On Saturday, we posted up an article about a price increase for the Xbox 360 and it’s software that will come into effect in January 2009. Local gamers are fuming and everybody is cringing or complaining over the concept of paying a thousand Rand for triple A titles.
We got on the phone with Microsoft’s Product and Marketing Manager, John Press to get an official statement on this whole situation and we have come up with some answers. Some of the news is bad, some of it is mildly better than expected, although it is unfortunate that I can’t really say that there is anything good coming our way in the very near future.
Read more about our discussion with Microsoft, after the jump.
[ Image courtesy of CraigN.net ]
Ok, so onto our phone call with Microsoft.
When asked about the fact that South Africa seems to be the only country that is going to be experiencing the price hike, Mr. Press said that it is simply “not true”, stating that all smaller countries and emerging markets similar to South Africa are “in the same boat” as both them and the RSA are affected by the economic crisis more than larger countries due to the lack of investments into the country in these times of financial crisis.
It is then very possible that gamers from countries such as ours will be forking out more money on our favorite hobbies than those from larger countries such as the USA and the UK, who will probably remain unaffected.
He states that the price increase in South Africa is completely due to the current exchange rate of the Rand and that the pricing is fluctuating solely because of it’s weak state and that it is has not been set in motion to increase profits.
When asked if prices will come down in future (if the Rand becomes stronger again), he said “Absolutely” and also made a point that their prices always fall again when the currency increases in strength. Pricing is set for products over a certain period of time and if the Rand does strengthen, the prices will drop once the new pricing is put in place.
So what about this idea of R999 triple A titles then? When asked, Mr. Press stated that we will not be seeing prices rise to as much as R999 but it looks like we can still expect it to be ” pretty close to the R899 mark”. While it is good news to hear that the games will not be as expensive as we have heard, it doesn’t exactly kick up a huge amount of excitement to know that games will still be sitting on the R900 mark.
Nintendo already jacked their prices in South Africa up to a ludicrous amount and it is suspiciously higher than one would expect. If what Mr. Press has said is true then Playstation 3 owners may do well to also prepare themselves for a rather unwelcome price increase in the very near future as well.
We sit in a situation at the moment where a lot of us want to buy now to avoid the higher prices but at the same time we will be buying into something that will then become significantly more expensive to enjoy once we have it.
We would like to hear our readers thoughts and comments on the statements from Microsoft as well as your opinions on how this is going to affect gaming for South Africans in 2009 so leave your comment below and let us know what you think.
Last Updated: December 9, 2008
Macethy
December 9, 2008 at 12:18
Maybe I’ll get myself a game or two for christmas errr sorry the “holidays” but if game prices start heading to R900 then it’ll be time for me to start trading games or looking for deals.Pick n Pay is selling Devil May Cry 4 and Dark Sector for R199 each and I think I saw COD4 somewhere for R270 so it might be a good time to catch up on all the hits that I’ve missed chasing the latest releases.The will just buy the “new” games once the prices fall to bargin bin or I can get a second hand copy.
Scratchy
December 9, 2008 at 12:19
My problem is this.
About a month ago, we had a price increase due to the weakening Rand. The Rand has started stabilising with a lower exchange rate, yet the prices are still increasing. Why not wait while it comes down(as it’s doing) before shooting poop sticks?
IIRC, game prices have NEVER come down after an increase and I don’t expect it to happen this time round
Chevron
December 9, 2008 at 12:30
PC games are still R350 a game…
Marc
December 9, 2008 at 12:44
As mentioned in your previous pricing post…
300 U.S. dollars = 3 027.45905 South African rands
and not R3799!
Where is all the extra cash going? Are the consoles even made in the states?
As for games, I think the new ones cost around $60 in the states…
60 U.S. dollars = 605.491811 South African rands
Seems like we are currently inline with our pricing (more or less).
I personally think that the price increase is ridiculous and agree with Scratchy in that once the prices are up, they will never come down.
Shaun
December 9, 2008 at 12:49
Kinda a bummer that games are getting so expensive! I think that rental systems like BT games is the way to go until prices start coming down again.
Wolfy
December 9, 2008 at 12:50
We’re paying for someone else’s mistakes again. I think gamming is the least of our problems at this moment if our currency is at a magnificent all time low. lets be realistic would you rather buy a R1000 for a game or get R1000’s food or heck even beer. Not everybody here gets a free bee from mommmy and poopy you know
al360
December 9, 2008 at 12:50
damn gonna go back to pc rather as you never see price increases there it only gets cheaper for the software.
i think its load of bull.
