Wow! That's very expensive. In Mexico, a normal $60 dlls game is around $74 dlls. No close to $100 dlls like Australia!
The publishers' perspective
Despite what the 2010 figures show, local publishers are celebrating rising sales numbers. Although Nintendo, Microsoft and Sony declined to comment on local game prices, all three publishers’ latest sales figures for Australia indicate that there is no cause for concern on their part.
In February 2010, Microsoft revealed that the Xbox 360 experienced its biggest year to date in 2010, with a 20 percent increase in total sales over 2009 (although it declined to offer any Australian-specific hardware details or numbers). Nintendo also revealed a profitable year, with the Wii in number one place as the highest-selling console of 2010, selling more than 420,000 units. Nintendo software (including both first party and third party published software) also accounted for 47 per cent of console game sales in 2010, and in November last year the publiser announced it reached 2 million Wii units Down Under. Finally, Sony reached 1.1 million PS3 consoles in Australia in 2010, making up 26.5 percent of all console sales in the region.
Managing director of Sony Computer Entertainment Australia, Michael Ephraim, said both the PS3 console and PS3 games were doing well despite the downturn experience by the local industry.
“PlayStation 3 as a platform continues to outperform and outgrow, even during the double-digit industry-wide downturn last year,” Ephraim says. “Our consumers are responding to the increased entertainment content offering, from both our company and our network of partners, enjoying the benefits derived from our ongoing technical innovation, and also the more connected network experiences we continue to offer.”
When GameSpot AU interviewed Ephraim for our last game prices feature in 2008, SCEA’s managing director said a big segment of the market still chooses to buy games locally for things like ease and return policies, something that is unlikely to change in the future.
"Compared to the European market, prices in Australia are quite reasonable for our games," Ephraim said in 2008. "In Australia we have to consider things like the GST, different retailer margins, freight issues, geographical location, and volume of customers when setting the prices of our games. Plus there is no consistency with the exchange rate--it's always fluctuating. Who knows, by 2009 things could have done a complete turnaround."

The retailers’ perspective
Aussie game retailers also remain unconvinced that slipping sales are a cause of concern. Two of Australia’s largest game retailers, EB and GAME, are adamant that price is only one among many concerns that Aussie consumers have when it comes to buying video games. Debra McGrath, EB’s national brand and marketing manager, says competition between retail and online stores has always been fierce.
“There are so many factors that contribute to the rise and fall of sales that there is no way of pinpointing exactly what percentage of that relates directly to online sales and the strong Aussie dollar,” McGrath says. “As such, [EB] has not seen a direct impact on sales. However, price is only one element of being a successful and trusted retail business. We have seen exciting growth in our [online] store by offering customers a safe, quality and reliable service experience that integrates seamlessly with our physical EB Games stores.”
Paul Yardley, managing director of GAME Australia, agrees. He says his store’s online business has doubled year-on-year, something that signifies that while more people are buying online, they’re still buying local.
“The games market falling isn’t just a local issue,” Yardley says. “It’s happened in other markets around the world, and it’s no surprise here really. We’ve kept an eye out for any impact but from what I can see [GAME] sales have not been impacted at all. Sure, more people are buying online and I can understand why some gamers may look elsewhere for the best deals given current game prices in Australia. But it’s only a narrow part of the customer base that will go and look for the very best price and go to overseas retailers to get it. I know a lot of customers who would never do that. I was recently talking to a couple of mothers who came in to the store, and they said they’d never ever shop online from an overseas retailer because they are worried about things like giving out their credit card details, and returning the product if something is wrong with it.”
Yardley says the unfair game pricing in Australia doesn’t apply for all games. He lists LittleBigPlanet 2 as an example, saying the title’s Australian price is much more favourable than its current UK price. [However, at the time of writing, the GAME Australia online store price for LittleBigPlanet 2 is A$64, while the GAME UK online store price is A$56, and the US price is A$60.]
“Of course some people are really good at finding deals, and that’s what they will always want to do. But it’s not just about the price. Look at the reasons people have loyalty cards--you can only use them in stores. There’s also the problem of availability--you can only get a day one release if you buy it from a store. Yes, some Aussie consumers are prepared to wait and get a better price, but we have to ask ourselves how big that niche is. I think if the local games industry looked at that niche it would discover it’s not a big problem at all.”
Most Aussie gamers would disagree. But how easy is it to compare Aussie prices with other territories to find the best gaming deals? How easy is it to factor in things like shipping costs, release dates, region coding and delivery times?
The consumer perspective
These questions led Aussie gamer Andrew Kudilczak to start GameCafé, Australia’s first games price search engine. The project began in 2007 as a hobby for Kudilczak and a friend; they both recall wasting hours on Google (instead of playing games) looking for the best deal for newly released titles and wondering why there wasn’t simply a website that listed all the game stores, both online and traditional retailers, along with handy information about prices, shipping info and delivery times. Initially, GameCafé was hosted from Kudilczak’s back shed on a single machine; now, the site runs on hosted dedicated servers, and includes full-time, dedicated staff. Although the site initially included price comparisons within the Australian, UK and US markets (with over 120 stores listed), this amount of information overwhelmed consumers, leading Kudilczak to strip the site back to serve just the Australian market.
Although the need to find cheaper games is what led Kudilczak to start GameCafé, he understands why Aussies sometimes have to pay more.
“Gamers in Australia enjoy a quality of service from Australian retailers that perhaps warrants the extra cost,” Kudilczak says. “The GST is one obvious contributing factor to the high prices, but most gamers in Australia are simply not willing to wait one to two weeks for the latest game to hit their mailbox from an overseas retailer, when they can simply order online within Australia, or round up a copy at their favourite brick-and-mortar store. The prices simply reflect the market forces at play. In some cases, region code restrictions force Aussies to buy locally anyway.”
“I think even though the Aussie dollar is high, the prices of games in Australia reflect the market demand. Should this demand drop, the price of games will drop too. I believe that the large demand for locally-sourced products remains the primary reason for prices remaining relatively high compared to shifts in the currency. I believe the Australian gamer wants the assurance that the game they buy won’t be region locked, and will arrive in a short time. They also see value, and are far more comfortable dealing with local distributors.”

GameCafé’s data is obtained through a combination of data feeds from merchants as well as directly from game retailers’ websites. The price data is then collated and forwarded to a centralised database which gamers can search via the GameCafé website. All this processing is done autonomously, without human intervention. Kudilczak believes that while there has been a big shift towards buying online through distributors such as Steam, he doesn’t think this has had a large impact on overall game sales in Australia.
“The immediate access [of a service like Steam] appeals to the cutting edge/new release gamer, who simply can’t wait to get stuck into it! I believe that more and more services like Steam will begin to appear, especially as network bandwidth costs fall, and network speeds increase. The era of physical gaming media is starting to decline. Many game companies are looking to distribute online. Having said all that, the Aussie gamer can expect to make significant savings from shopping around--some games listed on our site could return a saving of 75 percent or more for the economical gamer. Within Australia, it is nearly always cheaper to buy from online retailers (local or overseas) compared to brick-and-mortar stores with savings in the order of 10-25 percent on a typical game.”
While it seems that some Aussie gamers continue to remain dissatisfied with high game prices Down Under, the percentage of the consumer market moving away from buying local and towards overseas imports is not large enough to hurt the local industry, or to become a cause for concern for local publishers and retailers. When factored in with things like market fluctuations, global economic instability and Australia’s geographic location and size, what this indicates is that Aussie gamers are unlikely to be paying fair prices for games for a long time to come. Are high game prices in Australia a concern for you? Let us know by leaving your comments below!



