A Necessary Higher Price?

Whenever you visit a craftsman’s workshop, be it an artisan, wood craftsman or whatever else, their shops usually have a decent range of items from something that may cost five to fifteen euros to the proper items costing from fifty euros up. It should not be any surprise that the most selling items are the little trinkets and jewellery, as their price most often are from the bottom up. The price is nevertheless higher compared to the production costs than on anything else in the workshop, and that is due to necessity.

Wait, isn’t this blog supposed to be pro-consumer? Is this a hundredth post? No, and this is pro-consumer. The more information the consumer has the better. Nevertheless, we must consider reality as well. The big item orders and their several hundred or thousand production costs and installation may not bring in large income in the end. Maximising profit is any business’ main goal, and an absolutely necessity for smaller companies or individual entrepreneurs. By minimising some production costs and maximising the price the consumers are willing to pay, a person can maybe gain a living.

For example, small full metal jewellery, like crosses and such, are of one or two millimetre thick steel. Their shape usually is either something slightly original or from the general consensus of what looks. When mass-produced, their production costs tend to me low, as you can get them laser or water cut at a very low price. Adding some of your own flavour, like hammering the surface and painting it black, often produces a look that looks like the jewellery was hand-made in a forge from a piece of steel. Production costs for an individual piece might be something like to two euros (perhaps five with modern cost of material, though I know cases laser cut jewellery has cost as low as 20 cents) and the final price tag on the item might be either fifteen or twenty euros.

An example of a hammered product with a failed paint application

The reason why small items of relatively high price in comparison to their production costs exists is because they sell the most. These trinkets are often gifts that fit in the pocket and might look a bit special, especially if they have some local flavour to them. They’re also great for impulse purchases, as the low-cost seems almost insignificant compared to a hundred euro candelabra next to it. If all the work is done locally, the price won’t even have big chunk of logistics in it.

Of course, the price wouldn’t be that high if people weren’t willing to pay. The consumer rarely considers the end-price their willing to pay in terms of logistics, raw materials and work put into the product. The perceived value of a product weighs more in the end over more practical and solid information. The fact is that we as consumers pay what we consider to be valuable to use (or to others depending how much you want to impression people with your new shit) and modify our purchasing behaviour accordingly. Trading card games are great example of this. While the cards themselves are practically worthless pieces of cardboard and ink, the perceived value of their rarity within their specific games or their usability in a given deck gives them a high market price. Rarely you see a card being high in price because it has exceptional artwork or the like. The value of these cards also tend to shift rather quick as formats change, something that yours truly is not keen on.

Another though a bit different example of maximising profits while cutting away production costs is the lack of headphone jack in smartphones. Even when some phones nowadays lack the jack for traditional headphone gear in favour of wireless pieces (that frankly tend to outright suck in utility), the end price of the phone is still the same. The Wirelesness doesn’t excuse the same price, as Bluetooth is a standard in modern phones across the board. In cases like this we can question whether or not it’s just or acceptable for big companies to keep the same sales price for their phones when their production costs have seen a cut. After all, we’re not talking about a trinket here, but a several hundreds of euros worth of money.

The question whether or not upping the price like this is ethical towards the consumer is somewhat a moot question. On one hand it is true that in an ideal world products wouldn’t cost much more than what their production costs, personnel salary included. In reality this doesn’t really work due to how life tends to kick us in the balls. Profit is also necessary in order to gather money for industry related projects, additional raw materials, new equipment and so on. Profit doesn’t magically end up in a bank account as a plus mark. I’m sure all of know the feeling of wanting, needing to expand on something that you directly need, but simply lack the budget for it.

This can turn into purchasing politics very easily. While voting with your wallet is essentially the best way to hurt a provider (even a 10-15% drop in sales with video game sequels sounds alarms in companies) but is also used as a way to show support for whatever reason. DLC, especially visual flavour DLC and the like, is like these trinkets. Producing them doesn’t cost much at all while their pricetag can be surprisingly high. Again, this is just minimising costs while maximising profits. A consumer may buy these trinkets just for such perceived values as they’re just cool to have within a game as options, or that the user has a “complete” game in their collection with all the extra stuff and thus feel satisfaction through this, or just because they happen to like the developers and wish to show some support by providing them with further sales. Not really sure how much I can personally encourage buying any DLC to a game,  but that’s something any and all individuals have to decide for themselves. It is a question of opinion in the end, and all of us have the right for our own.

