“You want to make sure you have a good topline to support [creating new games]”
Microsoft is in no rush to announce the prices of its first-party games for the Xbox Series X and Series S consoles.
During an appearance at the virtual Jefferies Interactive Entertainment conference, Xbox CFO Tim Stuart said that the company isn’t planning on “making specific announcements on first-party pricing yet. So we’ll do that sort of in due time,” as transcribed by Seeking Alpha.
He also noted that while the consumer price of games has not increased since the PlayStation 3 and Xbox 360 console generation, the production cost of games has increased exponentially. “Prices have not gone up in – what, for a couple of generations now, so it’s not unheard of to see things like this going on,” Stuart said.
“[C]ontent creation costs go up,” Stuart added. “And these publishers and content creators, including ourselves, want to make sure you’re driving the right gross margin profiles, the right earnings profiles of what it takes to build these new, awesome, amazing games. And you want to make sure you have a good topline to support that.”
Stuart’s recent comments come in contrast to those made by Aaron Greenburg, the general manager of games marketing at Xbox, who previously described the issue as “super complex”. Greenburg had suggested that next-gen games likely not launch at a uniform price point across the board, adding that “there’s not a simple answer” to the issue.
Stuart is also not the first video game exec to note the rising cost of developing video games. Earlier this year, Take-Two Interactive CEO Strauss Zelnick cited more expensive production costs as the reason for increasing the price of NBA 2K21, which retailed for US$10 more on next-gen consoles as compared to current-gen systems.
Take-Two has since confirmed that the price hike will only affect selected titles, although its criteria currently remains unknown to the public. Sony has also announced that it will increase the prices of its first-party game prices on a case-by-case basis.