NoMaD
December 9, 2008 at 12:57
This sounds like a marketing attempt at getting people to shift stock before Christmas. Not a bad Idea!
Buy NOW!!! before prices go up!
Craig Nicholson
December 9, 2008 at 13:02
@Marc Good point, however there are certain things you’ve forgotten to take into account, namely shipping costs (not cheap), tax (at least 14% VAT) and import duties.
Regarding the exchange rate, you can’t work on todays rate. You need to work on an average for a period of time as it changes to often. Just looking back the last month or so we go from a low of 9.46120 to a high of 10.79000 and an average of 10.17810.
So work it out. 300 * 10.17810 = 3053.43 before taxes, shipping and duties. Add 14% VAT and your on R3480.9102. Add a conservative 10% for shipping and duties and your at R3829.
Flameboy
December 9, 2008 at 13:05
http://www.shopto.net
shane
December 9, 2008 at 13:08
with the low oil price shipping, transport costs should have come down significantly.
Adam
December 9, 2008 at 13:08
Yeah I have to say this is bad.
I’ll be buying a lot less and maybe do the rental thing.
PC gaming is also looking very attractive to me right now.
No issues over “Official Live support” and game prices are cheaper. At R900 per game it will take you 3 games to buy a decent graphics card and you will only have to do that every three years.
bokka1
December 9, 2008 at 13:17
No Craig your argument is flawed. The US prices includes US taxes, shipping cost and retailer profits. Our distributors are not paying $60 or $300 because they are not buying it direct from a shop in the US. You must deduct all the above US expenditures to ascertain the real cost price and then add SA taxes and costs.
Why can I buy a game in the UK, have it shipped here and still pay less?
The game prices are insane and us, the loyal consumer, are being screwed again.
SubXaero
December 9, 2008 at 13:22
Funk that, I’ll use my bonus this Xmas to upgrade my PC or
even buy a new one; sell my Xbox with all of her games included.
I think it’s absolute rubbish that we have to pay such high
prices for console titles. I would like to add that for a
format such a PC and the games that are easily pirated the
prices would be even higher than console titles being that
MS has the security that most console gamers buy original.
Microsoft raises the prices because they know XBL gamers
have no choice but to buy original games if they plan on
playing multiplayer on Live, in order to increase their
bottom line. You know what I’ve had it up to here with
Microsoft, F**k ’em and all other consoles manufactures.
I initially changed from PC to console and it was an
expensive move but I did it to avoid software and hardware
compatibility issues with games but you know what I would
rather struggle that be raped by a company who most
probably afford to give gamers grace when it came to price
increases.
F**k these greedy bastards, I won’t give them the
satisfaction of spending my bonus on new games at the worst
I can buy fairly new second hand titles for a fraction of
the price.
Nick
December 9, 2008 at 13:26
I was actually speaking to a retailer the other day who told me that the mark up on the consoles was something ridiculously low like 2% for them. So it really does make me wonder what all the costs are that are making it so expensive.
SubXaero
December 9, 2008 at 13:30
Guys lets face it we are always screwed over in this
country when it comes to the cost of most things but
lets not deny why, because we allow it to happen to us.
We are so complacent when it comes to paying for things
and we never take a stand against unfair pricing.
If we did what ordinary consumers in Europe and the US do
when it comes to paying for goods we wouldn’t be in the
situation. Imagine the impact of what would happen if we
never bought any new games the festive season to MS South
Africa’s bottom line? Just a thought how many of would be
able to resist the temptation of buying any new titles for
3 months, not many and that’s why they can rape us so
easily.
ewie
December 9, 2008 at 13:30
The rrp of a game is 60$ in the us, on top of that a customer will pay state tax, depending on where you buy it, like gst we had years ago, If we look at the european prices they will be on par, as if you pay %0 Euro it will include sales tax already.
0rk0
December 9, 2008 at 13:37
Amen brother.
SubXaero
December 9, 2008 at 13:42
Yes God Bless GameXchange 🙂
Lupus
December 9, 2008 at 13:43
They would just not ship to us at all, simple as that, our market is so small that losing us is better then trying to keep us. Welcome to the GLOBAL economy where we are but a speck.
SubXaero
December 9, 2008 at 13:46
Anyone have any spare nades lying around? I’d like to send them a Christmas present. 🙂
Bboy
December 9, 2008 at 13:47
boo boo bee boo… right where is that copy of dota!
SubXaero
December 9, 2008 at 13:51
Right on brother, *he blows the dust off his copy of America’s Army, Titan Quest and Company of Heroes, and
says “Damn these games are old, I got to gets Diablo III”
👿 Long live Blizzard 👿
Murderface
December 9, 2008 at 13:57
I think alot of ppl are gonna get their bandannas and eye patches ready..
