Why such high price tags on video games?

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I can't help but to wonder why so many games these days cost 50 dollars or more. I see a lot of new games are getting more and more expensive every year. Same goes for the consoles... gaming is becoming less affordable with each passing year. I won't be surprised if in another few years we see video games with 80 to 100 dollar price tags.
I decided I won't be buying another console, no ps4 or Xbox 1, or Wii U or whatever. It would seem the most affordable means of buying / playing video games is using Steam on my computer, but I still don't think 60 dollars for a zombie survival game is justifiable, such as Dying Light, I want that game, but the price is a little much. If I had the money to spare, I probably would buy it. The thing that bothers me, is how gaming in general keeps getting more expensive. I noticed even Lego Jurassic World is a lot more expensive than the other Lego games. Of course that's another game I really want... I guess I'd be more willing to pay full price for that one than I would for a zombie game though. Anyway, what are your thoughts on the prices of modern video games?

Hehargh! Come to Denmark! It's already a reality here for console games! Here they cost 100-120 dollars, while 3DS games cost about 70 dollars.

Nevertheless.

Prices here in Denmark are really high in retail price and that's why i don't own a console, besides space. I'm more interested in games on Steam, really as the ones i want to play are typically independent or very old games that have been heavily discounted.

I rarely pay more than £2 (about $3 US) for a game, though I do stick mainly to PS2 and Xbox stuff. Beginning to look at PS3 and Xbox 360 games now that they're tumbling in price though (got CoD World At War and Halo 3 , both on Xbox 360, for £2 each last week). Best ever purchase was Medal Of Honor Underground on PS1 for 20 pence.

That's because with the progress in graphics and some other technologies AAA video games are now very costly to make, they are huge productions needing thousand of peoples comparable to Hollywood blockbuster productions. So to make back the costs video games become more expensives.

Prices for games have actually gone down, when you consider that $60 has been the standard for a while and you factor in inflation. What cost $60 today is less than what cost $60 ten years ago. And if it's a game that gives you ten hours or more of gameplay, $60 is a steal. That's a pretty nice cost to content ratio compared to movies.

I don't want to sound too defensive here, because I could bore you for hours complaining about all sorts of things that are wrong with the gaming industry, but pricing isn't really one of them.

If you want to do your gaming on a budget, it's pretty simple. Even on current gen systems, there are always going to be older games that have gone down in price significantly that one hasn't checked out yet, there are used games, there are stupidly cheap downloadable games, etc. Today's hot new $60 game is tomorrow's $20 Amazon deal, and there's always plenty to keep one occupied until that happens.

This...

Hell games were $50-$90 on NES and Sega Master System in the 80s, with the same price structure on SNES and Sega Genesis/Mega Drive.

The games that were $60 or higher were games with special chips and/or RPGs with bigger amounts of RAM.

We literally had to pay $90 + tax for Phantasy Star I on Sega Master System due to the cart have a special sized RAM chip to hold the game.

So here is what you do, if you feel a game isn't worth the retail price:

1) Borrow it from your local library system (if they stock games)
2) Go to your local video store and rent it for a small price
3)Sign up for Gamefly, which is the gaming form of DVD Netflix
4) Wait for retailer to have a gaming sale
5) Wait for the inevitable price drop by the 3rd month.
6) If you are a member of rewards program and/or Best Buy's GCU and get it a decent discount.

Thankfully most WBi games are over-shipped and quickly reduced in price to clear the stock out.

Lego Jurassic World is launching at $60 which is the price all console Lego games launch at.

Actually, a large portion of the price of games goes straight into developing anti-piracy measures. unfortunately, the price is the main reason for piracy in the first place, so there's a neverending cycle there.

that said; i also only use a PC with steam, and i get most, if not all, of my games from humble bundles or off of steam flash sales.

well they were $60 dollars all throughout the last gen and before that they were $50. so its not new. games have been 60 dollars for the last 10 years.

people would pirate games if they only cost $1. some people just refuse to pay for anything that they can just steal.

That's not entirely true.

Games have tier pricing ranging from $60 to $30 depending on the game.

As for mobile it goes like this:
iOS users breaking point is anything priced over $2.
Android users refuse to pay for anything and pirate everything including free apps.

