Why Does The Witcher 2 Cost More In Australia?

Why are Australians paying more for The Witcher 2? And how long will we have to put up with this kind of price fixing on Digital Distribution? We spoke to the Managing Director of Good Old Games, Guillaume Rambourg, to get some answers. Turns out he was way more frank than we expected....

The price of digitally distributed games in Australia is an issue that continues to frustrate and confuse consumers nationwide. As recent price fixing of The Witcher 2 has illustrated, publishers are almost terrifyingly transparent in the way they pander to retailers – artificially increasing prices to ensure retail has a fighting chance against online services such as Steam and Good Old Games. Initially Australians could pre-order The Witcher 2 at the US dollar price but now, as we approach the retail release, the price of the game has been increased – and we wanted to find out why.

So far Steam has neglected to comment on the situation, but Guillaume Rambourg, the Managing Director at GOG.com, was kind enough to answer our questions, and was as frank as anyone we’ve ever spoken to on the issue - especially considering the fact that Good Old Games, and The Witcher 2 development team, are owned by the same company - CD Projekt.

“First off let me explain the pricing increase issue,” began Rambourg, in response to our first question. Good Old Games had previously referred to the price increase on The Witcher 2 as being the result of “licensing agreements”, but what were the specifics of these agreements?

“CD Projekt RED has legal obligations with distributors all over the world including Australia concerning different SRPs. Good Old Games' pricing policy in Australia was causing some conflict in the marketplace, so we had to change the price for the Australian market.”

In short, it appears that The Witcher 2’s price increase on the GOG.com service was raised to provide some sort of parity in the Australian marketplace. A little unfair considering that Australian consumers, who had pre-ordered early, purchased the game at a cheaper price. Rambourg was only too happy to concede that the situation was unjust.

“We know it's not fair and that's why we're extending the 'Fair Price Package' to Australian users and will be giving them a $26 USD store credit to spend at GOG.com. This means that not only is GOG.com not making any money on the price increase, it's actually costing us money, because we're paying royalties to the publishers on the games our users are getting for free.”

We have to give kudos to Good Old Games, not just for the ‘Fair Price Package’, but for their transparency on the issue. Most publishers we’ve spoken to regarding this issue have either spoken off the record, or point blank refused to address the issue at all. It’s refreshing to see how open Good Old Games has been – to the extent that they sent a Facebook update letting their users know that a price change was imminent, giving some consumers a chance to purchase the Witcher 2 at the US price before the changeover.

According to Guillaume, the whole situation has been a juggling act, making it difficult to please everyone.

“Every retailer is free to set prices at the level they feel is the most appealing to users,” he claimed, “but there are many other strategic elements that you have to take into account so that you aren't crushing the competition, and this put the rights holders - which are CD Project RED, not GOG.com - in a very uncomfortable position.

“At the end of the day, distributors need to keep two different groups happy - customers and business partners. Sometimes we have to perform some interesting strategic gymnastics to satisfy everyone. We’re always fighting for the best offer for our customers, though, which is why we came up with Australia’s own version of the Fair Price Package to address this.”

It was our understanding that the decision to increase prices was made in order to satiate retailers, who were buying The Witcher 2 at a higher cost price from local distributors – but Guillaume was keen to emphasize that both tradition and digital means of distribution existed in tandem, not in opposition to one another.

“Digital and retail are complimentary channels, not wholly competitive,” claimed Guillaume. “The presence of a box and physical goods are definitely a big deal for a lot of people, so paying a higher price for retail vs. digital distribution still makes sense for many. That said - we're still honouring the deal for everyone who pre-ordered the game at the initial digital price. Having to change your price this late in the game isn't ideal, but we think that GOG.com's offer remains the most compelling one, especially with our regional Fair Price Packages.”

As traditional retail continues to decline, we wondered how long digital distribution services such as Good Old Games and Steam would continue to cater to retail by artificially increasing their prices. Surely as traditional retail loses relevance the practice will ultimately become bad business for all involved.

