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nikolai
21-11-2011, 08:46 AM
G'day all,
I am putting together an FOI request to the ACCC regarding Steam's pricing agreements with it's publishing partners in Australia. I have been in contact with Valve Corporation & Steam Support. They've both been helpful, in that they vaguely allude to them having pricing agreements with some game publishers, but none of their staff (understandably) will comment on specific cases.

While I can use the email correspondence so I have so far, it would be greatly appreciated if you could reply with links to any official publications Valve Corporation has posted in the last few years regarding their pricing policies outside the US. More Specifically their pricing policies/agreements for Australia, but documentation relating to U.K. pricing would be helpful too.

Thanks in advance,
Nik

TailSwallower
22-11-2011, 06:11 AM
Whilst I don't have any links to offer, you could try getting in touch with Kotaku Australia (which is far less trashy and far better written than its American cousin). They've posted some great articles about retail pricing in Australia, so they might be keen to help you with your FOI request as they could certainly get an article out of it too.

You could also poke around in their archives for any useful articles - I don't remember coming across any, but I was primarily a 360 gamer until earlier this year, so I wouldn't have necessarily paid much attention to any posts about Steam.

soldant
22-11-2011, 06:45 AM
I highly doubt you're going to get anywhere with it. The differences in price is fairly well known compared to buying a boxed copy from an overseas retailer but this doesn't necessarily mean that what Steam/Valve/publishers are doing is wrong. I hate the ridiculous region pricing which means a digital copy costs the same as a boxed copy (at least while our dollar holds out) but I don't know what you expect them to do?

nikolai
22-11-2011, 07:43 AM
Thanks TailSwallower. While I have not contacted Kotaku directly, I have referenced a number of their articles (and excerpts thereof) in my request to the ACCC. While the content in articles from websites like Kotaku may be spot-on, as far as providing evidence to the ACCC goes, it really amounts to nothing more than speculation. Which is why I'm seeking official publications from Steam (And other online distributors.) I have also written to a number of publishers who may be perceived as having pricing agreements with distributors, but haven't received a reply from any.

I will give you a little background on what I'm doing, because I'm sure most people read the title and just rolled their eyes. For about 6 months now I've been collecting pricing data, articles and information on major titles from a few major publishers. Clearly the public perception is there is price fixing happening, even distributors such as Steam and GoG have alluded to this in non-specific ways.

To quote an email from Steam Support "We are always working with publishers to adjust prices to be in line with what can be found at local retailers and online shops."
This in itself constitutes anti-competitive behavior according to Australian law (technically it would also constitute cartel behavior which can carry a $10m fine and upto 10 years jail,) unless the publishers and Steam have a recognised agreement which is known to the ACCC. There are certain circumstances where pricing agreements are allowed, hence my FOI request to the ACCC, to determine if such an agreement is known.

In the case an agreement is known, there may not be much anybody can do, because it would mean the government has already deemed the pricing agreement is in the public good. I don't think this is likely.

In the case an agreement is not known, I begin the process of a formal complaint about anti-competitive behavior between Steam, other distributors and their publishers.

Soldant, there has been a lot of miss-information going around, specifically about the motivating market factors behind the prices. Some folks don't recognise that those factors and the prices themselves are completely irrelevant. The issue is anti-competitive behavior, publishers are not allowed to fix prices in order to placate the other distributors.

When the publishers threaten to stop selling their titles through Steam unless they comply with the pricing arrangement - that is called Market Sharing under the cartel provisions. - Very illegal.

Anyway, if anyone's interested I'll keep you updated.

Lukasz
22-11-2011, 09:35 AM
This in itself constitutes anti-competitive behavior according to Australian law (technically it would also constitute cartel behavior which can carry a $10m fine and upto 10 years jail,) unless the publishers and Steam have a recognised agreement which is known to the ACCC. There are certain circumstances where pricing agreements are allowed, hence my FOI request to the ACCC, to determine if such an agreement is known.
no no no.

its perfectly fine what steam is doing. steam is a shop. a shop can charge any price they want. they can sell something for 10 dollars and for 100 dollars (same product) and no one can really stop them. They can charge australians more than anyone else. they can charge australians 100000 times the price in every other market.
the agreement with publisher is nothing more than what cut publisher get. cause stuff is sold on percentage of sale. I think it was 30% for valve and 70% for other party. Yet publsher wants a proper cut. so they can claim that they want min 50 bucks for any copy of COD sold on steam. therefore a customer pays 75 bucks.
Furthermore publisher do not want cut too much of their retail sales by selling at lower prices than game, or ebgames, or jbhifi

and steam is not anticomptetive. you have retail. you have d2d, gamersgate, impulse, if you don't like their prices.

nikolai
22-11-2011, 09:43 AM
Lukasz, thanks for the reply but I'm not here to debate that topic. I am NOT talking about the agreement Steam has with it's publishers in regards to their cut. I am referring to the price equivalency agreement between distributors and the publishing companies.

Sorry for any confusion.

You do sort of touch on my point, though I don't believe you meant to. "Steam can charge whatever they want" - No, I don't believe they can. If you would like to do more reading on this I can refer you to GoG's handling of a certain publishers heavy handed tactics when they aimed to sell a title lower than the publisher was happy with.

Lukasz
22-11-2011, 09:51 AM
Lukasz, thanks for the reply but I'm not here to debate that topic. I am NOT talking about the agreement Steam has with it's publishers in regards to their cut. I am referring to the price equivalency agreement between distributors and the publishing companies.

Sorry for any confusion.

You do sort of touch on my point, though I don't believe you meant to. "Steam can charge whatever they want" - No, I don't believe they can. If you would like to do more reading on this I can refer you to GoG's handling of a certain publishers heavy handed tactics when they aimed to sell a title lower than the publisher was happy with.

steam... or any shop can charge any price they want. that's mate is a fact. situation might have been different if steam was the only available source of games.
it is not. you have at least three major retailers and bunch of online only. you have d2d and gamersgate and impusle and greenman. you have options. therefore steam can charge what they want.

i sold christmas decorations. i sold them at double the price i paid (minus gst) but it was my choice to do that. i could sell them at 10 times my cost.

and gog's handling is because publishers want a proper cut. selling lower means less money to publisher per each copy. reason is why vampire bloodlines is not on gog i believe. game costs 20 bucks everywhere else. so activsion wants a cut for the game higher than gog maximum price. their product, they also can charge whatever they wish.

nikolai
22-11-2011, 09:56 AM
Like I said, I'm not here to argue with you. You apparently still don't understand what I'm saying.

