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General discussionGetting back to our roots(1418 posts)(1418 posts)
(1418 posts)
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This is my favourite topic
Posted March 11, 2014
Hey, GOGgers,

We're not perfect, we're exploring new frontiers, and we make mistakes. We thought DRM-Free was so important that you'd prefer we bring you more DRM-Free games and Fair Price was less critical and that it could be sacrificed in some cases. The last two week's worth of comments in our forums (nearly 10k!), show that's not the case. We didn’t listen and we let you down. We shouldn't sacrifice one of our core values in an attempt to advance another. We feel bad about that, and we're sorry. Us being sorry is not of much use to you, so let’s talk about how we will fix it.

One: DRM-free forever. Abandoning fixed regional pricing means it will probably take longer to get some games, but you've made it clear that sacrificing fair pricing for more DRM-free games isn't acceptable.

Two: We will adamantly continue to fight for games with flat worldwide pricing. If that fails and we are required to have regional prices, we will make up the difference for you out of our own pockets. For now it will be with $5.99 and $9.99 game codes. In a couple of months, once we have such functionality implemented, we will give you store credit instead, which then you will be able to use towards any purchase and cover the price of it in full or partially. Effectively gamers from all around the world will be able to benefit from the US prices.

This will apply to every single game where we do not have flat pricing, such as Age of Wonders 3 (full details here), Divinity: Original Sin, and The Witcher 3. If you remember the Fair Price Package for The Witcher 2, this will be exactly the same.

Three: We still intend to introduce the pricing in local currencies. Let us explain why we want to do it and how we want to make it fair for everyone. From the very beginning our intention was to make things easier for users whose credit cards/payment systems are not natively in USD. The advantages are simple because the price is more understandable and easier to relate to. There would be no exchange rates involved, no transaction fees, and no other hidden charges. However after reading your comments, we realized we have taken an important element away: the choice. In order to fix this, we'll offer the option of paying in the local currency or the equivalent in USD. This way, how you pay is always your choice.

Four: You are what matters, and we will be sure to involve you all more in what we're doing and why we're doing it. Let's start by meeting you at GDC - we’d like to invite you to meet us face-to-face Monday the 17th at GDC. Obviously, not all of you can come to San Francisco, so we want to invite all of you to an online event with us early in April to ask us whatever you would like. More details soon.

The bottom line is simple: there may be companies that won't work with us (although we will work hard to convince the most stubborn ones ;). Yes, it means we might miss out on some games, but at the same time GOG.com will remain true to its values and will keep on offering you the best of DRM-free gaming with Fair Prices.

Once again thank you for caring so much about GOG.com. We will work hard not to disappoint you again.

--Marcin "iWi" Iwinski & Guillaume "TheFrenchMonk" Rambourg
Posted March 11, 2014
Wish there was a way to meet the gog staff and the gog members and treat everyone to a drink or 10 :D
Gog has shown that the costumer is really king and you guys are still one of the few companies who listen and interact with the costumers.

WELL DINE GOG, LETS ALL HUG IT OUT NOW :p
Posted March 11, 2014
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pickle136: Am I missing something?
Yes, you're missing that the VAT discussion is not directly related to the idea behind regional pricing, plus the fact that even in Europe every country has a different VAT, and none of them is much higher than 20%, which is far from the common 30%+ of the 1$=1 EUR 'conversion'. If the stores would just add the individual countries' VAT you would have a point, but it's not like that.
Post edited March 11, 2014 by Leroux
Posted March 11, 2014
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pickle136: I come from a non-VAT country and i was surprised by the reaction of those that leave in countries with VAT. Its amazing that these customers demand that the retailer pay the VAT.

It seems to me that the customers in these locations have it backwards. Why did you let your representative government create a tax like this in the first place? Why attack and blame the retailer when its your tax? Why not take the zeal and passion to the government to repeal the tax?

When ive come across EU companies before they always pass on the taxes to the consumer. Otherwise their bottom line is effected and it makes it pointless to have created the sale.

