Blizzard Increases Local Heroes Of The Storm Pricing, Blames Australian Dollar

Citing a need to "reflect local and regional market conditions" Blizzard has announced that it will be increasing Australian prices in the Heroes of the Storm in-game shop.

These increases will be effective starting May 13.

In a post detailing the changes, Blizzard Community Manager Arcagnion blamed "currency shifts".

We regularly review our global pricing, and occasionally make adjustments as needed to reflect local and regional market conditions. We wanted to give everyone in Australia a heads-up that as a result of recent regional currency shifts, we will soon be increasing AUD prices in the Heroes of the Storm in-game Shop, starting May 13, 2015. All purchases made prior to this date will be at the current values listed through the in-game Shop. Note that because New Zealand pricing is in US Dollars, no changes will be made.

Note: Heroes of the Storm is free-to-play and makes its money through the micro-transaction model. Heroes of the Storm rotates its free characters, but players can add certain characters to their permanent roster for a fee. It's these fees that are being increased in response to "market conditions". Also of note: New Zealand players will not be affected as their pricing is tied the US dollar.

The timing is interesting. The Aussie dollar has been in decline since April 2013, but hit a peak of $1.10 against the US dollar in 2011. At time of writing the Aussie dollar is starting to rally at almost 80 cents after hitting an all-time low of 76 cents as recent as March 30.

The Australian dollar is struggling, no doubt, but I don't seem to remember anyone -- except Apple -- making adjustments when the Australian dollar was strong.

However, the reality is the Australian dollar is weak. Australian users on the Heroes of the Storm are currently paying less than their US counterparts. As a user on the Blizzard forums points out Brightwing -- on-sale this week -- is $5.49 on the Australian store and $4.99 on the US store. If we were paying US prices, Brightwing would cost Australians $6.26 at the current exchange rate. Point being: Australians still might be paying less than US users for micro-transactions in Heroes of the Storm after the adjustments.

That hasn't stopped people getting angry. On the Blizzard forums, where the changes were announced, most seem upset at the changes as you might expect. No-one wants to pay more money for the same product. However, it might be worth waiting to see what the adjustments look like. We've asked Blizzard to confirm how much Australians will be paying after the prices change. We'll update as soon as we have details.


Comments

    One of the risks of wanting to have prices judged against the dollar. But yes. Noone dropped them except apple when we were strong. Kudos to them for that and screw you to the others.

      more shit to come http://www.smh.com.au/business/federal-budget/federal-budget-2015-gst-on-netflix-and-more-on-the-way-20150506-ggvdpu.html

    Not gonna make any assumptions. When I see the new prices THEN I will make my opinion on it. Until then, do the right thing Blizzard. Don't screw us.

    The dollar rises and falls. It's a wave.

    It'll be interesting to see if they drop prices when the dollar weakens again. That's when we'll know if they're making a genuine attempt to minimize the amount of 'currency gaming' going on with people changing exchange rates to get a better deal, or if they're just lying sacks of shit.

    Hard to tell with Blizzard. They definitely charge Australia Tax for a lot of their digital catalogue, but not all of it.

    I have no problem with this as long as they sync it with US value (ie we pay about the same). So if it goes up, it also goes down depending on the market. It's a two way street.

    Taking bets that they'll never lower the price if our dollar gets stronger.

    At least it's reasonably close to exchange rate. As opposed to other companies that blame the Australian dollar but the price is actually significantly higher even after taking into account exchange rate.

      Yeah, the mysterious phantom 20$ on top, who knows where it manifests?!

    Blizzard do have local servers, so I'm willing to pay more to support that.

      Presumably they pay for the upkeep of those local servers in AU$ though ...

        Although the equipment is probably imported.

        I blame it on our plastic notes. Somebody told Blizzard that Australians only take payment in plastic, so they figure they have to add a surcharge to cover the extra credit card overheads.

    I was under the impression that we already pay using USD when buying stuff from Blizzard because there are no Oceanic servers.

