Can the Nintendo 3DS succeed in a world where your typical handheld game now costs between one and ten dollars? That’s one of the questions we’re asking ourselves as we consider the new-fangled handheld and it’s one that Nintendo is certainly considering as it launches its device whose games will, probably, cost between 30-45 dollars.

In fact, here’s an answer to that from Nintendo president Reggie Fils-Aime. To him, it’s all about value. Obviously, he thinks 3DS games will be able to offer more at their price points than app developers can offer at theirs.

"I actually think that one of the biggest risks today in our industry are these inexpensive games that are candidly disposable from a consumer standpoint," he told GameTrailers in a recent interview. He was then asked if he thought Angry Birds was disposable.

"Angry Birds is a great piece of experience but that is one compared to thousands of other pieces of content that, for one or two dollars, I think actually create a mentality for the consumer that a piece of gaming content should only be two dollars,” he said.

"I actually think some of those games are overpriced at one or two dollars but that's a whole different story.”

As Eli mentioned to me earlier, it’s hard to argue with that logic. People are beginning to expect low prices, which is a bummer. Truly epic, expansive, big-budget games like Dragon Quest IX just straight up are never going to be made again if the developer is expected to sell it at .99 cents. But, on the other hand, smaller experiences like, say, The Rub Rabbits? We shouldn’t be paying top dollar for those, that’s for sure.

[Via GameTrailers and Eurogamer]

  • BazookaTime

    We'll, I was with you until the Rub Rabbits comment. I found the Rub Rabbits to be a very unique gaming experience and a huge improvement over Feel the Magic. Regardless, this is why there will always be price debates, we all value games differently.

    • http://toucharcade.com Eli Hodapp

      But -both- Rub Rabbits and Feel the Magic felt like total tech demo mini games. I was definitely disappointed with both, especially when I bought them new at full price.

      • BazookaTime

        I understand your point but both games offered a unique look and method of story telling that made the games stand out to me. I just found it odd that with all of the crap full priced DS games out there that The Rub Rabbits was singled out. Anyway, I agree with the main point being made.

      • http://www.jeybee.com Jeybee

        This is the main issue really. The consoles and major handhelds don't have much of any correlation between price and cost of development. Unless, it's a re-release, they're pretty much all full price to begin with and full price is the same price regardless of if it's Brain Training or a 60-hour RPG.

    • zeldafanboy23ify

      But really, would you like to buy Attack of the Killer Granny for 99cents?

  • http://twitter.com/sstaver Stephen Staver

    I FREAKING LOVE THE RUB RABBITS!! :P
    Seriously though, Feel the Magic and The Rub Rabbits are unique experiences that I wish were more common.
    RUB IT! dun-duh-dun-nah-dun-nah-dun-nah!

  • YoureAMessy

    I'd have to agree with Reggie. I feel the same exact way. I feel entitled to games being no more than $20 because of how competitive the iOS market has gotten for games.

    • http://twitter.com/21tigermike Michael A. Robson

      Sounds like you actually disagree with him if you want prices to be alot lower than 40 bucks ha...

  • Dave

    I would definitely pay more than the average price for a game like dragon quest, but not as much as a DS game (don't buy games for the DS anymore BTW ;). Way I see it, even though apple takes it's 30%, the licensing fee is $99, the dev kit is free (assuming you have mac hardware), the distribution costs are pretty much nil since apple's 30% covers it. Compare that to nintendo's costs, plus box art, manuals, manufacturing of carts, shipping them to retailers who are taking their markup, etc. I don't see why Dragon Quest for $15 is a non starter. I wonder how well Crimson Gem Saga did. It was 10$ (currently it's $5). It was a port, so it already made most of it's dev costs up on the original PSP version, so it's just gravy, but it might give an idea of volume and market for such games that could be used to calculate a reasonable price for something original that has that many hours of solid gameplay.

