Nintendo Explains Why Digital Games Aren't Any Cheaper

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Nintendo Explains Why Digital Games Aren't Any Cheaper

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Nintendo boss Satoru Iwata says cheaper digital games could hurt the value people put on big franchises like Mario and Pokemon

You may have noticed that Nintendo has been making a push into digital distribution of its games this generation, with a large portion of its 3DS and Wii U library being made available for purchase through its online eShop. While you may think that digital distribution = no manufacturing/shipping costs, so therefore cheaper games, all of the digital games available on Nintendo's online stores are priced exactly the same as their retail counterparts. Nintendo boss Satoru Iwata explains that making the digital versions of games cheaper could potentially devalue them when compared to their boxed versions.

"[Digital games aren't cheaper] because we want consumers to value software as highly as possible and because we have been trying to heighten the value of our software whenever we produce it," Iwata said during an investor Q&A, adding "We decided that, since the contents are the same, the company would offer the software at the same price, be it the packaged version or the digital version."

He said that people have come to expect that big name Nintendo franchises such as Mario and Pokemon will be well "worth the price" before even purchasing them, announcing that sales for titles such as Luigi's Mansion: Dark Moon and Pokemon X and Y have been very strong for both their respective digital and retail versions.

Iwata did conceed that he was open to the concept of lower price points for digital games if the game in question is a new IP, or a franchise with well-known characters, but new gameplay features. Examples of this already happening include the Mario Vs. Donkey Kong franchise, and Dillon's Rolling Western.

"For these titles, if we take the ordinary approach of selling the packaged software, the software might not reach its full sales potential, and even when we are able to create something interesting, the games often can just fade away without being noticed by consumers," Iwata said.

Source: Gamespot

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More it could hurt their bottom dollar, since they're getting the difference in profit.

So digital games are the same price as physical copies cause publishers want more money.

Yet another blinding insight from Nintendo.

Didn't this industry used to be about producing fun entertaining software for the delight and wonder of the general public?

Wow, the amount of bullshit is staggering. Then again, it's Nintendo, I wasn't even expecting them to say anything clever.

Isalan:
So digital games are the same price as physical copies cause publishers want more money.

Yet another blinding insight from Nintendo.

Didn't this industry used to be about producing fun entertaining software for the delight and wonder of the general public?

The problem it, it's still a business. It'd be wonderful if there was some way for it not to be, but to make games people need money. I'm not saying I'm DISAGREEING, it's just a sad truth.

"Well the content is the same, it doesnt matter that we dont have to pay production, shipping, or franchise costs, we are still going to charge you the same...because its worth it...The fact that we make a LOT more money that way is aside the point honest! Also, thats just rain running down your back...just rain..."

I knew nintendo was run by idiots, but did they honestly expect anyone to not see through their bullshit? Fanboys excluded of course.

RT:
Wow, the amount of bullshit is staggering.

This is exactly (word for word) what I wanted to say.

Seriously Nintendo, I love you, I love digital distribution and I don't mind paying more for digital version than physical versions (especially on 3DS since then I can switch between games on the go more easily), but please don't make such bullshit excuses.

Isalan:
So digital games are the same price as physical copies cause publishers want more money.

All it is and all it ever will be. The excuse they've come up with is hogwash. Granted, there have been mixed reports for their finances and they've let people go, but please don't use an excuse like something EA would use.

Ed130:
So its an altered version of why EA is aginst Steam Sales?

http://www.escapistmagazine.com/news/view/117725-Origin-Boss-Says-Steam-Sales-Cheapen-Intellectual-Property

Yes but since Nintendo doesn't have the hate bandwagon like EA they will just get shrugged off as retarded instead of everyone having an uproar. lol

Digital should be cheaper by virtue of no box, no manual, and no 3rd party selling it. Period. End of fucking statement. Charging the same is absurd and I will never buy a digital copy over a boxed copy if the price stays the same. Ever.

*bzzzt* Wrong! Iwata-san, do you want to take another shot?

