Nintendo Fined $143m for Price-Fixing 447
kyz writes "The BBC is reporting that the anti-trust branch of the European Commission has fined Nintendo 146 million euros (roughly $143m) for preventing its distributors from selling games as cheaply as they are sold in other European Union countries. For example, "prices of Nintendo products were up to 65% higher in Germany or the Netherlands than in Britain".
Now if only the EU could do this with Microsoft, Levi Strauss and the MPAA members..."
$143 million dollars? (Score:5, Funny)
All they have to do is make a Pokemon game, and then paint it 4 different colors.
Re:$143 million dollars? (Score:5, Insightful)
Re:$143 million dollars? (Score:4, Insightful)
Re:$143 million dollars? (Score:3, Informative)
I wasn't aware any of these corporations are non-profit charities.
Nobody said, or implied, that they were. I have no idea where you got that.
What's wrong with maximizing profits by adjusting prices in different countries?
It's called price gouging. Perhaps you've heard of it. It's morally repugnant. There is a difference between making a tidy profit, and gouging the consumer.
Do you think upon hearing the verdict.... (Score:5, Funny)
Yeah... (Score:2)
Re:Do you think upon hearing the verdict.... (Score:2, Funny)
Re:Do you think upon hearing the verdict.... (Score:3, Funny)
If you take one and smack your head into it, a coin pops out of the other end.
They'll have the cash in no time.
It was Smash Bros. (Score:2, Informative)
Coins exploding from his body Sonic the Hedgehog style?
No, that's rings, and that's when you get hit, not when you die (as "explode" in the blurb implied). Coins come off a dying player in Super Smash Bros. Melee.
Nintendo never changes (Score:5, Informative)
Re:Nintendo never changes (Score:5, Funny)
Re:Nintendo never changes (Score:4, Insightful)
This is like telling a murderer that they are free to go, but have to give the police a 5-minute warning before the next time they kill someone.
Re:Nintendo never changes (Score:5, Informative)
hmmm who's going to pay the fine. (Score:3, Interesting)
In the end the end user ends up paying this fine as although prices might come down in europe they will no doubt go up in the UK.
Good for them (Score:5, Insightful)
With that said, I swear to god, multinational cooperations have no conscience. Turn on the news, and all you see is the Enrons, Microsofts, and all these other coopertions who do everything they can to screw the consumer and their employees to make an extra penny. Good for the Europeans, bout damn time someone smacked those companies down, even if it is one with good Karma like nintendo.
Re:Good for them (Score:2, Funny)
My take (Score:3, Interesting)
Re:Good for them (Score:5, Interesting)
If the protesters around IMF had their way, there would be much more trade barriers between countries, making it much easier for corporations such as Nintendo to set different prices in different regions.
Good for the Europeans, bout damn time someone smacked those companies down, even if it is one with good Karma like nintendo.
Hum... so if the market is not very competitive you propose knocking down the companies. I think the opposite - what is needed is more companies. And, this is exactly what has happened in the video game market. With three competing systems it is probably very difficult for Nintendo to rig prices, not because EU bureaucrats tell them not to, but because they would lose their business.
Tor
Re:Good for them (Score:2)
With that said, every one of these scandals where companies are found out to be breaking the law in order to increase the bottom dollar makes me want to start levying incredibly excessive penalties, as a way of "encouraging" the other companies not to even think about this crap.
Re:Good for them (Score:2)
Whoever makes that price-fixing deal in Europe ought to be paying $143M out of pocket as well as facing 5 years in a hard-core, anal rape kind of prison. I'd even throw in manditory termination without severance from whatever company they worked for, with lifetime banishment from the industry.
It used to be that shifty behavior by a corporation earned some negative reproach from the corporate community, which acted as a brake on the behavior.
Nowadays there is no reproach. These guys have an army of lawyers they consult beforehand and they know the potential fiduciary liability up front. They build in the liability to their overall pricing structure as insurance against getting caught -- if they don't get caught, it's just extra profit margin. If they do get caught, the cost is taken care of and the only "reproach" is to guys that get caught too often and can't cover their fine losses against the built-in "insurance".
Re:Good for them (Score:3, Insightful)
Re:Good for them (Score:3, Insightful)
Whoever makes that price-fixing deal in Europe ought to be paying $143M out of pocket as well as facing 5 years in a hard-core, anal rape kind of prison. I'd even throw in manditory termination without severance from whatever company they worked for, with lifetime banishment from the industry.
