industry news
Activision Boss Wants Cheaper Consoles
Posted by Brian Ashcraft at 11:20 PM on July 1, 2008
Activision honcho Bobby Kotick is worried. Very worried. Video game consoles are expensive! And to buy them, you need money. Lots. As Kotick points out:
It used to be the case that we did well during slowdowns because if you couldn't afford to go to the movies or to travel to a theme park, you stayed home and played a computer game. But now I think that the hardware manufacturers are going to have to think about reducing their prices because the cost of purchasing some of this stuff is prohibitive.
I dunno, as a kid, I kinda always remember video game consoles being expensive. But hey, that's because I was like a little kid and little kids have no money. But I'm an adult now, and it's all relative, Bobby Kotick! Speaking of adults, Bobby also pointed out that the adult geared games are as important to the industry as R-rated movies. That's echoing similar things Kotick stated earlier. This leas us to believe that yes he will probably say the same thing again.
Guitar Hero firm Activision [Times Online via MCVUK]

Comments (AU Comments · US Comments)
There are currently no AU comments for this post.
PENI_MASTA
Posted 12:38 AM 2/7/08
Actually people usually do go see movies during an economic downtown, that's partially why the weekend box office is up 22% over last year in the U.S. Plus even if a movies ticket is $15, it's still much cheaper than a $50 game (especially a crappy Activision one).
PENI_MASTA
Hendrixx
Posted 12:37 AM 2/7/08
I hate Bobby Kotick... seriously, ever since the debacle which was his statement that GHWT will be the first full band game all I hear when he opens his mouth is 'Blah blah blah...'
Hendrixx
Heyyou27
Posted 12:33 AM 2/7/08
This guy is really annoying; it seems like every week or so he's saying the Xbox360 and PS3 should be cheaper, but he's completely satisfied with games being $60, or charging $200 for the new Guitar Hero and making sure none of the peripherals are cross compatible. If it weren't for Blizzard, and id I'd avoid Activision just as much as EA.
Heyyou27
Tyrannical
Posted 12:22 AM 2/7/08
It's the $60 games I find expensive, not so much the consoles. The 360/PS3 isn't cheap, but at least I know where the money went.
Tyrannical
Primebuster
Posted 12:19 AM 2/7/08
heres a little rundown
60GB PS3 (US)= $500, thats £250 in the UK
60GB PS3 (UK)= £425, thats $847 in the US
i remember my first PS2 costing me £300, thats around $600
now you have games with plastic guitars costing you $99.99, and over here in the UK they'd cost you around £75. Thats almost $50 more than what the US would pay.
yeah, games and consoles are far more expensive, but if you look at the facts, the UK gets totally and utterly screwed over compared to the US.
I'd far rather pay the US prices, but importing into the UK screws you over as well. so by the end of it, its almost the same prce to wait half a year and get it when it comes out in this territory.
This jerk's talking about expensive consoles, well, maybe if he made the games economical, instead of having to buy a new freakin guitar every game (2 if you wanted to play with friends), then maybe, JUST maybe people would buy the games.
i think they should make their drum kits and guitars standardised, stick with ONE set of instruments and just create sequels to their games that utilise these intruments. Even make the games compatible with other companies instruments.
and by the way £425 is a bargain for a PS3,I've never regretted it. I dont understand why you yanks complain about the price all the time. youre getting it for £250.
Primebuster
Starsky
Posted 12:17 AM 2/7/08
Very noble Mr. Kotick! But how about not charging the insane price of 60 to 70 EUR per console game (when the same game for PC is only 40 - piracy seems to have regulated the market here)? Or how about not raising the price of your Guitar Hero games by 10 bucks with each annual iteration?
Starsky
nlyonssmith
Posted 12:14 AM 2/7/08
Adjusting the launch MSRP of the Xbox, Xbox 360, ps1, ps2, ps3, Wii, Gcube, N64, SNES, and NES consoles by inflation (assumed 4%) shows that:
Microsoft has increased their console prices at the same rate as inflation (that is only fair).
Sony has increased their prices at a rate greater than inflation (PS3 only) but note that the PS1 was prohibitively expensive at $300 MSRP in 1994.