Steam cannot charge whatever they want, the price is dictated by the publisher. Is that plain enough English for you?

Lukasz
22-11-2011, 10:03 AM
Like I said, I'm not here to argue with you. You apparently still don't understand what I'm saying.

Steam cannot charge whatever they want, the price is dictated by the publisher. Is that plain enough English for you?

eh. mate. listen again. and do not throw away my argument about cuts because it is vital part.

Publishers are not allowed to dictate what is the final price of their product. that is illegal. you see the price on newspapers, magazines? it is just a suggestion. shops do not need to sell Times at price it is on cover. they can sell it at double the price.
Publishers tough want a proper cut from each sale. they want min. price of for example 10 dollars. steam HAS to give them 10 dollars for each game sold. it then can set the price at 11 dollars (so steam gets only one buck) or 1000 dollars (so steam get 990)

nikolai
22-11-2011, 10:05 AM
Publishers are not allowed to dictate what is the final price of their product. that is illegal.

YOU GOT THERE EVENTUALLY! Congrats!

Seriously though, we're way OT, so I've sent you a PM if you'd like to discuss further, which I am happy to do.

Lukasz
22-11-2011, 10:13 AM
YOU GOT THERE EVENTUALLY! Congrats!
they dont do that. what is your problem mate because you really don't make much sense.
its universal for everyone what percentage steam gets and what publisher get. i think gmod was the only one being different as the guy used source and valves assets (so they split it fifty fifty)
so publisher can then dictate the maximum price by just dictating the min price valve pays them. but steam does not have to abide by that.
there is nothing illegal happening here and you really have no case at all.

nikolai
22-11-2011, 10:28 AM
they dont do that. I believe they are.

there is nothing illegal happening here Are you sure? Are you a lawyer? Ask me the same question and my answer will be the opposite of yours.

Althea
22-11-2011, 10:32 AM
there is nothing illegal happening here and you really have no case at all.
He's never said he has a case, he said he's using his country's laws to find out if there is a case. He's got a noble goal, and I don't think it's fair of you to dissuade him from that. Australia has had a bum deal with games for years, and if that can be changed then that is a good thing.

Anyway, shops can't sell things with a value attached to them for more than that price, at least in some countries. I could be wrong, but I believe that in England if an item has a price on it (say, 30p on a bag of crisps) a shop cannot charge more than that.

Either way, these things need to be tested in court to see if they stand up or not, just as EULAs and other agreements need to be.

Lukasz
22-11-2011, 10:47 AM
He's never said he has a case, he said he's using his country's laws to find out if there is a case. He's got a noble goal, and I don't think it's fair of you to dissuade him from that. Australia has had a bum deal with games for years, and if that can be changed then that is a good thing.
you are right.
I didn't meant to dissuade anyone. i do want my pcgames cheaper too :) was just stating what i know.
and australia had a bum deal on games since usd value went to sewers. years back games were just slightly more expensive. yet since usd and aud are equal. and prices didn't change neither in usa or australia, aussies get shittier deal.



Anyway, shops can't sell things with a value attached to them for more than that price, at least in some countries. I could be wrong, but I believe that in England if an item has a price on it (say, 30p on a bag of crisps) a shop cannot charge more than that.
i would assume that might differ from country to country but i never heard about it being compulsive. and i definitely paid more for those 30p chips in faraway places, hotels places where competition is limited.


Either way, these things need to be tested in court to see if they stand up or not, just as EULAs and other agreements need to be.
sure. there is no real harm.

Althea
22-11-2011, 11:10 AM
i would assume that might differ from country to country but i never heard about it being compulsive. and i definitely paid more for those 30p chips in faraway places, hotels places where competition is limited.
*Facedesk*

Lukasz
22-11-2011, 11:12 AM
*Facedesk*

??
please elaborate?

nikolai
22-11-2011, 12:56 PM
Anyway, shops can't sell things with a value attached to them for more than that price, at least in some countries. I could be wrong, but I believe that in England if an item has a price on it (say, 30p on a bag of crisps) a shop cannot charge more than that.


Interesting point. Since most of our laws are based on your laws there may be something along those lines in the Trade Practices Act/CC Act. I'll have to look it up. Most likely it would be ruled in-applicable, given it would have been written without digital distribution in mind :)

Althea
22-11-2011, 01:12 PM
Interesting point. Since most of our laws are based on your laws there may be something along those lines in the Trade Practices Act/CC Act. I'll have to look it up. Most likely it would be ruled in-applicable, given it would have been written without digital distribution in mind :)
I could be wrong, of course, but as far as I'm aware that's how it works.

deano2099
22-11-2011, 07:44 PM
When the publishers threaten to stop selling their titles through Steam unless they comply with the pricing arrangement - that is called Market Sharing under the cartel provisions. - Very illegal.

The problem I think you might hit is that Steam aren't selling a product. If they were buying serial keys from the publisher for X amount, then selling them for X + Y they would be. But instead Steam act as an agent for the publisher as far as I can tell. Same thing happens with eBooks.

And yeah, you can't charge more than what it says on the label, though that's not entirely related, just UK law on labelling more than anything else. It's a way the suppliers have of forcing the shops to sell at that price I guess. Though in most cases (newspapers, magazines) those items are on a sale-or-return basis - shop can't slash the price to sell them off but gets a refund if they're not sold.

Nalano
22-11-2011, 08:12 PM
In New York City (I was going to say "in America," but I think an even tighter geographical area would drive the point home) a 20oz bottle of Dr. Pepper can go for anything from $1 to $3.25. The former tends to be seen in bodegas in poorer neighborhoods, and the latter is the sort of price-gouging you see in airports and convention centers, what with captive audiences and physical distance from competitors. There are no price controls for individual retailers, with the assumption that competition will drive the price down to its lowest possible profit-making ratio. (Or even lower, as Chinatown shops inside the city and Walmart outside the city have been known to run at a loss for years in order to undercut their neighbors)

That being said, if all retailers got together and decided that "we're all going to charge $3.25 for this Dr. Pepper," that's a cartel, and that's illegal under the anti-trust laws we've had on the books for over a century. Now, such is nigh impossible for soft drinks because of the sheer number and type of retailers that sell them, but when you have only half a dozen national chains selling computer games, such is not outside the realm of possibility.