JimBob
December 9, 2008 at 13:59
The question I would love to have the answer to is this:
Why can Megarom and EA manage to keep their prices down, but Microsoft and Ster Kinekor cannot?
At the end of the day, I import all of my Sony first party games from Australia and the US, and now I will go the same route with Microsoft first party games. It’s inconvenient, but I must srsly question what is wrong with MI Digital when it is cheaper for me to get a game couriered to me from Australia at RETAIL prices than to buy it here.
The sad thing is that the market will shrink because of this, piracy will increase, and the chances of us gettign Xbox Live go straight out the window.
SubXaero
December 9, 2008 at 13:59
Aaarg! What’s that me matey!
ewie
December 9, 2008 at 14:01
To be honest I will just import these, I stopped importing
when xbox launched locally, but with all these increases it will be a lot cheaper with delivery to import from dvdcrave
if i need a new title. this year I only bought a few titles new that i really wanted – rest second hand when price = right.,
banana
December 9, 2008 at 14:06
Oh well, guess I’ll go buy another xbox and play my current games with it and with my old xbox that has a Toshiba/Samsung i’ll hack it and from now on copy games, I can afford to pay R1000 a title but I refuse to do it.
Grey
December 9, 2008 at 14:19
Total Bull$!!%! I have been a gamer from the age of 8 im 27 now I used to spend an average of 1.5k per month on games and I point blank refuse to support the greedy buggers anymore , enough is enough. We should set up a website , all sign and pledge not to buy a single game for 3 months , Maybe that would show them we have had enough!
Chevron
December 9, 2008 at 14:29
I was gonna say something similar. Surely the distributors buy in bulk and should be able to get the goods very cheaply. How is it that a lone South African can import the game(1 game, meaning no economies of scale) at a cheaper price?
evilgrinningmonkey
December 9, 2008 at 14:33
Sign me up for that. Will not buy a new MS game in SA next year anymore. Will asked my sister in england to buy end send them to me. I worked out that I’ll pay R650.00 for Gears of War 2 doing it that way.
Kale
December 9, 2008 at 14:37
I have a question.
I understand prices go up, fine. I understand that there is importing costs and vat rates.
My question is for example a console that costs R3000 in the US, I buy it here, and we pay R700 more for the console – fine import costs, vat I understand.
In the US they are making a profit on these things and still advertise, have X-box live have X-Box events, have X-box support (What we have doesn’t count it’s cheaper to replace one than to buy a new one).
Why then do we have to pay more with no benefits?
Also I don’t get the whole games price going up, I can buy the same game on PC for half the price, are console games selling worse than the PC?
They come in the same packaging and similar manuals.
I don’t support piracy but this is the point I’ll start considering it.
Macethy
December 9, 2008 at 14:51
So do it!
Kale
December 9, 2008 at 14:52
Wow thats incredible… I on the other hand earn R12 rand a month and drive a Porche 911 turbo live in the Michaelangelo, and since I’ve told you that it must be true. 😆
SubXaero
December 9, 2008 at 14:58
“I don’t support piracy but this is the point I’ll start considering it.”
What choice do we have, when things like this make it easy for us to make that choice even though we know it’s wrong.
SubXaero
December 9, 2008 at 14:58
Hell my drugs are allot cheaper!
bokka1
December 9, 2008 at 15:07
Yes, but the price already includes federal taxes that must be deducted. This has got nothing to do with state taxes.
Philip
December 9, 2008 at 15:52
“Regarding the exchange rate, you can’t work on todays rate. You need to work on an average for a period of time as it changes to often. Just looking back the last month or so we go from a low of 9.46120 to a high of 10.79000 and an average of 10.17810.
So work it out. 300 * 10.17810 = 3053.43 before taxes, shipping and duties. Add 14% VAT and your on R3480.9102. Add a conservative 10% for shipping and duties and your at R3829.”
You are not making sense. Just because they sell for $300 in america doesn’t mean we should use $300 as a base. Firstly its not made in the USA its probably made in asia. $300 is after microsoft has got their cut and after the redistributer has got their cut and after the retailer has got their cut. If it costs $300 there it should cost $300 * exchange rate here. You cant use the retail price in america as the base to do your calculations…its just stupid!
Marc
December 9, 2008 at 16:32
I was just using the $300 as a figure (including profits for everybody). It just feels like we are getting told to bend over….again. I don’t even want to mention the GOW2 map and lancer code debacle. Why is there no transparency? And why do we always get the short end of the stick?