Nintendo has increased their prices at a rate SMALLER than than inflation, meaning the console is actually cheaper.
If you compare the launch MSRP of the older consoles to the current MSRP of the consoles, the picture is even clearer. Console prices are not increasing at the same rate as inflation and therefore they are technically "cheaper" now than the older consoles were back in the day.
A better comparison would be to compare the MSRPs of each console at the same time after its launch, xbox360 after 2.5 years compared to Xbox after 2.5 years, etc, but I'm not going to worry about finding those numbers.
Bobby Kotick is wrong.
Also note that at $50 game in 2001 would be the equivalent of a $66 game today. Wikipedia was my source for console launch MSRPs.
nlyonssmith
themaninthebox
Posted 12:12 AM 2/7/08
@venkat55: ah, you beat me
themaninthebox
slomo788
Posted 12:08 AM 2/7/08
Well then maybe Activision should come up with a platform (didn't someone shut his mouth already with that quote?)!
slomo788
ichiban1081
Posted 12:08 AM 2/7/08
I do think the consoles are still expensive (except the Wii). I want the PS3 to drop down to atleast $300 and also the 360 as well.
ichiban1081
t0nz0r
Posted 12:07 AM 2/7/08
@venkat55: Clicked through to say the exact same thing.
I have 2 GH guitars that are useless because I only play RB now >.<
t0nz0r
themaninthebox
Posted 12:05 AM 2/7/08
what about gaming peripherals, like his damn Guitar Hero controllers. It is very prohibitive for the guitar controllers not to be compatible with other music games (like GH guitars not working in RB on PS3 or Wii, or RB guitars not working in GH on 360). I would have bought GH3 for 360 is i knew that my RB guitars would work on it.
themaninthebox
Rebochan
Posted 12:03 AM 2/7/08
I want cheaper consoles too. I also want a pony.
Sometimes I don't get the things I want.
Rebochan
jBusiness
Posted 12:03 AM 2/7/08
Wow, that's awesome. I love it when someone else writes what I write at the same time as me, only smarter. Well, kudos, quen.
jBusiness
EnigmaNemesis
Posted 12:01 AM 2/7/08
Activision Boss:
"You consoles need to be cheaper, so I can haz more moniez"!
EnigmaNemesis
mrantimatter
Posted 12:01 AM 2/7/08
Actualy, if you count in inflation, then consoles havn't really changed that much overall. At the very least the advancments in text justify those increases.
mrantimatter
runandgun
Posted 12:00 AM 2/7/08
@kratosfan: thats perfect
runandgun
jBusiness
Posted 12:00 AM 2/7/08
It's worth mentioning that both Sony and Microsoft lose money already when they make the hardware. And I prefer their graphics over the Wii. You get what you pay for, and I'd rather be able to buy something that will last me for many a year, rather than spend less over and over again. It's like the Slimline PSP or the DS Lite; it kinda sucks when they do that, unless you don't already have one. It would be even worse if they made completely new hardware.
jBusiness
quen
Posted 12:00 AM 2/7/08
@DaiMacculate: Every single comparable piece of tech on the market declines on a gradual curve, why should consoles be different?
Because every single comparable piece of tech starts off priced to make a profit. Consoles (with exception of Wii) don't. That means there's a long period at the start of the system's life where technology cost reductions just mean the manufacturer is losing less money. Once they get to the stage where a cost reduction means they're actually making money, then they're more likely to cut prices if they think it will increase sales.
Also, not sure if name-brand consumer goods really decline in price as regularly as that - the official recommended price, at least, often stays the same for a while, doesn't it?
quen
Kanik
Posted 11:59 PM 1/7/08
@everybest: Ya, most pictures taken at Sears freak people out.
I distribute my Christmas family photos out instead of candy during Halloween.
Kanik
Dimipapa
Posted 11:58 PM 1/7/08
Meh, consoles are not that expensive. Prohibitive sure, but even as a kid, if I REALLY wanted something like that bad enough I would do what I had to do to save for it, even going so far as to have my own garage sales at times. Its not the price alone, its the hype, its the want. If I want a game bad enough I will buy that console for that game. I bought a dreamcast because I wanted DOA2, I bought an xbox because I wanted DOA3 and you'll never guess what. I bought an xbox360 because I wanted DOA4, even going so far as to buy a core memory unit and component cables since there were no premiums at the time.
