Retail vs Digital

[Mánagarmr]

So I was looking around what the prices for Mists of Pandaria were at (Latest expansion for Digital Crack 2012) and found something extremely amusing.

If I trod down to my local retail shop and buy it there, I pay 179 kronor (roughly $28) and I get a box, manual and physical disc.
If I log into Battlenet and order the digital download, I pay 350 kronor ($55) and I get the digital download. Nothing else.

How the BALLS is it possible for a digital download (costing them barely anything except bandwidth) to be 100% more expensive than a physical disc that had to be printed and shipped?

Can anyone please lay this ugly nest of snakes out straight for me, because I cannot possibly understand how this is even possible? I know how it works for online digital stores (such as Steam) where they add a lot to the price due to Steam taking a 30% cut, but here it is their own store. Wouldn't it be in their best interest to offer the best price and service in order for people to use their service and thus make them the most money?

[Hearteater]

They likely have a contract with brick-and-mortar stores not to under-cut them.  Combined with region pricing, and what you are seeing is probably the greatest price any brick-and-mortar store offers anywhere in the world.

[KingIsaacLinksr]

If you publish your games in brick and mortar stores (and you very much still have to because retail still reaches a much wider audience) you have to follow their pricing rules. Even Valve still does physical copies and has to follow retail as far as I understand it, though their games are on sale quite often.

[Mánagarmr]

It's completely ridiculus. I mean, really ridiculus. I...I really have no words for it.

[doctorfrog]

Ah, first world problems.

They charge what they think people will pay for it. No nest of snakes. Just guessing and hoping and marking things on sale when demand goes down. It's not ridiculous. It's math and guessing and marketing. Which is ridiculous.

[Hearteater]

Don't try and bring capitalizim into it, the problem is much simplier: they are trying to make old obsolete business models work, and everyone suffers for it.  Including the companies themselves.

[Mánagarmr]

Don't try and bring capitalizim into it, the problem is much simplier: they are trying to make old obsolete business models work, and everyone suffers for it.  Including the companies themselves.

This honestly sounds more likely than "Harr harr GREED!" tbh.

[LaughingThesaurus]

Money is involved. Is there anything about money apart from the most basic of survival that can't be boiled down to "It's about greed"

[Hearteater]

Nope, stupidity and fear really. They could make more money with a different system.  Valve has proved it, and even said publicaly that game prices are not being set right to maximize money.  But the companies are too scared to do something new when they have something that makes money.  Even when it starts to fail.  I'd almost feel bad for them...but I don't.

[KingIsaacLinksr]

Yeah, I guess that's the other thing. Companies are comfortable with $60, believing that maximizes their profits. It doesn't. I should know, I can't remotely justify the several big AAA releases this month (Dishonored, XCOM, etc), but I could have bought another FTL-priced game by now if I had seen one I really wanted. And I cannot be the only one who is like that so AAA publishers aren't making the most money they could have on this business plan. But change is scary.

[keith.lamothe]

Well, there can always be more than one thing wrong.

I think it's:
- Partly fear that the new models would not be viable for them (this concern diminishes quarter by quarter as Valve continues to rake in ludicrous profit margins).
- Partly fear that they would not do well in the new models compared to the established players.  Jumping out of a pond they already dominate into one like that is understandably not something that appeals to them.
- Partly greed in that they're the established players where they are, and that means a certain share of the industry revenue (in their area, anyhow) regardless of how good a deal or service it is for the customer.