As such, when Steam say that they're matching the prices of local retailers, that does indeed smack of price-fixing, and as it is an explicit agreement (as they've admitted it themselves) limiting their competition (as Steam would, being an online retailer, always get games before brick & mortars and always be able to sell them cheaper, but is choosing not to), it can technically be defined as a cartel. With that in mind, finding ways to combat it legally are well within his rights and probably the duty outright of the Australian government.

Lukasz
22-11-2011, 10:21 PM
That being said, if all retailers got together and decided that "we're all going to charge $3.25 for this Dr. Pepper," that's a cartel, and that's illegal under the anti-trust laws we've had on the books for over a century. Now, such is nigh impossible for soft drinks because of the sheer number and type of retailers that sell them, but when you have only half a dozen national chains selling computer games, such is not outside the realm of possibility.

As such, when Steam say that they're matching the prices of local retailers, that does indeed smack of price-fixing, and as it is an explicit agreement (as they've admitted it themselves) limiting their competition (as Steam would, being an online retailer, always get games before brick & mortars and always be able to sell them cheaper, but is choosing not to), it can technically be defined as a cartel. With that in mind, finding ways to combat it legally are well within his rights and probably the duty outright of the Australian government.
the thing is...
the laws says it must be anti-competitive. what steam does is NOT as it does not harm the market. quite opposite as it prevents steam from destroying retailers who could not lower their prices to steam level (there are a lot of reasons why a boxed game costs up to 110 american dollars in a shop)

and what deano said is incorrect: you can charge what you want for whatever you sell as long as you don't control the market.
http://en.wikipedia.org/wiki/Resale_price_maintenance
sellers forcing resallers to sell at set price is illegal.
And i bought quite few times a magazine, or newspaper at lower price. sometimes it was damaged, sometimes it was a bit old and sometimes they were running a promotion (get a coffee and a paper is 50% off)

Nalano
22-11-2011, 10:32 PM
the thing is...
the laws says it must be anti-competitive. what steam does is NOT as it does not harm the market. quite opposite as it prevents steam from destroying retailers who could not lower their prices to steam level (there are a lot of reasons why a boxed game costs up to 110 american dollars in a shop)

Anti-trust laws defend the consumer, not the company. There is and should be no government guarantee that an obsolete company should yet remain. Tower and Virgin Records are dead in America, after all.

There is no law that requires that Valve has to allow GAME to remain in existence, any more than electric trolleys had to limit themselves as to be on equal terms with horse-drawn trolleys.

The reason games are so expensive in Australia is because it's expensive to ship to Australia. Online there are no oceans. That's a competitive advantage. Anti-trust laws were not meant to undermine that.

Lukasz
22-11-2011, 10:46 PM
Anti-trust laws defend the consumer, not the company. There is and should be no government guarantee that an obsolete company should yet remain. Tower and Virgin Records are dead in America, after all.

There is no law that requires that Valve has to allow GAME to remain in existence, any more than electric trolleys had to limit themselves as to be on equal terms with horse-drawn trolleys.

The reason games are so expensive in Australia is because it's expensive to ship to Australia. Online there are no oceans. That's a competitive advantage. Anti-trust laws were not meant to undermine that.

the thing is. Customers do not deserve lower prices. They deserve competitive market where companies can sale without obstruction from other companies (whether main sellers or competitors) which could prevent lower prices and customers deserve that they are protected from companies working together to squeeze as much money from customers as it is possible (aka control the market).
Steam does not work with other game sellers, therefore they really can charge what they want. They really do not need to make themselves more competitive.
So if publishers make steam games so expensive by demanding high cuts from each game sold, then the only entity which can complain is steam.
Customers are not hurt as they have many other independent game salers to choose from.

unless of course steam does cooperate with jbhifi, game and ebgames (three major game retailers in Australia) then we have a problem.

deano2099
22-11-2011, 10:52 PM
and what deano said is incorrect: you can charge what you want for whatever you sell as long as you don't control the market.
http://en.wikipedia.org/wiki/Resale_price_maintenance
sellers forcing resallers to sell at set price is illegal.
And i bought quite few times a magazine, or newspaper at lower price. sometimes it was damaged, sometimes it was a bit old and sometimes they were running a promotion (get a coffee and a paper is 50% off)

I wiki your wiki - http://en.wikipedia.org/wiki/Price_fixing - in the UK it's legal for newspapers and magazines. Guess not for sweets, technically you could sticker over the price with your own price, but that leaves your customer pissed off and you will a big job for not much gain I guess.

Lukasz
22-11-2011, 10:59 PM
I wiki your wiki - http://en.wikipedia.org/wiki/Price_fixing - in the UK it's legal for newspapers and magazines. Guess not for sweets, technically you could sticker over the price with your own price, but that leaves your customer pissed off and you will a big job for not much gain I guess.

I did say before it can vary from country to country. we are speaking about australia. From your link:
Price fixing is illegal in Australia under the Consumer and Competition Act 2010 which have considerably similar prohibitions to the US and Canadian prohibitions. The Act is administered and enforced by the Australian Competition and Consumer Commission. Section 48 of the Comsumer and Competition Act 2010 (Cth) explictly states that; "A corporation shall not engage in the practise of resale price maintainence." For a broader understanding of this statutary provision, we refer to Section 96(3)of the Consumer and Competition Act 2010 (Cth) that broadly defines what can and what potentially constitue resale price maintainence.

So UK laws is irrelevant don't you agree :)

whether following the suggested retail price is wise or not is only a decision of reseller. A producer can put a suggested retail price on anything really (not 100% sure but I did not hear about something being prohibited from having a suggested retail price) but resellers do not have to abide it at all.
magazines and newspapers from UK are exception.

Nalano
22-11-2011, 11:12 PM
Steam does not work with other game sellers, therefore they really can charge what they want. They really do not need to make themselves more competitive.

