“Engagement equals currency” is the philosophy they’re following.
Next-gen prices going up from the $60 price that has been the standard for over a decade has been a pretty hot topic of conversation these last few months. With the likes of Gearbox, Activision, Take-Two, and Sony having taken steps towards the same (hell, Sony even considered raising the prices to above $70), the question of when or if other major publishers will do the same has been asked often.
As a platform holder, Microsoft’s stance on the same is a crucial one- so where exactly do they stand on pricing for games on the Xbox Series X/S as far as their first party games are concerned? Well, according to Xbox CFO Tim Stuart, who recent spoke about this at the Jefferies Interactive Entertainment conference (via Seeking Alpha), that’s something that the company will talk about in due time- but not just yet.
“I think we’re not making specific announcements on first-party pricing yet. So we’ll do that sort of in due time,” Stuart said. “But again, if — I think if publishers can find a price point that works for their audience, defines a price point that works for the maximization of, I’ll say users and revenue, because you want to drive engagement. I talk about engagement equals currency a lot. Engagement is the ability for you to drive wholesale monetization, to drive activation of your content, to drive sort of hours in your service.”
“I think we’ll look at publishers to make the right decision for their content,” he added. “If they can drive a premium price point or a higher price point, I think that’s warranted. And I’d say, your point is exactly right. Prices have not gone up in — what, for a couple of generations now, so it’s not unheard of to see things like this going on.”
Stuart also brought up something that many developers, publishers, and analysts in the industry have brought up- that production costs are bound to go up, and that that may invariably lead to higher prices as well.
“Content creation costs go up,” he said. “And these publishers and content creators, including ourselves, want to make sure you’re driving the right gross margin profiles, the right earnings profiles of what it takes to build these new, awesome, amazing games. And you want to make sure you have a good top line to support that.”
Microsoft’s stance on the matter is going to be particular interest, given their investment in Xbox Game Pass. Xbox’s own Aaron Greenberg has talked about the same in the past, having wondered if game prices matter that much if they’re included in Game Pass subscriptions as well.