Nintendo has a lower price point, and a new way to play going for it. The system is selling mostly on the merits of what it cant do different than the other consoles. It seems to be a system seller, but not a game mover.
Xbox360 and PS3 are all about the games. Reducing the price will only increase sales so much. You might say, "all right MGS4 is pretty cool but, its not worth nearly 500 dollars to get it" or you might say 'Wow im such a fan of MGS4 I HAVE TO GET A PS3 TO PLAY IT.
The less someone wants a game, the less they are willing to pay and vice versa.
Dimipapa
GingerMohawk
Posted 11:53 PM 1/7/08
Sure consoles should come down in price and they more often do to get more people to buy them, sure it is'nt that big of a drop but the PS3 and 360 have come down in price but that's thanks to the different version on offer, maybe when the new Wii DVD comes out the Wii will go down..........maybe.
As for updates. Waiting for Divx support on the 360 was a killer but one of the deciding factor in me getting one, now i want more codec support but i would be willing to pay for it to get it sooner
GingerMohawk
venkat55
Posted 11:51 PM 1/7/08
If he is so concerned about expensive console, he should make guitar hero compatible with rock band' guitar, thus reducing the cost by buying redundant peripherals.
venkat55
phinehas
Posted 11:50 PM 1/7/08
Man, is he right. I know it's probably dreaming, but it would be awesome to be able to afford all the major consoles.
phinehas
DaiMacculate
Posted 11:48 PM 1/7/08
Seems pretty straightforward, EVERYBODY except the manufacturers themselves would like consoles to not only be cheaper, but to decline in price or expand in features more regularly. Every single comparable piece of tech on the market declines on a gradual curve, why should consoles be different? Even just $10 every 3 months would be something, and it would avoid the sense of buyer's remorse that more dramatic drops tend to engender in the early adopters.
Of course, I'm sure MS/Sony/Nintendo would be more interested in that if Activision wanted to share some of its own obscene money pile with them to help get it accomplished. What's that, Bobby Kotick isn't listening to that, too busy diving into a huge vat of money Uncle Scrooge style? I'm SHOCKED :P
DaiMacculate
Kaizuden
Posted 11:47 PM 1/7/08
Yeah.. back then a new SNES was still $200. However when new consoles replace the old they dropped down to as low as $50, which goes to show that even past hardware is still within a $60-$100 price range.
Kaizuden
EnigmaNemesis
Posted 11:46 PM 1/7/08
@kratosfan:
Win!
EnigmaNemesis
kratosfan
Posted 11:45 PM 1/7/08
If he's so worried about price maybe he should drop the price of his games.
kratosfan
everybest
Posted 11:42 PM 1/7/08
Man, that picture is freaking me out. I can't even concentrate on the article. What were we talking about again?
everybest
Trocar-Slush-Weasel
Posted 1:10 AM 2/7/08
I seem to remember my Atari VCS being like $199, and that was in late 70's dollars. (of course a couple of years later it was down to almost nothing)
Trocar-Slush-Weasel
susurrate
Posted 1:07 AM 2/7/08
I just saw that they are doing the new James Bond game, good work Bobby!
susurrate
susurrate
Posted 1:04 AM 2/7/08
This coming from a man who will be selling a game in the 150 dollar range within the next couple of months, which amounts to about half the cost of a console. So yeah, thanks for your opinion Bobby perhaps you should lower the price on your game or go back to making bad movie based games and let the market do that for you.
susurrate
AznSlackerType
Posted 1:01 AM 2/7/08
Seriously, who doesn't want cheaper consoles, by that I mean price range cheaper, not materials cheaper.
AznSlackerType
DaiMacculate
Posted 12:58 AM 2/7/08
@quen: Yeah I'm not saying that consoles don't have their own special issues that affect their pricing but I guess the point is how they enforce the MSRP, as you said other products don't drop off their MSRP quickly either, but for the most part they allow retailers flexibility in setting pricing that console manufacturers do not.
