Sales of consoles may have increased, but it’s common knowledge that consoles aren’t where companies make their money. Even at the UK launch price of £425, Sony were making a LOSS on every console sold.

GAMES are where they generate the majority of their profit, and with titles such as Killzone 2 costing multi-millions to develop, either they charge more for them, or they have to look elsewhere for the revenue.

OPM UK recently ran an article (issue 18, May 2008, pages 34-35) about the cost of games. Doom on PC in 1993 cost around £100,000 to develop. The cost of the average PS1 game was £75,000 to £1.5 million. Shenmue on Dreamcast cost £10 million. Average budget for a PS2 game: £2-3 million.

Average budget for a PS3 game? £5-8 million. And most of these studios put out several games a year.

For every £1 you spend on a game, here’s how it’s divided up:

5% licensing
5% manufacturing costs
5% retail placement fee
7% marketing
3% publisher/distributor profit
10% console owner fee
45% development costs
20% retail mark-up

So of the £40 or £50 you hand over for a game, the developer gets less than half of that money. Outside of development costs, the retailer takes the largest slice.

Just as UK fuel prices could be lowered if tax was cut, so the price of games could drop if retailers weren’t so greedy.

So unless you want low-budget crappy games, or are willing to pay considerably more for your games in the future as development costs continue to rise, I’d get used to seeing adverts in games.

Face it, if companies can’t manage a team to make a game profitable when it costs £40 then they clearly shouldn’t be in the industry. Look at Gears of war, sold over 3 million on the 360 but they put it on the PC to just try and cash in, did they have to? No it was already profitable. It was just another cash in.

i disagree on this. i believe the fake adverts are what helps to create the GTA world. it would be out of place to have real ad boards when everything else like cars, the internet and even the city is fake. would just be weird.

on the topic as long as they use the adverts responsibly then i’m all for it. maybe only in menu screens so it doesn’t result in big billboards all over games? or advert breaks between levels? that would suck.

http://threespeech.com/blog/?p=1127

It won’t lead to a decrease in the price of games, but it may result in the lack of a significant increase.

As gamers, we have to be realistic. We demand better and better games, and those cost multi-millions to develop - last I heard, Killzone 2 had cost $11 million, and that was over a year ago, so I hate to think what the total currently stands at.

But the minute there’s an increase in the price, everyone starts shouting that they’re being ripped off. Someone has to fund these games, and if we the gamers are not willing to pay £79.99 per title, then the money has to come from elsewhere. In-game advertising is an unfortunate but logical step.

I object to advertising that’s rammed down your throat, and wouldn’t like to see things like “Sponsored by Ford” splashed over every menu and loading screen. But if it appears in games as - for example - advertising hoardings, then I don’t mind. Something like GTA would, I feel, benefit from having real adverts dotted around Liberty City. Sure, the current ads are fun, but it the whole city would seem that much more real if you had adverts for Coke instead of e-Cola.