An Interesting Point About PC Prices Versus Console Prices

This is one for the master race: once upon a time PCs were expensive. Very expensive. When it came to playing video games, consoles existed as a cheaper alternative. But that argument holds less weight today. The average cost of PCs has been steadily declining while consoles are slowly increasing in price.

Ben Thompson at Stratechery expands upon this observation, and uses it to make the argument that there is a massive gap in the market for a cheap, games focused device ala Apple TV to come in and gobble up profits. I'm not convinced that this is accurate -- that gap has mostly been filled by tablets, mobile devices and handhelds I'd argue -- but it does raise an interesting point: why have PCs continually gotten cheaper, while consoles have increased in price?

Thompson's argument is simple: by trying to make consoles catch all media devices, console manufacturers are driving up the price of consoles, but moving away from the needs of average consumers.

"Specifically," he writes, "incumbents are driven by their best customers to add more and more features that drive up the price, causing the incumbents’ product to move further and further away from the average customer’s needs."

And Thompson uses the example of the Xbox One -- a device that has been slowly backtracking from it's all-in-one marketing messaging since the console was announced, to the point where its last E3 presentation focused exclusively on the Xbox One as a gaming device. This movement, you could argue, is a direct response to the PlayStation 4's success after pitching itself as a console designed almost exclusively for gaming (despite the fact that both consoles, by and large, have exactly the same feature set).

But could a cheaply made gaming device designed to be used with televisions actually work? I'd say no. The next step for that type of business model, I'd argue, is an eco-system built directly into TVs that mirrors the way we consume games on tablets. I'd say that's far more likely.

Via Business Insider


Comments

    Without info about the relative power of each item this graph is essentially meaningless.

      Agree, I think if you look at your average PC that is costing $500 - $600 as the graph states it wouldn't be playing many games...

        I was under the impression that a $500-$600 PC will perform similarly to a current generation console for all cross platform games at 1080p?

          Depends what you spend the $500-$600 on. Can it? Yes. Will it? Who knows. All I know is with consoles and PC you get what you pay for.

          The only difference is that consoles are cheaper to buy hardware wise, but the games are borderline unaffordable. PC's are more expensive to build (Depending on what you choose naturally) but the games can be much much cheaper.

          I think its interesting actually. Pay less now for a console (hardware wise) but pay more per game, or pay more upfront for a PC (For a debatably better experience depending on spend *edited this bracket's contents for a typo*) and get the games cheaper in the long run, normally 60-40% cheaper. I always thought console games should be cheaper than PC games TBH because it is 'supposed' to be aimed at a more casual market, and that's coming from a guy with a PC, PS4 and WiiU for my 'current gen' set-ups.

          Just my 2c.

          Edit: It also depends which console you are shooting for. GPU-wise, I had Xbox one level graphics a few years ago from my $120 Geforce 550ti. It's not the same card, but it's quite close. Except it had GDDR5 and could hit 1080p 2 years ago. So using an older card you could build a low end pc for around that price that may hit 1080p in games (You would probably have to do an AMD build because of their price to performance). But IMHO if you are buying a PC it would be better to save a little extra and build a little more than low end.

          But the debate isn't apples and oranges and your personal needs should dictate which platform you buy.

          Last edited 20/06/14 2:38 pm

          I hope this is a joke...

          Hey downvote doubters - it was a question not a statement (so an answer might be more helpful than a downvote), but according to this article it looks like it's not unreasonable:

          http://www.gamespot.com/articles/can-we-build-a-gaming-pc-on-a-console-budget/1100-6418829/

          A $550 PC performs similarly to current generation consoles. For example, in Battlefield 4, these budget PCs can hit 1080p at 50-70fps. The PS4 outputs Battlefield 4 at 900p, the Xbox One at 720p, both averaging sub-60fps for comparison.

            Eurogamer built a PC with similar parts/ price to the PS4 and X1 and ran BF4 on the PC, PS4 and X1. The PC with an AMD FX6300 and Radeon 7850 (I think, my memory is a little fuzzy, I'll try link the article.)

            The PC ran BF4 better than the PS4 and X1, and at 1080p.

