Microsoft has increased the prizes for its game products since 1 May. So the 1012 GB budget console has risen in price from $ 300 to $ 380, and for the Xbox Series X for 2 TB memory they already ask for $ 730 -more than for PS5 Pro. A little earlier, April 13, Sony announced the price increase of the PS5 Digital in Europe, Australia and New Zealand to € 500. Prices not only rise for prefixes and their periphery, but also for the games themselves. Nintendo was the first to announce that Mario Kart World, the flagship release of the studio, costs $ 80. Then Microsoft announced the gamers that for some new projects from the company should give $ 80. Why did they all start getting so much? We understand the material.
Why do consolence prices rise
The main reason for the last rise in game systems is the rate war. The United States introduced additional tasks for imported goods, in particular for products from China, to reduce the trade deficit and to solve problems related to the current American administration, with an unfair commercial practice. In turn, China and other countries introduced return rates. The consequences of mutual increase in tasks are not yet completely felt, but they already let themselves feel and cause uncertainty in the markets. Analysts predict a violation of global supply chains.
Experts also believe that the technological sector will suffer particularly strongly, because many electronic components, such as microcircuits and printed printed circuit plates, are produced in China or are dependent on Chinese deliveries. Because of the tasks, these details are appreciated, which influence the costs of smartphones and industrial equipment, as well as, as we already see clearly, the costs of the consoles.
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A logical question can arise against the background of the US and China: why are the prices for the same PS5 Digital in Europe, Australia and New Zealand? Although Europe does not participate directly in the trade war between the United States and China, Sony is – just like other companies – confronted with an increase in production costs and logistics around the world. As already mentioned, there are components produced in China valuable, supplied chains, currency courses are fluctuated.
Moreover, analysts suggest that Europe’s price increase can be an attempt to compensate for increased costs without the direct increase in the American market, which is the most competitive and important for Sony. That is, the company tries to compensate for the damage of American rates at the expense of other regions where things are going well.
But even if you forget the rates, you probably noticed that even without extra tasks of the current generation of console, they were somehow no hurry to fall into price, despite the fact that they were almost five years old. This is unprecedented in itself: rather game systems became noticeably cheaper than the consolecycle. For example, the PlayStation 3 on the release cost $ 599 per 60 GB of memory version, but after three years PS3 Slim for 120 GB came out for $ 299. Why did this not happen with the same PlayStation 5?
According to one of the possible explanations, the problem is in the size of the chips. Earlier, their reduction made it possible to lower the costs of the consoles over time, but modern chips are already so small and complex that the further decrease in the measurements has almost no influence on the costs. As a result, the same Sony and Microsoft can no longer count on traditional price reduction during the generation and the consoles remain expensive.
Another version of why the prices for prefixes or the same video cards were not in the entire history with tasks — a tree of and technologies. The neural networks use graphic adapters for training and work, and the Taiwan Semiconductor Manufactoring Company (TSMC) – the most important manufacturer of chips for AMD, NVIDIA and Apple – has limited production facilities. Because the chips for AI yield much more profit than consumer processors, TSMC prioritizes these orders.
In general, the recent prices of Xbox and PlayStation are related to the trade war between the United States and China, and the devices can continue to rise very well if the situation with the rates worsens. Even if the trade war is suddenly over tomorrow, you should not wait for a strong reduction in the consoles, because the chip deficiency factor will remain: production capacities are busy releasing chips for AI.
Why do the games growl
As soon as Nintendo announced that the Mario Kart World will have to give $ 80, almost all industrial analysts agreed that other large publishers will quickly increase prices for their games. What is curious, $ 80 is not really a new standard price of all future Nintendo -Exclusive, but rather an exception. For example price Donkey Kong Bananza, from the Mario Kart World, remains $ 70. The president of the American unit Nintendo Doug Bowser (Doug Bowser) in an interview as follows explained the new pricing policy of the company:
We will consider each game separately – carefully evaluate how much work has been invested in development, how wide and deep the gameplay is, how relevant the game is and how much it encourages to return to it. All these factors are important … so I think it can be expected that prices will vary. We have not installed a monument for one price.
Although Nintendo is not going to sell all games for $ 80, it seemed enough to overcome a certain psychological barrier on the Mario Kart World. And now Microsoft announced that some of its games published at the end of the year will also cost $ 80.
How does the rise in the prices of the game justify? Leading experts have long warned that it would happen inevitably. The development of AAA projects has become too expensive. The budgets have grown in such a way that some people are considerably higher than $ 300 million, taking into account the costs of development and marketing. Also forget the inflation and economic problems that only worsen because of the same rate war. In the new conditions, companies are forced to adjust prices to maintain profitability.
Another thing is that not all developers and industrial analysts agree that budgets of $ 300 million are a new standard that you need to be set up. Many believe that the publishers themselves have driven themselves in a corner and allow such funds for the development of AAA-Orgr, while it was possible to do fewer costs several times. In his recent article for Bloomberg, Jason Schreier, journalist Jason Schreier) Clair Obscur: Expedition 33, Blue Prins and Split fiction as excellent games with vague budgets and accordingly enough price tags.
With all these news it seems of course that the future of the gaming industry looks bleak. Especially when it is impossible to give an accurate prediction how events will develop further. But it is most likely that the price increase will simply lead to the fact that gamers will become more critical to choose AAA releases that justify $ 80, buy projects more often from the average budget for the type of Clair Obscur: Expedition 33 and more trust in their disadvantaged and subscriptions according to the game of the game.
And apparently it will apparently become more difficult for players to update the console or PC if the prices for game devices and components continue to grow. That is why it is possible that the current generation can drag longer than originally planned.
What do you think? How are you worried about the rise in prices for your favorite hobby? Tell us in the comments.
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Source: VG Times
Christina Moncayo is a contributing writer for “Social Bites”. Her focus is on the gaming industry and she provides in-depth coverage of the latest news and trends in the world of gaming.