The Race to the Bottom

Posted by Rampant Coyote on January 7, 2011

A fellow developer observed the following the other day:

Back in the 1980s, we used to dump quarters into arcade machines to play just a few minutes of a game.

Now, gamers grumble and agonize about whether or not to pay a few quarters to permanently own a ridiculously sale-priced indie game.

Painfully true. Even for me, and I’m a regular buyer of indie games.

Back in the day, we’d dump $0.25 in the slot (which was probably worth twice as much in modern currency) just to play a game once. I dunno about you, but the very first game would usually last about one minute. It took a dollar or two just to gain a base level of competency. After you’d spent that much, however, it usually meant you liked it, and you might return to the same game over and over again. After dozens of dollars, you might get pretty good.

I don’t really want to think about how many quarters I dumped into the Shinobi machine so that I could finally beat it on a “single” quarter.

Nowadays, an iPhone game costing more than a couple of dollars, total, will be met with loud complaints. Steam sales had a bunch of indie games at $5 or less all last month, and even the newest ones were steeply discounted into the $10 or less range.

Oh, as a consumer, I’m loving it. I went on an indie-game buying binge in December, with all the sales and expiring pre-order deals. Some of those games I bought I haven’t even installed yet. The key commodity for me nowadays is time rather than money, at these prices.

But I do worry about this. Is this kind of thing driving a consumer expectation that indie games should only sell for $5 or less? Are we racing to the bottom of indie game pricing where only those games that can sell a hundred thousand copies are more are profitable?

Arcade games back in the 1980s were built with a very specific purpose, and that was to maximize the number of quarters dropped in the slot. The kinds of games you’d find in the arcades were often very different from the ones sold in the stores. You wouldn’t play Ultima or Wizardry in the arcades. No, you’d get games like Tempest. Fast action, quick bursts of fun, and it would offer you bonus points if you started at a more difficult level to maximize your score (and minimize your play time). It was designed for that market.

That seems to be where a lot of indie games are going. Cheap, disposable, quick entertainment. As a game developer, building a sustainable business around making these low-budget games would mean cranking them out every couple of months or so. That’s doable – and in fact, even kind of attractive to me as a game maker. At least you wouldn’t get bored!

But are we getting to the point where a consumer will balk completely at paying more than $10 for an indie game, no matter how big, deep, and compelling? I hope not. I mean, the marketplace is the marketplace, and it’s not usually very profitable to fight the trends.

There’s another option, already popular with online games, and it’s also borrowed from the arcades. I will never know how many quarters I put into the Shinobi game. My total cost of ownership (well, pwnership) was hidden. I only played $0.25 at a time. That could be how bigger games might thrive in the current marketplace. A dollar or less at a time. I don’t prefer that option – I’d rather plunk my cash down once and forget about it. But that could be the wave of the future. Or the present, if you consider how many mainstream companies are pushing premium downloadable content.

Interesting times.

Filed Under: Biz, Indie Evangelism - Comments: 17 Comments to Read

skavenhorde said,

I’d say look to Amnesia. You just tweeted about them selling over 200k units, some at ridiculous sale prices, but they’re still selling about 200 units a day even after the Christmas rush. That brought a bit of hope for indies and PC gaming to my eyes.
Jay K. said,

I think the answer is the freemium model similar to what D&D Online and LotR Online are doing.

Otherwise, offer things in the game that cost very small amounts. In an RPG, it could be items, continuations/sequels or extra quests or what have you. The sequels would have to be ‘chapter’ sized rather than full book sequel sized.
Rampant Coyote said,

There is a problem with that model, as well – generally speaking, each chapter / episode typically sells more poorly than the last. The people who play episode 3 are a subset of the people who played episode 2, who are in turn a subset of the people who played the original.

That CAN be made up for, potentially, by the release of episode 3 causing a bump in sales for previous episodes, of course. But I’ve got some anecdotal evidence that in practice it’s not necessarily The Way.

And naturally, I’m kinda going that way with FK, though they are becoming a little bit more like true sequels now.
LateWhiteRabbit said,

Coming from a business and economics background (well, I have a degree in it), the key for selling anything is finding the proper price point.

Physical commodities and things like food are often a known quantity, need, and quality, so determining the price point for maximum sales is relatively easy.