Not exactly. According to Guillaume Rambourg, the situation is a little more complicated than that.

“As I mentioned earlier,” said Rambourg, “digital and retail games distribution aren't wholly competitors. The value of physical goods, boxes, and manuals is a very real one for many people, and even though a number of folks buy many games through digital services such as GOG.com, the demand for boxed copies of games remains quite high.

“I don't think it's necessarily a matter of retail having less influence on the pricing of games - it may be the case that, as the digital downloadable market matures further, you may see that there's an increasing influence both ways.”

Another problem consumers have with The Witcher 2 is the classification issue – the Australian version of the game will feature minor censorships to ensure the game gets through on our highest MA15+ rating. How frustrating was this decision to the team, and Good Old Games themselves?

“We had hoped—as a distributor—that the game would be available to the widest possible audience with the least possible restrictions,” claimed Guillaume. “We know that CD Projekt RED did their best to make that happen, but the decision is not wholly theirs. Are we pleased, as folks who've promised that there's only one version of the game worldwide? Not really, no - but living and working in Europe certainly gives you an appreciation that different cultures do things differently, and we respect the decision of the Australian Classification Board.”

Again Guillaume was more frank than we could ever legitimately expect him to be.

“On the bright side, there's very likely to be a fan-made patch shortly after the game is released, restoring the content that's been edited.”

The situation with The Witcher 2 is far from ideal. Australian consumers are being asked to pay more for a censored product that, until last week, they could purchase at a more reasonable price. But, despite these issues, it’s clear that Good Old Games are genuinely trying make good on their original offer – navigating the endless layers of politics and bureaucracy that comes with international distribution with their Fair Price Package.

It may not be ideal, it may not be perfect - but kudos to Good Old Games and CD Project for at least attempting to address an issue that other publishers have been avoiding for years.


Comments

    Kudos to GoG for making an effort. Actually 'fair price policy' is them making a huge effort IMO (+ no DRM, why would you buy anywhere else?).

      Agreed. It's one thing to say this sort of thing is unfortunate, it's quite another to put up your own money to compensate your customers for it.

    So as usual, it comes to the distributors. They charge local retailers huge amounts making the whole situation horrible for everyone...

      I've started to wonder if that's truly the case. I think it's more likely that instead of one party jacking up the price and making a killing, it makes more sense for there to be too many middlemen. Each one takes a cut of the pie, and the pie gets larger to accomodate this.

      It's disgusting, given that a private individual can import a copy of the game, including shipping, cheaper than it can be purchased for off of the shelf, but it's likely harder to rectify than one may think.

      In my opinion, we should just give up on localisation for Australia. Just give us the European copy. Retailers all have stickers with the local ratings on them, so why not just use those?

        For console games at least, we do get the European version (PAL), unless the classification board rolls a die and gets a 1 and decides to tell them to change something. The only difference between the two is the box art is diferent (esrb logo) and occasionally the text on the back will be in multiple languages vs pure english.

      Because they have to buy from the publisher in the publishers home currency, which if its Europe costs them more money.

      They don't just get the games for free, they too have to buy them....and make a profit to keep themselves a float.

      Least that's the feeling I got from reading the Saga of Red Ant.

      It's always "the distributors"...
      Who are they? Let's get some names. While they remain a faceless entity it's hard to take them to task for these practices.

      Name and shame so to speak.

        THIS. I'd love to get the names of some companies...

          One of the largest and main ones in Australia is

          All Interactive.

          http://www.allinteractive.com.au/

    I had no interested in the Witcher, or GoG until I for whatever reason decided to pick up the Witcher Enhanced Edition from EB Games for $7.95 (Ironically the cheapest price I could find it, physical or digital) last week... I have since been amazed at how compelling the story and gameplay are, especially compared to the dismally boring Dragon Age Origins.