Valve has made deals with brick & mortar retailers before (most notably GAME in the UK), and ultimately the legal argument for this case, if it were held in America, hinges on whether this collusion (since they basically admitted to fixing the prices) is explicit - ie: whether they contacted the local retailers to hammer out this deal where they wouldn't undercut them and steal the market - and as such it depends on the wording of Australia's 2010 Act.

Again, anti-trust laws are put in place so consumers won't get gouged. Consumers are currently getting gouged.

Lukasz
22-11-2011, 11:22 PM
Valve has made deals with brick & mortar retailers before (most notably GAME in the UK), and ultimately the legal argument for this case, if it were held in America, hinges on whether this collusion (since they basically admitted to fixing the prices) is explicit - ie: whether they contacted the local retailers to hammer out this deal where they wouldn't undercut them and steal the market - and as such it depends on the wording of Australia's 2010 Act.
Yeah. that might be a problem.



Again, anti-trust laws are put in place so consumers won't get gouged. Consumers are currently getting gouged.
No. Customers can be as gouged as much as companies want, as long as customers have a choice. Ant-trust laws protect us only to the extent of protecting us from companies working together to gauge us.
if everyone is independent they are not obligated to not gauge us.

so if Valve did not sit down with retailers and promised them not to sell at lower price point than they do, then valve has no obligation to be more competitive than it currently is.

Nalano
22-11-2011, 11:26 PM
so if Valve did not sit down with retailers and promised them not to sell at lower price point than they do, then valve has no obligation to be more competitive than it currently is.

True, but they'd be hurting their own business interests - namely, domination of the market - which is why this whole thing is fishy. Competition is sacrosanct because it drives down prices, so artificially high prices imply anti-competitive prices.

Case in point, Steam's competitors are D2D and Impulse, not brick & mortars. Brick & mortars are dead - they just don't know it yet - so to keep prices at brick & mortar levels - and the fact that nobody has undercut them - seems to be an artificial construct that deserves investigation.

Lukasz
22-11-2011, 11:37 PM
Digital distribution is not strong enough to beat brick and mortars yet. Retailers are not required to stack up a product if they believe it won't make them a profit.
And majority of sales for AAA titles is via retailers.

So if retailers do not stack up the product because digital sales take away their profit then publishers will lose money.

Publishers cannot allow that to happen. Therefore they are playing nice and do not challenge them with lower prices on digital products and steam and other shops cooperate.

There is no clear picture of price fixation, who is a bad guy here. Everyone wants to just stay in business. There will be a time when big publishers just like indies now, will stop caring whether retailers advertise their products, whether they stack it.
It is not the time now. Big players cannot lose their current major source of income by removing their products from shops.

Nalano
22-11-2011, 11:55 PM
Digital distribution is not strong enough to beat brick and mortars yet.

Actually, they've matched them (http://www.totalpcgaming.com/latest-pc-news/digital-distribution-catches-up-with-retail-sales/) sale for sale two years ago, of which Steam has 70% share (http://www.escapistmagazine.com/news/view/96259-Steam-Is-70-of-PC-Digital-Distribution-Market). And if brick & mortars are undercut, sales don't decline - the distribution model changes.

nikolai
22-11-2011, 11:57 PM
Digital distribution is not strong enough to beat brick and mortars yet.

Tell that to Angus and Robertson.

http://www.theage.com.au/business/list-of-angus--robertson-stores-to-close-20110616-1g4un.html

nikolai
23-11-2011, 12:19 AM
Valve has made deals with brick & mortar retailers before (most notably GAME in the UK), and ultimately the legal argument for this case, if it were held in America, hinges on whether this collusion (since they basically admitted to fixing the prices) is explicit - ie: whether they contacted the local retailers to hammer out this deal where they wouldn't undercut them and steal the market - and as such it depends on the wording of Australia's 2010 Act.

That hit's the nail on the head.

The Act states that ANY pricing agreements need to be acknowledged by the ACCC. If they are not, it constitutes cartel like behavior, and is a civil and criminal offense.

And Lukasz, please don't misunderstand 'pricing agreement' to mean the agreement between the publisher and Valve as to the percentage each will get from the sale, that's not what we're talking about here.

Lukasz
23-11-2011, 12:28 AM
Actually, they've matched them (http://www.totalpcgaming.com/latest-pc-news/digital-distribution-catches-up-with-retail-sales/) sale for sale two years ago, of which Steam has 70% share (http://www.escapistmagazine.com/news/view/96259-Steam-Is-70-of-PC-Digital-Distribution-Market). And if brick & mortars are undercut, sales don't decline - the distribution model changes.
I am questioning this numbers as none of the digitial sellers release numbers. And publishers dont often do that themsevles. TW2 for example sold more via retail than all digital sales combined. sure. they benefited from kickass retail version but it still shows that retail is strong.

and you are missing one thing. that retailers will stop stocking up games which don't provide them with enough income. so if steam cuts too much of retailers' profit, they will simply stop selling the game and sell something more profitable, therefore publishers will lose significant income. Sales will decline because retail sales will diminish. and not everybody wants to buy games via internet. especially in australia where you have downloads limits, slow and expensive internet connection.
That they are split half and half means that digital distribution is not strong enough to completely abandon retail. if the split is 90-10 we can talk about abandoning that 10 percent completely. They cannot do that now in my opinion and the whole situation with steam and UK seems to confirm that.

@nikolai
Tell them what? That they should invest in online sale of books? cause that's what amazon does and it is the biggest bookshop of the world. Not sure what relevance that piece of info has (its sad btw. i don't like when bookshop close. I hate buying books over the net. :( )

nikolai
23-11-2011, 01:03 AM
Tell them what? That they should invest in online sale of books? cause that's what amazon does and it is the biggest bookshop of the world. Not sure what relevance that piece of info has (its sad btw. i don't like when bookshop close. I hate buying books over the net. :( )

The relevance is that online book sales destroyed the brick and mortar booksellers in Australia. This is exactly how the free market is supposed to work. It's the core principle of capitalism - the best service/product wins, and like it or not, others die.

We should have already seen this happen years ago with the video games industry, given the medium.