    Also,

    is $5.49 on the Australian store and $4.99 on the US store. If we were paying US prices, Brightwing would cost Australians $6.26 at the current exchange rate.

    Forgive me if I'm wrong but this indicates that Australian users are already paying more than their American counterparts. I can't check the Battle.net shop to confirm but I know the average price for a hero that is worth around 10,000 gold is around $8.20 on the shopfront however I don't know if that's AUD or USD.

      Pretty sure that the value in the shop for a 10,000 hero is around $11.99, that said I might need to double check that now >.< time to pick up those expensive heroes before they become even more so!

      All 10K gold heroes are AUD 10.99 which is ~$US 8.70.

    after hitting an all-time low of 76 cents as recent as March 30.

    Really? So it didn't drop to below 50 cents in 2001?

      Yer i giggled at that as well - people have a short memory or are to young :P

      Maybe "all-time" here refers to "since blizzard had an online store"?

    The whole concept that one piece of paper with numbers on it is worth more or less than another piece of paper with numbers on it still baffles me.

    I don't understand why currencies vary or fluctuate. It's not supply and demand driven, it's artificial digital trading at yet somehow it establishes a value between one type of digital data vs another type of digital data.
    It's bizarre.

      While fiat money is theoretically of no value, in practice it's worth the value of whatever goods and services it will buy. It is, in fact supply and demand driven - witness the plummet in the value of the Bitcoin when it was compromised (on several occasions).

      The Australian dollar went down because when the mining boom ended, there was less Australian stuff that people overseas wanted to buy, so the AUD became less useful (its purchasing power was effectively reduced) and so the value of the AUD itself was also reduced. To put it another way, the demand for the AUD was reduced, so the price went down.

      Back in the 80s the AUD was pegged against the USD which meant that it was a lot easier for currency traders to take advantage of changes in the current account because the RBA had to maintain the value of the AUD by buying or selling USD to keep things even. This was changed when Hawke and Keating floated the dollar. A floating currency, at least in theory, results in a long-term neutral balance in the current accounts.

      Even further back we followed the "gold standard", which is unfortunately useless in a credit economy because the amount of money in circulation varies considerably.

      There's more to it,of course - there are entire books written on this topic - but that's the nutshell version.

        I did a bit of reading yesterday and it really didn't answer my questions at all...
        I don't think it's supply and demand driven... it is because increasing supply devalues the currency but the demand part is purely artificial.

        The value of money is perceived value. It holds no inherent value (at least not since 1971 when most currencies moved away from the "gold standard"). Something like 80% of all world currency is now digital. It's just ones and zeroes. It's worth absolutely nothing.

        In any case, I get how money works. Exchanging some tangible measure for a good/service makes sense. No problem there.
        The thing is struggle with is varying world currency, hourly fluctuations, and why one currency is worth more or less than another.... why are there even multiple currencies at all? Is it simply to deal with inflation and devaluation events? It seems like a standard global currency would simplify things.

          Generally, the value of a currency is guaranteed by the government that issues it. Issuing notes and coins costs money, so it's not in the interest of a country to issue notes in a non-local currency. On the other hand the fact that the government usually requires payment of taxes in that currency usually gives it some semblance of real value; there is always at least one party (the issuing government) wanting the currency.

          The actual value of the money is to some degree an agreed illusion. It's guaranteed by the government to some extent in that it can (and usually must) be used to pay taxes.

          The value in having different currencies is that it allows markets in different countries to operate, to some degree, in isolation, without worrying about the money actually running out. Otherwise the money flows unevenly between economies, and you get local inflation/deflation, recession as there is no longer enough cash around to keep the economy's wheels turning, and shortages of key goods (suddenly people overseas have more of your currency than you do, and they use it to buy out the key commodities you need to stay alive, in the absence of anything else of value.)

          If you want a modern example of where a shared currency doesn't work, look at Greece in the E.U. The economy is a wreck, basically, and the government has racked up enormous debts - all measured in euros. There is a serious risk of the Greek government defaulting.