    Hopefully CDPR and GoG will eventually be able to break the bonds of local publishing and start selling their games to the consumer via their own in house publishing (for physical products anyway). CDPR and GoG seem to be the only companies that actually care about their customers, especially since they're taking a loss by offering us a $26 voucher to purchase Witcher 2 from GoG.

      Witcher: Enhanced Edition: Director's Cut.

      Available for download on GOG.com

      In two days time.

      For five bucks.

        Yes, but wasn't available 2 weeks ago when I wanted to buy it.

        Funnily enough, I always buy DD products when cheap enough, and I'll be buying Witcher Enhanced Edition from GoG in 2 days time, even if it's just to give CDPR more money for making such an excellent product!

          Agreed. I'll definitely be getting it. Never played it before and I'm somewhat excited.

      I picked up the Witcher Enhanced Edition the other week too. I think I'm missing something - I played about an hour of it and found it really awkward, and the combat rather repetitive?

      I'm not having a dig, I'm trying to find someone else who's played it to tell me I'm doing something wrong, or it gets awesome 2 hours in.

      Figuring it got such a cult following, and I'm normally down for these sorts of games I'm either retarded or just impatient.

        Yeah the game doesn't always highlight where you need to go. Best tip is to really follow individual quests through to completion before taking on to many more. Refer back to your journal a lot.

        Other than that, don't be scared to click away from the combat to get Geralt to dodge an attack. Constantly clicking on an enemy can lead to death as you leave yourself more exposed. And don't forget potions!

        The first area of the first game is basically terrible, along with the swamp area in chapter 2. After that it gets much better. Stick with it a bit.

          I'm actually at the swamp, weird plant thing killed me before I got bearings on what was going on
          What actually sold me on the game was that excellent decision about the elves early on and whether to trade the goods to them

          When I got the consequences of my choice hours later, I was completely sold
          I didn't think my decision could have that much of an impact honestly

    This makes me even happier with the fact I bought Planescape: Torment from GOG on the weekend and I'm now planning to grab one thing off my massive GOG wishlist every week until it's empty.

    Nice stuff. That's what we in the industry call a "scoop".

    Or I could go to ozgameshop or cdwow and get the physical copy for $45. I don't need to play this right away anyway.

    This is just another explain of an Australian Distributor sticking their noses in to Australian pricing on Digital distribution. It's basically regional price fixing.

    The local distributor is oputting pressure on the compnaies so we have to pay the same as or more than the local brick and mortar shops ... hikeing the price to keep our local prices high ...

    It's not good enough ...Regional price fixing should be banned and policed...

    So of these hikes are way higher than what us customers are paying on steam - we shouldn't be paying more for a digital product - It's a scam ...

    Certianly will not help the local brick and mortars as it will drive punters to buy their retial copies from overseas. Eg the Witcher 2 can be got for as litte as $38Aust delievered from the UK...

      It is driving the local business overseas. Definitely. And I think that unless the specialist retailers do something about it in the next 2 years, they won't exist in any meaningful capacity beyond the next 5.

      That said, the major department chains will keep selling games at local prices. There will always be idiots who buy them for the inflated rate. But there won't be enough for the specialists to pay their wages.

        You mean the specialists like eb and game the 2 most expensive places to buy games in Australia

        Half the issue is that out rip-off prices mean that the second hand games market it's 2-3 times mor lucrative here than in the states where they might buyback a game for 30 and sell it for 45

        Over here eb can buy it back for 60 and sell it. for 95

          There's nothing wrong with a lucrative second-hand market. That's fine. It's not even as profitable as it might sound, unless you're stupid enough to 'save' $5 and go preowned. When it's $20 cheaper to get preowned than mint, it's usually no more lucrative for the companies retailing them.

          Additionally, it's not like those companies are gouging consumers. As has been stated many times elsewhere. Prices are frequently as low as JB's, which are approximately cost.

      Agreed.

