GearWERKZ TechBlog

All over the interwebs, fights are breaking out over the current pricing model on the XBox Live marketplace for the new avatar add-ons. Some XBox Live patrons are incensed that Microsoft would set such a gougingly high price for things like Star Wars apparel and props. My own view is that MS is a business. They can set whatever prices they deem appropriate. We consumers are a pretty powerful lot, too. We can push those prices down by just not buying the stuff. But at the end of the day, each individual consumer does what serves his own best interests in the free marketplace. So trying to organize collective market resistance is a questionable strategy. My forum post on the topic after the break.

Follow up:

Yeah, I've read the article and some of the comments, and I am going to take the side of the business. And it's not that I support Microsoft for every policy choice they make, but with a degree in Finance, I am a dyed-in-the-wool, never surrender supporter of the free market economy.

The advent of online outlets for voicing your opinion is great. I take advantage of it almost every day. But organizing a campaign to create an outcry against a pricing model just does not ring true to me. The way to influence the market when it comes to the basics of economic supply and demand is the same as it has always been: buy it or don't.

If you want a feature or a map-pack or more players in the lobby, etc, those seem to be more worthy issues to voice your concern over. Trying to manipulate the market while standing on the sidelines not participating in it seems dubious.

And there is no such thing as "unfair pricing" in an open marketplace unless there is collusion between multiple vendors to rig prices. And if its a monopoly, then almost none of the typical economic theorems apply. Consumers who see the avatar stuff as a "Want" have options. They can buy a PS3 and purchase cheaper avatar stuff on PS Home. They can not buy avatar stuff. They can be happy outfitting their avatar with the free stuff, of which there is already so much that I can hardy see the need for the avatar offerings in the marketplace anyway. I can personally think of many more issues of critical import to the XBL Service, community, and ecosystem that I would like to see championed by consumer advocacy.

The really big option is: XBLivers can wait, because anything that is $5 now will almost certainly get cheaper in a few months (don't almost all of the map packs eventually become free?) or will get bundled with something, or who knows. There always seems to be some discount deal that comes out for such a large percentage of this stuff.

The market bears the prices that are supported by consumer demand, plain and simple. If we want prices to come down, we need to not buy it. And trying to organize effort to not buy it is, at least for me, not a good use of my leisure time. If there is something that is too expensive for me to pay for, I just admit that I can't have it and move on. Just because it is a feature of our chosen console ecosystem, it does not mean that we should all have it. We are stake-holders in XBL, but at the end of the day we should not expect to be privy to every nook and cranny that it consists of. I would love to have music videos on my 360. But I think that they are too expensive for the limited offerings that are available. So I do not organize a Twitter or Blog boycott against music videos on XBL. I wait for the prices to come down, or I resolve to do without that product.

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