A look at Canadian DLC for those who want to know

[J-Rock]

From http://arstechnica.com/news.ars/post/20071010-strong-canadian-dollar-means-canadians-pay-dearly-for-xbox-live-psn-action.html


Strong Canadian dollar means Canadians pay dearly for Xbox Live, PSN action
By Frank Caron | Published: October 10, 2007 - 10:06AM CT

Canadians are used to paying more for games. Games have typically sold for roughly CAN$10 more than the US version—a difference often attributed to the exchange rate. When it comes to buying games through online stores, however, things are a little different. Usually, prices are listed online in the native currency and then the exchange rate is left to the credit card companies, offering fair and up-to-date pricing. However, the respective online stores found on the current generation consoles from Microsoft, Sony, and Nintendo don't follow this trend, and the pricing may not be as fair in the Great White North as a result of the rising Canadian dollar and a system that obscures what you're actually paying for games.

Microsoft's pricing is region-specific, though the prices of points do not appear to be fluctuating with the Canadian dollar. Like Nintendo's system, Microsoft uses points to mask the true dollar value. There is no exchange rate conversion; each chunk of points carries an absolute value, no matter what value the native dollar is trading at. Currently, 500 Microsoft Points sell for US$6.25 through the Marketplace, whereas the price is CAN$7.75 for Canadian users. The games cost the same amount of points in both markets.

At the moment Canada is paying more per point than the US, and as the Canadian dollar gains value, Microsoft is basically pocketing the difference; having a set value for points that doesn't change in this case means the points themselves do not cost significantly more for Canadians. With the recent parity in currency, that means Canada is paying CAN$2 more for an 800-point game. It's not a lot of money, but that difference adds up, and there is very little reason for the difference to exist at this point.

Platform - Item - US price - Canadian price
Xbox Live - 500 points - 6.25$ - 7.75$
Xbox Live - 1,000 points - 12.50$ - 15.50$
Xbox Live - 2,000 points - 24.99$ - 31.00$
Xbox Live - 5,000 points - 62.48$ - 77.50$
PlayStation Network - 1 dollar to wallet -1.00$ - 1.00$
PlayStation Network - GO! Sports Ski - 2.99$ - 2.99$
PlayStation Network - LocoRoco - 6.99$ - 7.59$
PlayStation Network - Warhawk - 39.99$ - 42.99$
PlayStation Network - High Stakes Poker - 9.99$ - 10.99$
PlayStation Network - PixelJunk Racers - 6.99$ - 7.49$
PlayStation Network - Super Puzzle Fighter - 9.99$ -10.99$
PlayStation Network - Piyotama - 2.99$ - 3.99$
PlayStation Network - Rockband, 1 Song - 2.99$ - 3.99$
PlayStation Network - Rock Band, 3-Pack - 5.49$ - 6.49$
Virtual Console - 1,000 points - 10.00US$ - 10.00 plus exchange

Nintendo's system is the most traditional, from an end-charge perspective. Users first buy Wii Points through the Virtual Console, which are sold in regimented chunks, and then use those points to buy games. Even on the Canadian Virtual Console, the prices appear in US dollars, and the exchange and tax are applied to the amount by the credit card companies—a typical approach, as mentioned. The pricing is in tune with the surrounding economy.

Sony's approach is perhaps most up-front, thus making the pricing discrepancies are all the more apparent. The PlayStation Network's payment system works entirely with real dollars. A user inputs native dollars from his credit card into a digital "wallet," and then purchases games that are listed in the actual price that corresponds to the his registered region. This includes an explicitly disclosed, region-specific, and region-appropriate tax. This leads to little confusion, and the number that is taken from your wallet is the exact number that shows up on your credit card statement. There are still some arbitrary differences in price, however, as evidenced above. Warhawk is US$39.99 for American users, whereas the title is CAD $42.99 for Canadian users. This discrepancy is evident throughout the store, with price differences ranging from CAN$0.50 to CAN$5. While Canadians still pay more, the amount differs from game to game, and the pricing process is transparent.

While each console has a different system for handling online sales, Microsoft's point system seems to be the least fair as the US dollar continues its slide. Amusingly, one could buy a card of MS points in the US, take it across the border, and have the card gain value. Sony prices games on a per-case basis online. While Canadians still get stuck with a higher price, it's not hidden behind a smoke screen of points, and many games are priced similarly between the US and Canada. Nintendo simply converts the currency, making it the most fair between the three.

While we don't see Microsoft moving away from their point-based system, it's clear that as the Canadian dollar grows in strength, so do its profits.

We contacted Microsoft for a comment, but received no response by the time of publishing.

So there you go. All canadians (except Wii owners it seems) should contact their console companies and ask that this price gouging stops.

I'm also asking, since it's on a case by case basis, Harmonix can't you also ask to reduce your DLC prices? I won't pay 65% more for a song.

[Ultrace]

I'm also asking, since it's on a case by case basis, Harmonix can't you also ask to reduce your DLC prices? I won't pay 65% more for a song.
What happens then when things like the XBox Live points get equalized? Then Canadians would be paying less than people in the U.S., and that would just shift the unfairness in a different direction.

I empathize with you having to pay more, definitely.

[Nitz13]

It Should be equalized, and be determined by the price of the dollar, if that means we pay less than Americans well too bad for them. We spent years below the American dollar and never had much of a problem with it

This is why I keep my Points spending to a minimum.

[SteppinRazor]

What happens then when things like the XBox Live points get equalized? Then Canadians would be paying less than people in the U.S., and that would just shift the unfairness in a different direction.

I empathize with you having to pay more, definitely.

