When Valve first announced that the Australian dollar would finally be enabled by November 21, it was long overdue. And after speaking to local developers to gauge the impacts of the change, the general sentiment is that Australians should be fine. Here's what to expect once you can start using the Aussie dollar on Steam.
This post has been updated in time for the Steam AUD changeover, which is still expected later this week.
Two Valve employees gave a presentation about the AUD changes at Melbourne International Games in Melbourne, and not long after that developers received emails from Steam properly announcing the release of front-facing support for the local dollar.
In that email, Valve revealed that they were hoping to enable the AUD by November 21. That's hugely important for developers, as they'll need to have set an Australian-specific pricing before that date. Once the AUD support goes live - and Valve has said this whenever new currencies are added - a developer's games cannot be sold in Australia if an Australian-specific price hasn't been set.
"If you do not have new currency pricing entered by November 21st, customers will no longer be able to purchase your games in Australia via the Steam storefront," the email reads.
Developers that previously set Australian specific pricing will have to do so again, because all previous pricing for Australians has been reset. The major reason for that is because of a change to Valve's pricing matrix:
Due to significant currency fluctuations, old pricing entries for AUD have been removed. If you previously submitted AUD pricing, you'll need to resubmit. Right now, games are available to purchase on Steam in Australia with USD, but are often more expensive compared to the price in USD throughout the rest of the world.
So Valve's matrix was updated due to these "significant currency fluctuations". Around this time last year, the Australian dollar got you $US0.784. At the close of play yesterday, the Aussie dollar was $US0.73.
What that means in practical terms is Valve's recommended pricing - what a game's global USD price should be in AUD, more or less - has become a fraction more expensive.
According to the developers I spoke to, that will result in a small hike in prices. Before the pricing matrix change, Steam would recommend a $US10 game be sold at $11.95. Now, Valve's algorithm would recommend that same game be sold at $14.50. (A $US10 game comes to $13.69 at the time of writing, although that's not factoring in bank or PayPal conversion fees.)
Plans to support the Australian dollar on Steam have been in the works for years. But when the AUD finally appears on the front page, what actually happens? To dispel some of the confusion and concern, I spoke to some developers to help outline what customers can expect next month.
Here's a breakdown of pricing recommendations provided to Kotaku Australia post the algorithm change:
- $US10 —> $AUD14.50
- $US20 —> $AUD28.95
- $US30 —> $AUD42.95
- $US40 —> $AUD56.95
- $US50 —> $AUD69.95
- $US60 —> $AUD84.95
- $US70 —> $AUD99.95
- $US80 —> $AUD114.95
- $US90 —> $AUD129.95
At the time of writing, that's roughly in line with current currency conversions (after factoring in bank fees). It's not unreasonable, but it's also not the small saving Australians were looking at before the algorithm change.
It also means Steam's pricing recommendations will basically be bang on with retail prices. There's still an advantage to buying through Steam, given that most PC retail boxes are just digital codes anyway.
Steam also included a warning of sorts to developers and publishers:
Here's some data: over the past year, we've found that the proportion of sales in Australia has been 21% higher for top-selling games that price at parity as compared to top-selling games that price above the worldwide USD price.
In other words: top selling games that aren't gouging Australians sell 21% better than those that don't. Valve didn't name any offenders, although below highlights the kind of behaviour they're talking about.
But as always, it's up to the publisher/developer to set the price that they want. And global publishers with elaborate retail deals - or their own digital storefronts - will price accordingly.
The most interesting part of all this is the third-party storefronts. What happens to places like Humble Bundle or Green Man Gaming, which sell games to Australians in USD? Do they adopt the new pricing or do they sell to Australians based off the global USD price? There'd be a strong competitive advantage for them to do so, and we'll keep an eye on how that situation develops.