So let me get this straight. You're saying that if a foreign country doesn't like what your company is doing, then they should be allowed to extradite you to their country and punish you as they see fit?
So, if your product is sold in Libya, and Libya thinks that your "action figures" are offensive because the women aren't covering their faces, you'd have no problem with the US packaging you up and shipping you off to Libya, to spend the next 5 years in THEIR prison, after losing all your assets and being banished from your job, because you had the moral contempt to actually manufacture an idol of a female who is not covering her face?
Ok then...
Re:Good for them (Score:5, Insightful)
There's your first problem... you watch the news.
and all you see is the Enrons, Microsofts, and all these other coopertions who do everything they can to screw the consumer and their employees to make an extra penny.
Bad news sells.
Of course you don't hear about the plethora of companies that do good things, act humanely, have scruples, etc... they do exist, and I'd wager they outnumber the enrons of the world.
Bad news sells.
Re:Good for them (Score:2)
Re:Good for them (Score:4, Insightful)
You're making unsupportable generalizations here, you know that? Boeing, Home Depot, Fannie Mae, State Farm, Morgan Stanley, Target, P&G, Berkshire Hathaway, Safeway... these companies are all in the Fortune 50. Please list your complaints against each, in as much detail as possible, so we can all accept your assertion that big companies are automatically evil.
Re:Home Depot (Score:3, Interesting)
But most importantly, there's nothing evil about this, for several reasons.
1. Home Depot was ordered, by the Ontario Ministry of the Environment, to evict the squatters (not "homeless encampment," but squatters) in November, 2000. The order was based on the premise that the vacant lot was formerly the site of an iron foundry, and not fit for direct human habitation.
2. In December, 2000, Home Depot put flyers all over the squatters' tents saying that they would be clearing the site and asking people to leave. That pretty much blows your "with no notice" theory out of the water.
3. In August, Home Depot actually starting building shelters on the site in preparation for winter. Does that sound evil to you?
There's even more to the story. A good-- and unbiased-- synopsis can be found on the CBC's web site, here [www.cbc.ca].
Re:Good for them (Score:2)
Yeah, cos you know how stories about businesses who operate legally keep people glued to their sets.
This post was brought to you by Ford. Thick like a rock!
Ok (Score:2)
But nowadays, it seems there are so many that they just keep coming out of the woodwork.
Re:Good for them (Score:4, Insightful)
On the contrary, multinationals are only operating within the framework provided by national governments. When governments dismantle their trade barriers, such as import tarriffs and quotas, then price differences will simply be arbitraged away by brokers (i.e. you see something selling for $10 in country A and $5 in country B, export/import it and sell it in country A for $6 - eventually the margin will tend to zero). But that can only happen if there are no obstacles to freely moving goods and capital around.
The biggest barrier to this is ironically the EU itself who protect manufacturers like Levi Strauss from UK retailers who source overseas and want to sell at less than Levi's MRRP. Not to mention the distortions the EU create in the market with their subsidies of inefficient industries.
Frankly, I don't know who's worse, corrupt corporations (as distinct from well-run corporations) or corrupt politicians - and the EU isn't even democratically elected! A shareholder has far more influence on a company than a voter has on the European Commission (that's a fact).
Re:Good for them (Score:5, Informative)
ok, I'll bite.
The EU [eu.int] is run by five institutions, each playing a specific role:
* European Parliament (elected by the peoples of the Member States);
* Council of the Union (composed of the governments of the Member States);
* European Commission (driving force and executive body);
* Court of Justice (compliance with the law);
* Court of Auditors (sound and lawful management of the EU budget).
I trust that you'll believe me if I told you that the goverments of the member states are democratically elected.
The comission [eu.int] "has a college of 20 members. The President, the two Vice-Presidents and the 17 other Members of the Commission are chosen for their general competence, and all present guarantees of independence. They have all held political positions in their countries of origin, often at ministerial level.
The Commission is reappointed every five years, within six months of the elections to the European Parliament. This interval gives the new Parliament time to approve the Commission President proposed by the Member States, before the President designate constitutes his future team, in collaboration with the governments of the Member States. Parliament then gives its opinion on the entire college through a process of approval. Once accepted by the Parliament, the new Commission can officially start work the following January. "
That's ok for me, so let's go on to the Court [eu.int]
The judges and the advocates-general are appointed by joint agreement of the governments of the Member States for a renewable term of six years, with partial reappointment every three years. These are members of the highest national judiciary or jurisconsults of recognised competence presenting all the guarantees of independence.
