Where the $60 for new games goes
by Justin Murray 
{ Dec 20th 2006 at 9:05AM }
With the 20% price hike in PS3 and Xbox 360 games, gamers wonder exactly where it all goes. We hear it is because of the increase in production costs, but we still would like to know the breakdown of where our triplet of $20 bills gets sent. Now, Forbes has given us the skinny on the whole deal, explaining why games like Gears of War are priced at $60.
According to Forbes, $27 of the $60 taking its leave from your wallet goes toward the actual making of the game; $15 goes toward art and graphics while $12 goes toward gameplay mechanics. Other major price aspects are the 25% retail markup ($12 from a wholesale $48 per game) and console owner fee of $7 (Forbes says the PS3 is higher). All in all, the parties involved (retail and publisher) only get $1 for every game sold (publishers can boost it up to $3 per game if they sell advertising in the manual or as a pack-in pamphlet). This is, of course, before all those costs are paid up; after that, they can still make a nice profit at a $20 price point.
The article, accompanied by a nifty slide show presentation, is an interesting look into the world of the new current generation. Still, it doesn't exactly explain why we got the 20% boost other than the "increased production costs". Are programmers getting paid more, working more, need more to finish the game, etc? In either case, the breakdown is an interesting glimpse of the inner workings of a game companies pricing decisions.
[Thanks, Scooby Doo]
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Reader Comments (Page 1 of 1)
CakeOrDeath @ Dec 20th 2006 9:25AM
"This is, of course, before all those costs are paid up; after that, they can still make a nice profit at a $20 price point."
The point is how many sales do you need before an avarage title is paid up?
Without that info the rest of this is meaningless.
Russell @ Dec 20th 2006 9:30AM
5 years of inflation brings the $60 price tag to around $50. Really, the price of games hasn't gone up at all.
I'll never understand why people expect prices to stay the same no matter what.
Karmakin @ Dec 20th 2006 9:26AM
Errr...
Because for HD content, you need more renderers and graphical designers to create the more detailed textures and shapes.
Mack Swift @ Dec 20th 2006 9:29AM
It's definetly interesting to look at the price breakdown of not only games, but DVDs and sometimes music CDs.
But the thing I find more interesting is what the breakdown looks like a year after the game's release. Quite a few games drop down to $30 or $20 even. How does the breakdown work then and where does profit come in? Was the price of the game able to drop that low because certain parties involved in the game were paid and able to profit? Was their cut effectively dropped from the overall price?
Take a look at FEAR on the PC. A year ago, the game retailed at release for $60. Now, the game can be had for $30 and its expansion pack for $30. You can get the full game and a half for the price the original cost a year ago. Did the game make enough money so the price could be dropped while still retaining a profit? Or was the price dropped to move more units along with the expansion pack?
Fred T @ Dec 20th 2006 9:36AM
"Quite a few games drop down to $30 or $20 even. How does the breakdown work then and where does profit come in?"
The used and resale market has a lot to do with this. After a year, there is a ready supply of viable, used discs on the market selling in the $20 range. The devs and studios make no profit from these resales; all that goes to the store.
So, dropping the price to the $20-30 range allows them to pick up sales were before it would have been lost to the used market. All the development and marketing costs have already been eaten; and it costs nothing to stamp a new batch of discs. Consumer can now decide between used for $20 or brand new for maybe $25.
You will not be seeing downloadable game prices dropping that drastically in this generation... theres no used market (one of the drivers behind digital distribution).
GameMan @ Dec 20th 2006 9:37AM
This sounds very, very wrong.
Ime. Publishers and retail are the ones taking the largest piece of the pie - definitively not the creators
of the game.
troc 59 @ Dec 20th 2006 9:39AM
"Console owner fee".Sounds like they were at a loss as to what they would call yet another way to extract $$ from the hapless gamer. Kind of like a monthly parking fee or something. I think they ran that one up our asses and we didn't feel a thing! lol lol
el Chino @ Dec 20th 2006 9:42AM
Russell
Remember when Psone first came out many of its games were 60 bucks. N64 games cost upwards of $70.00. Inflation in my opinion only affects high priced items like TVs and life sustaining products like food and gas. Videogames aren't really affected by inflation ditto other things like CDs and books. A CD $12 and a book $7 or so for paperback are the same prices we paid 5,10 years ago. A Sega Saturn cost 400 bucks in 94/95 and a 360 costs 400 bucks in 2006. Where is this inflation? Like Forbes said its just greed.