  • http://www.facebook.com/profile.php?id=599360859 Stephen Middlehurst

    See I don't think Reggie is being entirely honest here. He's right in a way, having mobile games priced as low as they are does create an expectation amongst consumers but let's look at this for a moment...

    iOS games are digital downloads. Same for Android, WP7, webOS etc. When you buy a dollar game the resale value of that game is, instantly, zero. Get something with wondeful reviews that you don't click with and you're out of pocket. Do the same with a retail game and you can always sell it or trade it back in (or even return it if you're in a country with decent right-of-return laws). This is something Sony, Nintendo and indeed Microsoft have struggled to get to grips with on their home consoles, Sony being a particularly common offender with the price of digital PSP games being set at or near the retail price of a boxed version. So that's one important thing to bear in mind.

    Next, I'd argue that the price point expectation is only really set amongst the more casual gamer. The (and I hate this phrase but can't think of a better one) 'hardcore' gamer is well aware, just as they always have been, that bigger games are often worth paying more for. What Nintendo are terrified of is the generation of casual gamers that flocked to the DS and its variants, paying £30 or more for a single game, now have different expectations.

    Finally I'd say that mobille gaming, by and large, IS overpriced. The current generation is pushing the edge but 3DS games are already showing up at the same price as home consoles. While the cartridge probably costs a bit more than a DVD or Blu-Ray I struggle to believe that 3DS games, which run somewhere around a PS2 in terms of graphics, really need to be priced that high.

  • Anonymous

    Yeah, Nintendo's model for the last 10 years has been to sell 5 or 10 great games and then hundreds of pieces of shovelware, all at the bloated price point. I'd rather take my iPhone games, where the biggest, broadest games cost 10-20 dollars, but the arcade games cost 2 dollars.

    • S1pstream

      You have no idea what you're talking about, do you? Name one piece of shovelware thar Nintendo released in the past 10 years.

      • Random

        I'd say he was referring to the mountains of terrible third party rubbish that Ninty makes a killing in license fees with.

    • MARIOGALAXY2FTW!!!

      Well, the 3ds dosent have as much of a problem like the wii.
      In fact, this year Nintendo had about 20 sweet exclusives for their console.

  • Anonymous

    It's hard to argue with Nintendo when they're being pigheaded --with their old-fashioned cartridges, underpowered hardware, and anemic online support -- but they're profitable and popular.

    That said, I think they're starting to sound a lot like the recording industry and print media establishment: threatened by changes and saying stupid stuff to justify their greedy defense of the status quo. Prices were high because that's what the market was able to bear. That will still be the case with Nintendo stuff, but they can't just shovel any old junk on us. I wonder how much of their income is from 3rd party licensees, and how much is from selling their own stuff?

    Let's not forget that Square Enix was able to sell Chaos Rings for $15 on iPhone.

    Maybe there's a market for everyone. iOS for apps (think TV shows), and 3DS for "serious" games (think theatrical movies).

    One last thing: Rub Rabbits was awesome, but it was never worth $30. It would have been a great $3 download game.

  • Chris Powers

    I can relate to the disconnect between prices and the consumer. I for one am very disappointed that the Mac iOS store apps are so high as compared to the iPad.

    I can buy Call of Duty: Modern Warfare for the Mac for $49 (same price as the publisher charges on their website, yet its $39.70 on Amazon, and I get free shipping with Amazon Prime. Sure its not a digital download, so its a bit inconvenient to wait a couple of days... But this is an OLDER game, and according to Amazon was released on September 29, 2008.

    Yet, over on the iOS App store for the iPad, I can buy DeadSpace (HD) for $9.99, Modern Combat: Sandstorm (HD) for $4.99, Modern Combat 2: Black Pegasus (HD) for $6.99. Now granted, none of these are available on the Mac App Store & only DeadSpace was released for the PC and console systems & is available on Amazon w/ a digital download for the PC for $10. It was released October 14, 2008 (one month after Call of Duty, Modern Warfare for the PC & consoles. Its between $15 to $20 for a physical copy on either PC or console... Not to mention, Battlefield Bad Company 2 (HD) for $4.99 but on the PC for digital download on Amazon, its $19.99... Not to mention ranges from $35 to $55 for the various consoles-still high because I guess its a popular game...