      Why are we still paying double USD at retail when our dollar is HIGHER atm? All other imported product have basically dropped in price, but video games haven't.

      The ACCC needs to get off their ass at get the distributers inline, as they are the ones that set the prices.

    I'm really happy that I forked my money over to them now. I'm going to try and buy as much stuff from them from now on. That's what many gamers want - honesty which quite frankly we never get. Good on them for being honest and going to the point where they're taking extra steps just because the system wants to squeeze money from the small and isolated Australian market.

      Bang on mate!

        Meant for FUBAR, but anyhow all good points

    Mark, thanks for writing pieces like this. It's the reason why I follow Kotaku.com.au. No other place on the internet would ever get answers like these.

    You're worth every award they heap on you :D

    Cheers Mark. GOG were definitely between the proverbial rock-and-a-hard-place with this one. Nice to see the entire situation explained.

    Those distributors and retailers who put them screws on GOG/CD Projeckt (and they know who they are ... they are more than likely reading this right now) should be more than ashamed. They should be downright humiliated at perpetrating an industry practice that has overcharged the Australian market for decades. Just no excuse any more. None. Nada. Zip. Greed is not an excuse - it's a symptom.

    All they'll succeed in doing is driving more and more people offshore to acquire their games - and even hardware. Congrats! You're killing your own industry!

      Australia is not a very profitable market to be in, anyway. So I don't think the publishers care very much.

    Great article. Good Old Game appear to have handled the situation pretty well, turning a bad situation into free marketing. Great way to help them compete with Steam.

    Nice work Mark.

    Hey CD Projekt, SHUTUP AND TAKE MY MONEY.

    Gotta say, I like this guy. Makes me wish I had a PC so I could buy some stuff through them. Definitely appreciate the honesty and frankness.

    Basically its all about keeping Namco Bandai happy.

    This has been asked so many times in the past and maybe on here within the comments (I'm too lazy to read them all) but why is that the Oz dollar is higher than the US Dollar and we still pay more than the US Cost for digital downloads and retail copies?

    This is one of the main things that annoys me to the point of voilence (not really, just saying I get really mad). For years Australians have paid more and MORE for the same thing when compared to overseas. The Oz dollar is almost $1.10 compared to US dollar and we still pay more. I for one would like this to stop and changed to a fair system for all Australians. It's almost crime like that EA, Activision and the rest can do this and get away with it. Why can't Kotaku start something that fights this and get other companyies involved. Retail companies like EB Games are a dying meduim, just like Blockbuster in the USA.

    Also another pet annoying issue is how Australian sites use USA Spelling instead of correct ENGLISH. Sorry but it is annoying

      If you can't be bothered reading through the comments, why do you expect anyone to be bothered to answer your questions? It's not like this is TAY where there are 1,000 posts.

        Because I was lazy and in a hurry. Some of us work and some of us are lazy at times. I am one of these people and I'm proud of that :-)

      as I understand it, it's a matter of fixed contracts negotiated a year or two ago which fix pricing for products.
      Unfortunately, with little competition, renegotiating that price is harder.

    honestly why are peopjle complaining so much, just import the game at a lesser price and it will be uncut as well...

    regional price fixing is only hurting themselves as it turns the customer to importing... heck i am trying to import everything as i do save enough money

    but what really pisses me off is its a digital distribution, its not factoring cost of packaging, printing or anything else due to the fact it isn't a physical product, they are just being greed bastards, but hey let them be, it just turns more and more people to piracy

      Replying to Laguna, many of the companies (like EA for example) are starting to be very sneaky with the digital copies. For Battlefield 3, they lock you down via your IP Address so if it detects you are from Australia via IP (I hope I'm right about that because it did it to me) it won't sell you the game at US prices, only Oz prices, which is about $20 more than the USA price. Like Apple's iTunes, you have to have a US address to get some things at USA price and this sort of thing has to STOP.