BTW, games get marked down because they no longer sell and publishers and retailers must get rid of excess inventory. If they didn't do this there would probably be new Saturn and N64 games out in retail if games never dropped in value.
Petrie @ Dec 20th 2006 9:44AM
"This sounds very, very wrong.
Ime. Publishers and retail are the ones taking the largest piece of the pie - definitively not the creators
of the game."
Retail makes very little from game sales. Why do you think EB tries so hard to sell USED games? That's where the money is.
el Chino @ Dec 20th 2006 9:50AM
Console owner fee might be the $10.00 mark up this generation?!?!?
Bender @ Dec 20th 2006 9:56AM
You know, these figures only count for the North American market.
In Australia, premium Xbox360 games retail at $120 - at current conversion rates (from xe.com) that's US$94.42! I know Australia / New Zealand isn't a very large market but it's worth considering that perhaps there is more money to be made in territories outside North America?
I'm not sure how much new games cost in Euro or GBP, if anyone could tell me that might shed some light as to how accurate the figures quoted in this article are on a global basis.
Erwos @ Dec 20th 2006 9:58AM
"Console owner fee might be the $10.00 mark up this generation?!?!?"
No, those fees have been with us for a long time. Nintendo pioneered them with their "Seal of Quality", in fact. "You want to develop for our console? It'll cost you - per copy sold."
As to the genius who said "inflation doesn't affect everything", I recommend you brush up on your economics, and figure out that inflation has to do with the value of money, not with the value of any particular goods.
Analyst @ Dec 20th 2006 9:59AM
For those of you complaining about the "console owner" fee, it is the money that goes to the company that owns the console (Sony, Nintendo, Microsoft). In other words, game companies pay console companies for the privelege of making games for their system. This is why first-party games (for Microsoft) are cheaper than third-party ones.
It really says something that Sony charges people more. I wonder how long that will last.
el Chino @ Dec 20th 2006 10:05AM
As to the genius who said "inflation doesn't affect everything", I recommend you brush up on your economics, and figure out that inflation has to do with the value of money, not with the value of any particular goods.
Yes it does. As inflation goes so do prices...........I'm I missing something. More inflation is caused by the supply of money increasing and this in turn causes prices to go up. Maybe its you that needs to brush up on economics.
Neil Christie @ Dec 20th 2006 10:06AM
Sick of hearing darned Americans complaining again. In the UK an Xbox 360 game runs for £49.99 at many retail stores. That's $97USD including tax or $80 excluding tax.
Come back and whine your asses off when you're paying $100 a title, but until then you guys should be thinking yourselves lucky to have such cheap games which come out on time.
Sithlet @ Dec 20th 2006 10:32AM
Makes sense -- with all of the costs split up, there are big incentives for companies to start with the microtransactions (cut out the retail middle-man for themselves), and for retailers to sell used games (cut out...well, everyone except themselves).
el Chino @ Dec 20th 2006 10:15AM
That's $97USD including tax or $80 excluding tax.
Jesus you guys have double digit sales tax? Here in the US we have no VAT and most sales tax is 5-7%. You did that here in the US and there would be riots. The funny thing in Europe people protest when taxes are cut. LOL!!!!! Ayn Rand is turning in her grave.
Zack @ Dec 20th 2006 10:22AM
Neil: Games cost that much in the UK because people are willing to pay that price. If everyone in the UK suddenly became as price-snobby as most Americans, companies would probably sell games for an equivalent price.
In other words, the more complacent a populace is about a product's price, the more they will pay for it.
Stef Geiger @ Dec 20th 2006 10:28AM
Why does everyone seem to overlook the fact that these "next/new-gen" games obviously REQUIRE more development time? No, it's not the fact that the game can run in HD. It's likely due to the fact that gamers are demanding more and more from the games they play. These new-gen titles have for more detailed environments than previous generations (which takes a whole bunch more art direction and programming time), apparently FAR more animations, which have to be painstakingly integrated, and don't forget, there are so few consoles out there that you'd pretty much have to sell to every owner in order to make a good profit. So of course costs for new-gen games rise. Why wouldn't they? They're obviously and justifiably more costly to make.
Jayscott @ Dec 20th 2006 10:31AM
Those console fees are exactly like the licensing fees you see for manufacturing a DVD player using the DVD standard, a DS cartridge (which, incidentally, you also pay Nintendo to manufacture), or any other product that involves a proprietary standard or patent pool. Forbes sends out a slightly tainted message by simplifying with "PS3 has higher licensing fees"; as with both Xbox and PS, it depends on the launch price of the game. The gap between the two is very very small.
