Friday, December 19th 2008
Valve Inflicts European Gamers with $1 = €1 Equation
At the time of preparing this report, US $1.42 makes a Euro. Here's what Valve seems to be pricing its games and those of its affiliates on the Steam platform as: $1 = €1, ignoring exchange rates, meaning that if a product costs say $20 on Steam, you will be charged €20 (approximately $27.86), if you are buying from the EU. Several game titles have been priced in this fashion. Call of Duty 4, priced at US $49.99 ($59.4 after applicable taxes) is tagged at €49,99 ($70 before applicable taxes).
In reaction to this, disgruntled European gamers have started protesting this move by Valve on online forums, an example of which can be found on Valve's own Steam Users' Forums. Also found on the same board is a user group named 1€ ≠ 1$. Certain groups have even started reporting this to the European Commission Consumer Cell. The gamers allege that they have been given a largely unfair pricing scheme with products on the Steam platform, that violates trade laws. The Steam platform serves gamers from around the world with a common platform to purchase games, and coordinates multiplayer gaming and updates. An unhappy consumer base from one of the largest markets in the world could certainly impact on its revenues.
Source:
Tweakers.net
In reaction to this, disgruntled European gamers have started protesting this move by Valve on online forums, an example of which can be found on Valve's own Steam Users' Forums. Also found on the same board is a user group named 1€ ≠ 1$. Certain groups have even started reporting this to the European Commission Consumer Cell. The gamers allege that they have been given a largely unfair pricing scheme with products on the Steam platform, that violates trade laws. The Steam platform serves gamers from around the world with a common platform to purchase games, and coordinates multiplayer gaming and updates. An unhappy consumer base from one of the largest markets in the world could certainly impact on its revenues.
196 Comments on Valve Inflicts European Gamers with $1 = €1 Equation
Other people here have posted facts and asked you to prove your side of the story and all we hear is crying "its not fair waaaa". Well show me I'm wrong. Show me how much Valve pays to distribute in YOUR local area. Show me how they are doing anything different than anyone else in the market? Also your statement "they could sell 10 times less and still make more money than before" proves nothing than your lack of understanding for the currency exchange rates. Please Darkmatter lets get down to brass tacks here. You don't want to pay more because its an American company or your just cheap.
As for how much more they get with $1=1 € it's easy to demostrate. I have a friend in a Gamestop here, his salary is 1500 € per month* (14 payments + bonuses) and there are 6 working there (one is the boss). They sell less than 1000 games average per month and about 10 consoles. Let's extract hom much of the 45-50 € per game sold they get by the simple fact that the store does work financially (far from bankrupt). They are six employees: 6 * 1500 = 9000. Let me round that to 10000, the boss surely earns more, take into account the bonuses too, etc. So 10000 € have to be paid in salary concepts each month and 1000 games are sold. That's 10 € per game that goes into sellers salaries and 7 € is what pertains to VAT so 35 € is probably the max that the store ever pays for them. You still have to extract how much the delivery company takes, the intermediaries, etc. I can easily say that at max 20-25€ are paid to the publishers in retail. How much costs to make the game? Judging by the publishers reports of profits and how many games they sold, they usually make a profit of $3-$5 per game usually. Calculate it yourself, the numbers are public. Because through Steam they have to pay NO ONE of the people/services above mentioned, they'd get 50 - 20/25 = 25-30 € wich is $35-42. So yeah I don't dare to say that's 10 times more.
As you can see it is YOU who have no idea of how the market works. Revenue doesn't matter at all and currency exchange rate much less. It's profit what matters and that can certainly be 10 times higher, the more you inflate the price the more you get. If the euro is 50% higher you'd certainly get 50% more revenue. But the profit would be MUCH MUCH bigger. Learn a fact or two before saying such STUPID things as "proves nothing than your lack of understanding for the currency exchange rates", PLEASE DO US A FAVOR.
And as for "Please Darkmatter lets get down to brass tacks here. You don't want to pay more because its an American company or your just cheap."
I don't want to pay more, BECAUSE I DON't WANT TO PAY MORE. Because there's no fucking reason except Valve's greed for which I had to pay more than you, or an aussie or an asian boy. I don't know what's so wrong about that, that you have to enter here to complain about my desires of EQUITY and FAIRNESS, to the point that your only VALID POINT is that you doubt about my integrity.
* I want to express how hard has been to me that the reason I have phoned a friend to who I did not talk for almost a year (no reason for that) was to know those details, but I felt I had to. I now regret doing so, but it's done.
