According to the co-creator of Fallout, game prices did not follow inflation and its fluctuating rates.

Tim Cain, the developer of Interplay, Troika, and Obsidian, as well as the co-creator of the original Fallout, spoke on YouTube about the difference between physical and digital media. At the beginning of the video, Tim Cain takes a pro-digital distribution stance. Games can be uploaded to Steam instead of being manufactured on discs, which means developers have more time to work on games because there is less time between completion and release. Games are also easier to update, and old games (such as many of the classics Cain worked on) will hopefully remain easily accessible forever. The really interesting part, though, is when Cain talks about how digital distribution has affected the price of games.

“Digital is cheaper. It’s cheaper for everybody. There are fewer costs all around. In theory, prices should have dropped, but they didn’t. You know those cost savings from going digital? They should have been passed on to consumers, but they weren’t. The argument I hear is, ‘Well, costs were rising in development, so it balanced out.’ I don’t think they were balanced. Digital technology is probably the reason games have resisted matching inflation. I’ve said this before: I bought games for $59 in the ’90s. That would be an expensive game nowadays. These were standard games for the Super Nintendo. Cost of goods—COG. As a developer, you often hear your publisher say, ‘Our COG is really high.’ Those costs dropped tremendously with digital, but the savings weren’t passed on,” Cain said.

The money saved by eliminating physical media went straight to the companies’ pockets. The extra profits from reduced distribution costs meant that companies could keep game prices stable without significantly impacting their profit margins. If Cain’s analysis is correct, it seems that we have passed the point at which consumers could benefit from the savings generated by digital technology.

With ever-increasing budgets, the gaming industry consists more and more of high-stakes projects that publishers hope will generate huge revenues. We are seeing more and more games priced at $70 or $80, and there has even been talk of Grand Theft Auto VI costing $100.

Source: PCGamer