I have a local sales tax and i expect i will be the one paying it (unless the store is running a promo).
Maybe theres too much of an entitlement culture in these countries?
Am I missing something?
The vast majority of countries that GOG sells to will have some kind of sales tax, although the % fluctuates. I would imagine the highest sales tax amount is considered the base to calculate prices off, and if sales are made in countries with lower tax rates then more money will be made by GOG. From this point the tax is paid by the consumer, though the level of profit made by GOG on each sale changes according to the country the customer is from.
Post edited March 11, 2014 by Professor_Cake
Posted March 11, 2014
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Cavalary: They were saying (and any look at the numbers will confirm) that all their simulations resulted in the fact that they'll lose money on each sale that they fully make up for, unless of course the developer/publisher agrees to take a proportional cut as well. So unless everyone takes the hit (which CDP will, and the AoW3 update post indicates Triumph agreed to do as well), I'm hoping they'll be making darn sure to avoid signing games with regional prices because any such sale will be in the red, it'll make no sense to have them in the catalog. Or at least that's how it looks right now, hence me tentatively out of, er, protest mode.
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Pheace: Which doesn't make sense to me, because we know their numbers. We know they take a percentage off the sale. Given that, the example I have above should be basically what happens, in that case, they don't lose money at all, they lose profit. (and then only on the unfair priced regional sales)

Although I guess taxes might throw a wrench into that calculation somehow.
Way I see it, publisher demands a price of, say, $45 or EUR 45 for a game and based on the standard agreement they get 70% (31.5), leaving GOG with 30% (13.5). In USD, all well and good. For the customer getting shafted with the EUR price, however, GOG makes up for the difference of 12.5 EUR. If the publisher doesn't agree to also lower their share of 70% of the 45 EUR, GOG needs to pay that amount, 31.5 EUR, and also 70% of the price of the games that will be obtained by the customers with the extra codes / store credit. 70% of 12.5 is 8.75. So they're paying out 40.25. And from the remaining 4.75 you deduct taxes for their full share of 13.5.

May be wrong of course, but doesn't look good if put like that. So incentive for them to make sure to avoid regional prices, which sounds good to me since, as I already said, the point would be to fight against the practice, not to eat the difference just so the publishers will still get away with it as if nothing happened.
Posted March 11, 2014
Can I mention a little celebratory giveaway in response to this? I think I just did. ;)
Posted March 11, 2014
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vicklemos: Deep inside I knew something like this would happen :)
Don't hurt me people but either way was fine for me since I love GOG for years now.

And yay for store credit!
I know it's just the beggining, but will this feature be available for our already purchased games or just new ones?
It's only for games where you've paid a different amount than the index price (by which I mean US price). As such, it would pretty much have to be for new ones.
Posted March 11, 2014
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yyahoo: I don't understand the positive user reaction.

GOG is going to enforce one world pricing more strictly going forward in negotiations with publishers, which means that games that would have been regionally priced are now simply not going to be here at all.

This is cause for celebration?

Couldn't we continue to have regionally priced games and the "choice" for GOG users is whether to buy them here or not?

I just don't get it.
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adamzs: If you're from the US, you might not be used to always getting the short end of the stick on the gaming market but the rest of us are. To us in the EU (though not just here, obviously) "regional pricing" typically means that we end up paying more for games. GOG has been one of the rare exceptions and fortunately remains so. That's the cause for the celebration.

What GOG has done here is a good thing. They will try to convince publishers to work with worldwide fair prices but I doubt they will lose business over it. New releases will have the option to opt out, as they explained in the post above.
All I know is what I read, "Abandoning fixed regional pricing means it will probably take longer to get some games". I just don't see how this is a good thing. Regional pricing was only going to effect the games that GOG probably now won't get. If you didn't like regional pricing before, you didn't have to buy those games. Other than that, it doesn't seem like much more has changed. Just my 2 cents of confusion.
Posted March 11, 2014
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Zurvan7: Wish there was a way to meet the gog staff and the gog members and treat everyone to a drink or 10 :D
Gog has shown that the costumer is really king and you guys are still one of the few companies who listen and interact with the costumers.

WELL DINE GOG, LETS ALL HUG IT OUT NOW :p
Funny you should mention that.
Posted March 11, 2014
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TheEnigmaticT: It's only for games where you've paid a different amount than the index price (by which I mean US price). As such, it would pretty much have to be for new ones.
It's most probably too early to ask questions about credit system but I'll shot... :)
Will it be possible to make "mixed" payments? Like part of it in cash, part of it in credits?
Posted March 11, 2014
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pickle136: I come from a non-VAT country and i was surprised by the reaction of those that leave in countries with VAT. Its amazing that these customers demand that the retailer pay the VAT.

When ive come across EU companies before they always pass on the taxes to the consumer. Otherwise their bottom line is effected and it makes it pointless to have created the sale.

I have a local sales tax and i expect i will be the one paying it (unless the store is running a promo).
Maybe theres too much of an entitlement culture in these countries?
Am I missing something?
1) The pricing change was NEVER about VAT, it was always about regional pricing for other reasons entirely.

