Australia Asks About High Game Prices

[Andy Chalk]

Australia Asks About High Game Prices

The government of Australia wants to know why videogames cost so damn much.

Games are expensive. Let's not complicate that statement with talk about indie bundles and Steam sales and all that other good stuff; let's stay focused on mass-market, big-budget console releases and just agree that, yes, games are expensive. But as bad as things are here - "here" being North America, although I imagine it's pretty much the same situation in Europe - it's far worse in Australia, where by all accounts the beaches are great but videogames cost a bundle.

Check out EB Games Australia for some examples. Max Payne 3? 110 bucks [https://www.ebgames.com.au/ps3-147350-Max-Payne-3-PlayStation-3]. These aren't collector's editions, either; these are the standard, off-the-shelf releases that people in this part of the world can pick up for $30, $40 and even $50 cheaper. And the Australian government wants to know why.

The issue goes far beyond just videogames, obviously, and the inquiry announced in April by Stephen Conroy, the Federal Minister for Broadband, Communications and the Digital Economy, will also consider the high price of downloadable music, e-books, "professional software" and even hardware like game consoles. Today the government made a call for public submissions to the inquiry.

"Australians are often forced to pay more for IT hardware and software than consumers in overseas markets," inquiry chairman Nick Champion said in a statement. "The Committee's inquiry aims to determine the extent of these IT price differences and examine the possibility of limiting their impact on Australian consumers, businesses and governments."

At one point, high Australian software prices could have been justified by the cost of getting products to, and then around, the country. Australia's not the most conveniently located joint in the world, after all, and there's a big, empty space in the middle that seems to exist solely to kill people. But for digitally-distributed product, which at this point means just about everything except the hardware on which it runs, that's no longer an issue; data usage notwithstanding, it costs no more to "ship" a game to Australia than it does anywhere else.

Currency exchange isn't a factor either, as the weak state of the U.S. dollar has brought the Australian dollar just about to par. And while it takes time for markets to adjust to changing conditions, that doesn't appear to be happening in Australia, which leaves one simple, but rather ugly answer: Game sellers are relying on inertia and ingrained numbness to high prices to pad their margins. Greed, in other words, and while I have absolutely no evidence upon which to base that assertion, in the era of Steam and GOG, it's becoming harder and harder to see any other explanation.

Australians who want to take part in the public submission process can find out more at the Parliament of Australia website [http://www.aph.gov.au/Parliamentary_Business/Committees/House_of_Representatives_Committees?url=ic/itpricing/index.htm].

Source: GameSpot [http://www.gamespot.com/news/australian-govt-calls-for-public-submissions-into-tech-pricing-gap-6378379]


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[Shamanic Rhythm]

You only have to put with what you're willing to except. You don't want publishers boning you Australia? DO SOMETHING ABOUT IT!

Did you miss the part in the article where it said the government was holding an inquiry?

OT: Conroy had better bring the goods this time if he wants to redeem himself for the filter fiasco.

 

[Baldr]

Australian salaries are much higher and the conversion rates, they are actually paying less than any place in the world. $1AU is not equal to $1US. Even their minimum wage is like $18AU/hr

 

[Woodsey]

The answer to the digital distribution question is because publishers can't risk undercutting and pissing off retailers yet; it's the same situation everywhere else.

 

[matrix3509]

Games are expensive to buy because they are expensive to make, simple as. Stop having games cost so fucking much to make (i.e. reduce the man-hours required just to make a single goddamed room), and you will get your cheaper games.

 

[Jack and Calumon]

I think Extra Credits came up with a good idea about this. They said in one of their videos, a mailbag episode, forget which one, that the most likely reason was that there was a time when the Dollar to the Australian Dollar was unfavourable, so the price of Australian games had to be put up, and when it reached a better climate, publishers noticed people were still buying games at inflated prices there, so they just rolled with it.

It's honestly a reason I can believe, even if it paints a really negative image on publishers.

But really, they should have equal prices to the rest of us. So should Britain, for that matter, so Activision, don't you dare have the audacity to raise the price for the next Call of Duty because you felt like it again. I will slap you Kotick, with a hard leather glove, and you will have a red cheek and your stockholders will laugh.

Calumon: And you'll look silly! >: (

 

[Rednog]

Sigh, it gives me a migraine that something like this is even asked. It's basic economics, goods are priced at certain percentages to keep things balanced. You can't just say hey those guys are paying less why don't we pay the same amount when you're making damn near double the money.
It's the same reason why you don't see people from the US asking why do places like Russia/India/etc get games for half the price of the US cost.

 

[Worgen]

Australian salaries are much higher and the conversion rates, they are actually paying less than any place in the world. $1AU is not equal to $1US. Even their minimum wage is like $18AU/hr

$18 and hour minimum wage? Fack, I no longer feel sorry for Australians having to pay more for games, that is a real living wage right there, I think minimum wage here is like $7.30 or so an hour.