          If they did so, the Euro would probably plummet in value, internationally, since suddenly the demand for Euros - as a means of paying debt to to Greek government - takes a big hit. This automatically hits all the other governments that use the Euro but are more fiscally responsible (such as Germany). If the Greeks were still using the Drachma, the Greek government defaulting would be almost a nonissue for the rest of the EU; the value of the Drachma would plummet, the Greeks would get hyperinflation for a while, the banks would have seizures requiring the occasional rescue as the Greek bonds on their balance sheets abruptly become worth less.... but there would be no direct effect on other governments.

          If Greece were not using the Euro, Germany would probably have told them to go hang a while ago.

          Now, with regard to the gold standard, it was abandoned for a reason. The amount of currency in an economy should be reasonably well matched to the level of activity in an economy. Activity in the economy generates demand for currency. However, economies typically run on a boom/recession cycle, and they have been since long before the gold standard was abandoned. This means that during a boom, there needs to be more currency around; and during a recession, there needs to be less. Otherwise your boom/bust is matched by inflation/deflation.(*)

          With a gold standard, every dollar in circulation needs to be backed by a given amount of gold, so in order to keep the right amount of currency in circulation the government issuing the currency must continually buy and sell gold.

          Given that all the gold ever mined is worth about US$8 trillion, the value of actual issued currency is about US$1.2 trillon (M0), and the value of all bank deposits and bonds exceeds US$10 trillion (M2), you have to ask, first, which of these values do you want to match in gold? And secondly, isn't there a better use for that gold than locking it in bank vaults?

          (*) And if you screw up the balance, you get a recession with high unemployment AND high inflation, also known as stagflation. You may have noticed we're more or less stopped getting these . You may not have noticed they stopped happening roughly when the RBA became independent, rather than being a tool for exercising government monetary policy.

          I should add, by the way, that while I do have a degree in economics, it's pretty old by now. However, most of this is very fundamental economic theory. (I certainly seem to have a better idea of how an economy works than our esteemed Treasurer, but then the average gerbil seems to a better idea of how our economy works than our esteemed Treasurer.)

            Thanks, that helped. I guess I'm used to a "global" economy and thus a "global" currency would make sense, but of course, it's not really a truly global economy, and the local markets are more important than international ones (for the locals). Greece was a good example. I guess I still think of it as the AMOUNT of money in each market not the VALUE of the money in each market... Though as we've discussed, the VALUE is imaginary anyway... *shrug*.

            Anyway cheers for the explanation!

    The Australian dollar is struggling, no doubt, but I don’t seem to remember anyone — except Apple — making adjustments when the Australian dollar was strong.

    Not directly IT related I guess, but still in consumer electronics - I do remember Roland of all companies actually adjusting their prices when our dollar was strong too.

    the dollar is falling because we arent buying locally, we are buying from overseas and the reserve bank doesnt like that. its why are our interest rates have been getting cut down to stupid levels. Oh yeah sure its great if your on a morgage but then the banks never give the full interest rate cut, but if you have investments its fucking terrible but the banks will pass on th full cut for that.

      Actually our dollar is failing because there's increased sentiment that the US Federal Reserve is likely to start increasing rates for the first time since the GFC (meaning cash investors are looking to get back into the USD), while our currency is falling due to two major factors. A) our economy has weakened following the ending of the mining boom reducing investor confidence in the AUD and B) to combat the weakening economy and low inflation rates (driven primarily by a drop in crude oil) the RBA have cut interest rates to stimulate spending and help weaken the AUD even more so that our exports industry doesn't suffer in an already adverse economy. They have repeatedly said the ideal AUD value from the Reserve Banks point of view is 75c to the USD.

      the dollar is falling because we arent buying locally

      Not really, but okay.

        There is some truth to this - the value of the AUD is ultimately set by the value of the goods and services we want to import offset against the value of the Australian goods and services the rest of the world wants to buy. When we buy local, that adjusts that balance slightly.

        The common error made in this context is to assume that this means that buying local is always a good idea. In practice, different countries are relatively better at making certain things. It's not hard to show that this means that having a country specialise in the things it's better at making then trading with a different country which is relatively better at something else results in everybody being better off.