Movies too, are relatively fixed as far as length and enjoyment go. You know 99% of movies are between 1.5 hrs and 2.5 hrs, and you can determine the exact length of entertainment before you ever buy a ticket.

Games are more difficult. Play times and length can vary enormously. If two games offer equally enjoyable gameplay, but one offers 5 hours and another 10, should I be expected to pay $20 for each?

When deciding whether or not to purchase a game, players often have less information to go off of than when they spend money on other things. It doesn’t help that, at least on consoles, all new games cost the same. If I bought the latest AAA title last week for $60 and it lasted 40 hours, and then I bought another AAA title this week for the same price and it lasted only 20 hours, should I feel cheated or ripped off?

What if movie running times were hidden or unknown? You might be willing to part with that $13 ticket for a 2 hour movie, but would you be pissed off if the movie was only 30 minutes long, regardless of how good it was?

The issue of the cost to developers to make the game also comes into it, of course. If you sunk enough development time and money into a game that you must sell it at $20 to make a profit, that’s what you have to do, regardless of whether or not your game offers equal or better value in time and enjoyment as other $20 game titles.

That brings us to the big issue, and where I’m going to bring in a little business and economics. People will only pay what they feel something is worth. The amount and criteria will vary between individuals, but it will remain relatively stable across any given demographic. I think the hard truth is that if a market is not willing to pay over a certain amount for your product (or game in this case), or only a very small market exists (who, remember, are only willing to spend a certain amount as well), then you must plan and budget your game so that you can create it and sell it at that price point and still make a profit. If that is impossible . . . well, congratulations. You’ve discovered a bad business decision. Better now than $50K in the hole.

Both indies and big publishers routinely fail to make those calculations and do that research – and that research and calculation is hard. It doesn’t stay the same for usually longer than 5 years at a time. You may have a product or game that is so unique that previous information on what a market might be willing to spend aren’t available. That in itself will tell you something. People don’t usually like to be “first” when it comes to testing waters with their money. That will depress your projected sales figures.

And if you’ve already made your game or product, you can’t just charge whatever you want to make a profit back. Only commodities that are necessary and that people have no alternative source for, can do that, like gasoline or electricity.

It is hard truths like those that can scuttle indie dreams and big developers alike. You may not be able to afford to make your dream game because the market for it will be too small, and they won’t be willing to spend $120 on it so you can recoup your budget.

The Steam sales are interesting to dig into, because often they can expose the proper price points for titles. It is also helpful to point out at this juncture that there are different “tiers” of buyers. Each has their own “cut-off point” for what they will spend. For example, in a small market some buyers WILL be willing to spend $120 – but not all or even most of them.

Steam sales show this in a big way – for instance, when a sale is going on for a title, I have read reports where sales increased for that title by 3000-4000%. That’s huge. If you normally only sold 30 copies a week, now you are selling 900 copies a week. More copies, more word of mouth, more exposure, more sustained sales even after the sale ends.

And, if previously you sold your game for $20 and made $5 profit off each sale, but now are selling it for $10 and only making $1 profit off each sale, you can still make the same or more money as long as you are selling 5 times or more copies. If you have sustained sales at $10, but not at $20, you just discovered that your initial price point was twice what it should have been.

Finally, in regards to the arcade example you made with quarters, price points change over time. You have to remember that when arcades were big and popular (God, I miss those days . . .) the games were new and unique and you couldn’t get anything like them anywhere else. Right up until the PS1 era, arcades were lightyears beyond the abilities and experience of consoles. If you are the very best at what you do (in the public’s opinion – not yours) you can charge pretty much anything within reason and get away with it. Remember too, that not every arcade game did well. If it wasn’t worth dropping in quarters, people didn’t, and soon the machines got shipped back to the company and the company had to get creative to pay off debts.

Games are fun. Games are entertainment. Games are art. Games are also, unfortunately, business.
Rampant Coyote said,

Heh – you wanna do some guest posts here, LateWhiteRabbit? Your replies are often better than the original post!

Steam has become something of a force unto itself as far as marketing is concerned. In GENERAL, on their own, reduction in price by indies is not accompanied by a corresponding increase in sales. In fact, after an initial surge, it’s sometimes the opposite.

But yeah – Steam is … something of a wild card. For example:

Recettear: 100,000 copies sold and what that means

It’s great if you generated +75,000 sales because you dropped your price to 1/10th (or in this case, 1/20th) of normal cost. If that would have otherwise been *no* income, then it’s a total win. But there are two problems.

