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Comment by malnourish | Hacker News Reader

However, are they really extracting more money from their customers if they are charging used gamers for online content?

They don't make money from used game sales, resale stores like Gamestop do.

While this is a very questionable move from a consumer standpoint, it makes business sense.

MMOs rightfully charge for multiplayer access, however they have servers to maintain and use the resources acquired to improve their game and keep it fresh.

One could argue that if EA wants to make this idea appealing to customers, they should offer new content for free for the paying subscribers of used games, or those who paid for a new game.

Then again, they may just charge us for cheat codes and "VIP" mode like they have in the past. Even if one were to buy the game new.

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What I dont understand is that over the 10 years the size of the market has gone up, sales of blockbuster games have gone up, average selling price of a game has gone up, revenues via additional digital content has come in, product placement has trickled into some games, cost of servers has gone down, cost of bandwidth has gone down, cost of hiring programmers has roughly remained the same, some games have even gotten money via movie rights. What is it about publishers cost structure that pushes them to nickel and dime customers inspite of all the above mentioned factors ?

Development costs have gone up.

Even if the cost of hiring individual programmers has remained constant (and I don't have evidence one way or another there - we'd have to consult something like Game Developers' annual salary survey and apply the appropriate adjustments), development teams have definitely grown in size. Bigger teams mean more developers (from all disciplines), including additional management and QA staff.

There are also other cost areas to consider, such as licensing fees and devkit costs, but I'm afraid that I can't share specific numbers there.

http://vgsales.wikia.com/wiki/Video_game_costs - That suggests that game dev costs have nearly tripled over the last ten years. I also think the same timeframe saw the cost of a game go from ~20 to ~60. Admittedly I always bought games a fair bit of time after they got released, so my recollection on game costs might be biased / incorrect. Also - cost of devkits has in fact gone down. Suggested by the page that I linked to, and I know for a fact otherwise. At least the PS3 devkit and the Nintendo DS devkit are very reasonably priced.

New AAA games have never cost as little as $20. The increase is more like 50 -> 60.

However, are they really extracting more money from their customers if they are charging used gamers for online content?

No, they're trying to extract money from people who weren't their customers to begin with.

Just look at the second hand car market for a comparison - people are generally less willing to spend money on new cars that depreciate quickly, preferring vehicles that maintain their value. Particularly people who intend to sell their car on rather than drive it until it falls apart. EA are effectively increasing depreciation on their games.

I would guess that a good number of players who sell their old games use the money to buy new games. This move will definitely push the price of EA's used games down, I would guess by close to $10 for games with significant online content. Which means that EA's primary customers (the people buying the new games) now have $10 less to invest in their new game for every old game that they sell. I can't see people increasing their spend on new games to compensate for this, so the net result could be that EA get more money from used sales, which is more or less balanced out by getting less money from new sales.

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