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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:

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.

Article taken from GamingOnLinux.com.
Tags: Misc, Steam, Valve
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75 comments
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TheSHEEEP 21 Jan
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Quoting: x_wingthere is a chance that a third party can exploit this backdoor and create a business around it that will definitely simplify the steps that a user has to follow in order to get their games for cheaper.
That is true, but not a new problem at all.
So far Steam has failed to tackle the problem of key resellers.
Still, even with all the key reselling, it seems to only be a smaller problem for developers and Steam as most people simply continue to purchase via Steam (or legitimate stores like Humble or gamersgate) for the most part as it is the most convenient.

Quoting: x_wingIMO it's always better to keep things as simple as possible. So, maybe the rule should have been that if you get a key that you cannot activate in your country, the seller is obligated to refund your money
That would still be illegal within the EU as it is effectively region locking.
The best solution would be as I wrote above, allow different pricing regions per country instead of per currency.

The fear that this would lead to price explosions for the lower income markets simply has not come true for any kind of digital purchase that I am aware of (and I'm aware of a few).
E.g. non-region locked games from Russia, despite key resellers, have not caused a price explosion for Russian gamers. Nor am I aware of such price increases before there even was region locking - Valve introduced that because it was missing out on a bit of income and possibly due to national law demands.


Last edited by TheSHEEEP on 21 January 2021 at 2:55 pm UTC
M@GOid 21 Jan
Quoting: Purple Library GuyI gotta say I'm confused. I've read the article, I've read the whole thread, and I'm still not sure what the relationship is, or is likely to become, between the "regional locking" that is being banned and the "regional pricing" that is apparently not being banned.
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.

The way I see it, this whole thing will led to increase in prices on poorer countries in the EU. Simple as that. Some commenters, however, talk about companies should obey laws without seeing the big picture. And I bet those are not the ones that will pay more for their games.


Last edited by M@GOid on 21 January 2021 at 4:43 pm UTC
minfaer 21 Jan
Quoting: M@GOidThe way I see it, this whole thing will led to increase in prices on poorer countries in the EU. Simple as that. Some commenters, however, talk about companies should obey laws without seeing the big picture. And I bet those are not the ones that will pay more for their games.

One is not seeing the big picture if one thinks companies should obey the law? I believe You are not seeing the big picture if You complain about price increases in poor countries from a unified European market while failing to consider the wealth increase this market and the measures taken towards it have brought to the country. There is more to this EU deal than just billions of free subsidies paid by northern europeans.

Also, aybe the ones complaining are not the ones that will pay more, but that means they are the ones that are already paying more. This mentality of entitlement is baffling. If income levels in a country are not high enough to pay enough for a game to fund its development, these people have zero right to demand their prices being subsidized by other people in higher GDP countries.


Last edited by minfaer on 22 January 2021 at 10:48 am UTC
Windousico 21 Jan
Quoting: TheSHEEEP
Quoting: WindousicoRegional pricing was terminated with the elimination of region locks. It's a fact in Steam. Now we have the same prices in Poland, Spain and Germany (since 2015-2016).
This is clearly not true for Poland, as anyone can check.

However, it seems true that Steam only allows setting prices per currency, not per region. At least I couldn't find price differences within EU countries in my VPN search across different Steam fronts.
Basically, all Euro countries pay the same price - this does, indeed prevent regional pricing within Euro countries.
Which is really ridiculous as the disposable income within Euro countries is vastly different.

It seems like Valve basically took the EU's complaint about illegal regional locking and used that as a reason to not even have different regions within a single currency - they used to have that at least somewhat with their EU tiers, but they abandoned even that minimal effort.

As an annoying side effect, as all can witness in this thread, the wrong idea got into people's heads that the EU would want to ban regional price differences - even saw that in some articles.

