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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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x_wing 22 Jan
Quoting: TheSHEEEPYou 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.

Based on what it's written here Steam may not be able to restrict the access to the Russian store nor reject a credit card that is located in the EU. BTW, on many countries stores PayPal is not an option.


Last edited by x_wing on 22 January 2021 at 1:19 pm UTC
TheSHEEEP 22 Jan
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Quoting: x_wingBased on what it's written here Steam may not be able to restrict the access to the Russian store nor reject a credit card that is located in the EU.
But what's written there applies only to the EU, except if I missed or misinterpreted something.
I don't think anything in there applies to outside of the EU (like Russia).
x_wing 22 Jan
Quoting: TheSHEEEP
Quoting: x_wingBased on what it's written here Steam may not be able to restrict the access to the Russian store nor reject a credit card that is located in the EU.
But what's written there applies only to the EU, except if I missed or misinterpreted something.
I don't think anything in there applies to outside of the EU (like Russia).

You're right on that. Applied EU rules to any country of Europe... silly me.
M@GOid 22 Jan
Quoting: minfaer
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.

You talk like someone with money in your pocket. Good for you.

To hell with the poor and their problems. Let them go back to piracy, were they belong.
Mal 22 Jan
Honestly as a European I don't dislike the single market. The implementation though is sloppy in multiple ways. But it would be unfair to deny that it improved over the years and it will likely improve more in future.

Currently my biggest complaint is more about digital content than for physical objects. Geoblocking was forbidden like 3 tears ago, but only for physical goods. In this case VGs are treated like physical objects (don't ask me why) so in Bruxelles they are adamant with their stance (and it makes sense: phisycal stuff has to be shipped and this levels the field. Only that VGs are not shipped at all). But actual digital content is infact still exempted from geo-blocking within the EU (which is nuts if you think about it). So for example on German Netflix you won't be able to see Spanish or French Netflix stuff and viceversa. Which for me, personally, sucks a lot. So yeah, my biggest issue right now is more about "availability of content" rather than mere price. The same way I purchase abroad what I don't find in the national shops. It's the usual copyright bullshit the EU is in love to. Remember the meme thing?

Regarding the price issue (which is also a very real issue), in theory this should be fixed by better redistributing the wealth among the union. There are purchasing power regional differences in every market yet uniformed prices work anyway. Just because of this. But the country with "The Positive Trade Balance" tm is very receptive on several fairness topics but not this one. So I don't see the EU changing their policies anytime soon. Shame. This considered, regional prices are imho a kind of a necessary adjustment for fairness until the real issue isn't properly addressed. Again, take Netflix as an example. Since they are currently exempt from geoblocking they do use regional pricing in EU and it works wonders: they're unreasonably overpriced everywhere... but in a proportional manner. So it sucks for everybody in the same way.
shorberg 22 Jan
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Quoting: x_wing
Quoting: TheSHEEEP
Quoting: x_wingBased on what it's written here Steam may not be able to restrict the access to the Russian store nor reject a credit card that is located in the EU.
But what's written there applies only to the EU, except if I missed or misinterpreted something.
I don't think anything in there applies to outside of the EU (like Russia).

You're right on that. Applied EU rules to any country of Europe... silly me.

Don't feel too bad, geo-politics are a mess... :/

https://upload.wikimedia.org/wikipedia/commons/1/1a/Supranational_European_Bodies-en.svg
shorberg 22 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.
Correct.
This is a basic property of free market capitalism.

The solution to this is for publishers to lower prices to the lowest common denominator. If this leads to their products no longer being profitable, then the product is unsustainable and they will have to either lower production costs or pick a higher price and focus on a different subset of the market.

One example of the former is indie-games, an example of the later is Apple.

Quoting: MalHonestly as a European I don't dislike the single market. The implementation though is sloppy in multiple ways. But it would be unfair to deny that it improved over the years and it will likely improve more in future.
Agreed.

For anyone unfamiliar with EU, a lot of the mess comes from it being a democracy. Don't get me wrong though, democracy while not perfect is the best we got or as Churchill put it 'Democracy is the worst form of government, except for all the others.'

Here is a rough diagram:
https://upload.wikimedia.org/wikipedia/commons/3/36/Organs_of_the_European_Union.svg

Basically everything is a compromise between different member states (recursively), with "EU" as a concept being represented by the EU Commission.
Mal 22 Jan
Quoting: shorbergFor anyone unfamiliar with EU, a lot of the mess comes from it being a democracy. Don't get me wrong though, democracy while not perfect is the best we got or as Churchill put it [i]'Democracy is the worst form of government, except for all the others.'

As for everything, there are different shades of gray also democracy. The issue with EU democracy is that it's a very indirect democracy. The parlament is mostly fine. But for the government it wouldn't hurt to have less interference from national governments and more direct relationship with the voters. Yet (and this is true geopolitics) the EU is just another playfield for single EU capitals to subdue and/or excert their influence over the others. So I guess it cannot be helped. It would be a nightmare if not for the USA working hidden in the background to prevent anyone to have to much success. So, as far as I'm concerned, given the last century of peace I don't dislike the disfunctional status quo to much. As long there is no Frenxit or Germanexit, we should all be safe.
minfaer 22 Jan
Quoting: M@GOidYou talk like someone with money in your pocket. Good for you.

To hell with the poor and their problems. Let them go back to piracy, were they belong.

That is a pretty polemic attempt at a strawman. Try making an argument instead!

Quoting: MalSo I guess it cannot be helped. It would be a nightmare if not for the USA working hidden in the background to prevent anyone to have to much success. So, as far as I'm concerned, given the last century of peace I don't dislike the disfunctional status quo to much. As long there is no Frenxit or Germanexit, we should all be safe.

I don't see how the USA not working in the background to the detriment of all involved EU-countries would cause a nightmare. Peace and stability come from the aligned economic interests as well as a certain level of education, in my opinion, but not from the dysfunctionality in the representation of interests. Increasing economic entanglement makes conflict inherently lossy for all.


Last edited by minfaer on 22 January 2021 at 10:54 pm UTC
Arten 23 Jan
Quoting: TheSHEEEP
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.

I'm not shifting blame. I identified true criminal in this case and it is EU. Whole EU is just regulatory hell which make hell from living in here. Idea of duty free trade is good, but EU evolved into mutch closer to totalitarian organisation. Ok, not china level yet, but wait couple years.
EU is evil organisation to begin with.
Which negative consequences have maximizing profit in this case? That rich germans with houshold income mote then 2* greater then for example czech houshold income can't buy games on third party regional sites and use it? Without this barier, germans can maximize their profit at the expense of citizens of poorer nations. So local third party stores need choose higher prices.

In this case, Valve is purely victim of EU oppression and regulatory hell.
So, some games are using regional lock in russia. Is logical to assume one who change price are the one which move price.
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