Content is the same between retail and digital, true; however content is not the only cost involved with manufacturing and shipping games, is it? Digital cuts out many of those costs and so surely the nice thing to do would be to transfer those reductions to your loyal paying customer who will thank you for your nice service, rather than pocketing the difference and telling your loyal paying customer that they should value you more.

Also, where I look eShop prices aren't the same as their retail counterparts. They're more expensive.

That's fine Nintendo, I'll just buy physical copies then. Atleast then I get what I pay for and can even get a bargain...

"We could make them cheaper, but we won't. We're also not sorry."

Basically what I read.

So when I buy a digital game, really I'm just doing Nintendo a favor since it's saving them money on the production of a physical copy. That's pretty much it exactly. Okay, I get it. You want to save money. That's fair. But what do I get out of it? I have to go buy a fucking SD card for Luigi's Mansion because the game is so huge that the default SD card doesn't have enough room on it. So there's another 19.99 out of my pocket. Oh, and if I want Fire Emblem, I'll have to splurge on an even bigger card.

What the hell am I getting out of paying the same price for a digital copy as I would have if I had just gone and bought the physical copy, which I could then sell back if I don't like? Nothing. Absolutely nothing. The worst part of it is that there are people who will defend this kind of behavior because, for some reason, they seem to like getting screwed by Nintendo.

Well, they'll never get a digital sale out of me, which sucks because the new Phoenix Wright is digital only. =/

What's that, a company president explaining a basic business pricing strategy to investors? A practice that's well researched, tested and proven to work if pulled off correctly? And, it's being used by a company?! The world is truly ending..

Ahh... So THAT'S why PC games are ludicrously expensive on Steam, just like in retail shops. Oh wait... No. No they're not. Most of them aren't even CLOSE to expensive on Steam. Huh. Guess all those discounted games and IPs are completely worthless by now, hey Nintendo?

Yeah, Microsoft pretty much said the same thing when it came to the digital games, and judging by Sony's prices, I'm thinking they think the same way, as well.

Which I'm glad Steamboxes are on their way. I probably won't get one (because I have a PC, which is already a Steambox), but if forces the big three to charge more reasonably for their digital goods, I'm all for it.

chikusho:
A practice that's well researched, tested and proven to work if pulled off correctly?

Yeah! 'cause charging retail price for digital content is working out great for EA Origin.

Nintendo, I don't care that you are doing this, however, don't try to BS your consumer base, we're dumb but not that dumb. If your going to dick us, at least be honest about it. It is the reason that no one really cares when Activision does it.

So basically the same thing every other publisher has stated.

Honestly, why is anyone surprised that Nintendo will do this?

This is the company that has games that are notorious for never dropping in price.
The last thing I expect is the digital version of their new releases being cheaper than the physical copy.

Desert Punk:
"Well the content is the same, it doesnt matter that we dont have to pay production, shipping, or franchise costs, we are still going to charge you the same...because its worth it...The fact that we make a LOT more money that way is aside the point honest! Also, thats just rain running down your back...just rain..."

I knew nintendo was run by idiots, but did they honestly expect anyone to not see through their bullshit? Fanboys excluded of course.

It's not like the rest of the gaming industry literally has the same stance when it comes to digital copies being the same price as physical.

This isn't Nintendo being idiots. It's them literally following the crowd.

STENDEC1:
Ahh... So THAT'S why PC games are ludicrously expensive on Steam, just like in retail shops. Oh wait... No. No they're not. Most of them aren't even CLOSE to expensive on Steam. Huh. Guess all those discounted games and IPs are completely worthless by now, hey Nintendo?

If your only counting Steam Sales. Which are just that- sales and really old games.

Last time I checked a very good chunk of the games- especially newly released games on Steam were still sold at physical copy full price.

I think I spotted a spelling error: conceed should be concede.

OT: Eeeeurgh, nintendo... Like everyone else has said, this is BS. Pure and simple. Though I'm not sure how much it costs for them to store all that content on the server, make it hacking proof as much as possible and other costs for maintaining a digital distribution...*gasps* but the fact that they keep the prices around the same level as a few years ago is unacceptable, especially considering how steam is doing things.