            Edit: Sorry, they used a Gefore 760, which is a better card than I thought. For reference a 7870/ r9 270x gets better performance than the PS4, so thats what I would personally aim for as a minimum.

            Last edited 20/06/14 3:05 pm

            It's not unreasonable at all. I had this same argument with kingpotato (I think?) a few months ago and showed (with online shop links) that you can build a PC that either equals or outperforms both current generation consoles for around $600 Australian. I don't know what it is with some people that don't seem to want to accept that cost-to-performance ratios for console and PC have been close to equal for half a generation.

              Did your calculations include the Windows licence? While many games will now run under Linux, a significant majority still require Windows. I would also normally go for a mid-grade 3D card (around $150 new) which pushes the price up a bit.

              Normally I would suggest building a PC to exceed the performance of a console rather than equal it, if only because disk fragmentation & OS bloat will tend to slow the PC down somewhat in the medium term. Build a new PC with a good CPU and solid motherboard, since everything else can be upgraded incrementally. My current PC is over 5 years old; it won't handle Ghosts at 1080p/60fps, but 90% of games it handles more than adequately.

                At the time the discussion was on hardware bang-for-buck, so OS cost wasn't included, but you can add $50 onto the price for that, or less if you buy at the right time. SteamOS has a decent amount of game support as well, from what I understand, and it's free.

                Console is an entire closed ecosystem. The hardware might seem cheap at 500/600 a pop, but they also pay $100+ for new release at retail. Even shopping around and online, it's difficult to find the same level of price you can get for the same game on PC. Buy 5 games and you've already paid off the difference in price between console and PC, but now you can buy all the rest of your games for cheaper, more conveniently, and your machine can do a lot more. And, as you said, if a game comes out it can't handle, you can upgrade just the part that's weak and away you go again.

          The graph illustrates that hardware is coming down in price essentially. Consoles are almost a bigger market now than PC's; I havent sourced any of this it just seems that way to me. Seeing as most games seem to come out on consoles before PC and the like.

          This is probably besides the point of this article and said a billion times but I see consoles as a convenience in the fact I buy one piece of hardware, and the games just play on it. Over the life of the console the games get better and perform better because the hardware never changes and devs get the hang of squeezing performance out of them.

          When i played games on PC (many many years ago) I was faced with having to upgrade hardware every few years to get decent performance. I dont know if thats the same now days but I still hear people saying they are upgrading their PC for more than the cost of a console at launch (and this has been the case in previous gen consoles when you could pick one up for $200).

          I guess games on PC are a lot cheaper/can be gotten through illigitimate avenues easier than on consoles. I hope that the popularity of things like Steam do filter more into the console market. Digital stuff is still way more than buying physical at a retailer or second hand.

        got an HP with a terabyte drive, 8 gigs of ram, and a quad core processor for 500$

        I recently built a Mini-itx PC that can run BF4 on high.

        Cost just under $500.

      That your $2000 in 1990 bought you an Amiga 1200 or 286 isn't relevant. For the time, it was the most powerful home computer available and ran things that were considered "cutting edge" at the time - comparable to the NES. Nothing really has changed since that point to now in terms of "relative power".

        I think the reason d'aitre for a console has changed though. Originally consoles were good bang for buck because they could discard with lots of quality of life components (eg hard drive) in place of dedicated hardware such as graphics cards and sounds cards. Because the graphics cards didn't need to be general purpose they could optimise the impact on graphics, meaning that by and large on a bang for buck basis consoles had much better graphics than PC (For instance, look at the fact that commander keen was seen as a work of unequalled genius for doing something that Mario had been doing for years on the NES).

        Now though, consoles are considered for the role of "best graphics ever" (a subtle distinction but still an important one). This means cost is not considered a factor. Unfortunately we are at a point where even hardware that is considered low powered can still generate graphics that are acceptable to most people, meaning there is just no good reason for wanting the console.

        I think you're missing my point.

        A "PC" and a "console" are not identical items - their price at a given point in time is only meaningful in terms of what they are "worth", which in general terms refelcts how powerful they are (as well as how flexible etc).