I am all for a mass protest/boycott…
Garren
December 9, 2008 at 16:37
I agree with Marc, it just seems like they are trying to make extra money and dont really care about the users. All the excuses really dont make any sense and dont seem to effect the price as much as they say it should.
Its definitley time to boycott buying any new games!
imajin
December 9, 2008 at 17:26
Dear Microsoft,
It breaks my heart to say this, but it’s over. I can’t live like this any more. I’m really miserable. I’m leaving you for the Jolly Roger.
Love,
imajin
(as posted on myadsl)
IN OTHER BREAKING NEWS……
Local video game piracy rockets by 200%.
Publishers are baffled as to why.
Bm
December 9, 2008 at 17:40
and graphics cards are still 1.5k a pop for a medium one.
Lydon
December 9, 2008 at 18:52
And they wonder why there is piracy. I’m sorry, but there’s no utter way in hell I will pay that much for a game. Consider one customer gone. I refuse to pay for a single game while the prices are at that mark. They are already ridiculous. Not only are we paying for half a product (no Live), but now we’ve got to pay more for said product that countries that do have Live.
PillsburyDeeBoy
December 9, 2008 at 19:20
Precisely.
PillsburyDeeBoy
December 9, 2008 at 19:24
How much do you know about corporations? Any corporation worth it’s salt will eek out every cent of profit it can for its shareholders. I think it’s fairly safe to say that Microsoft is a corporation worth its salt… so your reasoning, although interesting, is probably not correct.
RivaZA
December 9, 2008 at 19:29
Whilst I must resist, it is so nice to scream out Aaarg!
RivaZA
December 9, 2008 at 20:16
Now I have changed my mind about digital distribution. Before I thought it was evil but now I would welcome it.(Once our bandwidth prices fall). I actually hope the next lot of consoles are exclusively digital distribution then these local distributors can all go the way of the dodo!
xyber
December 10, 2008 at 08:02
and you missed the point he was making.
xyber
December 10, 2008 at 08:08
Please explain to me why the exact same multiplatform game is so much more expensive on console than PC? Is it because the publisher pay some kind of royalty to to MS and Sony or is it something else? Why would Prince of Persia for example be R632 on PS3/Xbox360 and R361 on PC?
Atomic
December 10, 2008 at 09:11
As someone who works in a FMCG, specifically with imported products, I can say these increases are not justified. yes the exchange rate took a dive, we’ve already seen about 14% out of a MAXIMUM of 30% increase, with the R @ todays rate, it only translates to a 27% increase from average levels, meaning to compensate, we should only be seeing another 15% increase. Transport costs are down, therefore anything higher than 12% is not justified.
Flipping criminals
Krypty
December 10, 2008 at 09:20
Import FTW
Fudzy
December 10, 2008 at 10:55
Why hasn’t anyone asked this guy why we dont have proper Live support?
Incognito
December 10, 2008 at 18:16
I must say, knowing the some of the guys at Microsoft personally, and being pretty loyal to the Xbox brand not only for that reason but because I think it’s an awesome product, this is a bit hard to swallow.
I earn a pretty decent salary, 40k + per month, and there is just no way I can justify 900 – 1k on a title.
Sales are gonna take a massive hit.
PS3 has looked pretty good lately. If prices don’t increase that sider, I see a few jumping ship, myself included.
ewie
December 10, 2008 at 19:05
The big question to ask is -seeing that we are linked to the british pound / euro zone and not the dollar.
http://www.x-rates.com/d/ZAR/GBP/graph120.html
and according the pound did not change a lot.
I call bullshit, when we complained first time it was because we are on par with the british pound , now it s the dollar, next it will be the yen, depend on which one is the strongest .
SubXaero
December 12, 2008 at 12:07
Could it be the R and D that goes into console gaming?
SubXaero
December 12, 2008 at 12:08
Please hope it never gets to the Chilean Peso because then we are screwed 🙂
JC
December 14, 2008 at 08:43
Maybe it’s time for a new hobby then… urgh… the art of tree pruning… maybe a bonsai or two…
Martin
December 18, 2008 at 21:39
The majority of XBox gamers I know buy one new game every 3 to 4 months, because of the price. It is simple these guys will now just buy a new game every 5 to 6 months. Less sales for MI Digital and everyone else… They are all idiots
Top
December 27, 2008 at 08:54
The test is whether Australia, New Zealand, the UK and others are seeing similar increases. All of these have currencies that have depreciated severely against the Dollar. The UK economy is in a very bad state.