Recommended Steam prices increase significantly in many countries: +18% in Europe, +485% in Argentina
Valve has made changes to its regional price recommendation system that should make life easier for developers, but it could also lead to higher game prices in some countries.
Steam currently supports 39 different currencies, which is a lot of money for developers, especially smaller indies. As Valve said today announcement (opens in a new tab), it’s pretty easy to decide that you’re going to charge $20 for your latest build, but how much is that going to cost in Qatari Riyals or Norwegian Kroner? Rather than forcing everyone to do manual exchange rate conversions, Steam makes all-currency recommendations, based on your US dollar prices.
“We think this is a useful guide, but with ever-changing purchasing power and exchange rates, we needed to make significant changes to these conversion recommendations to stay current,” Valve said in the update. up-to-date pricing recommendations.
“We are also committed to keeping this guide as valuable as possible by establishing a more regular cadence for reviewing prices. We will closely review these recommendations on an annual basis and make adjustments accordingly.”
This all sounds quite reasonable. But the new price recommendations, shared on Twitter by SteamDB (opens in a new tab), reflect stunning increases. On a $59.99 game, for example, the recommended Turkish Lira price increased from ₺92 to ₺510, an increase of 454%. The Argentinian peso rose again, from AR$649 to AR$3,800, an increase of 485%. Other increases are less blatant but still remarkable: Steam’s recommended prices in Russian rubles increased by 75%, the Indian rupee by 80%, the Kazakh tenge increased by 97% and the Polish zloty increased by 28. %. Even my beloved Canadian dollar rose, albeit by 13%, more correlated with inflation.
To be clear, these increases do not reflect an increase in actual prices on Steam, only in the prices that Steam recommends to developers, who are free to charge whatever they want in the regions they choose. Still, it might impact some games: busy indie developers trying to release games on Steam probably don’t want to spend a lot of time figuring out unique prices for, say, Colombia and Switzerland, so at least some of them they are likely to take advantage of Valve’s recommendations to do so.
The massive increase in Turkish and Argentinian prices in particular could be driven by Valve’s efforts to reduce region swapping – the practice of using VPNs to buy cheap games (opens in a new tab). Some developers have taken individual steps to combat region swapping: Motion Twin, for example, increase in the price of dead cells (opens in a new tab) in Turkey and Argentina earlier this year because “a significant share of last year’s sales came from these two countries, with no corresponding increase in the number of players there”.
“The percentage of our total sales from a given country will be approximately equal to the percentage of our total players from that country,” the studio wrote. “For Argentina and Turkey, their percentage of total sales is 3 to 4 times the amount of the percentage of their total players.
“It’s no coincidence that the price of Dead Cells and DLC in these two countries is by far the lowest in dollar/euro terms, so it’s extremely likely that people will switch regions to enjoy a 70-90% price reduction.
Exchange rate fluctuations can also impact regional price recommendations, though Valve said that’s not the only factor that comes into play. From updated Steamworks pricing page (opens in a new tab):
It is tempting to treat prices as a simple exchange rate problem and link the price equivalence of each currency to the exchange rate. But this type of strategy greatly simplifies the disparate economic circumstances from one territory to another. And while exchange rates have macroeconomic consequences, they generally don’t have a short-term impact on an individual consumer’s purchases.
Rather than just pegging prices to exchange rates, our price suggestion process goes deeper into the details of what players pay for the goods and services in their lives. This includes parameters such as purchasing power parity and consumer price indices, which allow prices and costs to be compared more broadly across a range of different economic sectors. But in the case of games on Steam, we’re also digging more specifically into entertainment purchases to better inform those decisions.
All of these factors have prompted us to commit to updating these price suggestions at a much more regular rate, to keep pace with economic changes over time.
Even with the recommended price increases, games in many of these regions are still considerably cheaper than in the United States. AR$3,800 is around $24.50, while ₺510 is $27.40 – each is still less than half the cost of the game in the US. But the percentage increase is massive, and the net income per capita in these two countries (and many others on the list) is significantly lower than that of the United States. Developers who adopt the higher price recommendations may see a reduction in region trades, but it’s also going to put a lot more financial pressure on consumers in the affected regions.
Some Reddit users don’t think the new recommendations will have much of an impact on big releases, as major publishers pay no attention to recommended prices anyway and usually charge more. “RE4 Remake was 25% above the new price even before the change, and FIFA 22 (yes, last year) cost twice as much”, redditor SchrödingerSemicolon (opens in a new tab) wrote. “What it does is just raise prices across the board for games that followed. [the guide] before.”
Indie games are another matter, though, because as several reviewers have pointed out, indie developers are most likely to follow pricing recommendations. indonesian player arhcerwartune (opens in a new tab) said in a “rant of frustration” on Reddit that “we got a big hit of +30% to +73% on games priced at $10-$30 that [is] the indie spot. I understand it’s because [of] inflation and all that, but it defeats the purpose of REGIONAL PRICING.”
I have contacted Valve for more information on recommended price increases and will update if I receive a response.