Nalano
23-11-2011, 01:22 AM
and you are missing one thing. that retailers will stop stocking up games which don't provide them with enough income.

THEY ALREADY FUCKING DO THAT.

Have you been in a GameStop in the last five years? Fuck, Best Buy has a better stock of PC games than the store dedicated to games.

Look, Borders died. Blockbuster died. Tower died. Virgin died. And, yet, somehow their respective industries not only survive, but thrive, with more sales than ever. Gaming is no different.

deano2099
23-11-2011, 01:49 AM
So UK laws is irrelevant don't you agree :)

Quite, so why did you link me to a wiki page that only had info on the UK and US then? I assumed you'd moved on.

Thing is, Steam isn't actually re-selling anything. They're just offering a conduit to buy the 'goods' directly from the manufacturer. They're not buying in then re-selling. Like I say, they're agents. I don't think any laws relating to re-selling would apply. And if the publisher is selling 'direct' which is essentially what happens with digital distribution, then I think they're allowed to set whatever price they want. If they do that by looking at what the high street is charging and picking a price in that ballpark then that's also not an issue. The publisher isn't working with the shops, it's just reacting to the market.

And of course, the retailer is never obliged to carry a product, so publishers won't want to upset them. And good as digital distribution is, it doesn't change the fact that there's a major gaming retail store in every town and having stuff in the window and on display is a huge part of marketing a new title. There's no requirement for a formal agreement because it's in everyone's best interest for everyone else to keep doing okay.

deano2099
23-11-2011, 02:00 AM
Look, Borders died. Blockbuster died. Tower died. Virgin died. And, yet, somehow their respective industries not only survive, but thrive, with more sales than ever. Gaming is no different.

Thing is, there are still bookshops, there are still DVD shops and there are still record shops. Pretty much just one of each left now, but there is still a high street presence because it is important for the sake of visibility. And for gaming even more so given how large the trade-in market is. Firms close down, but none of these mediums vanish entirely.


Valve has made deals with brick & mortar retailers before (most notably GAME in the UK), and ultimately the legal argument for this case, if it were held in America, hinges on whether this collusion (since they basically admitted to fixing the prices)

Wait, are these facts or 'facts' - isn't the whole GAME thing that thing that came up months ago that no-one could substantiate? And admitting that you look at what retail stores sell the game for then set prices accordingly isn't price fixing. It's just reacting to the competition. If they looked at those prices to undercut them, then no-one would be complaining. But they don't. They set them around the same level, because it's not Steam that's setting the price, it's the publisher, because you're not buying from Steam, they're just an enabler, you're buying from the publisher. And the publisher likes the high street and doesn't want to undercut itself.

The prices aren't being fixed because GAME et al could still turn around tomorrow and drop their prices if they wanted - GAME did it yonks ago when they were called something else in the UK, Playstation era, around the time Tekken 3 came out, they decided that no game would be more than 29.99 in store, all new releases: 29.99. Lasted for a good while (when 39.99 was the standard price and 44.99 was not uncommon).

soldant
23-11-2011, 02:21 AM
Have you been in a GameStop in the last five years? Fuck, Best Buy has a better stock of PC games than the store dedicated to games.
EDIT: Okay EB Games = GameStop apparently, sorry I didn't know that.

Interestingly enough, at least at my local EB Games (and any of them I've walked into over the last few years) there's always been PC games on the shelves, in boxes and stuff, to a significant number. I don't think the elimination of the PC game market in regular retail game shops has spread to Australia.

To the OP: Clearly you're educated on the subject, so I wish you the best of luck! It pisses me off that a digital copy costs the same as a physical copy with printed everything and associated shipping costs.

Nalano
23-11-2011, 02:32 AM
Thing is, there are still bookshops, there are still DVD shops and there are still record shops. Pretty much just one of each left now, but there is still a high street presence because it is important for the sake of visibility.

No. People don't browse anymore. The shops of that nature that are left in this city are the ones that have heavily specialized to niches and rely on repeat customers. General interest stores have gone the way of the dodo, and are no longer the primary means of achieving notoriety. Barnes & Nobles is dying in this city, but indie bookstores (with Strand being the largest) are keeping up, mostly due to very deep stocks in niche categories and a standard in staffing that practically requires an MFA. (I've seen their applications. I'm well-read (http://i42.photobucket.com/albums/e342/jonmphy/new%20apt/DSC_0274.jpg), but damn.)


Wait, are these facts or 'facts'

Are you waiting for Valve to commit perjury or are you going to put two and two together?


EDIT: Okay EB Games = GameStop apparently, sorry I didn't know that.

Aye. Here in the States they stock four copies of the top two releases and a couple dozen WoW timecards.

nikolai
23-11-2011, 02:35 AM
The prices aren't being fixed because...

Are you asserting prices are not being fixed in the UK or Australia? If the later, there are a number of problems with your prior paragraph;
Mainly: "it's not Steam that's setting the price, it's the publisher" - That IS price fixing (according to our law.)
But also: "because you're not buying from Steam, they're just an enabler, you're buying from the publisher." - Does your credit card statement list Valve Corp. or Electronic Arts?

Soldant, I currently work in Intellectual Property law (or Imaginary Property as I call it.) But I do have some knowledge of consumer law. I do have colleagues I can call on when I'm uncertain, but the problem is often that the legal industry at large is somewhat isolated and ignorant of digital rights issues in Australia. There's really not a huge amount of precedent to go by, a lot of these things are being tested for the first time.

Lukasz
23-11-2011, 12:40 PM
THEY ALREADY FUCKING DO THAT.
not in australia unless it changed in past 5 months since i last visited a gaming store. and if you knew anything about internet connection in australia you would realize why retail is still popular (altough in past 3 years the situation improved drastically. I mean, in 2005 they advertised a broadband with 5GB limit on TV. and it said it was huge)



Look, Borders died. Blockbuster died. Tower died. Virgin died. And, yet, somehow their respective industries not only survive, but thrive, with more sales than ever. Gaming is no different.
I completely agree. that's not the issue. Publishers don't want them to die yet it seems.


I think there is some confusion here about the price of games and who is responsible for what.

