What To Expect After Steam Supports The Aussie Dollar

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.

Once you've gone through the hoops and have approved access to the developer backend, Steam lets you set the price of the game in US dollars. At that point, Steam will then uses a matrix to suggest region-specific prices.

Say a developer sets the price for their game at $US10. Valve's algorithm then makes recommendations on pricing for other countries. It might be slightly lower, as recommended for some parts of South East Asia, or the CIS territories.

Australians are generally charged the same price in USD as Americans. One example below is Two Point Hospital:

But because the AUD wasn't available as a currency to purchase games with, the recommendation could result in Australians paying a higher USD price than other territories.

So for the most part, developers and publishers have been happy to let Australians pay the global USD price.

That hasn't always been the case, though. Major publishers have often been the most egregious offenders, with DOOM and Civilization: Beyond Earth recent examples. Both games were instances of locals being slugged an extra $US20 than our American counterparts, before the currency conversion and bank fees were factored in.

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This is why the impending support for the AUD has, traditionally, been welcomed. Since it was enabled on Fanatical and GOG, two major third-party marketplaces that sell games in AUD, the Australian price has been marginally better than what the US price would have been post-currency conversion.

And amongst the developers I spoke to for this article, the general sentiment was that Australian pricing should remain largely the same, if not a little better.

One developer, whose game currently sells for $US14.99, explained that Steam's recommended Australian pricing was $21.50. That's a fraction higher than the current exchange rate - $21.11 at the time of writing. But once you factor in the extra charge from Australian banks, the price ends up being a little higher ($21.74 if you're adding a 3% fee).

PayPal, in this instance, would have charged just over $22.

Another local developer, who requested anonymity, outlined another scenario. For a $US9.99 game, Steam recommends developers charge Aussies $11.95.

If you were to buy that $US9.99 game today, you'd be charged around $14.07. That doesn't include whatever your bank will charge for the currency conversion either.

Even applying the worst case scenario - where Steam enables sales in AUD, and adds 10% GST on the top - Australians should still be charged roughly the same amount.

A key factor here is whether Valve changes its pricing matrix, which makes recommendations for regional pricing based off a global USD price. If it remains as is, Australians should expect to pay about the same, if not a little less.

However, all of that is moot if a developer or publisher opts to set the price manually. Let's say a particular game is being published on other major platforms. If GOG suggests a $US19.95 game be sold for $24.95, and Steam recommends a higher or uneven figure - like $24.30 or something - there's a good chance the publisher/developer would adjust that themselves to keep things uniform.

Because of that desire to keep pricing fair across multiple territories, as the War for the Overworld developers noted, the most likely outcome is that game prices will remain largely the same.

Of course, publishers and developers can always set whatever price they want. Steam might recommend - as an example - that a $US49.95 game be sold at around $70. But that can always be changed to $74.95, $79.95, even $89.95.

There's nothing stopping them.

Where Australians will see the most benefit are from indie publishers, smaller studios and the AA-type games. The ones you might drop $40 or $50 to buy digitally, the ones that won't appear in a store at first. Without the currency charges from banks, and what Steam is currently recommending to developers, Aussies shouldn't get shafted.

We may even save a few dollars here and there. And even if the prices work out roughly the same, at least that's not money going back to your bank.


Comments

    I wouldn't be worried. If it's cheaper on GOG, buy from there. At least we can now compare prices transparently.

    at least that's not money going back to your bank.

    Shouldn't we be supporting our Aussie bankers?

      Nah, if the RC's shown us anything, it's that they've been helping themselves.

    I'll just be using steamprices (or the like) even more as they can do cross-currency comparisons (makes it easier to see the "Australia Tax") especially through any currency differences.

    One point though: Im assuming it would be a dual use currency thing for a while at least - given a lot of people would have a USD balance in their Steam wallets, or have their hands on USD Steam gift vouchers.

      Install Steam Enhancement Suite in your browser and the currency comparisons as well as comparisons to authorised resellers will be visible directly on the store page for each game.

    I think one of the major advantages will be psychological.