Well, if the cost for DLC in Canada were to be properly adjusted for the exchange rate, both US and Canadian customers would be paying the same amount in total value - thats what the exchange rate is.

Like, at this instant, the CBC website says the exchange rate is: one Canadian dollar buys 1.0127 US dollars (not a big difference, but its the middle of the trading day, it will close a little higher than that typically).

Now, if the prices were equalized at that rate, a cheap DLC song might cost $1 Canadian and $1.01 USD, but while it looks like the Canadians are saving one cent, they're not, because that is the equivielent value of the currencies. Dig?

Which is why its un-fresh that we're being squeezed for an extra buck or better when the money is worth nearly the same.

[Ultrace]

It Should be equalized, and be determined by the price of the dollar, if that means we pay less than Americans well too bad for them. We spent years below the American dollar and never had much of a problem with it

This is why I keep my Points spending to a minimum.
That wasn't quite what I meant. Certainly if the Canadian dollar is worth more you should pay less of them. What I mean is, if some sort of solution is applied now and then an additional solution being sought is applied on top of that, you could end up paying less than you actually should. Does that even out with right now where you'd be paying more than you should? Not something I can so easily determine.

[SteppinRazor]

That wasn't quite what I meant. Certainly if the Canadian dollar is worth more you should pay less of them. What I mean is, if some sort of solution is applied now and then an additional solution being sought is applied on top of that, you could end up paying less than you actually should. Does that even out with right now where you'd be paying more than you should? Not something I can so easily determine.

Ah, I see that you understand already. Well, consider my prior post to be aimed at people who don't get that distinction. ;)

[oddroot]

Just let us pay american prices and let the stupid credit card companies sort it out (lord knows they all charge 2.5 cents per dollar on conversion of currencies anyways)... This is really the fairest way, atleast in the case of the PS3.

[batsu336]

Does Harmonix, or any other online game for that matter, have to pay a fee or tax when providing international services? I'm pretty sure they do. I know that there are international fees on phone calls, and the fee amount is set by the individual country you are calling. I always assumed this was part of the reason for subscriptions, item shipments, and online fees being different for out of country sales no matter what company does the selling. Ask Microsoft and/or Sony to move to Canada and then you will be all set.

[DaMan12]

Does Harmonix, or any other online game for that matter, have to pay a fee or tax when providing international services? I'm pretty sure they do. I know that there are international fees on phone calls, and the fee amount is set by the individual country you are calling. I always assumed this was part of the reason for subscriptions, item shipments, and online fees being different for out of country sales no matter what company does the selling. Ask Microsoft and/or Sony to move to Canada and then you will be all set.

but they are not shipping anything or doing any different with canadian and american DLC. Microsoft uploads it all onto the same server and we both DL it, just for different prices.

[J-Rock]

Does Harmonix, or any other online game for that matter, have to pay a fee or tax when providing international services? I'm pretty sure they do. I know that there are international fees on phone calls, and the fee amount is set by the individual country you are calling. I always assumed this was part of the reason for subscriptions, item shipments, and online fees being different for out of country sales no matter what company does the selling. Ask Microsoft and/or Sony to move to Canada and then you will be all set.
Sony is a japanese company. If their were international fees associated with the PSN, why would they be 65% higher in Canada than in the U.S.? If they were fees, why wouldn't there also be fees on the Wii virtual downloads? Also, I don't see online fees for any other services other than Xbox Live and PSN and if they were I believe the article would have mentionned them.

[MF-PO'd]

Just let us pay american prices and let the stupid credit card companies sort it out (lord knows they all charge 2.5 cents per dollar on conversion of currencies anyways)... This is really the fairest way, atleast in the case of the PS3.

Yes! This is the best solution (like eBay does).

[batsu336]

Sony is a japanese company. If their were international fees associated with the PSN, why would they be 65% higher in Canada than in the U.S.? If they were fees, why wouldn't there also be fees on the Wii virtual downloads? Also, I don't see online fees for any other services other than Xbox Live and PSN and if they were I believe the article would have mentionned them.

Yes, Sony is Japanese, but Sony Online Entertainment is based off U.S. servers, not Japanese, and American PS3s don't even play Japanese coded games, without altering the PS3, because of the geographic coding Sony has used for years. I know there are always fees for international shipping of real goods, and fees for any international telephone transmissions, so it would stand to reason that governments would charge fees to big companies that provide international downloads whenever they could. My question is if anyone has concrete info on this theory. It would help to explain at least some of the increase for foreign price differences. That, and, they are a private company so they can charge whatever they think people are willing to pay.

[J-Rock]

Yes, Sony is Japanese, but Sony Online Entertainment is based off U.S. servers, not Japanese, and American PS3s don't even play Japanese coded games, without altering the PS3, because of the geographic coding Sony has used for years. I know there are always fees for international shipping of real goods, and fees for any international telephone transmissions, so it would stand to reason that governments would charge fees to big companies that provide international downloads whenever they could. My question is if anyone has concrete info on this theory. It would help to explain at least some of the increase for foreign price differences. That, and, they are a private company so they can charge whatever they think people are willing to pay.
But besides PSN I do not know of any other companies that do this. Do you have any example? Microsoft doesn't directly do this. And would the fees be so different from game to game? Look at the examples, a few games have no increase in cost, others a 120% increase. Do you think a government would charge so differently for DLC? It doesn't make any sense.

It's "they are a private company so they can charge whatever they think people are willing to pay". That's why I urged canadians to contact their console companies and ask them to stop price gouging canadians.

[J-Rock]

I emailed Sony about this but I'm still waiting to see how they respond.