The European Commission just announced that they've now issued formal fines against Valve, Bandai Namco, Capcom, Focus Home, Koch Media and ZeniMax for breaching their antitrust rules. An investigation that has been going on for some time now since early 2017, and certainly not the first fine Valve has dealt with for breaking some rules here. Note: statement from Valve at the bottom.
What's the deal? The EU say that Valve and the others restricted cross-border sales on the basis of their location inside the European Economic Area (‘EEA'). To put it simply: Valve allowed certain developers and publishers to block keys being redeemed in one country, that were purchased in another (where it might have been cheaper). Out of all those named, Valve is the only company that did not cooperate with their investigation and so they got slapped a lot harder.
The EU Commission made this handy chart for the issue:
Executive Vice-President Margrethe Vestager, in charge of competition policy, said: "More than 50% of all Europeans play video games. The videogame industry in Europe is thriving and it is now worth over € 17 billion. Today's sanctions against the "geo-blocking" practices of Valve and five PC video game publishers serve as a reminder that under EU competition law, companies are prohibited from contractually restricting cross-border sales. Such practices deprive European consumers of the benefits of the EU Digital Single Market and of the opportunity to shop around for the most suitable offer in the EU".
The fines:
|
Company |
Reduction for cooperation |
Fine (€) |
|
Bandai Namco |
10 % |
340 000 EUR |
|
Capcom |
15 % |
396 000 EUR |
|
Focus Home |
10 % |
2 888 000 EUR |
|
Koch Media |
10 % |
977 000 EUR |
|
ZeniMax |
10 % |
1 664 000 EUR |
| Valve | 0% | 1 624 000 EUR |
For a company as big as Valve (and the likes of ZeniMax), they won't be losing any sleep over fines that for them will most likely be a drop in the ocean. Valve especially, as the Steam store pretty much prints money for them.
You can see the full announcement here.
Update: We reached out to Valve and they said this:
Article taken from GamingOnLinux.com.During the seven year investigation, Valve cooperated extensively with the European Commission (“EC”), providing evidence and information as requested. However, Valve declined to admit that it broke the law, as the EC demanded. Valve disagrees with the EC findings and the fine levied against Valve.
The EC’s charges do not relate to the sale of PC games on Steam – Valve’s PC gaming service. Instead the EC alleges that Valve enabled geo-blocking by providing Steam activation keys and – upon the publishers’ request – locking those keys to particular territories (“region locks”) within the EEA.
Such keys allow a customer to activate and play a game on Steam when the user has purchased it from a third-party reseller. Valve provides Steam activation keys free of charge and does not receive any share of the purchase price when a game is sold by third-party resellers (such as a retailer or other online store).
The region locks only applied to a small number of game titles. Approximately just 3% of all games using Steam (and none of Valve’s own games) at the time were subject to the contested region locks in the EEA. Valve believes that the EC’s extension of liability to a platform provider in these circumstances is not supported by applicable law. Nonetheless, because of the EC’s concerns, Valve actually turned off region locks within the EEA starting in 2015, unless those region locks were necessary for local legal requirements (such as German content laws) or geographic limits on where the Steam partner is licensed to distribute a game. The elimination of region locks may also cause publishers to raise prices in less affluent regions to avoid price arbitrage. There are no costs involved in sending activation keys from one country to another, and the activation key is all a user needs to activate and play a PC game.
At the end of the day I doubt this will or should end regional pricing in the EEA. I imagine key sales are a relatively small chunk of the market and majority just buy directly from the local store page, so IMO it would be sensible for Valve and the like to just set those keys to be redeemable across EEA and keep the regional pricing in place.
Quoting: mphuZOf course. When the EU decided on price tags, all prices were adjusted not for poor Estonia, but for rich Germany and France. Common sense has lost again.Quite frankly, you should feel very ashamed for spreading BS like that. That is exactly how fake news start.
A good rule: if you don't know what you are talking about, don't talk about it. At least look up some official information before embarrassing yourself like that.
This is NOT about regional pricing, it is about region locking within the EU.
Regional pricing is not only legal, it is perfectly normal - you pay different prices for the same thing in different countries - the EU is no exception. I've been in seven countries within the EU (not counting airport stops) and went shopping (groceries, etc.) in all of them, and almost ALL prices differ from country to country.
Those of us within the EU who know how to make a deal generally try to order stuff from outside our national borders (but still within the EU so no customs apply, etc.) if you can save money that way.
Problem is that many national stores don't offer an international shop front to begin with - so you gotta awkwardly go through Google translate to order sth in France if you, like me, don't speak French.
Quoting: TheSHEEEPThis is NOT about regional pricing, it is about region locking within the EU.Do you understand that one thing leads to another? No?
What do you think will happen if the geo-blocking is removed? That's right - everyone will run to buy games from other countries at a reduced price.
Quoting: TheSHEEEPwent shopping (groceries, etc.)Why are you comparing grocecies and digital products? You will not constantly order products from other countries for the sake of saving? I agree that this is not fair to honest users who bought the game on the territory of their country, and could not play it on a business trip because of geo-blocking. But this geo-blocking is aimed at freeloaders who want to get games for 10% of the price in their region.
Quoting: TheSHEEEPThose of us within the EU who know how to make a deal...It is because of people like you that geo-blocking was created.
Can you suggest a better solution for sellers and buyers - suggest.
This issue is already almost 2 years old: https://steamdb.info/blog/steam-geo-locking-europe/
Even Valve itself spoke about the problem of price increases in poor regions.