    Sales rely heavily on getting customers engaged with the product. You might not click on a title that says it's selling for $45AUD, but if the store page has a big, flashy, "On sale, half price, $30!" on it, and people think, "I can afford $30!" they go to put it in their cart and it's only in the fine print, a half-dozen clicks in, that they remember it's not AUD, but USD, and Paypal says that based on current exchange rates plus their fee, it's going to charge $45AUD...

    By that point, there's psychological investment. A rational human can override it, but it's still there and it absolutely changes the buyer's perception of the value of that remaining $15 difference - literally a third of what they're about to spend.

    Steam sales are legendary for their hijacking of impulse behaviours. This change should help limit some of that damage.

      This is the real reason it matters. It’s easier for us to assess the price now - no nasty surprises at the checkout. It makes comparing prices much easier too. Publishers will always find a way to screw us with regional pricing - but at least now we know exactly how much they’re trying to extract at a glance.

    I'm mostly hoping for an end to the confusion that some publishers have over the price to charge in Australia. Giving them the benefit of the doubt, I think there's a bunch of developers/publishers who assume the price they set in the regional pricing matrix would be in the regional currency, which has not been the case for Australia for a really long time.

    EG, those games that are displayed at $89.99 to Australians, to match the "brick and mortar" RRP, but the fact that we were displayed and charged in USD was overlooked when doing regional pricing on Steam.. so we get charged a huge amount more than the USD price paid in other territories.

    My observation has been that outside the usual AAA Australia-tax markup, most smaller publishers have simply absorbed the 10% GST since Steam started collecting it. I presume that this is mainly due to the fact that setting a universal price across all USD territories is just simpler for everyone.

    I am concerned, however, that once game prices start being advertised in AUD the simplicity advantage of a single global price for smaller publishers will be eliminated.

    Once publishers are forced to to type a specific AUD number into the screen rather than relying on a global USD price it's a very small step indeed at that point to add 10% on top. I'll also bet that when faced with a choice between rounding down or rounding up to the nearest .99c AUD the vast majority of publishers are not going to rounding down.

      I don't think tax is taken into account on the prices the developers/publishers set for their Steam game. Steam itself would add any applicable regional taxes on top of the set price during checkout otherwise for EU pricing and US pricing they would have to nominate like 50 different prices since every state/territory has different taxation.

      Last edited 25/10/18 1:27 pm

      I'll also bet that when faced with a choice between rounding down or rounding up to the nearest .99c AUD the vast majority of publishers are not going to rounding down.
      Prices work on a psychological factor as much as anything else we do. We often see something thats $9.95 as a massive saving over something thats a flat $10, and businesses know it.

      Likewise, there are other convenient price points they take advantage of as well, which strangely can lead to us accepting higher prices before lower ones. Something thats $10.20 can seem an annoying price to pay, while $12 doesnt. So in the end we feel happier paying 15% more.

      There will be times they round down. That $10.20 example would probably be rounded down to $10 for simplicity, recognising that the potential backlash isnt worth it for a relatively small market. Or not as their US market sees us getting things cheaper and complain - they could put higher prices here to increase sales there.

      Or they might just accept the matrix price and blame everything on Steam. All of those are things we subconsciously accept, and we'll only know after the fact. There will be some interesting variations in the next few months, and it'll be interesting to see how it plays out in 6 months time.

    We only have ti look at NZD pricing on Stram in recent years... while we were screaming about "Australia Tax", New Zealand gamers were getting local retail pricing or better due to the pricing algorithms.

    This is going to be awesome... shame it kicked in AFTER Bethesda stopped sealing their new titles like F76 on the platform.

    Or you could just abandon that worthless piece of crap $2800 PC and get an Xbox One X so you can play Red Dead Redemption 2 and not be afraid of the game crashing for no reason or losing your saves. Then you can have all your games and achievements in one place instead of having to use Steam, Uplay, Origin, Bethesda.net, Epic Games Launcher, etc.

    And if you don't like Xbox then you can get a PS4 Pro and pay money to save your game to the cloud.

    I don't read replies.

    Get onto ING's bank accounts people, they credit international transaction charges and also atm fees.

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