Again, it sounds good to me
Finally, The Court of Auditors [eu.int] comprises 15 members appointed by the Council for a renewable term of six years, ruling unanimously after consultation with the European Parliament.
So the main bodies of the EU are either elected by the people or appointed by elected officials. I really don't see what your problem is.
Re:Good for them (Score:3, Insightful)
Also, of course you only hear about screwy corporations on the news, just like you only hear about terror attacks in Israel/Palestine, or hostages in Moscow. CNN wouldn't attract a lot of eyes if its headlines ran 'Corporation continues ethical business as usual; 30 people on bus in Jerusalem get where they're going without incident; 700 theatre patrons watch play without interruption'. Much though I wish that were all the news there was to report, people are attracted to news about death, corruption, greed, and so on, so when four Israelis die, they focus on that, not the five million that didn't; when corporations cheat, they focus on those, not the ones that did the math right, and so on. For that matter, every time people get together to protest globalization, we end up with riots, assaults, property damage, and so on. Can we really judge all anti-globalists based on those few? Can we judge all multi-nationals based on those few? I don't think so.
--Dan
It has also been reported... (Score:5, Funny)
Conspiracy (Score:2, Funny)
So... (Score:5, Insightful)
Re:So... (Score:2, Interesting)
Re:So... (Score:5, Insightful)
Re:So... (Score:2, Insightful)
Imagine if consoles were cheaper in Utah, but any Utah resellers were forbidden to ship them out of state.
The EU suffers from too much of this kind of stuff.
Re:So... (Score:5, Insightful)
Not what the ruling's about. The ruling isn't about price per se, it's about controlling the distribution.
What Nintendo were doing was selling a game for x in the UK, and the same game for x+5 in, say, France. Perfectly legal.
The trouble is that they were then trying to prevent French consumers from buying in Britain and importing directly into France. Now, the EU is an internal free-trade area, so controlling imports between member states is a big no-no.
That's the case. Not the price as such, but the control of distribution across member state boundaries.
Cheers,
Ian
Re:DVD Region Coding? (Score:3, Informative)
Re:So... (Score:2, Insightful)
They were fined for stopping cross border imports inside the EU. The US equivalent would be forbidding shipment between individual states inside the US.
That's not competing, that's avoiding competition.
Re:So... (Score:3, Informative)
That was not the case in the mid 90s Europe, the market which the allegation is about.
Tor
Re:So... (Score:3, Insightful)
Less demand ==> Lower prices
High demand ==> Higher prices
is a pretty bad simplification. There is a great demand for cheap bread, but that doesn't mean cheap bread is expensive.
What offer vs. demand means is that you have two curves, the demand curve and the offer curve. The demand curve is a hyperbolic shaped x-demand/y-price curve: few people want to pay a high price for a good, many people want to pay a low price. The offer curve has the inverse behaviour : many suppliers want to supply high margin goods, few are willing to suppl low margin goods.
We live in a world where there is demand AND offer so the demand and offer curves are plotted on the same chart. As one is rising from 0, and the other is faling to 0, so they must cross at some equilibrium point, the one where the transactions do occur. In fact it is not a point, it is broader, if I enter in a shop and my Coke is
Fluctuations in offer or demand are translated to the correspondent curve going up or down, setting a new equilibrium point. This is left as an exercise to the reader.
Those who had economics 201 are welcome to flame me away.
Nothing new for Nintendo (Score:4, Insightful)
People have already mentioned their price fixing the NES, but how about their security chips and their rabid hate of Tengen? And then there's the Game Genie and how Nintendo did their best to put Camerica out of business.
Nintendo just ain't cool when it comes to anything that lowers their share of pocketbook abuse. Always has been, always will be.
Re:Nothing new for Nintendo (Score:3, Insightful)
Yeah, you can tell that by their strategy of making kick ass games.
Re:Nothing new for Nintendo (Score:2, Insightful)
About time... (Score:3, Insightful)
Seems like the EU is coming down on other [bbc.co.uk] business [utopiasprings.com] sectors [eurunion.org] as well. It is about time someone cleaned up the imperfect markets that still prevail in europe.