@Izzeme
The break down of a $60 game sold at retail goes as follows:
~$30 goes to the Retailer (depending on the deal the publisher has with them)
~$15 - $20 goes to the publisher
The rest goes to the developer

Obviously if the developer and publisher are the same, then they get half.

As for Digital:
~$18 (30%) goes to the platform holder (Sony, Nintendo, Steam, Apple)
~$18-$30 (up to 50%) goes to publisher, unless self published.
Whatever is left goes to the developer.

The yearly Call of Duty costs $100M - $200M+ (marketing included), same goes for EA sports.
Watchdogs (Ubisoft) cost between $150M - $250M (development costs only!), even higher when you add in marketing.
Assassins Creed (Ubisoft) average between $150M - $200M (development costs only!)
GTAIV cost $300M+ to make, not counting marketing and DLC.
GTAV cost over $400M+ to make not counting marketing and DLC.
Etc...
The average blockbuster/AAA game costs between $150M -$300M+ not counting marketing and DLC this gen.

The reason for this is to push graphics and performance to meet consumer demands.

^ This.

As far as I can remember, Sony and MS, their brand new games were usually $60, and Wii games were usually $50. I didn't do a lot of my own console game purchases before the Wii, but I don't think prices were much different back then.

The only prices I'm aware of having gone up are for Nintendo handhelds. Average price for brand new GBC and then GBA games was $30, DS was $30 maybe $35, 3DS is $40.

In the 1996-98 period, when I had a good income (and had less idea of the value of money), I would buy PS1 games new, and the price-range was about £35-45. That would've translated to about $60-80 in the USA, though I suspect they'd actually have been priced at parity with the £ over there, ie at $35-45, as US consumers are not as willing to be ripped off as we Brits.

Games were $50 20 years ago, probably even later than that, so I don't think $60 today is that unreasonable. And as others have said, games are big productions - the amount of people involved in creating them is pretty high and they can easily spend a year or two - their salaries, and profit for the company, has to come from somewhere.

Everything in Denmark costs more, not just games. I did notice a lot of people in Denmark love playing games when I was there.

The reason they cost as much as they do is because people are willing to pay that much to get them. People spend well over 10 times the amount of time with a game compared to a movie and yet movie tickets cost more than 1/10th the price of games for the most part.

It's not just Denmark...
The EU requires that all software is localized in the major EU languages and fits certain EU regulations.

Modern-day video games, especially in today's society, are very costly to make. Since there have been an array of high advancements associated with the graphics and overall production level of video games, the value and price of these games will have to increase exponentially. The company producing these games will need to make a profit, along with the retailers that are selling those games to the general public.

I personally believe that, yes, video games nowadays are definitely more expensive than they used to be, but as the saying goes: "You get what you pay for." So when you're paying a high price tag for a particular video game, you're ultimately paying for the overall quality and "experience" of it.

Not entirely true.

Ubisoft, EA, WBi, Capcom, Microsoft, etc... have released tons of broken games at $60 price mark which required a few patches before they became stable, they even spent hundreds of millions developing them.

The main reason for the high cost of development, is the fact that Western developers refuse to budget properly and spend that money efficiently/smartly.

They are all chasing the next big cinematic game at all costs.
They could make the necessary changes to structure and culture, that allows them to be more efficient and productive instead of spending money head over heals to the game out within two years.
Though to be fair Rockstar is horrible inefficient studio, which causes to them to spend as much time and money as they do on GTA games.

This Western model is horrible unsustainable, which will eventually lead to a huge consolidation of Western Developers even further.
This also means you need greater and greater sales to earn back that money, which makes each game built on this model hugely risky.

Nintendo on the other hand is able to produce a game like Xenoblade Chronicles X for less than $2 million on Wii U.
Though Skyward Sword (Wii) is currently the most expensive title Nintendo has ever produced at ~$3M due to how long it was in development (~7 years).
With that said Zelda Wii U will be their most expensive game to date due to the development time (over 4 years when completed).

Nearly all of Nintendo's games are less than $1.5M to develop to date.

Companies like Atlus, KT, NLG (Canadian), Monster Games, and even Colossus Order (Cities Skylines on PC | Finnish Developer) are able to make their games for less than $1.5M.
These are decent quality games that are most polished than the big blockbuster titles.

The long story short is, mostly the Western Developers are horribly structured and inefficient, which is leading to the constant increases in their development budgets.
Add marketing on to it and it is even higher.