The video game industry is in a very unique position right now. On one hand, video games are the highest-grossing form of entertainment, outgrossing books, music, and movies. In 2024, the global games market brought in nearly $200 billion. In comparison, the movie business grossed roughly $33 billion worldwide and $8.56 billion domestically in the United States. On the other hand, games are getting more expensive to produce, with certain AAA titles like Call of Duty reportedly costing hundreds of millions of dollars per release. This, along with a few big games that failed to meet expectations on launch, has led to mass layoffs in the industry, along with the looming doubt of increasing game prices.
It is important to point out that when it comes to profitability, mobile games and their rampant monetization schemes set a bad standard. Of the nearly $200 billion the gaming industry brought in last year, roughly $82 billion of that was from mobile titles, with the top 10 highest-grossing mobile games of 2024 each bringing in over $1 billion in revenue.
Rough Start
After roughly two generations of $60 titles, Sony made waves when it increased the price of first-party games to $70 with the release of the PlayStation 5 and the Demon’s Souls Remake. With the launch of Grand Theft Auto VI on the horizon, many were wondering if this was when prices would increase even further. Meaning publishers could ask for more money for games that often don’t work as intended on launch.
This is a result of multiple factors, from rushed development timelines to hit fiscal windows to prioritizing profit over player experience. Games that release too soon on a “release now, fix later” mentality often come broken. This has led to some notorious releases, from Cyberpunk 2077 running so poorly that it was removed from the PlayStation Store, to Jedi: Survivor running incredibly poorly on PC, marking two great games that stumbled out of the gate.
Surprisingly, the price increase happened earlier than expected and from an unlikely contender. Last month, Nintendo showcased the Nintendo Switch 2, a follow-up to their incredibly successful 2017 hybrid console. After the Nintendo Direct, the internet went abuzz at the news that the launch title, Mario Kart World, would cost $80. However, it was noted that this price would only apply to certain first-party titles. For example, Donkey Kong Banaza, which will be released a month later in July, will be $70. But, as PlayStation showed us less than five years ago, once one company hikes prices, others will soon follow.
Mixed Messaging
Which brings us to this week. Microsoft just announced via its support page that prices would be going up across the board for its products. They cite “market conditions and the rising cost of development” as the reason. Starting this holiday season, first-party games will cost $80. Furthermore, consoles and accessories are getting bumped up as well. The regular 1TB Xbox Series X, which was $500 at launch, will now be $600. The same goes for the budget option, Xbox Series S, which will go from $300 to $380. That means, at least for now, the 2TB Xbox Series X will retail for $730, making it more expensive than the PlayStation 5 Pro with the same storage.
There are a few things I find confusing about this news from Microsoft. For a while now, they seem to be moving away from being an active competitor in the console race and more towards the role of a publisher. There is no better proof of this than this last month, when Forza Horizon 5 and Indiana Jones and the Great Circle hit the top of PlayStation Store sales charts. In fact, Xbox is currently one of the top publishers on PlayStation at the moment, with Indiana Jones reportedly selling more copies on PS5 than on Steam and Xbox.
Another change in the Xbox marketing strategy is the “This is an Xbox” marketing campaign to promote their cloud gaming service available through Xbox Game Pass. Be it a streaming stick or a TV, anything can be an Xbox. That’s right, according to Microsoft, you’re currently reading this on an Xbox. Which essentially means that as long as you have a steady internet connection, you don’t need a physical Xbox console to play Xbox games. Which is a cool concept and one that does lean into the company’s recent “Play Anywhere” mantra.
But all this talk of “this is an Xbox” and “that is an Xbox” in a market where prices keep going up begs the question: Who is Xbox for? I mean, if seemingly all Xbox first-party titles will make their way to other platforms eventually (and still sell well, as Forza and Indiana Jones have proven), then why would anyone be incentivized to buy one? I mean, I can pretty much guarantee that Sony is preparing the price increase blog post announcement as I write this, but why would anyone need to buy an Xbox when they can get a PlayStation for less and get access to first-party PlayStation and Xbox games? And that’s not even taking into account just buying a PC and waiting until they all arrive on Steam eventually.
It’s Not Yours
To Xbox’s credit, I do still think Xbox Game Pass is currently the best deal in gaming. (Although the new $80 price tags might mean subscription prices will also go up.) For one payment a month, you get access to all new first-party titles on day one from Obsidian’s Avowed to the upcoming DOOM: The Dark Ages. However, while you might be able to play those games for a cheaper price up front, you do not own any of them. Once your subscription lapses, they are all gone from your library.
Let’s take a brief detour to talk about Ubisoft here. In 2024, Ubisoft shut down the servers for The Crew, citing “server infrastructure and licensing constraints.” For an online-only game, this means that the game was no longer playable. Even if you bought it outright. This led to a lawsuit in California, where just last month, Ubisoft reiterated that you don’t own your games. In the case of The Crew, Ubisoft lawyers claimed that when you buy a copy, you’re getting a limited access license only. And this isn’t just a Ubisoft issue. It’s a trend. More publishers are pushing digital storefronts and subscriptions, meaning players pay for access, not ownership.
If you’re looking for a logline for this write-up, then it’s this: Video game publishers have stopped caring about the gamers. (If they ever did.) This isn’t a blanket statement that applies to everyone (there are some exceptions like Larian Studios, for example), but by and large, the biggest companies have been so obsessed with “red line go up” that they ignore the casualties. Gamers are being asked to pay more than ever for games they don’t really own.
The Indie Lining
When you step back to look at the bigger picture, the anti-consumer trend of the market seems antithetical to maximizing profits. The inevitable result of higher prices turns the video game hobby from affordable escapism to a luxury. You can look at the prices of N64 games with prices adjusted for inflation and think that $80 might not be that bad after all, but the reality is not that simple. Back in the day, the cost of living was lower. In the modern $80 era, while prices are going up, wages are not. This drives more people away from spending their hard-earned money on new AAA releases, waiting instead for deep sales or even pirating as an alternative. And the shrinking market share will lead to more games that will get cancelled if they don’t quickly find their big spenders (aka “whales”).
The silver lining through this all is that while large publishers are outspending each other in a Cold War-esque race to make the largest games with the highest graphical fidelity that have to be sold at a higher price to make up for increasing production costs, the indie game space is poised for greatness. Thanks to affordable and free creation tools, developers in smaller teams can make ambitious and incredibly compelling video games. Take the current Metacritic front runner, Clair Obscure: Expedition 33, for example. Made by a team of roughly 30 people, Clair Obscure was released to glowing reviews earlier this year. And the game was released with a $50 price tag.
One thing to note on the point of Metacritic scores is that the three current highest-rated games of 2025 are all “budget” titles that were not released at the full $70 or even $60 price point. I already mentioned Clair Obscure, but Blue Prince is $30 (and available on Game Pass and PlayStation Plus), and Split Fiction was $50 on launch. Some of this piece might have sounded doom-and-gloom, but I think these games are a testament to the love that still exists in this medium. The industry’s most innovative, polished, and passion-driven experiences are coming from smaller teams that respect their audience, price fairly, and release games that work at launch. Which is all to say that the future of gaming may not belong to the biggest studios, but rather the ones that remember why we play in the first place.
