Valve was fined €1.6 million ($1.7 million) for obstructing the sale of certain PC video games outside Europe. However, the company pleaded not guilty.
Wait, outside Europe?
Some countries make it illegal to buy certain video games. If Valve can’t geoblock sale of them outside Europe, how are they supposed to conform with both sets of laws?
I remember that the EU didn’t want country-specific pricing inside the EU, and had some case over that. That I get, because I can see the EU having an interest in not wanting it creating problems for mobility around the EU. But I hadn’t heard about the EU going after vendors for not selling things outside Europe.
Okay this article is shittily worded and the Bloomberg article it links to is paywalled so I found this which goes into much greater detail.
TLDR: Valve and five other publisher’s were blocking activation of keys sold to people/distributors from distributors/vendors who purchased them from cheaper regions.
The article is shit. In the official response they talk about the following countries, none of them is outside Europe:
Czechia, Poland, Hungary, Romania, Slovakia, Estonia, Latvia and Lithuania
But retail law attaches to a location, not to citizenship. Why would the EU be mandating sale of things in other regions? I mean, it’s not like the US says “if an American citizen is living in the EU, then vendors operating in the EU must follow American retail law when selling to him”.
Steam specifies in its terms of use that it is prohibited to use a VPN or equivalent to change your location on the platform. Except that it takes the case of the activation of a game given to you by someone and sent to your account. Following Europe’s decision, this should technically change and it would be possible to change region in Steam directly to buy a game then activate it in France. Valve has not made a comment at this time.
Hmm. Okay, if that is an accurate summary – and I am not sure that it is – that seems like the EU is saying “you must be able to use a VPN to buy something anywhere in the world, then activate it in Europe”. Yeah, I can definitely see Valve objecting to that, because that’d kill their ability to have one price in the (wealthy) EU and one in (poor) Eritrea, say. Someone in France would just VPN to Eritrea, buy at Eritrean prices, and then use it in France. The ability to have region-specific pricing is significant for digital goods, where almost all the costs are the fixed development costs.
thinks
If that is an accurate representation of the situation, that seems like it’d be pretty problematic for not just Valve, but also other digital vendors, since it’d basically force EU prices to be the same as the lowest prices that they could sell a digital product at in the world. I don’t know how one would deal with that. I guess that they could make an EU-based company (“Valve Germany”) or something that sells in the EU, and have a separate company that does international sales and does not sell in the EU.
I mean, otherwise a vendor is either going to not be able to offer something in Eritrea (using it as a stand-in for random poor countries), is going to have to sell it at a price that is going to be completely unaffordable to Eritreans, or is going to have to take a huge hit on pricing in the EU.
I’m a little suspicious that this isn’t a complete summary of the situation, though; that seems like it’d create too many issues.
EDIT2: Though looking at my linked-to article, it seems to be that the author is saying that that’s exactly what the situation is.
Wait, outside Europe?
Some countries make it illegal to buy certain video games. If Valve can’t geoblock sale of them outside Europe, how are they supposed to conform with both sets of laws?
I remember that the EU didn’t want country-specific pricing inside the EU, and had some case over that. That I get, because I can see the EU having an interest in not wanting it creating problems for mobility around the EU. But I hadn’t heard about the EU going after vendors for not selling things outside Europe.
Okay this article is shittily worded and the Bloomberg article it links to is paywalled so I found this which goes into much greater detail.
TLDR: Valve and five other publisher’s were blocking activation of keys sold to people/distributors from distributors/vendors who purchased them from cheaper regions.
Ah yes, that thing my brother likes to do where he VPNs into another country and then buys them at the greatly reduced local prices.
Guess they were attempting to crack down on purchase frauds and legitimate buyers got burned too?
It was punishing the consumer rather than the distributors abusing the regional pricing.
Yes, but it was the part they have control over. The alternative is not having regional pricing allowing lower income countries to buy games at all.
The article is shit. In the official response they talk about the following countries, none of them is outside Europe: Czechia, Poland, Hungary, Romania, Slovakia, Estonia, Latvia and Lithuania
https://ec.europa.eu/commission/presscorner/detail/en/IP_21_170
I think they meant sale of region specific games not being available to EU citizen living outside Europe
But retail law attaches to a location, not to citizenship. Why would the EU be mandating sale of things in other regions? I mean, it’s not like the US says “if an American citizen is living in the EU, then vendors operating in the EU must follow American retail law when selling to him”.
EDIT: Okay, I went looking for another article.
https://www.gearrice.com/update/steam-cannot-block-the-activation-of-a-game-depending-on-the-country-of-purchase-europe-confirms/
Hmm. Okay, if that is an accurate summary – and I am not sure that it is – that seems like the EU is saying “you must be able to use a VPN to buy something anywhere in the world, then activate it in Europe”. Yeah, I can definitely see Valve objecting to that, because that’d kill their ability to have one price in the (wealthy) EU and one in (poor) Eritrea, say. Someone in France would just VPN to Eritrea, buy at Eritrean prices, and then use it in France. The ability to have region-specific pricing is significant for digital goods, where almost all the costs are the fixed development costs.
thinks
If that is an accurate representation of the situation, that seems like it’d be pretty problematic for not just Valve, but also other digital vendors, since it’d basically force EU prices to be the same as the lowest prices that they could sell a digital product at in the world. I don’t know how one would deal with that. I guess that they could make an EU-based company (“Valve Germany”) or something that sells in the EU, and have a separate company that does international sales and does not sell in the EU.
I mean, otherwise a vendor is either going to not be able to offer something in Eritrea (using it as a stand-in for random poor countries), is going to have to sell it at a price that is going to be completely unaffordable to Eritreans, or is going to have to take a huge hit on pricing in the EU.
I’m a little suspicious that this isn’t a complete summary of the situation, though; that seems like it’d create too many issues.
EDIT2: Though looking at my linked-to article, it seems to be that the author is saying that that’s exactly what the situation is.