 

[Robert Ewing]

I thought it was just because of inflated Australian dollars, and their high earnings that made stuff so expensive?

It's like Japanese yen, it takes a fuck load to get even the most basic thing, but yen isn't that valuable, so it balances out.

I dunno, I just never considered Australia's prices to be that outlandish due to their economy.

 

[Baldr]

Australian salaries are much higher and the conversion rates, they are actually paying less than any place in the world. $1AU is not equal to $1US. Even their minimum wage is like $18AU/hr

$18 and hour minimum wage? Fack, I no longer feel sorry for Australians having to pay more for games, that is a real living wage right there, I think minimum wage here is like $7.30 or so an hour.

I've been saving up to move over their to be closer to family that lives there, but seems out of the question $7000+ for immigration visa, $1000+ for airfare. $1000+ moving and other stuff. Not a cheap transition.

 

[DTWolfwood]

Game sellers are relying on inertia and ingrained numbness to high prices to pad their margins. Greed, in other words, and while I have absolutely no evidence upon which to base that assertion, in the era of Steam and GOG, it's becoming harder and harder to see any other explanation.

We have the same problem too, even as inexpensive as they are compared to Australian prices, digital copies cost as much as retail copies, when in fact you never truly own the game.

 

[Therumancer]

Well, the big question I'd ask is what the Austrlian business policies are here. I'm not Australian, so I don't know.

My first thought is that the Aussie goverment is charging very high tariffs and/or taxes on games coming into the country as a luxury good. I know in the US there has been a lot of QQing over how the goverments in other countries are able to make a bundle off of digital distribution, where in the US it's difficult for your average state to even charge basic sales tax, and is taking years for them to catch up. Not to mention greedy politicians apparently claiming that taxes on digital goods should be at an even higher premium than physical goods for various reasons. Connecticut (where I live) has thrown a lot of these arguements around from time to time.

If Australia is one of those countries that US politicians seem to be envious of, it might very well be that your game is the standard price, with the rest of the asking price effectively coming from goverment charges. Sometimes goverment charges aren't always visible, as you have them built into the base price of an item, and then taxed again when it's actually sold. If that's the case, it's the goverment itself that has to knock it off, and forcing that issue on a goverment can be difficult. Meaning this inquiry is basically one side of the goverment not knowing what the other side is going, which happens all the time (at least in the US).

There is also the issue of deals between companies, one of the justifications occasionally trotted out to justify digital games costing as much as retail, is that the game industry doesn't yet want to totally undercut retailers like Gamestop selling physical copies. Thus they sell it for the same price, basically argueing there are differant benefits, digitally you have more conveinence, physically you typically get more stuff.

If the prices here are in keeping with what the physically shipped products cost, then I could potentially see some kind of deals existing where the digital distributors charge the same thing the retail copies do, with all that inflated shipping.

I really can't say, perhaps someone from that neck of the woods would have more insights. I'd imagine it wouldn't be an issue if the problems were that obvious.

 

[Judgedread]

Australian salaries are much higher and the conversion rates, they are actually paying less than any place in the world. $1AU is not equal to $1US. Even their minimum wage is like $18AU/hr

$18 and hour minimum wage? Fack, I no longer feel sorry for Australians having to pay more for games, that is a real living wage right there, I think minimum wage here is like $7.30 or so an hour.

I've been saving up to move over their to be closer to family that lives there, but seems out of the question $7000+ for immigration visa, $1000+ for airfare. $1000+ moving and other stuff. Not a cheap transition.

The higher minimum wage compensates for the high cost of living here. Someone on minimum wage in Australia who also has to pay their own way (rent,food, etc) is still going to have almost no money left for games at all let alone $110 for a game on release. Hell second hand games like halo 3 and CoD are still 60-70 dollars and that's years after their release.

 

[Eikoandmog]

I've been fighting against this for ages and in fact, I've done some sneaky things with steam to avoid the "better beaches tax". I've had people make the same argument before about our higher pay rates but I've always wondered why it's such a big issue when I can import for significantly cheaper for consoles without a region lock. That's including shipping.

 

[BlueMage]

Welcome to arse-backwards reasoning. We don't have a high prices because we have a high minimum wage - we have a mandated high minimum wage BECAUSE THINGS ARE SO GODDAMN EXPENSIVE. Of course, that high minimum wage is then used as a justification for the prices, but it's a complete cop-out. There is nothing inflated about the value of the Australian dollar - it's simply that in a recession (which we didn't actually have) resources remain valuable. And boy do we have resources.

 

[Drmonstereater]

My guess is that the games are either highly taxed and/or tarrifed (in which case, a full fledged government inquiry is a little silly and excessive) or demand elasticities. However, video games are generally considered a luxury, which would give them a relatively elastic demand; in other words by their nature video games should have a relatively low market price.