#1 – Was the sale price too low? Did you leave a ton of money on the table? Were there a lot of people who would have bought the game for $7 who jumped at getting it for effectively $1 (I know I TOTALLY did that with one game last month… I found out I could get a bundle of games for the same price I was going to get the game by itself, and jumped at the chance). If so, you sabotaged potential sales.

#2 – Are you setting a precedent for consumer expectations of ridiculously underpriced games? This is my primary concern. I mean, the way things are now, I am *very* hesitant to buy an indie game I want from steam unless it is at least 75% off. I’ve come to expect it.

And as an added bonus in the opposite direction:

#3 – Will “bundled” sales of indie games cause gamers to buy multiple copies of the same game. I’ve done that now, too.

Spiderweb sells the games they make at a specific price because they have a pretty stable customer base. It’s a known quantity. But even so, there’s a big question of whether or not they are leaving money on the table by not going pricier *OR* cheaper. Would they sell 3x as many copies at $15? I don’t know. Don’t think they do either, but I suspect not.

The math is, unfortunately, not cut-and-dried.
LateWhiteRabbit said,

Heh. I’ve been told I love a nice tall soap box. I might be up for a quest post or two whenever you next go on vacation. I usually find I work better when someone provides the hook to get me going, however!

I agree, the math is hard and the equation keeps shifting. If it were easy all businesses would be successful. Hell, if it was easy, I would be using my business degree to RUN a business.

Point #1 – It is entirely possible that the sales prices are too low. I also bought Recettear when it was absurdly cheap – I wasn’t willing to spend $20 on it, but I would have paid $10. Probably even $15.

Personally I think you should try and hit the proper price point out of the gate and stay with it as long as possible, but, as we’ve established, that is easier said than done. Barring that, I would stay at a price point until sales slowed dramatically (or I wasn’t seeing near the sales I wanted or needed) and then drop 10% and repeat until I had the expected sustained sales or I couldn’t afford to go lower. This has the added benefit of making sure the portion of your market willing to pay more DOES pay more, and then as you go down by bracket you pick up the rest of your market.

Point #2 – Are we setting a precedent? Yep. It is a problem in most industries. Once consumers become used to paying a certain amount for something, it becomes nearly impossible to charge more. You either have to be unified as an industry with EVERYONE raising prices together, or you have to innovate to produce the same products for less and thus earn more profit at the same price point.

I’m like you regarding Steam buys, except on EVERY purchase I make on Steam, indie or mainstream. The 75% sales are so common, why risk paying $50 for something when I’ll probably be able to pick it up sometime in the next four months for $12.50? But it is like my economics professor used to say: “If something is frequently on sale, it isn’t really ever on sale – that’s its actual price and worth.”

I also want to point out something influencing consumer expectations about indies – look at Shinobi up there. Look at a lot of the old arcade games. Look at a lot of the indie titles on iPhone. Great games many of them, right? Games just like them are also available for free at places like Newgrounds, or by talented developers who don’t “feel right” about charging for their first game. After all, it was just “practice” for them.

You can’t expect to charge as much for your cow if someone else is giving away free milk. And if enough people are used getting free milk for long enough, they’ll even start looking at you like an ass for even charging ANYTHING for your cow or milk.

Economy = scarcity. If there is no scarcity, there is no economy. Look at Star Trek and its replicators. Replicators turned the whole damn human empire communist. Because capitalism is no longer a choice. We are entering a new age of commerce where the previous economic models were never meant to work.

Q: What is the cost of 1 extra digital copy of a game to a developer?

A: The same cost as infinite extra digital copies of a game to the developer.

We’d all (hopefully) feel bad about stealing a car off a lot, right? It is a physical commodity that had to be built with actual materials paid for, by a paid worker, shipped to its location for a price, etc. We can quantify its loss to its makers or owners.

What if we could steal a copy of that car and it didn’t cost the makers or owners anything extra?

Digital commerce almost relies on altruism. And altruism is a bad foundation or model for any business. Just as a charity sometime.

Digital copies of games inherently depress the proper price point. After all, if you sell a boxed disc copy of your game for $50, and then turn around and try and sell me a digital copy for the same amount, I’m going to balk. People don’t even need to be good at math or economics to feel they are being taken advantage of, and consumers never like feeling like suckers.

