Why do games cost $70 now?

As a longtime gamer on a budget, I never thought I‘d see the day when new releases routinely cost $70 here in the US. Weren‘t $60 games supposed to be exorbitantly expensive enough already?

Well, times have changed, and those days are over as publishers set a new premium baseline. But what‘s actually driving these price hikes? As lovers of the medium, we gamers deserve full transparency from publishers benefiting from our passion.

So I‘ve dug into the numbers to unpack everything causing costs and prices to balloon:

Average Development Budgets Have Quadrupled

Let‘s rewind to the $60 standard‘s start – the launch of the Xbox 360/PS3 era around 2005-2006. Games then cost an average of $10-$30 million to develop, with few exceeding $20 million budgets.

Well in 2022, that average has skyrocketed to over $100 million for a high-end game! Some killer statistics:

• Destiny cost Activision over $500 million including marketing
• Star Citizen has raised over $400 million and counting from fans to self-publish
• Rockstar‘s Red Dead Redemption 2 cost an estimated minimum $240 million
• Recent Call of Duty‘s range from around $200 million (MW 2019) to $250 million (Vanguard 2021)

As a comparison, that means costs have more than quadrupled or quintupled in under 20 years – vastly outpacing inflation.

What Exactly Is Driving Costs Up?

From my research, a few prime culprits include:

• Much larger development teams, now routinely over 500 to 1,000+ staff
• Higher graphics fidelity and production values (mo-cap, voice acting)
• Vastly more game content – 100+ hours instead of 10-20
• Extended 5+ year dev cycles missing 3-5 shipped games vs. 2000s pace
• Marketing budgets actually exceeding dev costs

To conceptualize the sheer scale, these are now films with 8-figure budgets, not games.

As an example, Rockstar‘s staff exploded to over 1,600 to deliver the intensive worldbuilding of Red Dead 2.

Inflation Has Devalued $60 by Over 30%

Looked at another way, $60 from 2005 would equal almost $85 in today‘s money due to inflation.

So in real terms, that actually means the cost of AAA games has slightly declined. Gamers have been playing less and getting more in sheer content terms.

Here‘s a sobering graph showing just how severely inflation has eroded original game pricing in practice:

Yet game costs kept unnaturally fixed at $60 – until the dam finally burst.

Testing How Much We‘ll Actually Pay

But are these giant budgets actually necessary, or just bloat?

Well, publishers have clearly decided to test raising prices to $70 to help ease margin pressure. Consumers fund either profits or losses.

And for affluent franchises like Call of Duty, FIFA, and first-party PlayStation/Xbox blockbusters, they‘re betting fans will bear that premium.

After all, many of us already spend over $60 consistently on special editions, season passes, and microtransactions. Maybe $70 just speeds the fleecing!

But as budgets balloon, so does financial risk. A single flop could crater a studio now – just ask Square Enix after selling its Tomb Raider studio.

As gamers with limited time and money, I hope publishers carefully weigh if this will expand or just gradually erode the premium games market willing to buy at $70.

So what do you think – will you buy or pass at $70? Does this signal an creativity crisis with all budgets going to often disappointing sequels?

I‘d love to hear your thoughts in the comments!