QuoteThe elimination of region locks will also mean that publishers will likely raise prices in less affluent regions to avoid price arbitrage.
Quoting: randylQuoting: EgonautValve doesn't set the price of a game, publishers do. Valve applies publisher set regional pricing and key validation restrictions so some countries don't have to pay the same price as more economically powerful nations and regions. This was asked for by both players and publishers.Quoting: rkfgThis is very bad and stupid. They basically force Valve to set the same prices everywhere, no matter how strong economic is in certain countries. I
No they don't. They force Valve and other Publishers to redeem keys all over the EU no matter in which EU country they have been bought. If Valve changes the Prices due to this, it's all up to them and not forced by anyone.
This will just result in poorer countries paying more, or video game pricing going up for all. It sounds to me like richer Euros don't really care about that though. Let those poor nations eat video game cake if they can't afford bread!
Or going down if they earn less, because plenty of people will stop buying them.
LordDaveTheKind Jan 21, 2021
Quoting: minfaerTo everybody discussing the sense of regional pricing: That is still legal and all in the EU. The only thing they are no longer allowed to do is preventing people from buying their games in other EU countries by refusing key activation (aka geoblocking).Thank you for clarifying
Interestingly, from the latest law that obliges online business to let people from the EU access the offers from any EU country and forbids denying a sale based on location in the EU,digital goods"audiovisual services" (I believe this includes games and movies) are exempt. Definitely movie-industry lobbying in action there.
See here
Edit: More precise about exemption, added source.
Quoting: NanobangWicked wicked Valve ... she is a bad person and she must pay the penalty. And here in the European Union, we have but one punishment ... you must tie her down on a bed ... and spank her!On second thought, let's not go to the EU. It is a silly place.
Quoting: LordDaveTheKindHuh, obviously trying real hard. They're not shy about threatening to crash a member country's whole economy for disobedience if it's something they care about, like making sure you worsen your recessions with austerity.Quoting: x_wingI understand the idea of enforcing the UE as one country but is kinda difficult to understand this mindset when the same UE doesn't enforce a minimum wage for all their members.Actually they are trying to, but the laws have to be designed and approved in each member country:
https://ec.europa.eu/commission/presscorner/detail/en/ip_20_1968
Quoting: minfaerTo everybody discussing the sense of regional pricing: That is still legal and all in the EU. The only thing they are no longer allowed to do is preventing people from buying their games in other EU countries by refusing key activation (aka geoblocking).
Interestingly, from the latest law that obliges online business to let people from the EU access the offers from any EU country and forbids denying a sale based on location in the EU,digital goods"audiovisual services" (I believe this includes games and movies) are exempt. Definitely movie-industry lobbying in action there.
See here
Edit: More precise about exemption, added source.
From what I can understand on your source, what the EU is doing is to limit the tools that have some online sellers in order to filter which users are allowed to buy something on their market place. The EU may not actually banning regional pricing but if you ban the tools that allows the enforcement of this limitations, you may end up making impossible the regional pricing (ipso facto: many stores may end up removing regional pricing).
Your source is definitely more oriented for physical goods but based on the current article, it seems that in the near future the plan is to force all license to work in every country of the UE. And unless they create an specific rule for software licenses, I really fail to see how forcing that the activation of a key on every country of the EU will not translate in the same rule for anyone that wants to buy a game using a VPN and a foreign credit card.
Last edited by x_wing on 21 January 2021 at 4:30 am UTC
Cloversheen Jan 21, 2021
Quoting: mphuZQuoting: TheSHEEEPThis is NOT about regional pricing, it is about region locking within the EU.Do you understand that one thing leads to another? No?
What do you think will happen if the geo-blocking is removed? That's right - everyone will run to buy games from other countries at a reduced price.
https://yourlogicalfallacyis.com/slippery-slope
The geo-blocking has been removed for more than 5 years, and it didn't exist before Steam implemented it back in 2010. It only existed for 5 years and gaming did fine before and still does fine. The EEA has been around since 1994.
Quoting: mphuZQuoting: TheSHEEEPwent shopping (groceries, etc.)Why are you comparing grocecies and digital products? You will not constantly order products from other countries for the sake of saving? I agree that this is not fair to honest users who bought the game on the territory of their country, and could not play it on a business trip because of geo-blocking. But this geo-blocking is aimed at freeloaders who want to get games for 10% of the price in their region.
Because that's how an economic area works, anyone living in the EEA have the legal and moral right to go shop wherever they want within the EEA, any company can choose to market their goods in the EEA as long as they play by the rules. We here might enjoy games more than most in the world but games are just another goods. Nothing special about it.
Quoting: mphuZQuoting: TheSHEEEPThose of us within the EU who know how to make a deal...It is because of people like you that geo-blocking was created.
Can you suggest a better solution for sellers and buyers - suggest.
https://yourlogicalfallacyis.com/ad-hominem
QuoteThe elimination of region locks will also mean that publishers will likely raise prices in less affluent regions to avoid price arbitrage.
Regional locks where never allowed, the companies listed broke pre-existing law and had to pay the consequence. If you are a EU-citizen and disagree with said law, contact your representative. But you better prepare some better arguments to get through the queue.
Regional prices for less affluent areas in the EEA or any other part of the world are not going anywhere. There are over 400 million people living in the EU, no sane publisher will limit themselves to only a quarter of that market.
And I still don't understand exactly what Valve was doing--according to their statement it seems to have been a quite limited practice in the first place which doesn't seem to really map to either the regional pricing or any kind of enforcement of same, but I don't really get just what it actually was.
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