There is ALSO the licensing to consider, traditionally console makers never really turn a profit on hardware even when their costs go down, they simply recoup and profit from the piece they get out of every $60 game sold. From that perspective more regular price drops make even more sense, as the cheaper a console is in theory the more people will buy it and buy new games. Thats the reason Sony originally talked about locking games to each PS3 (an idea abandoned well before launch, of course, for obvious reasons) as a way to curb rentals and used sales, that hurts their profitability more than the money they're losing on the hardware.
DaiMacculate
scottieb2
Posted 12:45 AM 2/7/08
Console prices aren't outrageously expensive, its all of the add-ons and such that increase the price. For a complete Wii controller, its $60 a pop. That's not even counting a classic or gamecube controller. $60 games with no replay value is also harsh. Throwing down $100 and up for peripherals that might not work for another game is getting ridiculous.
@Heyyou27: I agree, this guy is just blowing smoke. He wants cheaper consoles (which I do believe Nintendo is still the only one turning a profit) and to reach a larger audience, but Guitar Hero is only compatible with its instruments and anybody who already has plunked down money for the guitars is gonna have to start over again.
scottieb2
megaStryke
Posted 12:45 AM 2/7/08
Am I the only one who remembers US$70, $80, and $90 games during the SNES/Genesis era? And these weren't special version, collector editions, no. These were game plus manual plus box. And that is BEFORE you plug in inflation and determine how much those games would run you had they been released today.
I think we are juuuuuuust fine when it comes to software prices. Hardware is another story.
megaStryke
dontEATnachos
Posted 1:51 AM 2/7/08
Activision Boss Wants Cheaper Consoles
Activision Consumer Wants Cheaper and Compatible Plastic Instruments
dontEATnachos
AgitoXIII
Posted 1:48 AM 2/7/08
i think the consoles arent terribly expansive, this guy isnt all that smart tho, cus he once said he'd like all the systems to cost $200, a man can dream eh?
AgitoXIII
ViciousViper
Posted 1:37 AM 2/7/08
.....And I want cheaper games
ViciousViper
Aex
Posted 1:33 AM 2/7/08
@Primebuster: I have a tip for ya... Move to America :p
Aex
firesign
Posted 1:19 AM 2/7/08
considering the changes in the value of the dollar over the years, i don't think consoles are really that much more expensive now and in fact probably actually cost less. the first new console i ever bought was a colecovision in 1982 which, if i remember right, was around $300 not including accessories like the atari 2600 adapter. in today's dollars that would translate to a *lot* more than any of the current gen consoles. cheaper is relative. it's not so much the cost of the consoles, but because the economy is in such crappy shape people have less disposable income for entertainment when the already have to choose between gas and food.
firesign
Llost
Posted 1:15 AM 2/7/08
Is this the guy who asked for price cuts last time? I don't mind him asking for it but there's obviously a limit. The consoles do usually sell at a loss at the start, then they have price cuts every year so they make even less money, the creators (MS and Sony) often do things for free like updates and BC etc. There's going to be price cuts now and then but for consoles like the PS3 which has lost them $3 billion and has lots of really good tech (large hard drives, blue-ray, cell etc.) it's almost impossible to just demand price cuts when they see fit.
Llost
Tycoonalex1337
Posted 1:14 AM 2/7/08
The question is, would more people buy consoles if they were cheaper, and would the net total be more or less if more people bought cheaper consoles? I know I would buy a PS3 if it were cheaper, and I think parents would possibly consider 360's and PS3's as well as Wii's if the prices were closer to the Wii's.
Tycoonalex1337
Primebuster
Posted 1:13 AM 2/7/08
@AznSlackerType: The materials to make the consoles are expensive though, dude. Thats one of the reasons why consoles are expensive when they first appear on the shelves. Cause theyre using newer technology. If u want cheaper consoles without losing quality of materials, wait until the console is redundant. Same materials/technology, just old fashioned.
Primebuster
Aex
Posted 2:21 AM 2/7/08
@AgitoXIII: Dude, I just noticed your icon isn't very work safe...
