I have always thought game prices have been too high, and I have put my money where my mouth is. At Dynamix, I pushed to have an entire line of casual products come out at the then unheard of price point of $19.95 instead of the industry standard of $40-50. When we first started the GarageGames Game download store, I advocated for, and won, a $14.95 price point. For the next six years I constantly advocated that we should blow away pricing friction and come out with some games at $1-3, as it was my belief that these rock bottom prices were inevitable.
There is an old saying that being too early is the same as being wrong, and I was way too early in all of these cases. Customers did not appreciate the $19.95 price point in 1997, instead thinking the games were probably not good (although they were great front line casual titles (like RC Racers, Mini Golf Mania, and Cool Pool), although the under $20 price point did eventually become the standard for boxed casual titles. There was not enough traffic to the GG store to justify the $14.95 price point, so we raised the price to $20, and saw increased revenue, if not greater unit sales. And, finally, GG just never got around to the $1 games, but we did set new industry pricing with the $100 Torque Game Engine.