While Take-Two is riding high on their announcement that a GTA 6 trailer is coming, its CEO has some…interesting ideas on how much video games could cost, part of a contingent of executives that believe games are underpriced, given their cost, length or some combination of the two.
This is of course Strauss Zelnick (who was paid $42.1 million in FY2023), who told investors what he views as his pricing philosophy for games. But since it can’t actually be applicable, he thinks GTA is one of the best values on the market. Here’s what he said:
“In terms of our pricing for any entertainment property, basically the algorithm is the value of the expected entertainment usage, which is to say the per hour value times the number of expected hours plus the terminal value that’s perceived by the customer in ownership, if the title is owned rather than rented or subscribed to.”
Reviewing games for a living, I have actually heard this from fans a lot of the time, that because a game is longer, it’s inherently more valuable because you’re getting more for your money in terms of hours spent with the game. But this is of course discounting that the length of a game can often be a detriment, and someone may like say, 12 hours of Alan Wake 2 a lot more than 150 hours of Assassin’s Creed Valhalla, even at the same price.
Zelnick continues:
“By that standard our prices are still very, very low, because we offer many hours of engagement, the value of the engagement is very high. So I think the industry as a whole offers a terrific price to value opportunity for consumers.”
Zelnick is admitting that even though maybe this should be the case, that because of the nature of the market, there simply cannot be a pricing model like that, and the move to $70 recently is sort of the maximum they can hope for.
What’s being unsaid here is that this $70, formerly $60, cap is why so many games have turned to many different forms of post-launch monetization, and lord knows that is certainly true of Grand Theft Auto, where GTA Online has printed billions for Take Two in the last decade from its microtransactions, and obviously GTA 6 is going to have a similar mode, if not an identical one.
I don’t even think the dollars per hour idea is true. Not across any industry. Shorter movies do not cost more than longer movies. Netflix may have 20 times the total content library of rival services, but at most it costs twice as much. This really is not applicable to any industry, much less video games, at least for box copies. And Zelnick is absolutely leaving out the countless games, including his own, that squeeze money out of consumers year-round with microtransactions.
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