Xbox Australia Talk Games On Demand Launch, Pricing, Future

Xbox 360's Games On Demand service rolled out earlier this week. We spoke to Xbox Australia about some of those crazy prices they're charging. The good news is that they're listening to your feedback.

Games On Demand allows you to purchase and download full version Xbox 360 games. The launch lineup in Australia contains 11 titles, ranging from the great (Mass Effect, Oblivion, BioShock) to the not-so-great (Perfect Dark Zero). Prices, too, range from $29.95 all the way up to $99.95 for games that are 2-3 years old.

On Wednesday, I spoke to Andrew Jenkins, Xbox Live product manager for Australia, all about Games On Demand. Here are the highlights of our chat.

I began by telling him how good it is that we're actually getting Games On Demand on Australia, considering there's been a few things over the years that we've missed out on with Xbox Live.

Thank you. I think we're benefitting more and more through the strength of the Live community in Australia. We're one of the strongest Live communities worldwide for Microsoft. And that's helped us a lot... with Games On Demand now and coming soon we're able to bring the Zune Video service and its streaming high-def movies to Australia the same day as the US. Also, Facebook and Twitter will be coming soon and in parity with the rest of the regions. It's very good stuff for Australians.

I asked about the launch titles. I mentioned that they're all quite old, some are launch titles and some are from 2007. What was the thinking behind that?

Honestly, not only does Games On Demand provide that convenience factor, you know... you've got the comfort of sitting there in your living room and you don't have to go hunting around for these titles at various retailers. But it also extends the life of them. These are amazing games, they're top of their class and mostly drawn from our Classics range... they're not always easy to find at retail. We want to make sure they have a strong life and that people can always enjoy them. Being able to offer these products on our service means that people are always going to be able to find the game they want to play. Of course, sure, some of these products you are going to be able to find at retail, but it's all about adding another way of delivering that content to our consumers.

I asked about the plan for rolling out more titles, but Jenkins said they had nothing to announce, save to say all their publishing partners are on board with the service and looking to participate with their back catalogues.

I asked about the strategy for new releases and whether we'll see games on there day and date with the retail release. Jenkins again said they had no announcements to make and reiterated that Games On Demand is about extending the lifespan of older products.

I asked about how Microsoft has positioned this service with their existing retail partners, given that digitial delivery is all about bypassing the retail channel. Jenkins had an interesting take on that.

The great thing is that it expands the retail reach. If you think about it, the guys at retail might not able to carry all these titles and keep them on shelves. But it's really easy for them to keep Microsoft Points on shelves. Points are some of the strongest sellers right across the Xbox business. And by selling Points it gives the opportunity to keep selling Kameo, to keep selling Perfect Dark Zero, even though that title might not be on their shelves any more.

I asked if Games On Demand was a bit of an experiment right now.

I wouldn't necessarily call it an experiment. But I would say that as we launch the service we will take user feedback, you know, what our consumers are saying about it, as well as sales trends to determine if we're at the right price point for that particular product. And product pricing is going to range on our service, just as it does at retail.

I asked if Jenkins thought a title like Mass Effect, which is US$20 overseas but AU$100 here, was at the right price point.

Well, in determining price points we look at many different factors. We work with our publishers and look at the market and try to price accordingly. For Mass Effect we'll look at that and continue to listen to what the community's saying. You know, we just launched the service, so we'll look at sales trends and ask if we're priced at the right point with that product.

I asked about the typical consumer expectation that digital pricing should be cheaper than packaged goods and whether Jenkins had any thoughts about that.

These product that we're launching with, they're products that have been in the market for a long time and you can't necessarily find them at retail. The convenience of getting it digitally delivered to your home is what we're providing. That's the reason why we're selling these products. But if you can find them somewhere else for a better deal, we totally understand. You know, for every savvy shopper out there, they have options and opportunities.

My take on this is: it's early days and Microsoft is currently testing the water to gauge consumer response. Yes, there is an element of convenience here, though I would argue it would be even more convenient to be able to download new releases too. Give it another couple of years and Games On Demand is likely to be the only place - outside of eBay and the odd lucky preowned find in-store - you'll be able to get hold of those early 360 titles.

Yes, it's great that Microsoft is listening to your feedback around pricing. They're obviously fully aware of the reaction to some of the crazier price points. And if you respond with your wallets and don't buy Mass Effect, for example, then they'll clearly look at adjusting that price down. Hopefully the sales data from this launch lineup will clearly indicate what price points are acceptable for 2-3 year old titles.

But right now, at the current pricing, I couldn't recommend any of those games.


Comments

    I don't think there's any fear whatsoever of not ever being able to buy Mass Effect or Bioshock easily. The argument that "we can charge whatever we want because we provide everything" doesn't wash.

    PlayAsia anyone? cdwow? game.com.au? ebay? There are a ton of places to legitimately buy older 360 games, all of them usually much

    I don't think this is a case of MS "listening" at all. It's them dictating terms, seeing how much they can get away with.