Kaemon @ Dec 20th 2006 10:37AM
"Jesus you guys have double digit sales tax? Here in the US we have no VAT and most sales tax is 5-7%. You did that here in the US and there would be riots."
Thats becasue in that area of the world they practicaly pay any lazy person who can breaths way though life, so they tax the heck outta everyone else to pay for things people should pay for themselves (Healthcare? College?)
(Or at least thats my experiance with one person.)
nuts and bolts @ Dec 24th 2006 5:22PM
WoW! you pay 40 pounds in England! Thats cheaper than in the U.S where we pay 60 U.S. You don't live in america so you are not paying 80 U.S You would not pay 80 pounds would you? You currency is higher so of course it costs more if you compared to a weaker currency! Your job pays you in pounds right? not dollars. So it evens out to where you are paying 40. Here in the states where we get payed in U.S currency and pay things in U.S currency have to pay 60 dollars to those fat cats! Thats sucks! and yeah there are some third world countries that sell games for 100 U.S dollars but this is because these items are very limited and there is a very short demand for them. So the retailer has to buy them at a very high price not like big companies in the states or in england. SO his over head is going to be higher and he will have to sell it higher. Plus he has the advantage of he being probably one of the only sellers in the town that sells these games and can sell it at any price he wants.
Shagi @ Dec 20th 2006 11:09AM
Having worked many years in the game industry I can understand why the first couple games you make for a new system can cost more, generally it takes longer to learn the systems, and theres a learning period that you need to compensate for. However its perposterous to claim that HD gaming costs more beacuse the artists are creating more detailed models or textures. This is simply not the case, the more polys and higher res textures a system can handle the less work the artist has to do.
In trying to reach the optimal look for any platform your models are always made without concern for the number of polygons they are created with (within reason) the artist then spends an enormous amount of time making revisions to bring the count down to what the system can handle based upon the engine and platform, this requires a bit of guess work depending on how precise the game design is layed out (you gotta make sure you know how many polys are gonna be onscreen all the time). I've never worked on a game where crappy models were rendered and then the artist took more time to make them look better, its always the other way around.
Same thing with textures, when you can have only low res textures your artists have to be more clever in the way they draw the textures, high res textures means less guess work and redos on the art.
I don't see why people believe its more expensive by nature to develope for next gen systems cause all my experience just points to this being untrue (except for learning curve like I pointed out earlier).
Cheers.
mangrilla @ Dec 20th 2006 11:10AM
"15. Sick of hearing darned Americans complaining again. In the UK an Xbox 360 game runs for £49.99 at many retail stores. That's $97USD including tax or $80 excluding tax.
Come back and whine your asses off when you're paying $100 a title, but until then you guys should be thinking yourselves lucky to have such cheap games which come out on time."
Uh, Neil, couldn't you complain about that in pretty much everything you buy? The pound is nearly twice as strong as the dollar, but your pricing scheme there is pretty much the same. So really, you could say, "You pay X for a big mac, but in US dollars, I pay 2X!"
Of course, I'm assuming that you could probably use your pounds to buy twice as many American products... So why don't ya quit yer whinin' limey.
Stef Geiger @ Dec 20th 2006 11:10AM
Yeah, in Canada, you can pay up to 14% tax on nearly all purchases. But we have things like free health-care (thank you, Kiefer Sutherland's grandfather), the government subsidizes tuition, so we pay less than half what most Americans would.
hegemonyhog @ Dec 20th 2006 11:14AM
Economics discussions on the internet are a lot like taking a swim in sewage - no matter how good you are at it, you still come out shitty.
Inflation drives the value of money down. Ergo, prices (which are simply a valuation of a product in terms of how much currency it takes to procure that product) will go up.
As a hypothetical, a dollar in 1980 would be worth $1.25 today (this isn't necessarily accurate, just an example picked out of nothing). That means in order to have the same purchasing power, you'd need to spend roughly 25% more to get the same thing.
"More inflation is caused by the supply of money increasing and this in turn causes prices to go up."
Of course, the real issue from an economic sense is whether or not you're actually spending more money. $20 today isn't worth what it was in 1986. It's very difficult to get exact figures on inflation, but a $50 game in 1985 (the NES' first full Americna year) would cost over $85 in today's dollars. If the PS3 stayed at $599.99 for the next five years, its price would be continually falling in real dollars.