Aex
DARTH_TIGRIS
Posted 2:54 AM 2/7/08
Every time Kotaku quotes this guy, he always comes off as someone that wants everything to cater to Activision's needs. That makes sense, sure, but stop pretending that you speak for me. Consoles need to be cheaper, but so do GAMES. I HAVE a console already, but these games for it are too expensive (hello GH franchise) for me to buy what I want to play. And I AM an adult!
DARTH_TIGRIS
worsethannormal
Posted 2:23 AM 2/7/08
Cheaper? How about the Atari 2600. In today's dollars this console would have sold for $650-$700. I don't think Mr. Kotic knows what he's talking.
[cache.gizmodo.com]
worsethannormal
gencid
Posted 3:18 AM 2/7/08
Well, if Kotick priced all Activision games $19.99, then he might have something to say to the console manufacturers. As it stands, I can see a STFU coming from Sony and Microsoft.
gencid
murph
Posted 2:56 AM 2/7/08
+1 for venkat55
maybe if i don't have two buy two different drumkits and 2 different guitars, i'd have more $$ to buy more consoles.
this guy is way out of touch with reality. anyone know his salary? 200K? 500K? i'm sure it's in some SEC filing somewhere.
murph
Primebuster
Posted 4:35 AM 2/7/08
@Aex: Id rather spend a fortune on games than risk moving to a country where youre more likely to be murdered for a packet of crisps (potato chips) than combing your hair. FACT.
Primebuster
bubble-bee
Posted 4:19 AM 2/7/08
CHEAP GAME!!!! OR everyone wants cheap consoles like WII that in the end are in fact expensive? 260 euros for a GC its kinda expensive.
bubble-bee
bubble-bee
Posted 4:18 AM 2/7/08
Maybe they should start by the cheap games... like guitar hero?... yes, cheap games! ok? coz the price of the consoles aren't that bad. Especially Xbox360 and ps3, for all the hardware components, its the cheapest "PC"! Activision, plx, dont blame consoles, blame the games price!
bubble-bee
DasKonstruct
Posted 5:09 AM 2/7/08
All he's concerned about is reducing development costs due to the multiple consoles. If we had one universal platform I would guesstimate the console to cost 800-1k dollars since theres no competition for the manufacturer. This will cause a monopoly in the game hardware industry. As it stands right now the consumer is winning with consoles at least with the 360 and PS3, they are getting them cheaper than it costs to make them. He's not worried about prices he's worried about reducing his own costs. Consoles are usually sold at a loss but software never is, this is how the companies make their lost revenue back. I hate slimy little pricks like this. They are the ones trying to ruin the industry to pad their wallets a little more.
DasKonstruct
bubble-bee
Posted 4:51 AM 2/7/08
@Sugaray: The biggest pproblem its not console prices... it's the games price. COmmon, i buy 4 games, it's already the price of one new console!! or i buy 2 guitar heroes, and its the price of a new console again! Games are too much expensive, not consoles! okok, wii its kinda expensive for what it has (GC with wiimote)...but X360 (with its price cut) its really cheap for the hardware it has! also ps3 inst that bad, tatking in account the bluray reader! For me the best priced consoles are the X360 and PS3. WII, yes, its expensive. They could put WII selling 150 euros and still win lots of money.
bubble-bee
Sugaray
Posted 4:40 AM 2/7/08
Anyone that hasn't hd their head up their ass for the past 4-5 months knows the economy sucks,prices are going UP on just about everything, and gas prices are likely goiNG to hit(already have in a few areas)$5 a gallon here in the US...and the Activision CEO wants cheap consoles.Sorry charley, but as far as the 360 and PS3 neither is going to see sub $250 prices for quite some time to come.Anyone who wants one and isn't afraid to sweat a little to earn the money to buy one CAN DO IT! It's the lazy bastards(many of who didn't even finish High School)that whine and complain about console prices because they simply don't want to work for the money, they want it given to them.With pirating and development costs what they are, that's why games are priced what they are also.
Time for some people to do a reality check including but not nearly limited to the Activision CEO.