Game shops cannot sell games cheaper than they are selling now. maybe with weak USD they could cut the price a bit (and it happened when USD was cheaper than AUD. i got brand new game for 75 bucks while before they were around 90) so there is no real price fixing with them.
Publishers decide that they do not want to be competitive. Their right to do so. There is no legal obligation on their part to provide better service, better price. They have right to demand same prices as it will earn them greater income per each digitally copy sold and it will make retailers happy that their sales are not drastically undercut.
They CAN do that. they are not fixing the price together with retailers. no. They just match the market price.

The only one to complain is steam because it does not benefit from retailers. We, customers are not hurt by that, we do not deserve lower prices. We deserve fair competition. Steam is not destroying competition by having higher prices.

deano2099
23-11-2011, 01:29 PM
Are you waiting for Valve to commit perjury or are you going to put two and two together?
...
Aye. Here in the States they stock four copies of the top two releases and a couple dozen WoW timecards.

There's not one reliable source for it. And it makes no sense, if you put two and two together, you get five. Because of the other thing you said - the average high street GAME store has about 5 PC games for sale. Why would Steam need to do a deal with them?

Were the claim about say, Amazon, I might give it some credence. But the whole GAME thing just seemed to be made up.

Are you asserting prices are not being fixed in the UK or Australia? If the later, there are a number of problems with your prior paragraph;
Mainly: "it's not Steam that's setting the price, it's the publisher" - That IS price fixing (according to our law.)
Can the publisher not sell directly to the consumer in Australia? So for instance, Team Meat wouldn't be able to sell to Australian customers via it's own website if they're selling boxed copies at Australian retail?


But also: "because you're not buying from Steam, they're just an enabler, you're buying from the publisher." - Does your credit card statement list Valve Corp. or Electronic Arts?
Steam. Much like my rent cheques are payable to my estate agent but my Landlord sets my rent. It's an agency model. You're talking about resale, but the very word 'resale' involves a product being bought by one company, and then sold by that sale company to someone else. Resale. It's literally re-sold. Sold again.

That's not how Steam works. It could work that way. Resale doesn't require physical products. Steam could work by buying the rights to deliver say 10000 copies of a game from EA for X amount of money, and then sell them at whatever price it wants, and when it runs out go back to EA and buy another batch. That's a digital resale model. Not how Steam works. Steam sells you the game, takes a cut and passes the rest directly to the publisher.

Question is if an agency model is legal in Australia. I'm going to guess yes, if it's not the eBook sellers are still getting away with it anyway.

nikolai
23-11-2011, 02:29 PM
Deano,
I will re-itterate for both yourself and Lukasz. This has NOTHING to do with the 'cut' Valve is given by the publisher. It's about the tactics used by publishers to force Valve, and other distributors (online & offline) into pricing agreements. Perhaps you are all fixated on how Steam sets it's prices because I used them as an example in my original post.
I am not under the illusions that Valve is the one morally responsible here but if they are complicit in the price fixing, they are legally responsible.

Lukasz
23-11-2011, 03:00 PM
Deano,
I will re-itterate for both yourself and Lukasz. This has NOTHING to do with the 'cut' Valve is given by the publisher. It's about the tactics used by publishers to force Valve, and other distributors (online & offline) into pricing agreements. Perhaps you are all fixated on how Steam sets it's prices because I used them as an example in my original post.
I am not under the illusions that Valve is the one morally responsible here but if they are complicit in the price fixing, they are legally responsible.
but mate. what you don't get nobody is forcing valve. They created steam to work like that. They WANT to do this.

Althea
23-11-2011, 03:02 PM
They WANT to do this.
And? Microsoft want to ship Windows with just IE, but they were forced to stop doing that because it's anti-competitive.

Just because you want to do something, it doesn't mean you can.

Lukasz
23-11-2011, 04:03 PM
And? Microsoft want to ship Windows with just IE, but they were forced to stop doing that because it's anti-competitive.
But what steam is doing is not anti competitive.


Just because you want to do something, it doesn't mean you can.
Of course. but please look at the whole argument.

Althea
23-11-2011, 05:03 PM
But what steam is doing is not anti competitive.
Says who? You? Now, forgive me if I'm wrong, but you're not a lawyer are you? You don't have much - if any - experience with the legal aspects of running a business like Steam, correct? Well, in that case, it is for the courts to decide whether Steam is anti-competitive in any of its practices. That will also vary from country to country - EU laws will function differently to US ones, Australian laws to those in the UK. This needs to be looked at and possibly put through the courts, because we're talking massive numbers of consumers (millions at any one time) and massive amounts of money.


Of course. but please look at the whole argument.
I am.

Nalano
23-11-2011, 06:15 PM
not in australia unless it changed in past 5 months

Then let me tell you why what I said was important:

BECAUSE THE GAMING INDUSTRY HAS NOT DIED IN AMERICA. Brick & mortar retail has waned and will continue to disappear as well it should, and this has not in any way reduced the profits of games developers. In fact, they're doing better than they ever have before!

And I'm sure that once Aussies see that they could have their games quicker and cheaper than the shit they have to wait and pay for, they'll flock to online distributors... provided they get better service.

deano2099
23-11-2011, 06:49 PM
Deano,
I will re-itterate for both yourself and Lukasz. This has NOTHING to do with the 'cut' Valve is given by the publisher. It's about the tactics used by publishers to force Valve, and other distributors (online & offline) into pricing agreements.

Yes it does. Okay, the actual 'cut' doesn't matter but the way the goods are sold does. I'm not sure you actually understand the difference here? To break it down:

In traditional retail, retailers will buy stocks from the publisher for a given price. They can then sell those at whatever price they want. Obviously they'll normally want to make a profit, but they might also sell off cheaply to clear stock.

With Steam, and other online distributors, it doesn't work that way. It's an 'agency' model. Google it. And Google the stuff around the e-books agency model in Australia and you'll probably find some stuff really useful to your project on both sides of the argument. There's no agreement on if it's legal or not. The fact that Valve take a cut of the sale is key because it's the publisher's sale, and Valve just take a cut. Valve are agents for the publisher, they are not re-sellers. Valve do not set the price on Steam, publishers do (although Valve advise). There's no need for publishers to force Valve to sell at a given price because the publishers choose the price that their games sell for on Steam. Valve don't decide that. Don't imagine Steam as a shop, imagine it as an art exhibition. Artists price and display their own work, if someone buys as a result of a exhibition, the gallery get a cut. But you're buying from the artist, and the artist sets the price.

