aid off” by releasing its recent Switch 2 title “Mario Kart World” for $80, Maloney says. However, it’s not a guarantee just yet.
Microsoft tried the same thing and announced that its upcoming roleplaying game “The Outer Worlds 2” would be priced at $80. It later walked that back, bringing it down to $70.
“We’re going to see a lot of variety in pricing” as publishers figure out what audiences will accept or push back against, Maloney says.
Nintendo, whose games are only available on its hardware, might be able to get away with selling its games for $80 or more. The same goes for industry-smashing titles like “Grand Theft Auto 6,” which comes out next year and could cost as much as $100, according to some industry analysts. Other publishers whose games are more widely available might stay steady at $70, pushing up to $80 with certain titles, Maloney predicts.
For De Schutter, the current pricing hikes are more of a stop gap solution to the root problem, which remains inflated budgets and expectations in the AAA space. He explains that games like “Clair Obscur” prove AAA visual fidelity and quality doesn’t need to come at the cost of AAA budgets.
“It’s just not sustainable,” De Schutter says. “They’re just trying to come up with whatever they can do to find extra money to afford these bigger development teams.
But in my opinion, what they’re just going to have to do is go back to not needing everything to be that high fidelity in terms of graphics and be content with, ‘These graphics are functional and it looks fine.’”
Written by Cody Mello-Klein/ Northeastern University.