Secondly one of the biggest points is the tax - they now impose a flat rate tax onto the cost of games even if in that country you don't have to pay tax. Legal?? we'll see, i'm sure there have been lots of complaints. I'm sure most of you guys wouldn't be arguing this point if it were the same in the US.
But from browsing some forums it seems to me that steam have lost a lot of customers - hopefully you will see them revise their pricing policy. Whether they do or not will prove the point either way.
I hope your not thinking of me as an Asian boy ^^ ;) I just live here.
As for the exchange rates by your logic the EU would be hundreds of times richer than the United States and the UK would be the richest country in the world far beating the EU. Do some research and you would see thats simply not true. Also as for what it cost Gamestop to sell a game is completely irrelevant. Shipping costs and the such do not matter because Valve is charging what the MARKET DICTATES! You also do not know how much Valve has to pay to keep Steam as a service up and running. It ain't free thats for sure.
FYI you think the U.S. is crooked? I'm sure the EU never ever does anything under the table. :laugh: Its all big business. Its all about the bottomline. Money. Welcome to the real world. Nothing is fair or equal. Everyone and everything has a price. If you don't like it then I suggest you move to Mars.No silk I would express the fact it sucks I have to pay more but I wouldn't call "foul" and "illegal" if I knew it was just a market adjustment. As for our friends down under I think it sucks them guys have to pay more. I wish you didn't. But as with Europe I just wouldn't buy anything off of Steam until they readjust the prices and or correct the prices they have on certain third party games.
My knowledge of all things legal is fairly slim (apart from substances). How i like to see it Unfair=Illegal - I realize this is seldom the case.
I have however had a lot of experience with dual pricing systems, Where i live used to impose a 100% foreigner tax, and it seems that these things die pretty quickly when they get negative press.
mind you i would still call it foul - If it's never happened to you you wouldn't know the feeling of discrimination.
- As much as being expressive is fine, being vocal about things isn't...it usually spoils some serious and interesting debates
- Beyond a point let's agree to disagree with things...the participants of the debate hold the higher ground over the moderator of it, to decide when to do so...again, while things are within limits
Use these pointers as you proceed with the ongoing discussion. Thank You.Second, why in heaven would EU be hundreds of times richer? Or UK? YOU PROVE one more time you have NO IDEA what you are talking about. The euro and the pound are higher because the prices of things and/or cost of living are higher in the countries in which they are used. 30k € buys you about the same in the EU as $30k in US especially to what pertains to internal economy. The EU has indeed a little advantage when it comes to importing things, but also the same disadvantage when it comes to exporting things. If you knew something about economics, or if you had spent 1 second thinking about them before posting such an stupid thing, you'd have known that the importance of exportation greatly outweighs the one of importation. The more you export the better.
Third, the expenses DOES matter for fairness and it costs the SAME to Valve to market in the EU, Asia, Australia or the US. So charging more in the EU is NOT FAIR.
And finally,There are MUCH MUCH more strict LAWS and punishments that prevent companies from doing those things here in the EU. God knows M$ learnt it and you should know it better by now.
As for how the world is, I know, I'm not naive, but the fact that the world is not fair that doesn't mean WE have not the right to complain. And just because some do bad things that doesn't mean we should let others make it too or even something worse as is the case. FYI, when we think something is not well, we meet together and complain about it in the streets (sorry for my lack of english vocabulary, but the word just doesn't want to come to my mind). In fact millions of people complained about the war of Iraq, just for example.
Ooops! Sorry: "Fucking socialists, they are evil. Guilty of everything that happens in the WORLD, that's for sure". Fixed.
Mailman> The general feeling on the web is that a lot of steam users are boycotting the service. I just saw one poll, 68%=not use Steam, 15%=Continue 17%=Undecided.
So the general feeling is that it is certainly unfair and possibly illegal (but probably not). You have to expect a lot of gamers and users of their service to be "ranting and raving" about this. You'll also have a lot of dumb people using the famous words of Eddie Murphey "mmmmmm...........ok."
I disagree with what they have stated and it doesn't effect them, but the policy doesn't effect me either, but personally i have strong feelings about the issue.
Where i live used to have the same dual pricing system as steam has adopted. Different customers=different prices even if it is the same service and it is just wrong be it on a local or international level. Remember the internet dissolves borders.
There are more gamers in the state of California than many other states, but does that give EA the right to charge them more?