Sugaray
Replica23
Posted 4:38 AM 2/7/08
Hasn't this been posted... twice already? The biggest publisher in the world is whinning about console prices. So... priceless. I remember seeing the NES in a Canadian Toys 'R Us for $100 in 1986. Considering the 360 Pro is only $300 and the PS3 $400 that's not bad for over 20 years later no? I think people would run out of digits if they counted up how many other things in their life inflated way beyond the percentage of game consoles.
If anything I'd suggest the over population of games thins out how many software products a single person buys at any given time. I know I don't have the time to play all the games I want and thus I generally won't buy something until I'm going to play it.
Replica23
TRT-X
Posted 5:39 AM 2/7/08
@DaiMacculate: Prices for "comparable" tech drop over time because unlike consoles...media players, computers, and other entertainment is improved and updated almost daily.
On the other hand, a gaming console comes out...and that's IT until the next gen. The prices drop over time, just not for the same reasons.
Nor should they.
TRT-X
Pablos102030
Posted 5:53 AM 2/7/08
THAT'S WHY I'M GLAD I'M RICH! NYAH!
*Looks at 126 dollars in bank account*
*Looks at picture of PS3 on amazon*
Aww crap.
Pablos102030
TheHeartless
Posted 6:34 AM 2/7/08
What the hell ever. He's comparing an investment to a day at the amusement park. Let's assume am family already has a PS2 and wants Guitar Hero. $90 plus tax for GH3 with guitar to "pass the time" is quite a lot more expensive than the $40 it costs to get into my nearest theme park. And or the games with no novelty activision puts out, $50 on the PS2 and Wii, $60 on the systems that matter...you don't hear Microsoft and Sony saying "oh please Activision man, if only you'd make your software cheaper than a ticket to the amusement park-which it's not-we could draw more people in." Quit blaming a lack of sales on other people and make better games.
TheHeartless
mferrari
Posted 8:36 AM 2/7/08
I think he means that consoles this generation aren't dropping at the same rate as previous ones. And, the different versions guarantee a price above $200 on the high end versions for a long time. 'cept the Wii of course
The Wii is nintendo's priciest console, every other non-handheld retailed at $200 at first.
PS2 started at $300, by 2001 it was at $200, by 2003, it was under $200.
The 360 is approaching it's 3rd B-day, and we're above 400 for a good version.
I want iPhone-like price cuts NOW!
As I've said, I want a PS3 bad, but wont have all 3 consoles 'till the PS3 is slimmer down and at or under $200.
mferrari
EnigmaNemesis
Posted 9:11 AM 2/7/08
@Dalren:
It was compatible for GH3 on the 360 as well ... just not the PS3 version.
And reason being, you as a game peripheral maker, have to follow MSFT's 2.4 RF standard to make them.
Sony uses Bluetooth with no set standard, thus the Activision cock block.
EnigmaNemesis
Dalren
Posted 9:05 AM 2/7/08
@venkat55: Guitar Hero Aerosmith is compatible with the rock band guitar. At least on the 360.
Could be a good sign for the next gen music games.
Dalren
Beximus
Posted 10:19 AM 2/7/08
i'd buy an activision game if it were on a system i owned that wasn't licensed material nor required the use of a mock guitar
Beximus
BtownDesignGuy
Posted 11:14 AM 2/7/08
How many Xbox 360s and PS3s could he buy with his $3,079,798 bonus?
BtownDesignGuy
Aex
Posted 12:03 PM 2/7/08
@Primebuster: We all make sacrifices for things... Your sacrifice: being gouged on games
And thusly, I reply... Quit your bitchin' :p
Aex
quen
Posted 10:03 PM 2/7/08
@TRT-X: That's not true. Consoles do improve frequently - they are redesigned to cut costs in exactly the same way as every other electronic device. In addition, the standard components used to make them (chips, etc), even if fundamentally identical, become cheaper as new manufacturing processes come on line.
@DaiMacculate: I don't think console manufacturers really control retail prices (that'd be illegal, wouldn't it?). Retail prices are all the same because the markup allowed to retailers for consoles is so tiny. Not quite sure how they get away with that, but...
As for licensing, yes they make money from that. but unless you want to get into a printer-ink style model (where the console costs $50 but each game is $200) they are going to need to plan to break even on consoles eventually.
quen