The construction and music industries would be a good followup.
This is nothing new (Score:5, Informative)
The Intimidation Tactics of Nintendo [geekcomix.com]
Makes a change. (Score:4, Informative)
But the period they were fined for was only 1991-1998. That still leaves the past 4 years to be accounted for.
But then again Gamecube games are still a lot cheaper than X-box and PS2 games if you know where to shop so maybe they have learnt their lesson.
I wonder when... (Score:5, Insightful)
Re:I wonder when... (Score:2)
Yes, for years I have been buying Region 1 disks from the US/Canada at half the price, months before local release (often before cinema). Often the special features are better as well, due to licensing restrictions etc.
That is price fixing, and is a major factor in why they wanted region coding in the first place.
Not likely (Score:4, Interesting)
Kjella
$ 143 million... (Score:3, Funny)
Basic rights (Score:3, Interesting)
It seems like it has more to do with the open trade policies within the EU than it does with Nintendo.
Re:Basic rights (Score:5, Insightful)
It seems like it has more to do with the open trade policies within the EU than it does with Nintendo.
You're absolutely right. Unfortunately, it has lately become fashionable to hate corporations. Personally, I find it mind-boggling that someone can hate a corporation but NOT hate government for the same reasons. My government takes 55% of my income EVERY year. Compared to that, Nintendo isn't even a minor concern.
Re:Basic rights (Score:3, Funny)
My government takes 55% of my income EVERY year.
I'd like to make a suggestion here....
Maybe it's time to find a new accountant?
Re:Basic rights (Score:4, Insightful)
I hate monopolies, I love competition. Certain types of price fixing is a crime. Criminals suck. The gov't is not a bunch of criminals for taking your money. They are doing things that benefit society with that money. Ever drive on a public road?
You tax rate is prorably so high because your income is high and whatever country you live in was wise enopugh to institute some sort of progressive tax system. If you don't like having a gov't you should find a place where you can live among fellow anarchists. You can grow your own food and carry a gun everwhere you go, while watching you standard of living go to shit.
I personally believe that at some level of income, the tax rate for individuals should become 100%. No one person should have a billion dollars, it's impossible for a democaracy to exist when people do. The economy would still function just fine under this system, since indiviuals could still pool their money by creating corporations.
Re:Basic rights (Score:3, Interesting)
I agree, with a slight adjustment: $100 million. Damned if I can find the link, but some bored accounting flak did an article for Newsweek about Billy G a while ago. It concluded that you could take away all but $100 million from his portfolio, and his lifestyle would not change one iota. That's literally the limit of tangible wealth; after that, it's just keeping score against the other fat cats.
"$100 million should be enough for anybody."
Food For Thought (Score:3, Insightful)
First, some information. The decision wasn't made based on how Nintendo wants to set prices. All you free-traders are right - they can do whatever they want. However, the laws they admitted to breaking concerned their price-fixing, not their pricing, ie their strong-arm tactics in preventing distributors from selling their products in countries where Nintendo wanted to price them higher. This is exactly not free-trade.
A couple of thoughts:
(1) There are completely different people making the arguments. None of the free-traders are hanging out on the SuSe Linux discussion, but they're coming out in numbers here.
(2) The
(3) ?
That's what I love about slashdot. The diversity of the uninformed opinions... =)
Your 55% and the lack of ROI (Score:3, Insightful)
Or don't you like roads, electrical grids [usda.gov], and all that other good infrastructure and all those wonderful services? Me, personally, I like paying taxes [slashdot.org].
Coincidentally enough, I don't think people hate corporations for the same reasons they hate governments. It's not about the money corporations take away, it's the exploitation without accountability (or transparency) -- unless you are a shareholder, you cannot vote a corrupt CEO out of office. I am acutely aware of this paradigm, because there are US politicians who somehow directly affect my life and whom I would dearly love to vote out of office, and I'm not a US citizen.
While I agree that Nintendo's price-fixing is a non-issue as issues go, it's still worth a weather eye, much as many other things are. I'd hate to be serious and uptight all the time.
Re:Basic rights (Score:2)
If it were cheap to switch to another system I'm sure game prices would be down accross the board, but once you're locked in with a big system investment, you either pay high prices for games or have your investment sit there doing nothing.