They have the right to defend the corporations if they feel the need. But i'm sure they wouldn't be defending their positions if it were an individual or even small business practising this
Also for your information I have been all over this planet of ours and I do have a pretty good idea what Socialism is. Iv seen the best in mankind and the worst. You really shouldn't stereotype Americans. Its apparent you don't know many.Well If I were in their shoes I probably wouldn't agree with it ether. However I wouldn't call it illegal or ask my government to get involved. Especially when I didn't know all the factors behind the decision. To call Valve "greedy" is a knee jerk reaction. To accuse them of foul play without knowing the facts is even worse. It brings about the term "guilty until proven innocent." which by any standard is wrong. Complain all you want. Its your right but slander is something else.
Now I attempted to take the high road with DarkMatter with the statement "Well then I shall agree to disagree. Let the EU voice with their dollars and not their government." but he insisted on continuing the argument insulting my country. All I ever asked is to give the accused (Valve) a chance to explain and maybe toss in some rational why they made this decision but if its against DarkMatter opinion then it MUST BE WRONG and it must be the "Evil Americans" at it again. Sadly this whole thing has just shown his opinion and contempt for another culture. No facts.
Socialism doesn't work?? Haha can you back that up? You just can't because there's no model you can compare. Capitalism is what has failed badly, not socialism. And this comes from a capitalist guy who has never voted, nor is willing to vote socialists. But after the crisis and after understanding the reasons that lead to it, only a foul can't admit there's simply something really wrong with pure unrestricted capitalism.
You keep repeating we don't know the whole truth, but we do. Our governments are not charging them anything. I don't know from where did you take the idea you have from EU governments, but those have never charged anything to sell in them except VAT. You DO have to pay some fees IF you physically operate from here, but that's not the case with Valve. I will repeat it again, the only thing that Valve has to pay is VAT and is paid by us the customers.
Next thing we should know that can lead to Valve charging more?
There are a lot countries in Europe outside of the EU (with their own currency) and on those they have not changed the price (funny). UK is the most clear example, but not the only one. In any case on those countries the laws and taxes are pretty much the same, follow the same model and some are more socialist than those few in the EU (just in case that matters). And still no change in the pricing.
Not only that, but there's nothing new now that could make them follow the $1 = 1 € policy right now and not before, except the fact that due to the crisis more money can come in handy for them. Or the simple oportunity of making a lot of money. Do you honestly believe they've been losing money for 4 years straight????
I see it important to say once again that I never said that was illegal, and I neither said the government had to get involved. It should be investigated and eventually taken to court if they found something illegal, but that has nothing to do with the government, it's called separation of powers, you know.
And as to let Valve explain why, they already did and chose to say it was due to VAT being included and that they had some issues with the pricing. The VAT is a poor excuse as I have explained, because VAT is a fixed thing and the currencies change. Also they changed the price WAY ABOVE what would be required to pay 3 VATs in any country within the EU.
And the one about the issues is just a tremendous LIE, because they had already changed the pricing to € just a week before, BUT with the correct pricing.
All in all, if Valve themselves would have thought this was not UNFAIR, they would have not used such blatant excuses.
Cuba is another prime example of complete failure. You fail to understand what it stands for and how the common people are effected. Do you have any idea what violations on human rights countries that currently practice a form of Socialism have done? However I can name some pretty damn strong countries that practice capitalism without the cost of personal liberties. They have been economic powers longer than Socialism was even conceived.
Churchill said it best:So keep preaching how great Socialism is. I hope YOU never have to face it.
Spain is socialist now. Well the party at charge is socialist now and things have never gone better in my whole history.
In Russia COMUNISM failed and CUBA is COMUNIST too. Comunism =! Socialism. As I said you have no idea what socialism is, just what you have been told in a country that hates equity of mankind because they are the ones above all.
Oh and BTW Churchill? Seriously are you trying to make a point qouting him?
EDIT: Not only was Comunism what failed in Russia and not Socialism, but it was Socialism what made Russia one of the most powerful countries in the world. Then they adopted comunism and it took almost a century to fail. Also there were far more factors that led to the fall of the USSR than their economic model.
On the other hand capitalism might have worked for 200 years in the US, but when the crisis has come it's been socialist solutions the ones that Bush has applied to save the economy. I find it extremely funny. Don't you??
While it is unfair that this has happened, have the price of games gone up considerably in the EU now that this has happened?
I have no idea, don't really pay attention to prices.
Of course it isn't "fair" but not much is.
Also Ill quote Churchill all day. The man was a genius.