Apparently not satisfied with the explosion in game console sales over the last four years, Electronic Arts said it expected prices for gaming systems to be lower by now.
At a conference held by Goldman Sachs, Electronic Arts' chief financial officer Eric Brown said the cost of new gaming systems hasn't fallen fast enough since their introduction, IGN reports. "We do have a long way to go with respect to pricing," he said. "Last cycle, approximately 48 percent of PlayStation 2 units were sold at a price point of $149 or less. Clearly at $299 we're nowhere near that price point."
Taken literally, Brown is right. Prices for the Wii, Xbox 360 and Playstation 3 are not on par with the cost of their predecessors at this point in the console life cycle. In fact, they match up perfectly with the debut prices for the GameCube, Xbox and Playstation 2, at $199, $299 and $299, respectively.
But that's kind of the point. Current generation game consoles debuted at higher prices than the last generation, so they have a longer way to fall.
In any case, the current prices are justified for a couple reasons: First, today's consoles are far more advanced, technologically, than the last generation -- especially the Xbox 360 and Playstation 3. They use massive hard drives instead of memory cards and they support high definition graphics. Indeed, even EA acknowledges that graphics are so good these days, an upgrade might not look obvious to the player.
More importantly, the lifespan of these consoles are longer. It doesn't feel like these consoles are stagnating, especially with upcoming peripherals such as the Wii MotionPlus, Microsoft's Project Natal and the Playstation 3's motion controller.
EA wants lower prices to encourage more sales, providing a bigger base of potential customers for its games. But the games industry has ballooned over the last few years. Look at the software sales from 2004 compared to 2009, a year where the industry was hurt by a recession -- there's just no comparison. And that's not including all the downloadable content publishers sell for additional profits.
Of course every publisher wants price cuts, but the reality is that there's a lot of money going around as is. I wouldn't expect any price drops -- or a new console, for that matter -- not at least until those new motion controllers reignite the console wars.