Anyway, the $60 barrier is a price shock because we've been spoiled by falling costs for years (the transition from cartridge to CD/DVD, standardized libraries, etc.). Now that we're reaching an era where online components are considered vital rather than extra, total dev time and resources have to go up, at least in the short term.
stubbymonkey @ Dec 21st 2006 5:38AM
#18
There is no real difference between the PC version of fear and the 360 version.
PC games costs £30 for a new release.
While the 360 version costs £50.
Where does the extra £20 go?
chompu @ Dec 20th 2006 11:38AM
Whiney americans.
They're £49.99 here in the UK
Try a currency conversion. That's almost $100.
Stop complaining.
el Chino @ Dec 20th 2006 11:51AM
Yeah, in Canada, you can pay up to 14% tax on nearly all purchases. But we have things like free health-care (thank you, Kiefer Sutherland's grandfather), the government subsidizes tuition, so we pay less than half what most Americans would.
Its not free or reduce you pay it with HIGH TAXES DUMB ASS.
Zack @ Dec 20th 2006 11:48AM
Chompu: I'm guessing you missed my earlier post. By being picky and whiny about our prices, we pay less. If everyone in the UK refused to pay the equivalent of $100 US, video game prices would be lower.
If you want to chide anyone for the price discrepancy between US and UK, chide your fellow Brits for not being whiny enough. ;)
Miniboss @ Dec 20th 2006 1:39PM
"Because for HD content, you need more renderers and graphical designers to create the more detailed textures and shapes. "
And how much do movies cost to make? Many millions more than games do. And yet movies are still sold at around $20 or less.
I don't see why games aren't much cheaper. If the gaming industry is making more money than Hollywood, then can't they take a hit at retail? Wouldn't that get more people to actually play the games and potentially buy other games at the same time since they now have more money?
I'm a developer, and even I think this is a good idea.
DrHockey @ Dec 20th 2006 1:18PM
"There is no real difference between the PC version of fear and the 360 version.
PC games costs £30 for a new release.
While the 360 version costs £50.
Where does the extra £20 go?"
For starters, there is no Console Fee/licensing fee for the PC - it's an open platform. Anyone can develop a game for it or a new peripheral as long as it conforms to a set of standards. Also, physical production may be lower since PC games also use open CD-ROM and DVD standards while Xbox/PS3/Wii discs are proprietary DVD derivative formats.
CB @ Dec 20th 2006 1:24PM
Free Healthcare sucks. It's only free to the people who don't work and couldn't afford it anyways. In the U.S., healthcare is expensive but the quality is second to none. We get all the newest technology and drugs first because there is economic incentive to research. In Canada, you can have surgery for free, but you could be waiting upwards of a year for it. I can pay $50 co-pay and see a doctor TODAY or go into surgery tomorrow. You can have your "free" healthcare and I'll keep my hard earned money in my bank account. I know what's best for me and my money, not the government.
nabisco @ Dec 20th 2006 1:23PM
Aren't British pounds about 2x as valuable as American dollars. Corrrect me if I'm wrong, but doesn't that mean that games aren't as expensive in the U.K. as you say. Besides, there was a price hike in games, isn't that enough for anyone to complain.
Scooby Doo @ Dec 20th 2006 2:08PM
There were certainly some things in the article that took me by surprise. For starters, I just couldn't believe that the "Company Owner" fees paid were so high, while the initial return for the developer was only a buck. It's just mind-boggling to me that the console manufacturers are making more money initially on the product that the company that actually created it.
I also wondered where they got their $12 retail markup. I was under the impression that retailers made so little money on software they HAD to trade used games. Granted, I'm sure some of that $12 also goes to shipping and distribution, but that's like a 25% markup. Are retailers that sell used games lying to us that they need to do so to remain in business? Don't get me wrong, I actually buy used games and like the market, but I don't like constantly being harassed to buy a used copy when I specifically want to buy a new, unopened copy.
Lastly, I've read some of the recent comments regarding how few games are available for the two new players to this gen. If Namco's statement that they have to sell at least 500,000 copies before making a profit is true, it better explains why these 'droughts' occur and why it would be difficult for any of the console manufacturers to drum up more games just outside the launch window. Think about it, is the PS3 installed base even at 500,000 yet? Assuming the statement is true, you'd have to sell your product to every single PS3 owner just to come out even. Kind of sad for the PS3 and Wii because I took it to mean that developers would definitely shy away from exclusives from either of those platforms until they generate a much large user base.