Trickle-down effect (Score:5, Funny)
Why does the government get to benefit? (Score:3, Insightful)
Rights (Score:3, Interesting)
Now, if I want to sell that game to someone in Britain for $50, and someone in Germany for $100, is there something wrong with that? After all, can't the German customer just call up someone in Britain and have them buy it for him and ship it to Germany, and pay him the $50 plus a bit for his troubles?
Perhaps the problem here isn't Nintendo. Perhaps the problem is government laws that prevent the free exchange of goods across borders, or government fees and taxes that discourage cross-border trade, and enable companies like Nintendo to pull stunts like this.
Re:Rights (Score:4, Insightful)
No - not if no-one's willing to sell it to them. And Nintendo were using their clout with retailers to ensure that no-one was.
That's the entire point of the case.
Cheers,
Ian
Re:Rights (Score:2)
That's the entire point of the case.
Exactly my point. In a free market, there will always be someone willing to provide such services. If people are unable to do so, then that is the case because EU laws/tarrifs/regulations/etc. are the problem. Maybe the EU should fine themselves.
Here's the tough part: If Nintendo, operating in a free market, can manage to sell to some customers at a higher cost than others, then more power to them.
Re:Rights (Score:4, Insightful)
No.
Nintendo were leaning on the retailers to ensure that anyone supplying to a cheaper country suddenly got their supply of Nintendo games cut off. There was no-one willing to do this. The second you did, you lost all rights to sell Nintendo stuff.
If people are unable to do so, then that is the case because EU laws/tarrifs/regulations/etc. are the problem.
Exactly the opposite. The EU has laws that enable people to do so and these laws have been used against Nintendo, who were trying to prevent it.
Cheers,
Ian
Nintendo's reaction: (Score:5, Funny)
Other attorneys on the case were quoted as saying that the lead attorney had a copy of the trial saved on a memory card, and would try his closing arguments over and over again until he won.
Re:Nintendo's reaction: (Score:3, Funny)
So What? (Score:5, Funny)
This is an important less, corporate boys and girls.
If you're fixing prices, then you'd better make sure that you charge the same high price in every single country in the EU.
Got that?
You can still catch flak for uniformly high pricing [theinquirer.net], though, but it beats this kind of bad press and fine crap.
Sounds like DVD region encoding to me... (Score:5, Interesting)
The distributors want to extract as much money as they can from each market: while they can easily get $18 for a DVD in the US, that would be way too high in China.
The way to scuttle this is to reform copyright to be free trade- and fair use-friendly: demand that, as a condition of receiving copyright protection, distributors not cripple the product in any way---no "copy protection," no region encoding, etc.---and allow users to buy and sell and resell them as they please, and to make copies for archival purposes or for limited distribution to friends. (Note: Your 10,000 closest friends on Gnutella don't count.)
OTOH, if the distributors want to put in anti-free trade or anti-fair use measures, they obviously don't need copyright protection. (LOL)
The point of this proposal is simply to shift the balance back to the center, away from the veritable power orgy for content owners that exists today. Reasonable people realize that copyright, patent, and trademark protections exist for a reason; reasonable people do not believe that these protections should come at the expense of all liberty for users.
Cheers,
Kyle
Re:Sounds like DVD region encoding to me... (Score:4, Funny)
Those bastards! I suppose you work for free then? I suppose you believe that investors should just randomly invest their money in companies, rather than favouring those who tend to turn the biggest profit? Perhaps in your view, we should do away with the whole concept of "money" altogether?
Go back to China, pinko commie.
Re:Sounds like DVD region encoding to me... (Score:3, Insightful)
If I had my mod points, I would probably mod this as a troll.
In response to the grandparent post:
DVD's have a built-in way to enforce trade restrictions: region encoding. Of course, film distributors will claim it's about release dates or other such crap; but in reality, region encoding was always intended as an anti-free trade measure.
The distributors want to extract as much money as they can from each market: while they can easily get $18 for a DVD in the US, that would be way too high in China.
I find it amazing that people don't see the hypocrisy of the positions of the corporations. By people, I assume the general population. Most slashdotters seem to see through the bullshit. I don't understand what it is okay for corporations to exploit lower costs (in most cases standards) of living to produce products for more wealthy consumers in North America, Europe, Japan and Australia, but will do all that they can to stop those wealthy consumers from purchasing items from the same developing countries.Normally, I am a commie pinko bitch, but this time, the I feel the free market would level the playing field. I would love to see corporations undercut by cheaper products (ie products less focussed on branding) from other countries the way they undercut the cost of labour with cheap labour from other parts of the world.