We are entering an era where knowledge and skills will be more valuable than the actual result of those skills and knowledge. What that means, I have no idea. Whoever solves the issue of charging for something there is an infinite supply of will win a Nobel Prize in economics. Until then, the best we can do is create “perceived value” and try and appeal to the better nature of mankind.

Point #3 – Of course. I’ve already bought multiple copies of some games. Luckily Steam keeps track of how many “copies” you own and allows you to give them as gifts to other people. More companies should follow suit.

And now I’ll dismount the soap box once more before I make myself depressed. After all, as an artist, writer, and developer I find myself in the same boat. Stupid math. Stupid economics.
MalcolmM said,

They really messed up the marketing of Recettear, I too would have paid $5 or $10 for it, instead of the $5 for a bundle of 5 games that I bought it for (but I did also want the other games in the bundle, unlike most people). Another example of lowering the price too quickly was Super Meat Boy, I think it was only for 2 or 3 weeks before they lowered the price by 75% for a one day sale.

I think Puzzle Quest 2 is an example of a game that was well marketed. It came out about 6 months ago at $20, too much for me as I was a bit tired of the match 3 games. About three months later the regular price went down to $10, which brought in more sales. Then, over the Christmas sale, they marked in down to about 6.70, which is when I bought it. I imagine sometime over the next few months they will feature it as a midweek or weekend sale item at $5, and probably by next Christmas sale it will be $2.50. So they squeeze as many sales out of each price level as they can.

I agree that the prices of some of the games are absurdly low. I bought about 25 games, 90% indie, over the Christmas sale. It’s gotten to the point where the price of most of these games is completely immaterial to me, it’s more a question of whether I have time to play all the great games I currently have in my backlog.
Craig Stern said,

From what I’ve read from other indies (and I’ve read a fair bit), permanent price drops don’t do much to make a game sell better. The massive increase in orders that we always hear accompanies Indie Bundles and Steam sales come primarily from widespread positive publicity, as well as the pressure of knowing that there is a time-limited deal to force buyers’ hands.

See here for an example of this principle in action:

http://rockpapershotgun.com/rpsforum/topic.php?id=485
sascha/hdrs said,

I have the feeling that most people are cheapskates today. It could be the side-effect of the globalization if you think about how dirt cheap many things today are that were much more expensive many years ago. Check around you how many quality supermarkets, shops or grocery stores have been replaced by cheap discount chains. A similar scenario applies to games now. People get a sense that everything must be cheap and besides that salaries drop lower as a result. The only ones who are winning (currently) are the ones who sell the cheap stuff in masses. But I think this will all backfire someday.

Apart from that I think you can’t really compare Arcade games with ‘living room games’. There are still arcade games today, even new ones being made (at least here in Japan) and they still have the same purpose like they had 20 years ago, to collect many many coins.
Personally I only buy a game if it feels attractive to me, i.e. if the theme, style, genre, quality etc. sits with me, regardless of how cheap or expensive the game is, or how it is distributed.
Whiner said,

You can’t expect to charge as much for your cow if someone else is giving away free milk. And if enough people are used getting free milk for long enough, they’ll even start looking at you like an ass for even charging ANYTHING for your cow or milk.

Two words: Bottled Water.
LateWhiteRabbit said,

@Whiner

Bottled water is a perfect example of the “create a perceived value” method of making money I mentioned in my last comment.

Coca-Cola sells Aquafina. Aquafina is tap water. Literally. They’ve admitted it. Sure, it gets filtered again, but besides that, all they do is bottle it.

Oh – and spend millions of dollars blitzing the market about how great THEIR water is. How healthy it is. How trendy. How health conscious. How convenient. They CREATE a value for their product in your mind. And then they charge you for it.

The corporate buzz word here is “creating a market”. And it isn’t a new idea or practice. My economics professor gave what is rather an infamous example in the economics and business world – deodorant.

No one had heard of deodorant before the late nineteenth century. There was no market for it. There was no problem.

“No problem, you say? What about underarm stink and funk?”, I can hear you asking. Simple. Your armpits don’t stink if you wash them with soap once a day. Which everyone did that didn’t want to stink.

But the creators of deodorant launched a large campaign for the time, emphasizing how you may stink and not know it. How people may be disgusted by your odor but too polite to say anything. How it was better to be safe than sorry. You get where I am going with this.