(Note to those of you who love to give the 'Numbers Shipped' figures. This is why 3rd-party support is dependent on SOLD numbers, not shipped numbers.)
Game Artist @ Dec 20th 2006 2:33PM
#22
Sure you can save time it you do half assed models and dont bother to optimize geometry or textures. However creating really good looking assets takes alot more time, and more importantly it takes better artists as they are required to make more and more detailed characters. All the geometry and texture optimization should be going on, just you need to do it on an even larger scale. Models require normal maps, bump maps, etc, etc. On the animation side of things there are many more animations, and the animation now typically involve both face and hand animation which is at least two additional passes.
On the art side of things a next-gen title is estimated to take 2-3 the man hours for art. So really the answer to why the prices are higher is increased development cost. Im a 11 year vet of game dev.
Zack @ Dec 20th 2006 3:03PM
#33, Miniboss:
Games cost several times as much as movies because they last several times longer. Let's say you get a movie and over the course of the year amazingly watch it three times (this is generous; very few people I know watch a movie they've bought more than twice a year); that will total maybe six hours on the long end. Compare that to the big-deal games that come out these days; you're most likely in for around 18 hours of play time per game, if not more. Hell, I probably spent 60 hours playing and re-playing Resident Evil 4 when that came out. You'll never, ever catch me spend 60 hours watching the same movie over and over though.
Jason @ Dec 20th 2006 4:31PM
This is hard to believe because in reality games are ported for multiple platforms. I worked for a "Big" game company and they would use the resources of making the game for ps2 and porting to all the other consoles....all they care about is being able to release for all platforms and the costs have not gone up for the price increase.
Dhruin @ Dec 20th 2006 4:31PM
"I also wondered where they got their $12 retail markup. I was under the impression that retailers made so little money on software they HAD to trade used games. Granted, I'm sure some of that $12 also goes to shipping and distribution, but that's like a 25% markup. Are retailers that sell used games lying to us that they need to do so to remain in business?"
It's very difficult to run a retail business at 25% markup (20% gross margin). My store needs around $60k / month to break even. Wages, other related expenses, rent, electricity, phones, shrinkage, 6% advertising fund, maintenance... That means we need gross sales of $300,000 / month just to pay the bills but then we haven't contributed a cent to the company. We then need to make a big enough profit at store level to pay our share of head office's expenses - that huge distribution system, all the logistics and accounting staff etc etc. Finally, the shareholders want a return on investment, so we need a bit more to cover that.
In addition, not everything is sold at RRP - of course. How many times have you picked up a premium game for $55? How much did the retailer make then?
"And how much do movies cost to make? Many millions more than games do. And yet movies are still sold at around $20 or less."
You'd best stick to developing and not go into management. What did your last game sell? 500? 1M copies? So, that's $60M at retail, right?
Now think about what a successful movie generates in revenue (hint: potentially hundreds of millions, even leading into $1B) and they still have DVD and merchandising sales on top of that.
Scooby DOo @ Dec 20th 2006 5:23PM
Thanks Dhruin,
I was kind hoping when I threw that question out that someone that manages or owns a brick-and-mortar retail store would comment. I haven't worked retail in years so I couldn't even tell you what the standard markup on eletronics and electronics-related items are.
As for the movies/games comparison, there's actually a HUGE difference: point of entry. When a movie studio produces a movie, the entire general public is a potential customer. Even if you buy a DVD, you can pick up a DVD player for $20, about the same price as the DVD. Video game systems are costlier and only represent a fraction of that same audience. They have to charge more for the game because you will never be able to match Hollywood's potential consumer base.
Shagi @ Dec 20th 2006 5:30PM
#35
I've worked with some great artists and once the initial model is done (full poly count with no consideration for the engine) the work of making it look good is primarily in reducing the number of polys and retaining the detail of the original. When a system can handle more polys to begin with (and the game design doesn't push the capabilities to the max) you dont need to do as much work on the models to get them into shape.
I did forget about the normal mapping and bump mapping which is unique to modern platforms and would definately cause more dev time, as well as facial animations, you'll have to forgive me most of my hardcore experience in the game industry on cutting edge equipment was before either of these were ever an issue. I've since moved into educational games and you can imagine the cutting edge cost is considerably less. However there are options like Motion capture that have been around much longer than the modern platforms that can help reduce the dev costs (assuming you have a good deal or your own studio). I don't want to argue about animation vs. Mocap just mentioning it as an option.