    Look at the avatars. What a freaking joke. Are MS "listening" about the fact that a prop can cost $4, on top of our GOLD subscriptions?

    I give credit to Kotaku for asking some of the tougher questions, but come on, this is more Microsoft marketing spin and bullshit.

    I don't have a 360. Do they tell you how big the downloads are before you purchase? I don't think they do on PSN and it bugs me because sometimes the convenience of purchasing a digital copy is outweighed by a slow, long download.

      File size is listed on PSN, actually.

        Only once you've made the purchase though, right?

      Its a full Retail Game...so you'd be looking at a couple of Gigabytes at the least, 3 or 4, probably more.

    Although I am not an Xbox owner I would like to think that those people savvy enough to utilise the service are also savvy enough to realise that the prices are a rip-off and over time the price of the games should come down to reflect this.

    What was that thing about retailers selling Microsoft Points? I thought the Games on Demand were in real money, not points?

      Yes they are, they're not bought with MSpoints at all. Most of Jenkins' answers are just spin.

      Currently the only titles On Demand that might be slightly hard to find retail are Perfect Dark Zero and Kameo, and really, they were pretty poor games.

        That's wrong. When you select the game to actually buy it, you then get the option to press Y to buy it with points instead of credit card. Mass Effect is 6000 points. So in that case it could possibly be even more expensive as points are $30 for 1500 at places like EB.

      Yeah, you can buy via credit card.

      But you can't buy avatars or DLC through credit cards. Go figure.

    Let the market decide. It's a capitalist world we live in. The size of most HDD's are still around 20-60 GIG which is way to small for this service, along with the broadband caps here in Aus, no local servers make it clear that we are still a backwater in their eyes. All these points have been raised already, so buyer beware!

      "Let the market decide. It’s a capitalist world we live in."

      Yes, and no. I'm libertarian in outlook, definitely pro-business, and have little time for bolshie sentiments.

      BUT... the HD console market is a highly restricted one, dominated by two players. If you want to develop, publish or sell online services through those two players, you have to abide by their terms and conditions, which are onerous for many developers.

      The reality is that Microsoft has never, ever shown itself to be responsive to the market. Rather than respond to the market, it has always sought to control the market, through any number of systems. This isn't conspiracy theorist stuff, just basic business. Just as they've sought to lock in consumers to a subscription-based OS over decades, they now seek to lock in both consumers and developers to a model where only MS get to call the shots.

      They have enormous market power. They should be called on it, often.

      Clearly, the justifications for Games-on-Demand is spurious at best. Microsoft have priced these products this way because they can, is all.

    I think Microsoft can safely say after, what 3 days?, that the Australian consumer response is....ARE YOU KIDDING ME!? IS IT APRIL!? [email protected]

    I was amazed they prived games so high- there's no WAY I would d/l Mass Effect for $100 when I acn find it in bargain bins for $70 or under. It's ridiculous. Good on them for introducing Games on Demand, but it'll go nowhere if prices don't fall.

      game.com.au, weekly sale: Mass Effect 360 for $29. Including shipping within oz.

      Also, Gears of War (original) for $14.

    THIS WHOLE THING IS BULLSHIT - HAVING BAD DAY

    Its all just bullshit. How is it pricing accordingly? The answer he gave is just avoiding the question. Being polite can only go so far. You need to attack the flaws in his comments. using xe.com the $AU is $0.84US so it has been staying at a steady $0.80US minimum for weeks now. So $100AU is still 4 times the American price. There's no way you can explain yourself out of that especially when this is digital distribution!

    I pay for my own internet, and I pay for the crappy gold subscription and this is what happens.

    "And if you respond with your wallets and don’t buy Mass Effect, for example, then they’ll clearly look at adjusting that price down."

    ...or they'll simply interpret it as a lethargic and disinterested consumer base. "Oh well," they'll say, "since Australians don't use this feature we provided, we have less reason to roll out other features for them in future."

    My tip: give Microsoft a clear reason why you're not buying. Let there be no mistake. A silent protest can be misinterpreted or misconstrued.

    Meh.

    I like going on the occasional game s/h shop rummage so this "service" offers nothing of value to me.

    ----Honestly, not only does Games On Demand provide that convenience factor, you know… -----

    I don't see what's so convenient for australians to have to download a up to 8.5 Gig game over our shitty broadband network. IT'll be quicker for me to search 3 different shopping centres before it's even 50% complete... I don't know what so convenient about that

      Hear hear. Yes, convenient to just click & buy, but:
      - inconvenient to wait to download
      - inconvenient to find precious HDD space
      - inconvenient to play at a friend's place
      - inconvenient to reauthorise after RRoD or console swap
      - impossible to loan out
      - impossible to resell when you're bored with it

      Could overlook some of these if they were a little cheaper, but at 3x the price? Fuhgeddaboudit.

        You guys forgot about the inconvenience of chewing up a significant amount of your monthly allowance (if not all of it), and having to put up with slow internet for the rest of the month.

        I'd rather go out for a nice drive, buy a game, and have something to put on my shelf.