Now you argue that it's illegal in Australia for publishers to force resellers to sell at a given price. And you're right. But Valve are not acting as re-sellers, they're acting as agents. It can't be illegal for publishers to sell direct to the consumer either or every small home production business is now illegal, and so are estate agents.

You should try and get your head around this because it's key to what you're trying to do. At the moment you're equating apples and oranges. The question you should be asking is 'is this sort of agency model legal in Australia'?

Lukasz
23-11-2011, 08:27 PM
Says who? You? Now, forgive me if I'm wrong, but you're not a lawyer are you? You don't have much - if any - experience with the legal aspects of running a business like Steam, correct? Well, in that case, it is for the courts to decide whether Steam is anti-competitive in any of its practices. That will also vary from country to country - EU laws will function differently to US ones, Australian laws to those in the UK. This needs to be looked at and possibly put through the courts, because we're talking massive numbers of consumers (millions at any one time) and massive amounts of money.

Have you read what was posted before? the link to legislation. and no, i am not a lawyer. But i did law courses which cover some of the stuff during my undergraduate studies and I had my company. So I do have a bit of knowledge and experience.
Anyhow
Steam is not anticompetitive because THEY are not lowering their prices. They are not preventing anyone else from doing that. They are not hurting competition by not being very competitive themselves. That's what anti-price fixing legislation do. They target any activity which might lower fair competition. You are accusing steam for being anti competitive by not being competitive enough.
Like I said many times. Customers do not deserve lower prices. They only deserve fair uncontrollable by anyone market. That is what is currently happening although checking it won't harm anyone. So I do support what OP is trying to do but at the same time I am trying to post what I know about the topic.

and why I told you to please look at the whole argument is simply because IE and Microsoft is different scenario to what Steam and publisher might be doing. First scenario involves a company which controls 90% of the OS market preventing browser market from being competitive by using its OS market power to influence browser market.
Second scenario involves a company which controls 20% of the market not wanting to control more of it.

Then let me tell you why what I said was important:

BECAUSE THE GAMING INDUSTRY HAS NOT DIED IN AMERICA. Brick & mortar retail has waned and will continue to disappear as well it should, and this has not in any way reduced the profits of games developers. In fact, they're doing better than they ever have before!

And I'm sure that once Aussies see that they could have their games quicker and cheaper than the shit they have to wait and pay for, they'll flock to online distributors... provided they get better service.

right. Your opinion which does not match reality. Explain why steamworks games are not being released in UK then (like brink and I think skyrim too)

Althea
23-11-2011, 09:05 PM
Explain why steamworks games are not being released in UK then (like brink and I think skyrim too)
The games-not-appearing-on-Steam thing makes no sense, because Rage and Skyrim have appeared, but Saints Row the Third and some others haven't. You can't explain it because there's no logic to it.

Lukasz
23-11-2011, 09:58 PM
The games-not-appearing-on-Steam thing makes no sense, because Rage and Skyrim have appeared, but Saints Row the Third and some others haven't. You can't explain it because there's no logic to it.
lol. nice explanation. there is a reason, there is a logic which we just do not know it. and yeah. skyrim is but Batman disappear didn't it?

Althea
23-11-2011, 11:03 PM
lol. nice explanation. there is a reason, there is a logic which we just do not know it. and yeah. skyrim is but Batman disappear didn't it?
Batman disappeared from some people's accounts when they restarted Steam (only to appear again), but it's been on the store for a few weeks, maybe even a month or two now, and that's only Steamworks if you're an idiot and buy the overpriced version from Steam.

nikolai
23-11-2011, 11:41 PM
With Steam, and other online distributors, it doesn't work that way. It's an 'agency' model.

Would you like me to provide you with a list of cases involving agents conducting or suspected of involvement in price fixing with their directors, other agents and distributors?

Still failing to see your point.

deano2099
24-11-2011, 01:44 AM
Would you like me to provide you with a list of cases involving agents conducting or suspected of involvement in price fixing with their directors, other agents and distributors?

Still failing to see your point.

Yes please. Because agents don't set prices. They can't, because it's not their's to sell. My point is you're quoting and referencing Australian law in relation to resellers. Steam is not a re-seller, it's an agent.

If you have agents in Australia then your entire argument falls down, because if an agent is selling something, the publisher/manufacturer is setting the price. Which you say is illegal. Steam don't set prices. The publishers set prices. You don't need an investigation to prove that, it's right out there in the open. Steam have said this many, many times. If that's illegal this is open and shut as it's something Steam freely admit to doing. They sell the game at the price decided by the publisher, they always have, they've always been open about it.

That's not to say that it means said publishers can't be involved in price fixing. If they're putting pressure on retailers to sell at certain prices, then yes, they are price-fixing. But of course Steam are selling at their desired price because they tell Steam what price to sell at.

But a publisher controlling the price of one outlet, where they provide the games directly through an agent, is not price-fixing. Because they only control one outlet. The others can still compete. The market for ebooks is more complicated, as you can class ebooks and books as different items more easily than digital downloads and boxed copies of games, which are seen as the same. And in the ebook case, the publishers set the price from every outlet. Nevertheless, even in this case it's debated as to the legality, and it's still happening right now.

nikolai
24-11-2011, 01:54 AM
Yes please.

http://www.accc.gov.au/content/index.phtml?itemId=809637


My point is you're quoting and referencing Australian law in relation to resellers. Steam is not a re-seller, it's an agent.

You're implying that agents don't have to play by the same laws as everyone else?


If you have agents in Australia then your entire argument falls down, because if an agent is selling something, the publisher/manufacturer is setting the price.

You don't understand my argument.



But a publisher controlling the price of one outlet, where they provide the games directly through an agent, is not price-fixing. Because they only control one outlet. The others can still compete. The market for ebooks is more complicated, as you can class ebooks and books as different items more easily than digital downloads and boxed copies of games, which are seen as the same. And in the ebook case, the publishers set the price from every outlet. Nevertheless, even in this case it's debated as to the legality, and it's still happening right now.