Anyways there are lots of ways to reduce the cost of doing everything yourself, liscensing someone elses engine, or maybe even buying third party models (assuming your character design is open to it), I would assume that all that would be cheaper than doing it from scratch.
Anyways though we weren't talking about what you could do to reduce dev time just why it costs more and you brought up a few valid points I forgot about.
Quality people also go a long way towards reducing dev time.
I worked with an amazing artist on a 'robot' project and before he left our studio he had designed a dozen wonderful models in a couple weeks. The team that took over for him spent months making only a handful of models after that. Get the right people and dev costs go down as well.
Im babbling.
Scott @ Dec 20th 2006 5:34PM
Game publishers may cite "increased production costs" as a reason behind the $60 price tag on next-gen games, but the simple fact is that price is rarely set by cost. Price is set by what the market will bear, i.e., what people are willing to pay. Why would they leave $10 on the table. If someone was willing to buy your used car for $500 over Blue Book, you wouldn't turn them down, would you?
hegemonyhog @ Dec 20th 2006 5:51PM
"And how much do movies cost to make? Many millions more than games do. And yet movies are still sold at around $20 or less.
I don't see why games aren't much cheaper. If the gaming industry is making more money than Hollywood, then can't they take a hit at retail? Wouldn't that get more people to actually play the games and potentially buy other games at the same time since they now have more money?
I'm a developer, and even I think this is a good idea."
...WHAT???
Okay, movies go to this place called the "theater", where they are played on large screens for $8-12 a pop (depending on your market) around the world. *Then* they come to DVD - DVD is a secondary market, not a primary market. Console releases of games *are* the primary market. The reason that a $150 million movie can be sold on DVD for $15 is because it already made $300 million at the box office. (You ever wonder why straight-to-DVD movies are low budget? There's your clue.)
The game industry is making more money than Hollywood comparing all game sales to box office receipts. Once you include DVD revenue (DVDs which are cheaper because they're already recouped a significant portion of their costs), Hollywood destroys videogames.
Seriously, your plan would have publishers sell games to lose money in order to sell more games to lose more money.
Burnt Meatloaf @ Dec 21st 2006 6:12AM
*Shagi: "Same thing with textures, when you can have only low res textures your artists have to be more clever in the way they draw the textures, high res textures means less guess work and redos on the art."
Indeed. I've done graphics for all sorts of stuff since my Commodore64 days, and I can certainly tell you that the less powerful the machine, the harder it is to optimize stuff, becuase there's less breathing room and more technical limitations you have to consider.
More powerful machines are easier to work with. There's more automated stuff to help you out and the development tools can do more stuff for you.
This applies to code, as well. Faster CPUs give you more leeway. Slower CPUs require a lot more optimization and more shortcuts to get similar results.
I remember when APIs like OpenGL and Glide were just starting to penetrate the PC market. Many developers complained that they just had too much overhead, and people who used them were just lazy. A few years later, it became clear that without these tools, GPUs, then known as 3D accelerators, would never have been manageable.
Saying dev costs are too high becuase the hardware is too powerful is BS. Costs are high if you are trying to impress beyond your abilities and you aren't mindful of your budget. In other words, you just suck as a developer.
Gee, it's a wonder Pixar makes any money at all, putting all that work into tiny details most people won't even notice the 5th time they see the movie. Maybe they can handle it because they have talent, have a good grasp of their budget, and, of course, they work on the story before they work on the graphics?
solomonrex @ Dec 22nd 2006 9:20AM
Ok, let's clear up their math.
Some games make money, some do not, and over the lifetime of the game, the cost to the retailer isn't a constant $60, it keeps decreasing, etc., like the Greatest Hits game. The math has to average this out, because every game is different.
The key thing is that ps3 games are no longer exclusive because so few will be sold, and publishers can't raise the price to $75 because Sony won't let them (bad PR). At $75, you'd see more ps3 games, because it's easier to pay off costs.
As for cross platform titles, they charge less for PC games because they don't pay a license to MS. They pay a smaller license and less work goes into DS or gameboy games, etc. Most of the pricing rests on real expenses, based on estimates, but not necessarily on good estimates.
Some people make more money than others - EA can update one section of their code and some of the text on the rosters and make millions on Madden 2008, while some developers spend huge sums to develop Psychonauts and get nothing in return. GTA 4 costs a lot less and makes more money than GTA 1, despite the difference in technology. It's hugely variable between games, much like movies.