Sucks for residents of affected countries.
Either way, that's not the EU's fault (as the EU only prohibits regional locking, not pricing), and in this case it's not even the publishers' fault - this is on Valve not caring about lower GDP regions within the EU.
All they'd need to do is to allow different regional pricing within countries with the same currency while also not allowing regional locking.

What I don't understand is what all the fuss is about, then. If Valve removed the region locking in 2015 already and there are no regional price differences within Euro countries - what's the actual problem now?
The remaining few EU countries that don't have Euro being region locked?
OK. It's not true for Poland but "Basically, all Euro countries pay the same price". Consequently, regional pricing was terminated with the elimination of region locks on Steam (something I regretted greatly).

There is no "existing" problem. There is a "verdict" 6 years later (more or less).
TheSHEEEP 21 Jan
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Quoting: WindousicoConsequently, regional pricing was terminated with the elimination of region locks on Steam (something I regretted greatly).
Indeed, it was.
Which is absolutely a mistake - I'm not sure what really went wrong there.
It was definitely not the EU demanding regional pricing to be stopped within the EU.

My guess is that Valve itself realized that regional pricing within the EU would lose it some income without region locking and therefore decided to just have one Euro region at the highest price and be done with it.
Also enabling the EU to become the scapegoat again. You kinda feel bad for EU politicians - meaning well, often doing good, but almost always failing to foresee consequences of their actions.

What the EU should actually do now is force Valve to enable regional pricing within the EU again. But I doubt there is legal grounds for that. And apparently the prices even for the lower income region are still "low" enough to make enough sales.

In the end, just another example of Valve's greed - right in line with the ridiculous 30% cut.
And no, I'm not a hater, I just see the good and the bad an entity like Valve is doing.

Quoting: WindousicoThere is no "existing" problem. There is a "verdict" 6 years later (more or less).
Yes, thanks.
I reread the article and now I get it, too. This is the resolution of the problem from back then.


Last edited by TheSHEEEP on 21 January 2021 at 9:17 pm UTC
Arten 22 Jan
Quoting: TheSHEEEP
Quoting: WindousicoConsequently, regional pricing was terminated with the elimination of region locks on Steam (something I regretted greatly).
Indeed, it was.
Which is absolutely a mistake - I'm not sure what really went wrong there.
It was definitely not the EU demanding regional pricing to be stopped within the EU.

My guess is that Valve itself realized that regional pricing within the EU would lose it some income without region locking and therefore decided to just have one Euro region at the highest price and be done with it.
Also enabling the EU to become the scapegoat again. You kinda feel bad for EU politicians - meaning well, often doing good, but almost always failing to foresee consequences of their actions.

What the EU should actually do now is force Valve to enable regional pricing within the EU again. But I doubt there is legal grounds for that. And apparently the prices even for the lower income region are still "low" enough to make enough sales.

In the end, just another example of Valve's greed - right in line with the ridiculous 30% cut.
And no, I'm not a hater, I just see the good and the bad an entity like Valve is doing.

Quoting: WindousicoThere is no "existing" problem. There is a "verdict" 6 years later (more or less).
Yes, thanks.
I reread the article and now I get it, too. This is the resolution of the problem from back then.

So, you propouse use regulation (forcing valve enable regional pricing) for deal with consequences of another regulation? All regulations have negative side efect! Only posible and ethical solution is remove original regulation! Another regulation only do situaction worst in another place!
Quoting: ArtenAll regulations have negative side efect!
This is no doubt true, but many regulations have positive primary effects that are much more important. I, personally, am quite fond of safe food and drink, for instance.
TheSHEEEP 22 Jan
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Quoting: ArtenSo, you propouse use regulation (forcing valve enable regional pricing) for deal with consequences of another regulation?
You are shifting the blame here.
The consequences of not allowing region blocking should not be that there is only one EU region. Imagine if that was the case for other goods - EU would have imploded the moment that happened.
That this was the result is entirely Valve's fault - they could have, and easily so, only removed the region locking without also removing different EU regions (remember, they had those, even if only three).
They did not do that out of good old corporate greed - capitalistic entities will always strive to maximize profit, no matter the negative consequences. Which a state (or in this case, the EU) exists to regulate in order to benefit its citizens. It's called social capitalism and is working fairly well in most European countries.
It requires regulations, believe it or not.

