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Valve is an exception to the rule. Almost no other companies drop their games prices so quickly.

Gabe Newell has already stated that experimentation has shown that dropping prices at a faster rate increases revenue, so who am I to say no to this?

Handheld games rarely drop in price. ie. Advance Wars was $35 when it came out, and $30 last time I saw it new in a store (last year). Because of this I limit my new game purchase to handhelds, Zelda titles, and one or two wildcards for the year. Games with special editions I know I want and will only jump in value - ie Bioshock 2's LP, are the main reason I buy games at launch (which is ironic because I dont own that LP cause I bought BS2 on Steam for $5).

The other side of this is if it is a game I know I will get my moneys worth out of with my friends in short order. ie Borderlands. I have clocked well over 1000 hours into Borderlands, so it was well worth my $50 at launch and $10 for DLCs. I just picked it up on Steam (partially so my girl and I can play coop with two of my friends online) and know I will get the $10 I paid for it there out of it.

The plan I have stuck to since about 2002 is to wait until the used copy of 3 games I want drop to $17.99 at Gamestop and wait until a buy 2 get 1 free sale plus 10% off with Edge card. What this means is typically 1 year after release I can get a game for $10 which has worked out well for my collection over the years. However project $10 and other initiatives where the publisher tries to suck another $10-15 out of people buying used has kind of thrown a wrench in my used game buying plan.

Granted I may not even be interested in multiplayer stuff but sometimes it even affects the single player game such as the Cerberus network stuff for Mass Effect 2. A happy middle ground that I have found is to buy used games from Gamefly which always includes the DLC codes with their used games that often go on sale for $10 to $18 or so eventually. Not a bad compromise and it keeps me from feeding the Gamestop machine...

The only time I will buy a game new is when I want to support the company, or I really want the game now and think it's worth the price. Otherwise, I usually wait months or even years.

Generally speaking, video games are too expensive. There are way too many video games out there. The market is flooded like crazy. Supply and demand.

I rarely have the money to buy a game at release. In fact, in the last year, I've only bought Frozen Synapse and Portal 2 within a week of their release. I will always try to buy the games I really want at release, but it's just not feasible most of the time.

I also agree with Inazuma, there are simply too many games. It'd be much easier to buy games new if there weren't 200+ releases a year.

The rapid depreciation of games also makes me think we might see another game crash in some form. There's no way they can keep the market going like it is.

I noticed this problem myself when i was a game trader 97-99 and this has got worse since.It may depend where you are trading from i guess but back then where i had my stall new Playstation games were out of date in 2-weeks and i had to drop the price accordingly to either recover cash back on the cash sale or entice a part-x in for it,if i did not drop the game price in this time it would simply sit there on the shelf gathering dust.
N64 did not have the problem because there were fewer titles overall and i think that is the main issue,the more games titles there are and the more frequently games are released the faster existing titles loose their value.So the 360 and PS3 now have this problem.

As a consumer, I'm always happy to see a quick price drop. I don't sell my games, so I don't care about the loss in value and I'm not a day-one purchaser, so I don't feel like I got duped into paying too much for something.

I do wonder though about how this will affect consumer perception. Basically, we think of new games as costing $50-60, which is what you mentally benchmark against when deciding if you are getting a good deal. I also have a used game mental benchmark that is basically anything under $20 is in consideration and anything under $10 is a worthwhile deal.

Steam has changed a lot of my perception with their low price sales and quick to drop pricing. I feel like Steam may be changing our mental benchmarks, which could prohibit people from spending $50-60, which isn't very good for the industry. What is smart business about the quick price drop though is that it opens the door to people that never would have paid $50-60 and it hooks them in while you are still relatively close to a game's original marketing push. It's also soon after the early adopters have played the games and been talking about them to spread awareness via word of mouth. There's a careful balance to be struck here: you don't want your early adopters to feel like they should have waited because they will stop being early adopters and you won't get as much money out of them, yet you also want offer up a price point that appeals to your later adopters and is there while the game is still fresh in their mind and still has a bit of hype.

I think if the benchmarks for reasonable prices lower in consumer minds, Valve may ultimately have a problem. As it stands though, they are doing quite well with their model. The number of Steam users has increased dramatically over the past few years and the sales bring in big money. I remember hearing from a friend of mine who works at Valve that they made more money from their first one-day sale of Left 4 Dead than they did from the whole first week of launch. This limited time offers can open up a flood gate of consumers that were not planning on buying the product before.

J T wrote:As a consumer, I'm always happy to see a quick price drop. I don't sell my games, so I don't care about the loss in value and I'm not a day-one purchaser, so I don't feel like I got duped into paying too much for something.

I do wonder though about how this will affect consumer perception. Basically, we think of new games as costing $50-60, which is what you mentally benchmark against when deciding if you are getting a good deal. I also have a used game mental benchmark that is basically anything under $20 is in consideration and anything under $10 is a worthwhile deal.

Steam has changed a lot of my perception with their low price sales and quick to drop pricing. I feel like Steam may be changing our mental benchmarks, which could prohibit people from spending $50-60, which isn't very good for the industry. What is smart business about the quick price drop though is that it opens the door to people that never would have paid $50-60 and it hooks them in while you are still relatively close to a game's original marketing push. It's also soon after the early adopters have played the games and been talking about them to spread awareness via word of mouth. There's a careful balance to be struck here: you don't want your early adopters to feel like they should have waited because they will stop being early adopters and you won't get as much money out of them, yet you also want offer up a price point that appeals to your later adopters and is there while the game is still fresh in their mind and still has a bit of hype.

I think if the benchmarks for reasonable prices lower in consumer minds, Valve may ultimately have a problem. As it stands though, they are doing quite well with their model. The number of Steam users has increased dramatically over the past few years and the sales bring in big money. I remember hearing from a friend of mine who works at Valve that they made more money from their first one-day sale of Left 4 Dead than they did from the whole first week of launch. This limited time offers can open up a flood gate of consumers that were not planning on buying the product before.

Sometimes I open up steam just to see the deals of the day/week and not even play a game. I got STALKER(plus first expansion), Bio Shock 2, Alien Shooter 1+2+3, Zombie Shooter 1+2 all for under $15 total once!

The mental benchmark thing is weird... for me at least. I have made about 3 or 4 "Launch day" purchases this year which is way more than I usually do. However, I find myself being really careful with the sales on cheaper games . If I see something for $30 on sale I convince myself it will eventually be down to $20 or $15 and wait. Heck, I'm even finding myself complaining about prices in the thrift store.

My retro gaming mindset is way different than my current gen one. I guess because there can be such a large gap in pricing for retro games. Literally from $0-$500+ depending on the game.

I sometimes buy games brand new/full price, but generally because they are special editions and I want to get a copy before Game Stop opens them all and ruins the cases.

Other times I just want the game now/the second it comes out. For example I preordered Skyrim and can't wait to play it. I was also really looking forward to the Ico/Shadow of Colossus pack and picked it up day one.

And the third situation is just impulse buying, and I generally regret it. The example being that I bought Dues Ex recently on a whim after seeing my brother play it. And while it's a good game, its not so awesome that I couldn't have waited a bit.

To be honest, I think those three examples are pretty much what floats the industry: impatience and impulse.

Outside of Valve games, are games actually dropping in price faster than they did 10-20 years ago? There's a whole lot of doom and gloom in this thread that I'm willing to chalk it up to the fact that most of us are now in a position to contemplate buying games at launch rather than the old days of waiting for birthdays. Now that we're adults and can actually consider buying a game at release we are more sensitive to changes in pricing.