Soon everyone was buying deodorant and using it. Now, it is such a staple of hygiene that no civilized person would not use. A huge, very profitable, industry. For an unnecessary product.

I’m sure you’ll say, “But if you play sports or perform an activity where you sweat a lot YOU do stink without deodorant.” True. But I also submit that if you don’t shower after a full body sweat you are being nasty and still stink, you are just using deodorant as a perfume to cover the odor.

Modern deodorants do a lot more things, like kill bacteria, prevent sweating in the first place, etc. but for nearly 100 years, they did NOTHING but perfume your pits. And companies got rich.

But bottled water isn’t really a good example for our discussion on games anyway. Sure, water is a common and readily available resource, but it isn’t infinite or free. In Iraq my unit actually fought a gun battle to protect a water source for a village, in fact.

Games are digital, however. Truly free and infinite. Current economic models only work in the digital world because of ENFORCED scarcity. The laws against piracy are doing THAT, not enforcing morality.

In short, for any digital commodity, any computer can act identical to a science-fiction replicator. To quote from the wonderful website http://www.projectrho.com –

In “Pandora’s Millions”, the ivory tower engineers of Venus Equilateral invent a matter transmitter, and quickly figure out that the signal can be recorded. This makes it into a replicator. A businessman friend of theirs screams at them that they’ve just destroyed the economy of three worlds in one fell swoop.

The businessman says it is too late to suppress the invention, but if the engineers want to prevent it from being a complete and utter disaster, they had better go and invent some substance that cannot be replicated ASAP. Lacking that, there is no way to prevent either currency or cheques from being counterfeited. Counterfeits so good they cannot be distinguished from genuine money.

With a replicator, everybody can pave their driveway with gold bricks, eat caviar and filet mignon every day, and wallpaper every room in the house with Mona Lisas. Which basically means all these formerly expensive items are now worthless, that is, valueless in the sense of being free.

Of course, if your monetary units are based on gold or something physical, they are now valueless as well. As are any investments, savings, or retirement nest eggs made with such money.

Things will go downhill quite quickly, since a replicator can also produce more replicators.

Factories will close sending millions out of work. Who needs the goods manufactured by the factory when all you need is a replicator and a recording of the desired item? The stocks and bonds of the companies who own the factories will plummet in value.

About the only thing that will still have value will be services. A replicator will not help you if you need a cavity filled or an appendix removed. Some kind of barter system will replace a monetary economy.
PsySal said,

There have been some great discussion in the comments. I have felt like posting something along these lines, too.

People will only pay what they feel something is worth. These “humble indie bundles” are making a few people a lot of money, who have already had some great success with their games.

For those of us in a niche market, or who have less exposure, or who are uncertain of our success, it hurts a lot. Now we are expected to sell our game for next to nothing, or better, just to give it away for free.

People a lot smarter than I have thought about this and probably understand it more, but I also know that nobody flinches to spend $2.50 on a glass of cola at a restaurant– this is because restaurants have created a certain expectation.

I am afraid to post this opinion publicly as it may seem a bit rude, but sometimes I feel that the HIB and similar deals are the big famous indies making lots of money at the expense of the marketplace, which includes a lot of smaller devs. We are all already up against AAA titles.

But… I’m not letting it get my underwear in a knot, because I’m just going to charge what I need to charge and work hard to get some exposure. Well, enough negativity =) Onward!
MalcolmM said,

I agree PsySal, you can only worry about what you can control.

One thing indies can control, at least I assume they can, is how their game is presented on Steam. I’m amazed at how many games on Steam don’t have a forum on Steam. The first thing I do when I check out a new to me game on Steam is go to the Steam forum. Some games have a Steam forum, but it isn’t linked on the store page, it might as well not be there. Archon classic is an example of this, if I hadn’t realized that there is a non-linked forum, I wouldn’t have bought the game (and I’m very glad I did, it’s great).

Once you have your Steam forum setup and the game is released, the developers should maintain a presence in the forum. If there is a thread with a negative tone created, provide an answer to the thread initiator, even if he is just being a jerk. If there a significant bug that you plan to address in the next patch, post about this, and say when you hope to release the patch.

I would say in almost all cases, my decision to buy a game is based on what I read in the Steam forum for the game.
BenD said,

Something you mentioned in your post but not actually used to answer the question raised regarding “racing to the bottom” is the fact that Ultima (for example) and Tempest (for example) sold in different venues.