Now, what can the EU do here?
Abolish its own principles because one fringe entity (in the grand scheme of things, when talking about the entire EU, Valve doesn't amount to anything) chose to be greedy about implementing laws?
I'd hope not - if they did that, it would show that just about anyone could strongarm the EU into backpedaling.
Force Valve to not f*ck over its customers? That would be optimal but as I said, I have no clue if there is legal ground to enforce regional pricing.
Or just do nothing and accept being blamed for another's fault? Unfortunately the most likely scenario here, there are bigger tasks to tackle right now for the EU than Valve.

Quoting: ArtenAnother regulation only do situaction worst in another place!
Not the one that I proposed, at least not for customers.
As I wrote before, regional pricing has not lead to price increases so far - just look at Russian games that aren't region locked, there is no price increase on the scale some seem to be afraid of.
Assuming that this would somehow be different for the EU is just fear mongering without a base in reality.

It would lead to Valve and publishers earning less money per purchase in lower income regions - while also leading to a lot more purchases in these regions. I'm not even sure it would lead to a net loss. I could very well imagine lots of people from lower income regions purchasing a lot more after such a change.

Besides, seriously, what is the worst that could happen?
We already ARE in the worst case for most Steam customers in the EU! Everyone's paying the highest price. Having regional prices again would mean an improvement for pretty much everyone.
Even in the (highly unlikely) case that those regional prices would be rising - they'd still be lower for most than they are now.


Last edited by TheSHEEEP on 22 January 2021 at 9:14 am UTC
TheSHEEEP 22 Jan
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Quoting: Guest
Quoting: TheSHEEEPjust look at Russian games that aren't region locked, there is no price increase on the scale some seem to be afraid of.

Real question: are those Russian keys region locked ? Can i buy a game at a lower price in a Russian store and activate it in the EU here ?
Depends on the game. I'm not certain how many are region locked. Probably most - except for indies.
But definitely not all - and those that aren't did not lead to their prices exploding for Russians.
Here's a guide on how to check if a game is region locked (it is cumbersome):
https://www.hlplanet.com/how-to-check-game-region-lock/

Bottom line is that it is up to publishers if they want to region lock or not.
Undoubtedly, most do want that as they expect increased profit from that.
But especially indie games are often not region locked (and you won't find region specific "CD Key" entries for them on steamdb).

That said, it isn't too easy to pull off.
You require a VPN to begin with - which has to function well enough for Steam not to detect that you are using it and just show you your "real" prices anyway.
I suspect the entire purchase pipeline in Steam is full with checks to detect VPNs - and afaik using a VPN to purchase is against Steam's TOS, so very much use at your own risk.
In addition to that, I'm fairly sure you also need a "local" payment method, e.g. local Russian credit card or something like that. If you wanna pay via PayPal and your PayPal still says you are not in Russia, well... I wouldn't do it.


Last edited by TheSHEEEP on 22 January 2021 at 10:50 am UTC
minfaer 22 Jan
Quoting: TheSHEEEPIt would lead to Valve and publishers earning less money per purchase in lower income regions - while also leading to a lot more purchases in these regions. I'm not even sure it would lead to a net loss. I could very well imagine lots of people from lower income regions purchasing a lot more after such a change.

I would assume it leads to a net win for the publishers. That is, after all, the reason they introduced regional pricing in the first place.
And there is nothing bad about regional pricing per se - region locks are banned in an attempt to even the balance of power between big corporations on the one hand that have the power and means to profit from the open market while blocking consumers from doing the same vs said consumers on the other hand.


Last edited by minfaer on 22 January 2021 at 10:46 am UTC
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