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The rise in PlayStation 5 game prices has been a sticky topic since it was announced, but NPD’s Mat Piscatella has argued that gamers will “happily pay” the boosted price point. Speaking as part of the Virtual Economy podcast, the analyst argued that he believes the increase can be ascribed to market demand, as opposed to inflated development costs.

“You do pay a premium, and you have been paying a premium, for years to play a game on day-one,” he said. “This is not different. If [companies] want to make the case that they’re doing it because of X, Y, or Z, I guess you could try to make that case, but when you look at the financial statements or the earnings reports, you can argue the other side. The market demand is the market demand.”

Sony became the first platform holder last week to attach $69.99 price points to its first-party games, following in the footsteps of Activision with Call of Duty: Black Ops Cold War and 2K Sports with NBA 2K21. There is flexibility to the Japanese giant’s PS5 launch game pricing, however – both Sackboy: A Big Adventure and the standalone version of Marvel’s Spider-Man: Miles Morales will cost less.

“Game prices have stayed the same since 2005, when Call of Duty 2 first went to $59.99 on Xbox 360 and we’ve basically stayed there ever since,” Piscatella continued. “Now, a lot of people will say a rise in base prices for the higher tier, premium games is needed to off-set development costs, inflation or whatever, and all those arguments seem to fall flat.”

He added: “But what doesn’t fall flat is that for some of these premium games, if the $10 increase was implemented, people would happily pay it. They might grumble about it, but they would certainly pay it. The price sensitivity, particularly on day-one, suggests that.” Piscatella continued that with more options available than ever before, including free-to-play titles, everyone will have plenty to enjoy.

As an NPD analyst, Piscatella is obviously looking at this from a US-centric perspective, but the bigger global story here is that in European countries consumers are being asked to pay up to $95 – albeit with tax included. This is a much bigger pill to swallow, and while we’ll need to wait for more data to see how sales shake out, we can’t see those kind of price points holding for too long.

[source, via]