      You import, you're getting the retail DVD version with Securom DRM.
      I'd prefer not to support this either, and buy from GoG digitally for their no DRM version.

      (I'm just glad there is enough other games, and options out there for me to be able to take such stances though!)

    How exactly is it in the interests of digital distributors to keep physical retailers in business? You don't find kindle bumping up prices to keep your local bookstore going...

      Because Digital Distributors are just what the name says - distributors. And if the retailers, the most significant source of revenue for the developers and publishers, were to go away, then there'd be no more publishers, which means no more developers.

        Right, so it's publishers we should be pointing the finger at, not GOG's rivals in the digital distribution market.

    I always thought GOG stood tall on its "Once price for all" option?

      hit reply tooo soon,

      I always thought GOG stood tall on its “Once price for all” option?

      But it looks like mommy started coming down on the child too hard... Its going to be a worry that they are going to start doing this as it could even start forcing other companies to hit them with a similar policy... It goes to show who the bad guys are in this story tho...

        GoG really had no choice... Basically Namco Bandai was going to sue them for lost revenue because their prices didn't come close to the Australian retail sector.

          I don't think that's necessarily the case.

            I reckon it's close to the case. GOG were likely acting preemptively to protect their business partner, and any future arrangements made between the companies.

            NB weren't going to be able to sue them, I think, but they sure as hell could refuse to do business / offer worse deals in the future.

              Exactly right, I believe anyway.

              It's the same for most things. Fosters refusing to allow Woolies or Coles to sell their beer at discounted costs in their liquor chains. It's undermining the value of their product.

              Obviously a little different in the gaming market, but whilst buying that beer IS cheaper, you don't exactly feel the change in your pocket cause its other items that receive minor increases in their price week to week to compensate. Prices don't go down and prices don't stay down - in todays economy, they go up!

              Australian's obviously want a better price for our games considering markets elsewhere in the world. But we are a relatively small market - however the thing is, online purchasing is far more common for the PC market than it is the console. I would say almost all or majority of PC games are available for full retail purchase via Steam or other online stores without a physical copy. The same can't be said of console games, they're added after released as "On Demand" or whatever on the Xbox.

              Taking a wild guess, retailers wouldn't be making THAT much off PC gaming these days as opposed to console games. So are they really taking away that many sales from the distributors/retailers? I wouldn't have thought so - so I saw, screw those distributors.

            Are you sure? I know it goes a bit deeper than what I said, but in reality it was really Namco Bandai forcing GoG to up their prices to compete with the Australian market... if GoG/CDPR didn't do this, they would have been in breach of their contract, the "Licensing Agreement", and it would have opened themselves up to a lawsuit.

            At least that's my conspiracy, why should GoG/CDPR be forced to do something on their own site?

              "especially considering the fact that Good Old Games, and The Witcher 2 development team, are owned by the same company – CD Projekt."

              Based on this... I think it could have gotten very political internally... Based on what i have read the Aussie section of NB didnt even know about this untill someone asked them...

              The developer would have gotten less money due to this, then they would get angry the publisher didnt enforce it so on and so forth...

              But as said, a company like NB pulling their agreement with GOG would have been ALOT more costly than just handing out money and it does give a good image to gamers that GoG are trying to keep their pricing fair..

              I have a region free steam account so non of this matters to me any more...

                They didn't. They didn't know anything about why Steam took the game off their store. And I believe them.

    I think the pricing issue is obvious where the problems are, and it's good to see GoG offer something in return to make up for these issues.

    The censorship issue though is unforgivable. They are in a position where the can make a stand against this censorship regime in Australia, but they still take the weak road and bow down to a government that isn't even theirs. There is no reason why they shouldn't sell the uncensored version to Australian's, they are not an Australian business, they are not Australian citizens, or even residents, they have no reason what so ever to comply with Australian law. Yet they still do bend over backwards to comply with this law their customers don't agree with. Really, if they had any dignity they would stand up for their customers here and offer the full uncensored product.