I completely disagree with your assertion that ebooks are not a perfect metaphor for this.

Tagert
25-11-2011, 03:33 AM
I'm curious why anyone is bothering to argue against the OP.

He (Or She - For the post I'm going to assume he) has not stated that anyone has, for a fact, done anything wrong. What he is doing is attempting to discover if anyone has done anything wrong. He may be assuming guilt (I don't know if he is) but he's going about the correct legal method to discover whether there is anything wrong.

nikolai
25-11-2011, 05:46 AM
Thanks Tagert, I kind of suspected the thread would get off-topic pretty quickly, especially if people misunderstood the context of my first post. - Perhaps I could have made it clearer.

Glad to see some people are on the same page as me.

Edit: That's not to say those other posts topics don't warrant discussion - they certainly do. Just in another thread.

deano2099
26-11-2011, 01:19 AM
I'm curious why anyone is bothering to argue against the OP.

He (Or She - For the post I'm going to assume he) has not stated that anyone has, for a fact, done anything wrong. What he is doing is attempting to discover if anyone has done anything wrong. He may be assuming guilt (I don't know if he is) but he's going about the correct legal method to discover whether there is anything wrong.

While that was his stated goal it's quite obvious from just reading his responses that he's convinced Steam has done something wrong and is looking for proof. There's nothing wrong with that, but he's certainly not acting as a neutral party.

nikolai
13-12-2011, 04:01 AM
Well, just a small update. The FOI request was accepted and turned up no agreements (as expected.) So, on to the next part. After numerous back-and-forth between myself and a helpful chap at the ACCC, explaining to him (among other things) exactly how online distributed content works, I outlined an example scenario which I believe fits this case. To which I received the attached.

For the ACCC to act on it, they do need some evidence to start with, so I'm pursuing an example of what I believe was a case of supply restriction to a distributor (GoG), not only because it's well known, but also relatively well documented, compared to any cases on Steam where it's largely speculation and hearsay. They have, in the past been very helpful, but contacting them can be difficult, especially when you're a nobody like me. If anyone out there has some street-cred in the industry and could possibly get me a phone call or even an email interview it would be very helpful. Basically, I'd like to find out how much they can talk 'on the record' about it. Of-course any contact with Valve would also be of great help too.


Dear Mr xxxx,

Thank you for your email of 12 December 2011 to the Australian Competition and Consumer Commission (ACCC) regarding price fixing. The reference number for this matter is xxxx.

For price fixing agreements to be considered illegal:
there must be a ‘contract, arrangement or understanding’ (the agreement)
two or more of the parties to the agreement must be competitors
the agreement must have the purpose or effect (or likely effect) of fixing, controlling or maintaining the price of goods or services
what is fixed must be the price for—or a discount, allowance, rebate or credit in relation to—goods or services supplied or acquired by the parties to the agreement.

The scenario you have identified is therefore likely to constitute price fixing if the agreement is between two or more competitors.

However, the conduct you describe may also constitute Resale Price Maintenance (RPM). Any arrangement between a supplier and a reseller that means the reseller will not advertise, display or sell the goods the supplier supplies below a specified price is illegal.

It is also illegal for a supplier to cut off, or threaten to cut off, supply to a reseller (wholesale or retail) because they have been discounting goods or advertising discounts below prices set by the supplier.

Further details about these anti-competition provisions of the Act can be accessed at http://www.accc.gov.au/content/index.phtml/itemId/816373.

Thank you for contacting the ACCC.

Yours sincerely,


xxxx
ACCC Infocentre
Ph: 1300 302 502

soldant
13-12-2011, 06:04 AM
Interesting. Forgive my ignorance, but what was the supply restriction for GoG?

nikolai
13-12-2011, 06:06 AM
Interesting. Forgive my ignorance, but what was the supply restriction for GoG?

http://www.kotaku.com.au/2011/05/why-does-the-witcher-2-cost-more-in-australia/ *

* You may be required to read between the lines. :)

soldant
13-12-2011, 06:14 AM
http://www.kotaku.com.au/2011/05/why-does-the-witcher-2-cost-more-in-australia/ *

* You may be required to read between the lines. :)
Oh right, just TW2 thing. Thought it was something I didn't know about.

nikolai
13-12-2011, 06:15 AM
Oh right, just TW2 thing. Thought it was something I didn't know about.

If there is something you don't know about, please let me know. :)

hahaha. uhhh... yeah...

deano2099
15-12-2011, 02:58 PM
Again, I'd suggest getting back in touch and asking how RPM applies to agents. Because all that stuff about re-sellers has nothing to do with Steam or GoG as they're not re-sellers.

nikolai
15-12-2011, 10:16 PM
Again, I'd suggest getting back in touch and asking how RPM applies to agents. Because all that stuff about re-sellers has nothing to do with Steam or GoG as they're not re-sellers.

The ACCC and I disagree. So please don't go to the trouble of suggesting anything else.

Lukasz
30-07-2012, 06:10 AM
http://www.brisbanetimes.com.au/national/digital-products-cost-twice-as-much-in-australia-20120730-2395r.html


im bumping this thread because of linked news.
Call of Duty 3 for example is 100 USD here. Max Payne is 90

nikolai
30-07-2012, 06:21 AM
Yes indeedy, it's been quite an exciting time with the federal inquiry going on. Will likely be a while before we hear the final word, and likely much longer before the government decides what (if anything) to do about it.

At any rate, it's refreshing to have the people who've tried to explain away the price differences put back in their box.

Wheelz
30-07-2012, 08:04 AM
+1 for that. I'm across the ditch in NZ, but our politician in charge of these things (buggered if I know which one it is) has said they'll be watching the Aus verdict closely to see if an enquiry is required here. Hopefully they go through with it, because we get hit with the same retarded pricing as Aus (Skyrim being $100 USD on release, Prototype 2 being $80 USD on Steam, Blops2 and MW3 both being listed at $100 USD, etc).

Not suprising to see apple get all tight lipped on it though.

Wheelz
29-12-2012, 09:16 PM
bumbing for dissappointment:

http://blog.greenmangaming.com/2012/12/australianew-zealand-pricing.html

that looks to be exactly the sort of thing they're not allowed to do...