Doesnt make sense (Score:4, Insightful)
More over, there could always be the additional language barrier & translation costs for the cubes or any other product. Wouldnt it be a valid argument for price hike from nintendos side ? (although 65% is a little too much)
Re:Doesnt make sense (Score:3, Interesting)
This is interesting because it's not that long ago that exactly the opposite was decided in the case of Tescos selling grey market Levis. But I think that was a UK court, not a EU one.
Why cant they.... (Score:4, Interesting)
Firstly, its their product, why cant they decide how much they want to charge? The value is only that of what people are willing to pay, people stop paying and the product obviously isnt worth what they are asking.
Secondly, as i said before, its not a vital product. All of these things are luxuries, and definatly things we can live without.
Priorities people, want to go after a price fixer? Then go after the Pharmacuetical Industry who definatly fixes prices! That sort of battle would benifit more people than this.
Game Over, by David Sheff (Score:2)
Nintendo a victim? (Score:2)
Exactly how did they arrive at that conclusion? Is not making more money an overall goal of the company that they'd be happy about? Sell your stock now!
Re:Nintendo a victim? (Score:2)
This quote comes from John Menzies, one of the distributors fined.
Errrrr ... Why ? (Score:3, Interesting)
You have avg income differences, and most important consumer diffences and market penetration differences.
Prices should not be the same in each country, as these conditions are not the same.
If i live in Germany and i see prices are cheaper in the uk i simply buy in the uk, that is what online stores are for. Granted, this would also make the price difference pointless but i bet that online sales for nintendo games (bought mostly by parents) is less than 5%
Re:Errrrr ... Why ? (Score:2)
Wrong number.. (Score:4, Informative)
Read the press release from the European Commission. [eu.int]
No surprise (Score:4, Interesting)
Some facts:
And so on and so on. You can find more facts about it at the rather appallingly designed Rip-off Britain [rip-off.co.uk] website.
Re:No surprise (Score:2)
Well, duh, who do you suppose is doing the ripping off? Of every pound you spend on petrol, 80p is tax - that's a 400% tax! A pack of cigarettes costs something like 25p to manufacture - and you're paying 15x that in tax!
And everyone pays, even non-drivers - because everything is shipped by road, it just gets factored into the price of loaves of bread. And, despite what the propaganda tells you, the NHS would be well and truly shafted without money from cigarette taxes - the government really wants more smokers, not less. After all they are the perfect citizens: they voluntarily pay more tax their whole lives, then die before they collect their pensions!
Parliament will take no action on rip-off Britain because they are it's biggest fans! And that's why in the past Customs have been so heavy handed with "booze cruisers" - it's only because of recent public outrage and the impossbility of comprehensive enforcement that the rules have recently been (slightly) relaxed.
Re:No surprise (Score:5, Insightful)
Even here in Canada, you can get a pre-cooked shrimp ring for about $9.99 in BC, $8.99 in Saskatchewan, and $4.99 in New Brunswick, all the same brand. You can also get $10 shrimp rings in New Brunswick from more widely known (i.e. larger, better) brands. Is this because people in BC get 'screwed', or because it costs a lot of money to ship refrigerated shrimp ten thousand kilometers?
If you're going to compare, you have to take more factors than just the price into account - local economy, shipping, VAT, local taxes, and so on. Is the US getting screwed because a BK Whopper costs more there than here? No, we just have cheaper beef, and a lower (but stronger) economy, so prices are less. It's good sense, and sensible economics.
--Dan
Re:No surprise (Score:3, Interesting)
You can buy a Rover car cheaper in Denmark (by over a thousand pounds) than in a dealership in Longbridge, Birmingham (next to the Rover factory). Tax is Denmark is similar if not more on cars also.
Re:No surprise (Score:3, Interesting)
I remember hearing a lot about the car companies being in trouble over this practice, and they were told to stop it. Little has changed by the look of it.
Does Price Fixing even make sense? (Score:3, Insightful)
For example (and for argument's sake) why would a person spend $60 for a game when they can get the exact same game for PS2 for $40? (Notwithstanding the difference in the cost of the hardware - which at roughly $50 evens out at about 3 games. Who only ever buys 3 games for a console?) You'd think that this scenario would simply hurt sales, and not increase profit. Unless of course, they only care about short term gain and higher profit margins and not increasing market share. Makes sense in the short term, but kills you in the long term.