    So yes, when I go buy a game on the iPad, I expect something more under the $20 range.... I can compare more apps, but since there's so little Mac games on the iOS store, its a bit hard to do a "fair comparison" but if you take a note from the DeadSpace digital download for PC--they I should really be paying that amount, or close too it, for the digital download of the Mac version of Call of Duty--since they're virtually the same age of being out, even though Aspyr didn't release their version until this past month. Not to mention the price difference between the iPad version & the PC digital download version of Battlefield Bad Company 2...

    Other games, more current & their price differences...
    Need for Speed Hot Pursuit HD for iPad, $9.99 but console is $55.
    Madden 2011 HD for iPad, $ but for ranges between $35 to $45 for PC/Console

    Now take a iPad version vs an Mac OS version on the iOS store...
    Sketchbook Pro for iPad, $2.99 but on the Mac App Store, its $79...a huge disconnect in prices. I'm not sure how they justify the difference...
    iBank for iPhone is $4.99 but for the Mac iOS App, its $59.99... I'm sure there's a huge difference here but it seems like a large disconnect...

  • http://twitter.com/victorleichner Victor Leichner

    I think it's pretty clear that games cost too much. Much like video and music content providers, Nintendo believes that keeping sales limited to people who really want the content is what gives them strength. The reality of it is that when distribution systems become irrelevant (and extremely cheap and digital) it's better to sell a substantially higher quantity of games than to sell fewer at a higher cost.

    • Sikeside

      And hello to the man who has no idea about development costs.

      • Spungo

        Development costs have NOTHING to do with the price of games (or anything else IP-based). It's a gigantic lie put out by publishers that the more gullible consumers swallow blindly. Hardback books cost $20+, do you think that's because of development costs? Don't be dim.

      • http://www.facebook.com/profile.php?id=1089737288 Wim Lauryssen

        You can't compare books and games. They have as much in common with each other as a cat and a flower.

      • Anon

        So if I spend 1.5 Mil making a game, I should put it out for $1? Cool logic, bro. Keep "stickin' it to the man". I'm sure next you'll tell me that the price of a car has nothing to with what it's made of.

  • Marsha

    As an iOS developer, it is VERY difficult to warrant making an "epic" game. The executives of the company refuse to risk the 300k it costs to develop a game when users wouldnt pay more than $10.

    Remember, nobody is going to make a game if they think they are just going to break even or cover their dev costs... companies make games to get a 5x or even 10x return - which is VERY hard to do on iOS because of the free/low cost software. There are simply not enough users and too much competition to warrant making huge games - so instead you get shitty freemium games like we rule and tap zoo that cost 1/5th to make.

    • Zevzoq

      or fantastic and fun arcade games like Fruit Ninja, Tilt To Live, Silverfish, Pocket Halfpipe, Beast Boxing, Vector Tanks Ex, Death Worm, and on and on and on...gmaes that are PERFECTLY suited for a portable play on the go.

    • Dave

      Well, according to this video:

      http://www.lazygamer.net/videogame-prices-where-does-the-money-go/

      The average amount that studios tend to see as profit for a 60$ console game is $17. That works out to be about 28.34% from the sale is profit, based on number of units sold and R&D, marketing, nintendo's cut, gamestops cut, etc.

      The break down should be simpler for an IOS game per unit:
      %30 to Apple
      %15 Advertising (according to the video that's the norm)
      %30 Profit
      which leaves %25 to cover R&D costs

      so for a $10 game to get the kind of return they are used to on average they should expect $2.50 per unit to cover the cost of R&D. For the 300k you quoted they need to sell 120,000 units. I don't think that number is outside the realm of possibility, especially with a %15 advertising campaign and the number of potential customers world wide for iOS devices. They've covered the cost and made an additional $360k. More than 100% return.

      120,000 units should be really easy for AAA publishers.
      Angry Birds sold over 6 Million units by itself, and it's developer was a nobody.

      Gameloft has sold a total of 330 million units across it's catalog as of May 6th 2010. (http://www2.gameloft.com/corpo_press.php?date=2010&press1=1329)
      It had close to 300 titles in it's catalog at that time so even if we average that out across all of them it's over 1 million units per title.

      I really think that $10-$15 games should be able to cover the costs and make a nice profit from AAA vendors if they treat the market seriously enough, even if they double the 300K investment. The $10 million they put into an XBox360/PS3 game would be another story, and the game would likely need to be closer $30 or $40 (dunno, not doing any more math now) to see a reasonable return (assuming the advertising blitz stayed at %15 to try and drive unit sales up). But I don't think anyone would need to spend that much for an epic iOS game currently.