      When you download code from an international source, is this not the same as importing it on a physical medium? As such, they'd be facilitating the breaking of a law. Which I'm quite sure is an actionable offense, so Australia could go after them, or outright ban them. And none of us want that.

      Have some patience; the censorship issue will be resolved soon.

        They have 2 RC game already on GoG!!

          Blows me right out of the water. Bah. Then yeah, their actions are inconsistent, and it doesn't make much sense.

        How would Australia "go after them" or even ban them? They are not an Australia company, or even an Australian entity. Any Australian authorities have no power of them, they have no-one to take to court, no-one to impose a fine on. They are in the perfect position to actually stand up against the government, yet they don't.

    Much respect for GoG for being so open about this, and for their Fair Price Package. These are very good things.

    However, as much as I'd love to support them for this approach, I far more strongly don't want to support inflated prices for the Australian market.
    If loss of sales because of this hits GoG harder than unhappy distributors, then they're quickly going to stop caving in to the distributors demands (and signing such ridiculous licensing agreements in the first place).

    I'll still be waiting for it to go on sale at GoG.

      Actually thinking about it, the Fair Price Package bit is pretty misleading.

      Those 'free' games that they're paying royalties for? You've just paid $26 for them. And since their (presumably) listed on the GoG store at a profitable price, they're still making money from this instore credit.

      And again one would presume the not-so-global-now price for The Witcher 2 at $45 is still a profitable one now.

      It's Win/Win for GoG. They make more money from this, and leaves people thinking they're great for it.

      like banning from Australian ISP, GOG site ?

      Also firms don't fight with goverment. Ever. Nothing good will be from fight with goverment.

      It's the people of austaralia should fight with pricing by democratic standards.

      Also GOG probably because that changed it's policy about geo ipss.

      That mean that if you are from australia you can change you country in GOG account system to USA buy game download it and change it back to Austrlia. Same price as USa no censhorship.

      GOG are people from my country (Poland) and we know how to find a way out of almost any rule or law, it's in our blood when we were fighting with Communistuc law till 89...

    Ugh why don't we just get rid of publishers? Obviously for big budget titles you need the money investment to get the project going etc, but what do they really do for their money that a developer can't do themselves? Advertising? Most titles (barring the big names) are advertised online and ususally the developer focused, gameplay vids, interviews etc. Distribution - as we go digital, couldn't developers negotiate with the distribution platforms themselves?

    Two games I'm getting in May, two different situations. Withcer 2 look at all the hassles that have been well documented. Then their's another title, Combat Mission: Battle for Normandy by a small developer who is selling this title direct. They know they're audience, they know what they are interested in and they know how to market their product. (Granted small niche market). No publishers, one point of contact for consumers and one price for all the world.

    This does not really answer anything.

    I appreciate the straightforward answers, good work hunting them down, Mark.
    However, if a AAA title released only online, would that lead to a universal pricing structure across the board?
    Just for the sake of argument, if DN:F had stayed underground rather than being adopted by Gearbox and been released at the start of 2012 through digital distribution only, would prices be universal, as distributors, packaging, retailers, all those were cut out of the market?
    Yes, sales would suffer, but if you could get a complete game for $30/40 less than anything else from release, wouldn't you?

    Great article Mark. Two question though.

    Why do you mention his name both at the start and halfway through the article?

    also, why do you refer to Guillaume Rambourg by both his first and last names at different points of the article?

    “On the bright side, there’s very likely to be a fan-made patch shortly after the game is released, restoring the content that’s been edited.”

    And if historical evidence is anything to go by, the OFLC will reclassify it RC, forcing the developers to properly remove the censored content from the game and re-release it. Meanwhile, the media will have a field-day over another 'Hot Coffee' scandal.

    However, hopefully by the time they get round to it, we'll have an R rating, and they'll be able to classify it properly and none of the above will come to pass.

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