        The graph shows trends, but is not useful in terms of comparing absolute prices.

      Plus there's no accounting for relative inflation either.

      I thought the same thing but then I figured that the relevant power of the PC would have to be equivalent to the power of the console of the same period.

      Might be an incorrect assumption but seems to make sense?

    But Nintendo games are cheaper then they have ever been. Chart fail.

      This is talking about hardware only.
      If you are talking about game costs the black line is well below the yellow

    Nope, there's a negative point about PC pricing you forgot to mention. It's much more expensive to buy and own a PC because while it may seem cheaper at first, when the Steam sales come around you're gonna be broke.

      witcher 1 and 2 for 6 bucks is all i have bought so far, im feeling quite restrained

      I already own every game ever made at this point. I'm immune to Steam sales.*

      *This is a lie, I've already bought 3 gift copies of Hotline Miami, a gift copy of The Witcher and another of Mirror's edge. I still have 2 gift copies of System Shock 2 from last sale. Owning All The Things just means you buy more stuff for friends and family.

    My latest videocard cost a little less than the WiiU

      Still get more power out of an unplugged 680 than you ever will out of a Wii U.

    I love PC, but I don't think you can get 1080p, 8x AA, "high" post-processing gaming from a $600 PC. Minimum spend for that (@30+fps) is more like $900, not including a monitor.

      Not sure why that's relevant in this instance, you're not getting that from a PS4/Xbox One either.

      I don't think that's part of the debate haha. Of course you aren't gonna get 8x AA from a low end rig. But you might be able to get console grade, if not better, experiences out of it.

      Also, when debating console vs PC I don't include the cost of the monitor, because people don't include the cost of the TV with their console prices lol.

    Erm, why are the PC prices showing up as $500 on the latest graph? I good gaming graphics card can cost that much or more on its own.

      It's probably an average price, when you factor in all the crappy business PCs and laptops people get for Facebook.

    Thompson’s argument is simple: by trying to make consoles catch all media devices, console manufacturers are driving up the price of consoles, but moving away from the needs of average consumers.I kinda agree with this. I think consoles used to be built with the best possible hardware for a set price (around US$200), but these days it seems to have tipped the other way around and it's more the hardware that's set and the price is changed to suit.

      I don't expect either new console to last as long as the 360 or ps3. This gen should be shorter because of the hardware sacrifices they made to entice early adoption because of lower prices.

      Good news is it worked, early adoption rates are through the roof.

    Would be more useful if the prices were adjusted for inflation.
    http://kotaku.com/36-years-of-console-prices-adjusted-for-inflation-1485353267

    If you are serious about gaming, and graphics in particular, you play a pc.
    The next gen console on release is always inferior to PC.
    Consoles have one edge over PC which is very attractive , couch gaming!

      you can play only on a console and still be serious about gaming. PC gaming is about being able to push a game to its limits and even break the game and turn it into something completely different with mods, something you just don't get atm with consoles. But to say that someone who just plays on a console isn't a serious gamer is ridiculous. It's like saying someone isn't serious about reading books because they buy a paperback instead of a hardback with colour pictures in

        To pay what we pay for console games, yeah, you have to be serious to play console games!

        I don't think that's what PC gaming is about at all.

        As a primarily PC gamer, it's actually about convenience. Right now, I'm sitting at my desk. I could play a game of Dota 2 or go buy Far Cry 3 with a flick of the mouse and some key presses. Everything is just right there.

        If you want to get better performance than what consoles offer, you pretty much have to go on PC. Even with a mid-range rig like mine, I can get a smooth 1080p/60fps on pretty much all games without sacrificing settings. That isn't being a graphics whore either, it's about getting a consistent performance.

        I don't bother with mods. They're there but so are the hundreds of cheap indie games that I don't play and a whole host of other things.

        On top of all that, there's one important details people forget: almost everyone owns a home computer. That computer can play the vast majority of games available on the market right now.
        Don't forget, some of the most popular games of all time are PC games that can run on a potato. The Sims, World of Warcraft, League of Legends and Counterstrike all have amazingly low system requirements and have huge followings.