Smartphones and their ilk are a different venue than the PC on my desk or lap, which is in turn a different venue than the TV across the room from me (and the consoles attached to it). The gap between these venues keeps shrinking: my laptop gets me out of the office and into the same room with the TV. The functionalities of these devices overlap: perhaps pad-type computers are the offspring of my laptop and your smartphone. The lines are blurring: my laptop could theoretically send output to my TV instead of its own screen.

But for most of us, most of the time, these devices serve different purposes. I don’t fire up the PS3 and hog the TV to play 3 minutes or even 3 hours of Angry Birds, because I could do that on my phone… at the grocery store.

Right now, a console is where you’d find Ultima. A smartphone might be where you’d find Tempest (and that might be a message to smartphone developers about selling games by the level, or even by the replay, in old arcade fashion – I don’t know). A PC could do either just as well, but really owns the market where games require hours of solitary concentration while offering a social network – MMOs.

We’re clearly willing to pay different prices for games that we perceive as belonging to one venue or another. Console games are going at an unsustainable rate right now – but the sustainable rate I suspect exists is still a decimal position away from what seems to be the going rate for a smartphone indie.

The issue with indies on consoles is that they’re living in a twilight place between ideal venues. The marketplaces for the two big consoles ‘ghetto’ indie games – first because indie games are download-only (this issue will slowly dissolve as physical sales become less crucial to a marketing plan for a new game and become more of a ‘collector’ approach) and second because they’re separated from their big-studio companions (by Microsoft, mostly). This really sends a message, which may have been intended to be ‘these are indie games woo’ or, more likely (considering Microsoft planned the message-sending), ‘these are inferior and cheap’ but for a significant chunk of the market, people who don’t follow gaming blogs and the game industry, has boiled down to: ‘you can buy smartphone-type games on your 360!’

I believe this is the wrong message (and the wrong approach, by the way). Why would I pay $10-20 for Tempest on the 360 if it’s available on my phone for $1 (or $1 per level)? Meanwhile, if an independent game of scale (say, a full-size, 3D, deeply featured RPG with a humorous approach) came out on 360 and looked just like any other game on the console, with a mid-range marketing approach (no tv necessary, but widespread web promotion and console marketplace ads might be good) – only I couldn’t find it any stores – well, I’d expect its price to be something like 80% of that of a major studio game. If it had no exceptional marketing attached I might assume it was a rerelease of some older game I’ve never heard of, in which case maybe I’d think its price should be 50% of that of a major studio game (when new).
And I’d be paying that price for the privilege of playing the thing on my TV set, basically, and that seems normal to me. Maybe that’s not good, but that’s where the industry is right now, and I believe it’s all about venue.
BenD said,

I should say, ‘A console is where you’d find a present-day equivalent to Ultima,’ since Ultima was of course released on PC… but then, I’m not sure that’s true. The spiritual successors to Ultima are probably still on PC, as much as I’d rather they be dual-venue. Still, let’s say ‘major studio RPG of scale’ and go with it.
Xian said,

I would rather plunk down my money all at once instead of being nickled and dimed (or quartered) a little at a time. I rarely ever get DLC either – I prefer a longer expansion than short DLC. I will buy episodic content though, such as the Sam & Max series. I have decided to wait for the Gold or GOTY edition on Dragon Age II and Fallout New Vegas instead of buying it at release to get the extra content which will surely be included with the later editions. That’s the ultimate race to the bottom, having the patience to wait for the inevitable price drop.

I am very interested to see what the Mac App store will do to the software prices on the Mac. I can already see some existing software that is cheaper to buy that way now, such as the iLife and iWork packages. They have been broken up into individual components, so if I only want Garage Band, I don’t have to buy the entire iLife suite now. Since Microsoft so often imitates the competition, what will happen if they follow suit with a PC App store? It could be yet another force to drive down software pricing.

What I don’t want to see is the pricing get so low that developers decide it’s not worth the time. Why spend the time and effort that Jay has put into Frayed Knights for instance when it will be a $2.99 App? As a consumer I welcome lower prices, I picked up a few Steam sales myself these past weeks, but if the prices get driven down to the smart phone level then some developers may drop out altogether.
Justin Alexander said,

I think it will be a question of figuring out how to serialize your content. Actual episodic gaming is an option. In-app purchases to further supplement revenue may be another.