Xbox Downloads Too Expensive?

A lot of people love to complain about Live Arcade games being expensive. Gradius is available today for $5 (400 pts) and 3D Ultra Mini Golf is $10 (800 pts). So Microsoft makes a lot of money, right? Let's compare with the Wii:

NES games: $5 (usually). Costs before profit are: emulator, R&D, hosting.

Gradius: $5. Costs before profit are: Xbox Live Arcade licensing fee (includes hosting), emulator, R&D.

Emulator. The Gradius emulator may be the same emulator used for other games, but only a handful. The NES emulator is probably the same for almost all of the games.

R&D. R&D for NES is just to get the game working correctly, and sometimes that is not complete (Super Mario Kart Ghost data). R&D for Gradius is to make the game run correctly, to utilize the HD display, add a backdrop, dashboard compatible, and in some other titles, revamp the graphics and sound.

Licensing Fee. Probably the same or similar for both, but XBLA games are always trying to get the widest distribution, while some of the NES are known niche games.

Hosting. XBLA games are generally bigger than Virtual Console.

My point in all this is that the XBLA games are typically a lot more bang than an NES, Super NES, TurboGrafx, or Genesis game, and they typically have more work associated with them. Not that $5 is a lot for any one game, mind you, but the NES games are definitely overcharging. You also have to consider that this is business first, entertainment second. The real game is to charge the most you can without alienating customers.