Australian Government Goes Ahead With Price Inquiry Into The Cost Of Tech/Games

And yes, that inquiry will most likely include the price of video games.

All major computer and software publishers will be sent invitations to defend their pricing policies at a Federal Parliament inquiry. MP Ed Husic has been campaigning for fairer local prices, and he welcomed the inquiry.

“People here scratch their heads trying to work out why they get fleeced on software downloads,” said Husic, speaking to The Age. “When the Productivity Commission asked IT companies why they charge so much for downloads, even they found the answers were not persuasive.”

The strength of the Australian dollar has seen many gamers import video games from overseas, as local prices refuse to budge. We’ve spoken to Managing Directors from multiple local publishers about their pricing policies in Australia, including Ed Fong from Ubisoft.

“Ultimately the consumer is going to tell us what they want to pay for a product,” said Ed Fong, Managing Director of Ubisoft Australia when we spoke to him last year, “because if we’re priced out of the market, we’ll see more people going online – the consumers will let us know. And consumers are as vocal as they have ever been, they have communication channels and we’ll hear what they have to say.”

When we spoke to Activision’s Managing Director Ben Graetz late last year, he claimed video game pricing was more complicated than simply comparing exchange rates.

“Well, the cost of most things, when you benchmark overseas, tends to be a bit high here in Australia, and there are reasons for that,” said Ben. “Speaking specifically about games, there’s a number of factors — it’s not quite as simple as doing a match on exchange rates.

“I’m very proud of the fact that we manufacture locally, we’re helping to create and stimulate jobs. We have options on that, but we chose to do it locally for those reasons. We distribute locally as well as through our partners — so that’s two things already that are independent of exchange rates. In addition to that, the way we go to retail is different compared to overseas, and the cost structures are different. So it’s not quite as simple as looking at exchange rates.”

Graetz did concede, however, that local pricing was something Activision was looking at.

“The Aussie dollar has been on a real tear in the last 12 months, and that does give us reason to look at this,” said Ben. “So it is something that we’re looking at, and it’s something that’s important to consumers.

“We have to make sure that we’re delivering value.”

At the moment, video game publishers are content to maintain prices on account of the fact that most consumers are willing to pay that price. Most publishers have been notoriously cagey on game prices locally here in Australia. Hopefully this inquiry will help open up a serious, open dialogue on the issue.

IT giants in price probe [The Age]

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