    Yes, but when the heck are we getting Indie Games?

    They're not even explaining WHY these prices are so damn freaking HIGH!

    I for one, won't be buying any of the games, even if they were cheap or the same price as retail versions. I would prefer the disc and i don't have the space on my 360 to download games quite yet!

    Not only that, ebay & other online stores can be cheaper than retail stores even when they're on clearance. Shop around & you can find things surprisingly cheap.

    The only excuse i've heard from MS is the currency and exchange rate. But if that was the case, then why is Mass Effect like $39.95 in store? If it was the exchange rate, then they would want that at $99.95 to make the money? MS don't need to purchase Mass Effect and slap it online for you to download like EB GAMES need to buy their stock and then sell it to make back there money.

    This is all just a ploy to catch the casual gamers or gamers who don't come on gaming sites and know the price of games at other stores to purchase a game over doubled the RRP in store to buy it from them over their 360.

    Just bought Mass Effect from GAME for $39. BRAND NEW. Microsoft are arseholes. I only bought a 360 because it has games that PS3 doesn't, and I refuse to pay for a sub-standard service like Gold LIVE. I'd never use it, except maybe to call stuff gay :P

    Couldn't they test the waters with Netflix rather than a service that's complete garbage passed of as middling convenience?

    They're going to respond?

    Can't wait for the response from people who bought ME for $99 if they go and half the price next week.

    They'll do nothing.

    Mass Effect Brand new - $29 Blockbuster
    Perfect Dark Zero and Kameo Brand new - $17 Harvey Norman
    Prey Brand new - $20 JB
    Call of Duty 2 S/H- $22.95 EB games

    oh and

    Viva Pinata Brand New $14.95 Game.com.au
    Viva Pinata 2 Brand New: $29 Game.com.au
    Bioshock Brand New: $39.98 JB

    You want a new strategy MS?

    How about release new games, all of them, at full RRP (120$AUD) through Games on Demand, and then let the JB's and the EB's sell them for a fair market value (<100$) and see what happens.

    I could understand the props store if there were more items at 40g, but 400 is a liiiiiittle greedy. But I assume this is not an Australian specific thing.

    In other words, they don't care. THey just want money. I could go and find any of the games on demand games right now at about 3 or 4 different local retailers for at least half the price they are on xbox live at the moment. They aren't going to change the prices too much and they may as well just admit that.

    Good to see the art of dodging the question still exists.

    It would be nice if they just said "We want money, so we are charging insane prices for old products to make lots of money we don't even care if it's convenient" although these prices pretty much speak for themselves.

    Really David? Was this the "Grilling" you mentioned earlier? This just seems like a lazy journalist not pressing to actually get the difficult answers.

    There's a clear issue here, and you just let him get away without answering or even really adressing anything.

    Thanks for nothing.

      I'm not sure what else you were expecting me to ask, but I feel the interview speaks for itself. I tend to think Kotaku readers are smart enough to draw their own conclusions.

        Kotaku readers are no doubt intelligent enough to read between the lines in a case like this, however the point is more that when Mass Effect is (in most cases) $70 more than retail, asking whether Jenkins "thinks" $100 is the right price point is entirely irrelevant, as clearly that's a yes.

        Journalism is about cutting through the spin at the time of the interview, and getting more than just stock responses.

        "I asked about the typical consumer expectation that digital pricing should be cheaper than packaged goods and whether Jenkins had any thoughts about that."

        Maybe try "Why is GOD Mass Effect over 300% more than retail when the customer is clearly receiving less - no physical product, console locked, the inconvenience of the low HDD space provided, etc."

        "Do you have any thoughts about that?" is not exactly digging deep.

        This is basically a Microsoft press release.

          The Mass Effect question followed Jenkins' own use of the phrase "the right price point". By laying out the question as I did, in referencing the price discrepancy between here and the US, and mock-innocently enquiring as to whether that was the "right price point", the lines are all there for you - and Jenkins - to read between. If you found it irrelevant, than perhaps I overestimated.

          How can it be a Microsoft press release when I conclude by recommending that no one buy these games?

            Ah yes, clearly I didn't "get" your exceptionally weak approach to journalism. Or should that be "journalism".

            Sometimes, David, it pays to actually press interviewees. You can imply and infer things, but on some issues, it's much more appropriate to address and state them explicitly than making mock-innocent suggestions.

            They may not appreciate it, and may deny you further interviews, but you have an obligation to your readers.

            It's true that you don't recommend any of the games thus far, but don't worry -

            "Microsoft is listening to your feedback around pricing."

            Well that's good to know, and certainly not blind repetition of PR spin allaying any actual addressing of the issue here.

            Keep up the good work Mr Wildgoose. It's reassuring to know that some journalists still believe in the fourth estate.

              You should "cut through" David's "spin" and "get more than just a stock response". But most of all, you should hold him accountable whilst remaining completely anonymous.

              Microsoft's PR are slippery - it occurred to everybody else that read the article, good work David.

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