The Legend of Zelda: Tears of the Kingdom will be Nintendo’s first Switch game to be priced at $70. News that Tears of the Kingdom, a sequel to one of the bestselling and most critically acclaimed titles on the system, will have an increased price compared to its predecessor came as a surprise over three-and-a-half years after its announcement. It also raised questions about what the future of pricing for Nintendo games will be, especially as Sony, Microsoft, and third-party publishers all upped the cost of their new games in recent years.
While Nintendo will release Tears of Kingdom at $70, a spokesperson for the company tells Digital Trends that this will not always be the case for its first-party games going forward.
“No,” the spokesperson said when Digital Trends asked if this is a new standard. “We determine the suggested retail price for any Nintendo product on a case-by-case basis.”
To get more insight into the price shift, I spoke to Omdia Principal Analyst George Jijiashvili, who explains what has caused the price of games to go up in recent years and how Tears of the Kingdom demonstrates that Nintendo will “remain flexible about first-party title pricing.” Ultimately, Nintendo fans are finally starting to feel the impact of inflation that’s been sweeping across the game industry, even if it’s only “on a case-by-case basis” for now.
The price is right
Nintendo claims that not every one of its significant first-party game will be $70, and we can actually already see that in action. Preorders just went live for Pikmin 4, which launches on July 21, after Tears of the Kingdom, and it only costs $60. Still, Zelda’s price tag indicates that going forward, Nintendo will at least consider raising the price of its most anticipated games to $70. But why start with Tears of the Kingdom?
When asked why it chose Tears of the Kingdom as its first $70 Nintendo Switch game, a Nintendo spokesperson simply reiterated that the company will “determine the suggested retail price for any Nintendo product on a case-by-case basis.” Still, it’s a surprising choice for Nintendo to make that pricing change to just one exclusive game almost six years into the Switch’s life span. Jijiashvili thinks the choice to do this with Tears of the Kingdom was a pretty apparent one for Nintendo, although it won’t apply to everything going forward.
“If you are going to make a game $70, it’s going to be the follow-up to one of your most critically acclaimed and bestselling games ever,” Jijiashvili tells Digital Trends. “I don’t think that this means that $70 will become the standard price for all major Nintendo releases. It’s worth noting that Metroid Prime Remastered is priced at $40. It’s clear that Nintendo will remain flexible about first-party title pricing.”
It makes basic financial sense for Nintendo to ask for a little bit more for a game it knows will be one of the biggest releases of 2023. But what factors in the game industry and world’s economy at large caused Nintendo to make this decision?
Priced Out
For more than a decade, people got comfortable with AAA video games being priced at $60. Of course, there were occasional exceptions to this rule, but it was seen as an industry standard until the dawn of the PlayStation 5 and Xbox Series X. Publisher 2K was one of the first to announce a price increase, and companies like EA, Sony, and Microsoft have all followed suit. Jijiashvili chalks this up to inflation-related pressure on game publishers.
“The games industry has already been experiencing a lot of inflationary pressure,” he explains. “AAA games are much more expensive to make now than they used to be, but prices have actually been declining in inflation-adjusted terms — if prices had risen with inflation since 1990, they would now be over $90. On top of that, we’ve had a big burst of general inflation, meaning that publishers are looking at big increases in everything from salaries to tools. It’s going to be really hard for most publishers to avoid passing on all those extra costs at some point.”
Jijiashvili provided us with a graphic created by Omdia that “shows what the typical price points for each generation would look like if you adjusted for inflation.” As you can see, the inflation-adjusted prices are only exponentially growing, and the big game pricing shifts the graph highlights were all technically not even enough to keep up with inflation when they happened.
While it is fairly frustrating to have to start paying more for games over the past couple of years, that graph makes it clear why this happened. Nintendo did resist this change for the longest out of the big three console manufacturers, outside of Breath of the Wild’s pricing in the EU in 2017, and even now is taking a more reserved approach to pricing than Sony or Microsoft. Jijiashvili thinks this may be the case due to the weakness of the Japanese yen compared to the American dollar, which he says “makes things easier for Japanese publishers — their U.S. revenues are rising in yen terms purely thanks to the exchange rate.”
The price of inflation
After years of being able to resist increasing Switch game prices, Nintendo finally decided to sell a Switch game for $70. Although Nintendo claims it’s not as monumental of a shift as it may seem at first glance, it will still be a key point of discussion around Tears of the Kingdom and one of the things the Breath of the Wild sequel will be remembered for. Will it have any negative impact on game sales? Jijiashvili doesn’t think so.
“Given the impact the Breath of the Wild had, and all the anticipation around its sequel, it’s safe to say that the $70 price tag will not dissuade a significant number of fans for it to negatively impact the sales numbers,” he says.
As of December 31, 2022, Breath of the Wild has sold 29 million copies. That’s a lofty goal for Tears of the Kingdom to match up with in the waning years of the Nintendo Switch’s life span, but it’s possible it’ll keep pace as it’s going to be one of the biggest games of 2023. That has also allowed it to be a testing ground for a new, if not permanent, pricing strategy for Nintendo.
As inflation continues to exponentially grow, we’ve seen almost every game publisher jump on the $70 price bandwagon in some way. Even if Nintendo is choosing game pricing on “a game-by-game basis” going forward, Tears of the Kingdom’s pricing confirms that the era of $60 being the standard game price is over.
The Legend of Zelda: Tears of the Kingdom will launch for Nintendo Switch on May 12.