I mean, mario tennis(forgot the actual name for the 3DS title) is STILL 40 euros? Get bent nintendo...

digital copies, sold at a discount could actually increase your sales!

Take Joe Blogs, he's bored on a thursday night, he can't be bothered leaving the house, so he starts browsing what games are available for him to download. 10 minutes later he's bought a game, Joe's happy, as are the publisher/ game developer.

The future Nintendo... aim for it and you'll be flying high once more!

So we all just gonna forget that all triple AAA game development houses do this even on Steam? Or do I have to really mention the latest COD game that just came out on steam and costs the same as retail?

Yes, some games because of digital distribution CAN be cheaper. OR a company that has been used to producing physical copies could use that money to either save themselves money or help invest internally in their own company that could actually produce better content. Especially when said company Nintendo is in a decline. Even if they do drastically slash their prices on their franchises it is only a short term solution to a LONG term problem. Do you really think the majority of consumers now that purchase games really will always buy the next game? Not really and it would be very difficult for Nintendo which doesn't have the same revenue or investment as sony or Microsoft to gut their own bottom line.

I mean it might even reach a point where digital distribution might actually cost more by virtue of actually having to invest so much in multiple servers that store and distribute said data. That is only going to grow exponentially and that data has to be stored somewhere physically and companies know that is in demand is only going to increase in cost.

i do wonder how much the marketing sap got paid to write that little pile of PR bullshit

"We decided that, since the contents are the same, the company would offer the software at the same price, be it the packaged version or the digital version."

Except that it's not really the same thing. With a physical copy you get a box, manual, etc. combined with the security and trade potential that comes with a physical copy, PLUS the possibility to buy it for cheaper (or with special extras) at retail rather than digitally.

And of course there is the reduced bottom line with digital games. Cutting the various costs to manufacture, ship, and stock a physical game means more of that money is simply going back into your pocket. Not that I can blame you for wanting that but its not giving me any incentive to buy digitally instead of physically either.

The bottom line is you (likely) want people to buy digitally so then you keep all the profits to yourself yet give no real incentive to do so for the consumer. And since you still charge sales tax for digital downloads there isn't even that going for you.

It's completely common to sell box and digital at the same price on release. Its the trend most of the industry follows. Is it the right thing to do? I don't think so since you are cutting out the middle man if you own the digital shop in question.

Personally I wouldn't be to bothered about this if it weren't for a different problem Nintendo has. Letting games depreciate over time. I can still go into my local Target and see copy's of New Super Mario Bros for the DS of all things, still going for $40, hell Super Mario 64 DS is till $30 on amazon. That was a release window title on the DS. Seriously, what the fuck Nintendo?

Dragonbums:

STENDEC1:
Ahh... So THAT'S why PC games are ludicrously expensive on Steam, just like in retail shops. Oh wait... No. No they're not. Most of them aren't even CLOSE to expensive on Steam. Huh. Guess all those discounted games and IPs are completely worthless by now, hey Nintendo?

If your only counting Steam Sales. Which are just that- sales and really old games.

Last time I checked a very good chunk of the games- especially newly released games on Steam were still sold at physical copy full price.

And that is why I never buy game with full price
Only when it drops 33+% of the price I will get it
Because digital prices should have been at least 33% lower, instead we get same pricing
And why?
Not to piss off retailers and all associated companies.
As far as I care retailers&co can go and die in a fire.

Dragonbums:

Desert Punk:
"Well the content is the same, it doesnt matter that we dont have to pay production, shipping, or franchise costs, we are still going to charge you the same...because its worth it...The fact that we make a LOT more money that way is aside the point honest! Also, thats just rain running down your back...just rain..."

I knew nintendo was run by idiots, but did they honestly expect anyone to not see through their bullshit? Fanboys excluded of course.

It's not like the rest of the gaming industry literally has the same stance when it comes to digital copies being the same price as physical.

This isn't Nintendo being idiots. It's them literally following the crowd.