2) AFAIK, GOG is a Polish company having some of its functions on Cyprus. Poland and Cyprus both have VAT, unless I am mistaken, so it will be paid by default anyway.

3) Buying from a EU company and being a resident of a non-EEA country enables you (in some cases) get your purchase tax-free. I don't know if this applies on GOG purchases or not. GOG order confirmation doesn't specify whether taxes have been paid or not, and if yes, how much. The point is, GOG doesn't lose any money on EU area sales. They possibly may have a bigger profit margin on non-EEA sales, but in no circumstances does GOG pay the VAT out of their own pocket. It's money that we pay that just goes through GOG bank accounts to whatever government they forward it to.
Posted March 11, 2014
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adamzs: If you're from the US, you might not be used to always getting the short end of the stick on the gaming market but the rest of us are. To us in the EU (though not just here, obviously) "regional pricing" typically means that we end up paying more for games. GOG has been one of the rare exceptions and fortunately remains so. That's the cause for the celebration.

What GOG has done here is a good thing. They will try to convince publishers to work with worldwide fair prices but I doubt they will lose business over it. New releases will have the option to opt out, as they explained in the post above.
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yyahoo: All I know is what I read, "Abandoning fixed regional pricing means it will probably take longer to get some games". I just don't see how this is a good thing. Regional pricing was only going to effect the games that GOG probably now won't get. If you didn't like regional pricing before, you didn't have to buy those games. Other than that, it doesn't seem like much more has changed. Just my 2 cents of confusion.
Again, was first and foremost a matter of principle. They said they'll never do this. Plus that the practice is wrong and it should be opposed. So, you know, if GOG doesn't get certain games because publishers won't allow flat prices, maybe they won't be available DRM free elsewhere either, and maybe the people who stick to DRM free as well will not buy them (which doesn't necessarily mean that they won't play them), which will hurt said publishers and send a message.
Posted March 11, 2014
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Professor_Cake: Agreed, although I wouldn't say the selling points were dogmatic. indeed, the opposite points that say companies should embrace DRM and regional pricing are dogmatic, and it is this dogma that GOG is confronting with publishers now.
I don't mean that GOG is promoting a dogma. Their policies are just policies, like any other company. I mean that they seem to think it's to their advantage to market those policies as not just selling points, but immutable ideals written in blood that must never be compromised.

GOG has put a great deal of effort into painting themselves as fair-practice heroes standing against the evils of the industry, such as with videos like "Regional Ripoff" that they probably now regret making. The result is that when they changed one of their policies for business reasons, they were met with extremely heated accusations of betrayal, of sacrificing principle for profit, of being worse than Steam (because at least Steam never promised anything), and so on. I never saw anything GOG offered me as a matter of principle, but clearly a lot of people did.
Post edited March 11, 2014 by Mentalepsy
Posted March 11, 2014
This is such good news, I hope this thread receives 10000 replies from people telling gog how awesome they are!
Posted March 11, 2014
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Posted March 11, 2014
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Pheace: There's nothing in the announcement above that should make it less likely for companies to work with GOG than it was before, it's basically a fluff line :)
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F4LL0UT: Then why are they themselves saying this in the very same letter:

The bottom line is simple: there may be companies that won't work with us (although we will work hard to convince the most stubborn ones ;)
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F4LL0UT: I guess they expect not all publishers being willing to work with a company that decides to cover costs that are supposed to be paid by the consumers. After all, regional pricing is about adjusting the price to the financial capabilities of the consumers, GOG is breaking that rule. Hypothetically speaking, if all distributors did what GOG is doing here then the whole regional pricing model wouldn't work anymore, it would mean that distributors are actually for some weird reason handing out gifts to consumers from mostly wealthier countries at their own costs - which obviously wouldn't make any sense and would eventually lead to the death of regional pricing. So it's comprehensible that some companies may still not be willing to work with GOG, even if technically they'd get the benefits of regional pricing (at first).
I personally think that's too far fetched. It's more likely these publishers (still) don't want to work with them based on their DRM-free stance or other things and that it was nice filler to toss it into the announcement because it helps make them look better.

Another more likely reason then would be that perhaps other distributor's (such as Steam) might complain about what GOG's doing, giving them too big a price advantage and then laying that with the publishers who would then have an issue with GOG.
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This is my favourite topic
Community
General discussionGetting back to our roots(1418 posts)(1418 posts)
(1418 posts)