Keitai marches

The modern mobile game market has two sources of origin; the PC market and the Japanese keitai culture. The PC market is the originator that is most visible in the West, as smart phone are essentially palm computers with a phone twist thrown into them. One could even argue that using the term phone is archaic at this point in their evolution, as calling has become a lesser function over almost everything else you can do with a smartie in your hand. Angry Birds is still a good example of a game that sits well on both PC and smart phones, as are the numerous examples of ports between Android and Steam games. Most smart phone games, mobile games if you will, do not try to hit the high market with their game design but gladly try to hit that low market. There are some high market games for sure, but a smart phone doesn’t exactly offer the best control interface. The fact that mobile phone games tend to resemble Flash and Java games isn’t a coincidence, but a natural growth from PC to its spin-off mobile market. Only few succeed in making a game that could shake things up. Niantic and Nintendo managed that with Pokémon GO, and in the future Nintendo’s titles on smart phones will aim to do replicate this success. The mobile marketplace is a great advertisement spot for them after all. Just like television and comics before it.

What Westerners tend to use their phones for nowadays strongly resembles the Japanese keitai culture with allowing basically everything with relative ease. E-mailing, phone and address books, instant messaging, photo sharing and so on. The usual stuff we take more or less granted was engineered in the 2000’s when J-SH04 was released. It was the first phone with a built-in camera, and basically kicked off the trend. Keitai is also the source of flip-phone fetish some Japanese still have.

When Western mobile market was just testing out possibilities of mobile gaming, Japan had expanded gaming possibilities with online connectivities and had began to implement more social elements within them. Phones in Japan in the early-to-mid 2000’s could be connected, for example, to NTT DoCoMo via I-Mode phones and use them as karaoke devices. Because of Kanji and the need to switch between them and alphabetic letters, Japanese phones tended to be small powerhouses with higher resolution screen than their contenders in the West. This, combined with the smart phones absorbing most of the palm computer market, is the direct progenitor on how modern screen came to be in the end.

Pokémon Go is nothing new in this sense. au was known to be forerunner in their GPS functionality and games. MOGI, socially connected GPS gaming, has a player avatar represented on the screen in real-world map and their aim is to collect virtual objects in the streets. This is around 2004, and Wireless Watch still has their old article about it up, which still does resonate in modern mobile market. If anything, all the little assumptions and suggestions made in the article have become true.

It should be noted that each time MOGI has resurfaced news about it taking spot in mobile game market has been hyped. New Scientist had an article boldly claiming that gamers will soon quit their living rooms and head outdoors in 2008. It would seem that it took Pokémon‘s name and brand recognition to make MOGI what it had been proclaimed to become more than a decade earlier. MOGI of course is more or less an obsolete term at this point as the more popular Augmented reality has taken its place. It’s really the same shit, just different boxers.

The Japanese games and game culture has evolved alongside other more traditional art and crafts fields just in the same manner they’ve evolved with technology. Technology that also evolved to serve the consumers’ needs for communication through various other means. Due to these, the are no clear barriers between each other and as such the barrier between high art and pop-art is much lower, if it exist at all. Western culture still has a definitive difference between the two, but with the generation and cultural exchange that barrier has been lowered and that is evident in smart phones. In their design, user interface, games and how we communicate with each other.

Keitai of course didn’t spur out from nothing. As mentioned before, multiple elements in the culture had to come together in a happy coincidence and intentional design to give birth to keitai culture and nurture it. Pagers are most likely the closest technological analogue without resorting to mobile phones outright, as teens found a way to utilise pagers to signal short messages, e.g. how 88919 would mean hayakuiku, hurry up, let’s get going. The mobile phones saw a price drop around the mid-90’s during which the switch from one form of communication to the other took place. i-mode service’s launch sealed the deal, and modern phone messaging was born.

Western phone culture has been much more rigid in comparison, largely reliant on text messaging, simpler games and so on. Perhaps the infrastructure for similar use at a reasonable price for use similarly extended use of media that the Japanese enjoyed just wasn’t there until relatively recently. However, the Western culture has always been more interested in incorporating home computers’ abilities into mobile phones, and in many ways Japanese keitai culture had already done all the leg work for it. With the advent of pads and smart phones in general, the two sides have come together in sort of fusion, thou there are numerous regional variants still.

What comes next is anyone’s guess. However, one could argue that we are already seeing signs where modern phone culture is going with the devices and how we use them. Mobile phone technology marches onwards in a very fast pace, and I hope we won’t be stuck with only one or two companies leading the way.