    • Spung

      The thing is, every study ever done on the subject shows that in the App Store you make MORE money by selling at a lower price. Put a game out at $10 and you won't make your costs back, because almost nobody will buy it unless it's absolutely amazing or backed by hugely popular existing IP. Put it out at 99c and you'll sell - literally - 100 times as many copies and make 10 times as much cash.

    • Crus

      Thats true man, we have same problem. For indie developer is risky to invest 300k to development now..

      Its really interesting why people think that you can make money and sell game for one dollar.. Just check top 25 app leaderboard and see how many real games are there..

      Even for big companies is hard to make money now.. Do you think that real racing 2 is in profit ? Or shadow guardian ? Or dungeon hunter 2 ? Or dead Space ?

      • Spungo

        If you don't think the games in the top 25 are "real games" you probably shouldn't be developing for the iPhone at all.

      • Toro

        Did you play any game except casual ?

  • Zevzoq

    "I actually think some of those games are overpriced at one or two dollars"

    this is a hilarious statement. I'd suggest quite a lot of the Wii shovelware would be "overpriced" even if it were selling for one or two dollars...

    • http://twitter.com/21tigermike Michael A. Robson

      You think it's hilarious that he's bitterly trying to jab Apple? Wake up, Apple is eating this guys lunch, and they're freaked.

  • Anonymous

    People aren't beginning to expect low prices. They've been expecting them for so long now that ever dollar above $1 that an app costs brings out more and more of the vocal cheapskates with a huge sense of entitlement whose arguments for cheapness primarily compare "expensive" apples to artificially cheap oranges. And the worst part is that devs -- mostly many of the first and second year indie devs -- did this to themselves. Reggie does have a point, though I think it's overstated a bit as you'd expect from a media sound bite. While I do think iOS games may very well sell in considerably larger volumes, and in a much shorter time frame, than more expensive console titles, I still think it is very hard even for top tier houses to justify blowing big budgets on console experiences for mobile devices because it is still a big risk.

    • Zevzoq

      for every one of those vocal cheapskates there are a dozen people who come back at them and inform them of how cheap they are. Theres lots and lots of ios gamers (myself included) who are willing to spend more than a dollar or two for a game. There are also a fair number of games that sell quite well in the 10 dollar range.

    • Dagnar Kafunkenun

      It comes down to profit. Always has. If it costs you $1 million to make a game you'd expect to make a profit off of that game. So, you project an estimated amount of purchases and factor in PR and all of the other costs and set your price. What's changed today is digital downloads. There's no need for shipping fees, factories, carts/CDs/DVDs/Blurays -- because it's all in a download with a digital poster art.

  • Anonymous

    Why even print this answer non-answer non-answer answer-non-answer corporate bullshit-speak? Fils-Aime is NEVER going to say anything of value or insight in public. Why quote him? Everything that comes out of his mouth is just Nintendo spin. Utterly pointless.

  • Carl

    I'm not an economist so your mileage may vary: in a digital economy, the lowest available price becomes the new perceived value. Why? Because reproduction costs are virtually zero and distribution costs can be measured in pennies.

    As more and more people come to understand this basic principle, they will perceive the lowest price as reflecting the real value - it's a copy, remember? People will know that there is no scarcity of digital copies - the bucket will never run dry.

    The success of low-low-priced digital assets, such as 99c games, acknowledges this and, I dare say, collects its due reward from a mind-boggingly huge userbase. It's the future, Nintendo.

    • Lauryssenwim

      If the future means that the Doodle Jumps of the world will replace the Sonics and Marios and the Infinity Blades will replace the Ninja Gaidens and Elder Scrolls, I don't want to live there.

  • SoulShading

    Reggie loved-son is a smart man. The IOS pricing model (and fart app model) is not benefiting the industry and the players at all as it generate this buy, try and throw away behaviors. Peoples aren't even trying anymore. It becomes like switching the TV channel.
    That being said, Apple did something good which was merging multiple devices into a single one.

