Research indicates average game price drop

Research by EEDAR indicates that prices for new videogame releases are, on average, coming down as publishers release more titles below the standard console price points of USD 59.99 for the PlayStation 3 and Xbox 360, and USD 49.99 for the Wii.

Analyst Jesse Divnich, using data from the company's GamePulse information service, believes it's a trend that's occurring for a number of reasons.

"First, development costs on some seventh generation game titles have decreased due to savings from use of now available middleware, the reuse of code and engines from previous titles and a development community that has moved farther along the experience curve with this generation of hardware," he said.

"This decrease in development costs has allowed publishers/developers to more effectively create cheaper videogames that can be effectively priced for casual and niche markets. Ubisoft's Shaun White Snowboarding, a game that uses the Assassin's Creed engine, is a prime example of these cost-saving methods.

Divnich also attributed the trend to an increasingly competitive retail shelf space environment, making it more difficult for new titles to make an impact.

"For these reasons, and some other minor ones, the entire videogame industry has grown, and continues to grow, more competitive," he continued. "In competitive markets, one additional way that a product can compete is to lower its selling price.

However, he did also point out that even if prices for the current generation titles were declining overall, they were still significantly higher than those for the last generation, and that therefore any overall potential fall in revenues would be partially offset by continued conversion from old to new.