        Console gamers are just as much gamers as any other group of gamers but PC gamers cover a wide spread from people who play Farmville to people who farm gold in WoW.

      I disagree. You can be a serious console gamer. The only reason I play on pc is when the game doesn't come out on consoles (civ, planetside 2, diablo 3 etc). I know people who have insane rigs for work (they are animators and modelers) that absolutely pound the shiznit out of the current gen consoles but still buy consoles to game with their mates.

      I game every day with the vast majority of it being on consoles. If you're serious about gaming, you play games regardless of platform.

        If you are serious you have ALL the platforms!

          Exactly! The only one we are missing now is the WiiU, which we had and hated. The gamepad was weird and awkward (to us), the os was annoying and slow, Ninty want far too much for games on the various vcs amd then didn't let you play them with the gamepad or preffered controllers (apparently they did something about this) etc. Add to that the games weren't/aren't there (for us)

          Will rebuy when a true console (not handheld) Pokemon game comes out. If only...

            The one I'm missing is the X1. I think I'll get one when the halo collection comes out. Maybe.

    Whose currency is this graph detailed?

      Almost definitely US dollars because the original author is American.

        And because everything on the internet is 'Murrican.

    I don't get it. Xbox One is cheaper than the 360 at launch and the PS4 is WAY cheaper than the PS3 at launch (and PS2 if I'm not mistaken). So how can the trend be going up?

    EDIT: Oh, it's Nintendo doing it...

    Last edited 20/06/14 3:27 pm

      360 is cheaper than the Bone according to the chart though?

      PS3 was also way way more expensive than anything else, too. PS4's still pricier than the PS2.

      These are US prices. The regular 360 was $US 400 at launch (the gimped 'Core' version, which is what they're counting in the graph, was $US 300), the Xbone was $US 500 at launch.

        Yeah, this doesn't take currency/model into account. Useless graph.

    North American chart is North American.

    I generally have zero self control and when building a computer will most likely spend 2-3k on some stupid semi supercomputer that will do everything blazingly fast, and end up having some annoying driver issues and tweaking to get it working properly.

    So I cbf anymore, have an i7 tablet, and play games on consoles.

      2-3k. You were doing crossfire or sli weren't you? Now wonder it never worked haha.

    I would like to see this chart with Australian prices to see how the price of the PS3 would change it.

      BAM! $1000
      hahaha

      Also wasn't the 360 about $750 on launch?

        I remember picking up my Xbox 360 premium for about $550 in 2005 so it would have been a pretty big price drop.

    How many of those consoles took a hit (sold at a loss)?

    That will make the whole exercise pointless unless it's accounted for, and would then lead to asking whether or not the console price rising is down to the manufacturers simply backing off the loss margin.

    The Other thing to consider that because the graph is American, PC Components tend to be cheaper over there, theoretically you could build a Gaming PC that could play games well in the USA for around the 500-800 mark, where as in aus it can be considerably more, i spent 850+ on my computer without a graphics card (which i have since added) the other thing that could be considered is console gaming is good for people who live in areas that have poor internet connections ie the country, where consoles and games are very easy to come by. i myself both game on my PC and my Console because i like the different asspects of both, PC has the mods, arguably better graphics and performance but after sitting at a desk for 8 hours a day working on a computer i feel like sitting on my couch and relax without having to touch a computer for a little while

      Ah, consoles are cheaper there too. Australian prices are insane regardles. Especially for retail games. That's why as much as I love my Ps4 I will never make it my primary device.. I just cannot afford $60-90 per game.

        I know it was a typo, but every time I see it I find myself pronouncing it in my head 're-GAHD-əls'.

    The graph doesn't seem to take inflation into account. According to http://www.calculator.net/inflation-calculator.html, US$1 in 1985 is equivalent to US$2.24 today.

    So if you adjust the graph for inflation, console prices have been roughly stable or also coming down, and PC prices have been coming down even faster. This isn't too surprising given that in 1985 PCs were expensive business machines, and are now common consumer products.

    Last edited 20/06/14 7:42 pm

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