  • My2Cents

    Competition is healthy.
    If you can't compete anymore... well heck... that's just the way it is.

    When the move takes place (and it will) from the "phone" vs "portable console" to a united peice of hardward, nintendo will need to evolve like the rest of the world or go the wayof dinosaurs.

    If you look at the trends on the appstore, better games are coming out and they are more expensive than in previous months. It's going to continue until we, as the consumers, decide this is the limit of what we are willing to pay for a game.

    I didn't think twice about 9.99 for Dead Space HD. I would have payed more for a big budget game that is done right.

  • Anonymous

    People need to stop buying Angry Birds and similar titles. One problem is with these cheap production titles selling at $.99. These games are "overpriced" when compared with other bigger titles.

  • Nineofspades07

    don't tell anyone angry birds is on the PC for free. ;)

  • The Truth

    so far, no iOS game I've played comes anywhere close to the best DS games in terms of quality.

    • Zevzoq

      Lego Batman seems about the same to me. I'd say Jet Car Stunts, COD Zombies, and a few others would be at home on the DS. Certainly, lots of the Iphone games I've got are as good as whats available for the DS on Nintendos download service...I certainly think the Iphone screen is massively nicer than the DSs two grainy low res displays...

    • http://twitter.com/21tigermike Michael A. Robson

      You should try Dungeon Hunters/Chaos Rings. DS is old school and pixelated man.

  • Zevzoq

    ...and I don't think there are any fighters on the DS much better than SFIV for the iphone...

    • http://www.facebook.com/profile.php?id=1089737288 Wim Lauryssen

      Jump Super Stars (and its sequel) says hi.

      • Zevzoq

        er, yeah...if you say so. Not really the same sort of game of couse, but whatever...

  • Caiman

    I think what Reggie is saying here is that the 3DS version of Angry Birds will be $39.95

  • http://www.facebook.com/people/Marshall-Pope/100000602530531 Marshall Pope

    All I know is that for every iteration of the Gameboy I have owned I have never purchased more than around a dozen games, I have probably purchased 200+ so far for the iphone and ipad...the most expensive I have purchased has been around $15 but I have dozens that were $10. When I picked up my first ipod touch I was still buying the occasional DS game, because surely things like Professor Layton and Zelda didn't exist...those genres have since received several quality titles. The bottom line is I ended up selling my DSi a few months ago and now really have no intention of buying a 3ds. I have a feeling that as I see more and more going that route both Nintendo and Sony are going to have to rethink their strategies.

    • SoulShading

      I think you are overconfident in Apple's ability to move into the game segment with its lack of experience. The half-assed Game Center demonstrates my point.
      Apple made itself a space in the market the same way industrial did it with almost everything; by flooding the market with cheap and quickly exchangeable products.
      Now, first party are seeing the danger and are putting their expertize into making a new generation of gaming platforms.
      In the end, players are going where the games are. Apple is failing to promote creativity and quality over clones and fart apps. Developers are tired of it and will soon migrate back to a better place. NGP guys? ^_^

      • Guest

        NGP = Neo Geo Pocket

    • SoulShading

      I think you are overconfident in Apple's ability to move into the game segment with its lack of experience. The half-assed Game Center demonstrates my point.
      Apple made itself a space in the market the same way industrial did it with almost everything; by flooding the market with cheap and quickly exchangeable products.
      Now, first party are seeing the danger and are putting their expertize into making a new generation of gaming platforms.
      In the end, players are going where the games are. Apple is failing to promote creativity and quality over clones and fart apps. Developers are tired of it and will soon migrate back to a better place. NGP guys? ^_^

    • Zevzoq

      total agreement here Marshall. My DS is collecting dust while my iphone is in almost constant use by either myself, my 2 boys, or (boggle!) my wife - who has never been a gamer in the past at all...

  • touchgamer

    Reggie, your talking utter rubbish !!
    1. Killing Gaming ? What the iphone/touch IS killing is Nintendo's ability to sell showelware at inflated prices !
    2. Have you seen the launch day games for 3ds ? Same old expensive rubbish....

    • Anon

      Aaaand that's why 3DS preorders are FLYING past the Wii's... Spoiled fucking kids these days.