Comment Re:Cost (Score 1) 98
I read that a lot. In any situation where costs to a business are going to increase.
There are three big pricing methods.
* cost plus Company decides their markup and adjusts prices to ensure that markup remains consistent.
* competitor Looks at what others are charging and adjust your own prices. Can vary according to how the company wants to be perceived.
* value How much is my customer willing to pay?
Value is the closest to of oft perceived view that businesses are universally squeezing every penny they can out of a consumer. In general only 15% to 25% of businesses work primarily under the value pricing model. 10% to 15% do so for goods, mostly in the luxury or very very specialized spaces while in services value pricing is up to 35% to 45%. Not surprising there is much variation based on factors relating to particular market segments. Additionally, companies that are considered as using one pricing model will often put a few thought cycles into the considerations of other models.
In this particular case, the pricing does have more a value component that it often does. The video game market is considered a luxury, is rather elastic and there are many competitors. Prices for video games are relatively consistent across studios. Base prices. In this market the cost plus can, and will, be expressed via bundling, increased shifts to subscriptions and the joys of additional pay to play and (is there a word for pay for cosmetics?). Or just plain quality cuts - no need for a cinematic there and let's just ship with two starting classes. That would likely negate Blizzard's moderately surprising pause in their slide out of the premium studio tier.