XBox 360 Game Prices Jump Up Through Microtransactions

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Published by 15 years ago , last updated 3 years ago

Posted on May 23, 2007, Ron Whitaker XBox 360 Game Prices Jump Up Through Microtransactions

Ever felt like XBox Live is driving up the price of your games? Some researchers are agreeing with you. How bad is it?

Michael Pachter, an analyst for Wedbush Morgan, estimates Microsoft charges a royalty rate of 30 percent for the average download. That means that, for a $10 download, Microsoft gets $3, while the publisher pockets $7. In fact, Pachter estimates the total value of the downloadable content market at $200 million. Now, that may not seem like much compared to the industry’s $19 billion in sales, but consider this: What are those downloads costing Microsoft? “It’s like building an extra room in a house,” Pachter said. “It’s nowhere near the cost of building the house.” Tony Key, vice-president of marketing for Ubisoft, said, “The (downloadable maps) are very profitable for us.”

So, the next time you fire up the marketplace, give a thought to all the devs who are hoisting umbrella drinks thanks to your dollar.

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