You do realize just because other people are idiots doesnt mean idiot cant also be run by idiots too right? I mean hell, I think it speaks more to their idiocy that they decide to copy this one thing from modern game publishers but not something like, I dont know...using more modern hardware...

And digital games on platforms like Steam only remain the same as physical copies for a short time before the prices dropping while retail remains fixed around 60 dollars.

I'm going to take a stab at this.(And probably get it all wrong because I'm an idiot)

Part of the price in anything comes from the labor required to make it right?
The thing is, with digital copies, there is dramatically less, if any physical labor involved. Once software has been made once, you can copy it an infinite number of times for very little labor.

I'm not saying digital should be free, but by my reasoning, digital is very justified in being sold at a lower price than physical copies where the material for the case, book ect have to be considered and produced. And of course digital knocks out any middleman required for shipping, hauling ect.

Idk, like I said, I'm probably wrong.

piinyouri:

Idk, like I said, I'm probably wrong.

That would be correct. See, running serverrs and keeping them stable does require someone to keep an eye on them. You also need a connection to the internet to allow people to download the games. You also need to keep in mind that equipment like that can degenerate. Those are a few factors that do go into the costs of maintaining a server farm to keep games on it.

But another thing here is we don't exactly know how much it actually costs to keep this up. While a game can cost a lot of money to make, expecting a more expensive product is reasonable. But if we knew what it actually costed and how many copies could be sold, which is a gamble, we won't know why they think this is a solid way to do business.

To me, they should degrade the price when some amount of time has passed. But nintendo isn't doing this and that is something I just cannot agree with. The best I can do is stop buying nintendo games, but pokémon so I can't keep my word on that one...

Desert Punk:

Dragonbums:

Desert Punk:
"Well the content is the same, it doesnt matter that we dont have to pay production, shipping, or franchise costs, we are still going to charge you the same...because its worth it...The fact that we make a LOT more money that way is aside the point honest! Also, thats just rain running down your back...just rain..."

I knew nintendo was run by idiots, but did they honestly expect anyone to not see through their bullshit? Fanboys excluded of course.

It's not like the rest of the gaming industry literally has the same stance when it comes to digital copies being the same price as physical.

This isn't Nintendo being idiots. It's them literally following the crowd.

You do realize just because other people are idiots doesnt mean idiot cant also be run by idiots too right? I mean hell, I think it speaks more to their idiocy that they decide to copy this one thing from modern game publishers but not something like, I dont know...using more modern hardware...

And digital games on platforms like Steam only remain the same as physical copies for a short time before the prices dropping while retail remains fixed around 60 dollars.

I didn't say they weren't being stupid, but the way comments on this thread is going is less of just being genrally tired of digital copies being the same as retail copies and more or less being like "X company is stupid for doing this what clowns" like they are the only company doing it.

Doesn't make it better, but considering how they are basically reinforcing the standard mentality it doesn't even surprise me at all.

Digital versions cost the same as retail versions because..... well, we like money

I would accept answers such as

It helps us maintain resonably low retail prices and we need the retail market to continue existing and hopefully grow, because there are people who either won't or can't make use of the internet.

So they say that digital games arent cheaper because the buyers may actually want to pay less for them? Great circulr logic you got here pal.

hickwarrior:

That would be correct. See, running serverrs and keeping them stable does require someone to keep an eye on them. You also need a connection to the internet to allow people to download the games. You also need to keep in mind that equipment like that can degenerate. Those are a few factors that do go into the costs of maintaining a server farm to keep games on it.

But another thing here is we don't exactly know how much it actually costs to keep this up. While a game can cost a lot of money to make, expecting a more expensive product is reasonable. But if we knew what it actually costed and how many copies could be sold, which is a gamble, we won't know why they think this is a solid way to do business.

Yes, keeping server farm costs money. significantly less money than it costs to make physical copies, ship them, give local dealers heir cut and all sorts of other things. Lets not forget some countries dont even tax digital copy sales.

And yes, we do know how much it costs. because we know how much server farms cost for other high demanding internet services that basically do same thing. and they are far less than physical sales costs.

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