So, you’ve no doubt opened up Steam today. You’ve heard about the switch. You know that your Steam wallet balance has already been converted using the day’s trading value for the U.S. dollar. You look around and see if there are any specials – and there are a handful – but at the back of your head you’re wondering if anything really changed. Is Grand Theft Auto V cheaper now? Can you somehow score on the Fallout 4 season pass? Is any of the DLC a little cheaper for the game you’re putting the most hours into? That’s a question that I hope to answer today in the form of a price comparison of ten popular sellers on the Steam market. We’ll take a look at a comparison of the prices before and after the switch to Steam using the South African rand, and hopefully we’ll have some things to ponder on moving forward. Follow me after the jump.
Am I restricted now?
The question of region restrictions rears its head now that we’ve been converted over to using local currency for buying games on Steam, and there’s almost certainly some new restrictions piled on us now that we’ve never had to deal with before. For one, the day before the switch, it was possible to send gifted games from one account to another across regions. Today, that ability is gone. If you have friends overseas who want to gift you a game on Steam, you’ll have to get them to top up your wallet instead. This move is to curb people from making separate accounts overseas through a VPN, and then gifting games bought at cheap prices to their real account in another region.
The other problem is gifting to friends within the same region, or buying a game for yourself while in South Africa. Some titles have restrictions on them when you’re purchasing them for yourself or as a gift, and a quick test for Fallout 4 shows, the person I gift it to must have a Steam account that was created in South Africa to receive my gift. Additionally, we may find later that other games have restrictions on which country you’re allowed to play it in. Recently, Valve’s changes to gifting games resulted in users discovering that they couldn’t play games they had bought themselves while holidaying overseas, because they had purchased them in a different region. Its an unfortunate arrangement, but this is how Valve is approaching the issue for now. In the future, they might find a better way of implementing these restrictions to make it more consumer-friendly.
Is there any precedent for lower pricing with a currency switch?
Yes, yes there is! The first game client to do this was actually Origin. Electronic Arts made the currency switch for Origin a few years back when the exchange rate was closer to R11 to the dollar. The switch resulted in a tiny saving for most people at the time, and it wasn’t vaunted much in the local news. Over time, however, that switch has started to show some savings for consumers buying select games on Origin, versus buying them through local online retailers. For other games, there’s the benefit of getting immediate access and being able to play your game later that same day, assuming your internet connection is fast enough.
Buying from Origin represents the best possible outcome for gamers locally using a game client to buy games online. Star Wars Battlefront costs the same as if you had to buy it from Takealot. Sims 4 is a little cheaper and saves you having to download most of the game. Its not a bad deal, and it comes with the added bonus of being able to refund your purchase for a limited time, which isn’t an option with any local retailer because of the way PC games are packaged and sold today.
Lets take a look now at some of the most popular games selling on Steam, and see how things stack up. We’ll be comparing the price of the game as it stood in U.S. dollars on 9 November 2015, and have a converted value to rands for that day. The next two columns will deal with the new pricing in rands, with a conversion back to the dollar to see if we’ve saved anything. As of this writing on 9 November, the rand is trading at R14.25 to the dollar (literally the highest it has ever been). With our currency in such a state, any savings we can claw back through Valve lowering pricing to match the local economic conditions is a win for every gamer.
|Steam sale prices for games on 9-10 November 2015|
|Old price (ZAR)||Old price (U.S. $)||New price (ZAR)||New price (U.S. $)||% Change (ZAR)|
|Call of Duty: Black Ops III||R854.67||$59.99||R799||$56.21||-6.51%|
|Counter-Strike: Global Offensive||R213.56||$14.99||R159||$11.19||-25.55%|
|Grand Theft Auto V||R854.67||$59.99||R589||$41.44||-31.08%|
|ARK: Survival Evolved||R427.26||$29.99||N/A||—||—|
|Football Manager 2016||R712.20||$49.99||R489||$34.38||-31.33%|
What is apparent after the switch is that there are price drops overall for most games. They are often in the double digit range, far more than most people expected when the announcement was made that the currency would be switched. Some games only see a small drop, and these are typically the AAA titles. Still, there are some incentives to buying from Steam instead of buying from local stores – primarily pre-load options, day one delivery, and refunds.
Some games, of course, aren’t available because the developers or publishers haven’t priced them for our region yet. Titles like ARK: Survival Evolved, a good chunk of Bethesda’s library, Battleblock Theatre, Terraria, and many more are missing. Thankfully, this shouldn’t be the case for much longer, as many of these games should be priced in rands within the next two weeks or so.
Comparisons to local stores
|Steam prices for games on 10 November 2015 compared to retail prices|
|Old price (ZAR)||New price (ZAR)||Takealot||Raru||CNA||BT Games|
|Call of Duty: Black Ops III||R854.67||R799||R699||R687||R799||R699|
|Grand Theft Auto V||R854.67||R589||R720||R615||R799||R755|
|Metal Gear Solid V: The Phantom Pain||R854.67||R589||—||—||R599||—|
What benefits, if any, do we get out of this?
There are several benefits, some of them immediately apparent, like lower pricing, and others that will take time to see their effect on our local market. For the most part, we’re a legitimately more important market thanks to the regional pricing. Valve considered it important enough to make the changes and go through the hassle of determining the ratio we should be awarded due to our economy’s performance.
In the long-term, there are going to be significant effects on the games economy. While it’s been somewhat more expensive to buy games at launch price on Steam compared to ordering through BT Games and other stores, future price adjustments might sway more people to purchase online. As mentioned before, having refunds be an option is something we don’t get locally, and being able to pick up Grand Theft Auto V, find out that it might not be playable on your rig now, and refund it for purchase later, is quite a benefit.
Elsewhere, it seems that our local distributors will be further protected against price shifts on Steam compared to their prices in stores. It’s still cheaper to buy Fallout 4 locally than through Steam, and it seems like the major publishers will work with local distributors to determine appropriate pricing. Now that we no longer have Steam pricing hinging on the exchange rate, things are more amicable for everyone.
If our currency gets worse, will games become cheaper?
Maybe, maybe not. There’s a great article on Valve’s pricing in various regions by PCGamer that goes into the math and economics behind some of the currency switches. Many of these countries have a sliding scale instead of a set amount of money that the games should be sold for, and almost all of the localised regions do engage in price matching to what people pay for games at the retail level.
But if our currency gets worse in the future, we might be able to look forward to adjustments downwards, though this is dependent on market trends. If everyone stops buying AAA titles locally for a month, or at least drops their spending by 50%, our local distributors will take note of that and figure something out.
Is VAT calculated into this amount?
I checked out a couple of games to see if tax is added in, and it isn’t. Valve might be swallowing this fee for us to make the games cheaper, or it might add that on a a later date. Either way, for now things are much cheaper than they were before for a lot of games, and it doesn’t seem like we’ve lost anything in the process.
The value proposition for being a PC gamer over buying a console and investing in that platform just got a whole lot cheaper. Rejoice! The Steam sales will be even better than before!