PC vs Console Gaming: Which Is Actually More Expensive?

Gaming Just For Fun

“PC gamers” often snicker about how “console gamers” pay for things that they get for free. They also tout that PC games usually sell for less than console games. After hearing these claims a few million times, I decided to dive into the numbers and see who is really paying more over the life-cycle of their gaming system of choice. Warning: there is actually some real financial analysis going on here. I’m just trying to get the facts straight. FYI, if you only care about the results, skip to the verdict.

The Scenarios

I decided to look at three different gaming configurations, an Xbox 360, a “typical” gaming PC, and the gaming PC setup as a home theater PC (HTPC). The main difference between the gaming PC and the HTPC is the display and sound. The gaming PC has a 22″ widescreen monitor with computer surround sound speakers. The HTPC has a 46″ 1080P LCD display, and a component 5.1 home theater speaker setup. The Xbox 360 setup has the same 46″ LCD display and speakers as the HTPC.

The Assumptions

  • The gaming PC must be replaced every three years (just the PC not the display or sound)
  • The gaming PC gets $250 of misc. upgrades by year two
  • The gaming PC is being purchased instead of a basic computer that would have been purchased anyway
  • The console PC requires a larger/better television than what would have been purchased anyway
  • The console life cycle is six years
  • For all scenarios four full-priced games, and one discount game (50%) were purchased each year
  • The console gamer purchases three additional controllers
  • The console gamer goes through four dozen batteries per year
  • The console gamer pays for an Xbox Live Gold membership
  • 23% (mean of Dell’s consumer financing rates 15-30%) discount rate used to calculate the NPV

The Method
I am using a finance technique known as net present value (NPV). It is a method for accounting for the time value of money. Basically a dollar today is worth more than a dollar three years from now (or any other later date). It should be noted that using NPV favors the PC rig because it discounts the future costs of upgrading/replacing the system which you don’t have to do with the Xbox 360.

The Verdict
In the scenarios I have laid out, the basic PC gaming setup is more expensive. It is somewhat close though; only 12% higher. Think about that though, a 46″ 1080P LCD TV, full home-theater setup, an Xbox 360, 6 years of Xbox Live, four controllers, and the two included games costs less than a good (but not amazing) gaming PC on a relatively paltry 22″ display.

If you compare the 360 to the HTPC it gets bad real quick: 38% more. If you assume that you already have the TV/monitor and sound that you’ll be using for your gaming, the PC solutions are a whopping 71% more. Here’s the breakdown in dollar figures:

Total NPV
Xbox 360: $3,152
Gaming PC: $3,523
HTPC: $4,349

NPV without display and sound
Xbox 360: $1,837
Gaming PC: $3,149
HTPC: $3,149

The Point?
The only point of this is to show the PC gaming is in fact more expensive. If you enjoy PC gaming, so be it. Just know that it costs more. For the record, I was actually surprised how well PC gaming did in this comparison. For my dollar, I’ll take the integrated approach of the Xbox 360 and Xbox Live though, not to mention that I don’t have to install my games and troubleshoot them to make them work (if you can make them work).

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