        This is, by the way, the basis for support for the idea of "free trade" being a uniformly good thing. The main problem with this idea is that most people (or at least most of the people writing the treaties) don't actually want free trade and most "free trade" treaties wind up reflecting this.

        @pupp3tmast3r's explanation is basically accurate but the values of the capital flows he/she is talking about are ultimately based on the values of the goods and services traded by each economy.

          No one's denying that currency is influenced by import/exports but to say that the Aussie dollar is weak because 'we aren't buying locally' is over-simplified and illusory. Aussies not buying locally has been parroted as the cause of just about every economic ill, from why local farmers aren't doing better, or why kids don't watch local TV. Australians have never even been the largest consumers of Australian goods so people skipping imported produce probably isn't going to result in cheaper Heroes of the Storm.

    the prices are already ridiculous, look like another reason to earn my heroes in game.

    Just to set the record straight, 76c is not even close to an all time low. During the Howard years it was almost 50c, as you can see in this graph:

    http://www.xe.com/currencycharts/?from=AUD&to=USD&view=10Y

    Either way, you can see that the Liberal party in reality don't know s*** about managing our economy. :)

      You know a low dollar isn't necessarily a bad thing right? Only for you people worried about buying stuff from overseas and your expensive pixels.

      That is the most ridiculous and baseless statement I think I've read all day... There's so much wrong with this on so many levels -_-

        Thanks for alerting me, I'll let the political correctness police know I'll be handing myself in. :)

          Thank god! I'd hate having to find a PC bounty hunter to track you down! Their retainer fees can be a bit excessive.

        tell that to steam too , other day buy steam wall at at 7 gas station 50$ AU and got 30$ of steam wall.

    The exchange rate has no bearing on a digital product because once provisioned there is no cost to Blizzard - it's all profit (after operating costs). It's surprising considering everything in their store is already quite expensive.

    Any local (ie Australian) costs would be going down if the Australian dollar was weakening not up because it would cost less US dollars than before. Any US-based costs would be static and won't be changing, as well as having no bearing on the local market.

    It all sounds like bullshit to me and is most likely the result of Australian Blizzard reporting back to US Blizzard in US dollars and it appearing to be not performing well after the conversion. I've seen it in many US-based companies who operate locally.

    why dont they just list in USD and let the exchange rate cover everything else?
    you can actually make a fake US account & the real exchange rate means you're paying less than if you were to pay in AUD, I dont get why this isnt illegal
    Aren't exchange rates already an indicator of a difference in GDP or whatever excuse they make against it?

      why dont they just list in USD and let the exchange rate cover everything else?

      If they charged in USD, your bank isn't going to do a straight Xe conversion. Most banks and e-commerce platforms like PayPal have unfavourable exchange rates. The only people coming ahead in this scenario are those who set their primary payment method to a card like 28 Degrees with no foreign transaction fee and rates comparable to the actual market.

    WoW subs used to be 15USD, when our dollar went bad they changed it to 16.50 aud. which is actually cheaper than 15 usd. So they have a proven track record of not being dicks about it so far. Lets hope they continue.

      That logic is backwards, when our dollar is down their local costs are down and therefore it should be worth more to them - not an indication that they should be charging more.

      They have proven they are dicks about pricing.

    When associated factors cause prices to rise, the adjustment is instant.
    When associated factors cause prices to fall, the adjustment might happen in a few weeks...maybe...

    Last edited 07/05/15 12:58 pm

    Packing sprites in a fictional box ain't cheap, after all...

      Hahaha I know right! Makes it all a bit mind boggling :B

    Well, thank you Blizzard for giving me yet ANOTHER reason to not spend any money on your stupid baby's-first-MOBA.

    Exchange rates should not apply to digital product transactions because there is no commodity involved. If Blizzard aren't losing anything by selling something to us -they are not giving away a material commodity- then if they had any respect for us as anything other than walking wallets, they'd let us pay the SAME amount as players in other countries, irrespective of what our money is worth. But of course, it's Blizzard.

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