This is price discrimination at work. It's basic economics 101 that monopolists or duopolists (such as Steam in PC games, or Microsoft and Sony in consoles) in

This is price discrimination at work. It's basic economics 101 that monopolists or duopolists (such as Steam in PC games, or Microsoft and Sony in consoles) in a market will price their goods above the actual marginal cost of their goods, thus undersupplying the market. They would like to charge lower prices to some customers -- they are happy to sell to your brother for $30 because it's certainly well above their marginal costs. Unfortunately, it takes an awful lot of market power to be able to charge different prices to different consumers. Otherwise you will just have people arbitraging away all your profits (case in point, the folks who do a thriving business buying Steam games in the US region and trading them to folks in Australia and Germany). Anyways, long story short, it's really hard to price discriminate in typical markets, because it's both really hard to figure out which of your customers will pay full price, and it's really hard to stop the people who get discounts from reselling to the full price folks. But, if your market is digital, flash-in-the-pan pop culture items, then you have a market that's pretty much tailor-made for price discrimination. Who will pay $60 for a game? Well, the ones who buy it on launch, or pre-order for nominal bonuses. How do you stop the the people who buy at a discount from selling to those who pay full price? Two ways -- you attach the game via DRM to an account that is inconvenient to transfer, and you only sell the discounted copies 2 years later. Sales are also a good way to do this -- many people who buy games in sales either were waiting for a sale because the price was too expensive, or heard about the game because of the sale and wouldn't have bought the game otherwise. The current status quo is that all the profit from the $30 customers is going to GameStop. Microsoft would rather it go to themselves and their developers, so they would rather have digital downloads. Not so they can stop games from being sold at $30, just so that they can sell games themselves at that price without killing their market.