Sounds to me that not only is Nintendo guilty of price fixing, but that they're guilty of having a somewhat flawed business model.
THis is very un Nintendo-like (Score:3, Funny)
Register follow up (Score:4, Informative)
The Expurgation of Maniac Mansion for the Nintendo (Score:4, Interesting)
Obligatory link to The Expurgation of Maniac Mansion for the Nintendo Entertainment System [crockford.com]
Behold, evil!
What strikes me (Score:4, Interesting)
What strikes me is that there is something of a double standard in play here. The EU makes no attempts to make sure that it costs the same amount to advertise a product in different EU markets, or that it costs the same amount to get a product on the shelves in each, but it does use fines such as this one to make sure that a producer can't charge different prices for the same item in different places.
As far as I can tell, this will tend to make profit margins necessarily higher in some EU markets than in others, with the result that either all markets will get more expensive, or that producers will stop selling in some markets.
In other words, if it costs Nintendo more to operate in the Germany than in the UK, and if they are prohibited by law from charging higher prices in Germany than in the UK, then their only options are a.) to not sell their products in Germany at all, or b.) to charge higher prices for their products in the UK.
If the goal of this legislation is to stiff the Brits or to reduce the number of products the Germans have to choose from, it would seem to be working quite well, but if it's goal is to make the product cheap everywhere, it's hard to see how it could possibly succeed.
Re:What strikes me (Score:3, Insightful)
We are discussing the double standard between the lack of regulation of the price at which a company pays for services and regulation of the price which it charges for its products.
Production is only a small part of this picture. While it is probably true that Nintendo makes games in one place and ships to both the UK and Germany from there, are many other prices which cannot be paid anywhere in the EU and shipped -- the price of advertising on German television stations, the price of getting shelf-space in German stores and so forth.
So again, if you make the only way for Nintendo to recover these costs be raising prices in the UK, they will either do so or they will abandon their interest in selling in Germany (as some other companies have done). In the one case, the British consumer loses, by paying more for the game than he had been paying. In the other case, the German consumer loses by not being able to buy a game he could have bought before.
In neither case does the law benefit the consumer.
So who can we buy video games from.... (Score:3, Funny)
I just want to know who I can buy console from and not feel guilty. Where is Atari when you need them?
So, I have a question.... (Score:3, Insightful)
Next time, read the article (Score:3, Informative)
The EU contacted NOE, and they cooperated and fixed the problems, now the EU is back stabbing them.
ummm but... (Score:3, Interesting)
Yeah but why would they? Those companies are not Asian, they are the "good guys" not the "bad" guys.
Price Discrimination not Price Fixing (Score:4, Interesting)
Price discrimination is when a single producer charges different customes different prices. Price fixing is when different producers agree to sell to all customers for the same price.
What followes is some detail on each and then some argumentation for why the ethical case against price discrimination generally is weak, without adressing the Nintendo case particularly.
Price fixing is an instance of collusion, where ostensibly competing producers negotiate an agreement to restrict price competetion between themselves. That is, producers agree not to sell their product for below some specified amount. The purpose of the agreement is to increase sales profits by rasing sales prices. Note that such agreements are always accompanied by another agreement about how producers divide up the market. Sometimes producers carve up the market geographically. For example, "You sell in Michigan and I'll sell in Ohio." Sometimes producers carve up the market by number of sales. "You won't sell more than x billion barrels of oil and I won't either."
OPEC is the quintessential example of a price fixing organization. Price fixing is its sole and explicit purpose. (OPEC can do this because it is an organization of governments, and there exists no super-governmental body to place on governments the same rules by which those nations govern their citizens.)
Price discrimination, on the other hand, is a pricing strategy of a lone seller for raising profits on sales without organizing agreements with his competitors. For each buyer, the seller attempts to negotiate the maximum price that buyer will pay. For the seller, this stragy works to raise net sales income above what would be obtained with a one-price-for-all strategy.
The moral case against is price discrimination is pretty weak for these reasons:
-Because richer customers are willing to pay more, in practice price discimination amounts to giving poorer customers a break on price. It places the costs of production more heavely on those who can best afford them. If you look at Nintendo's pricing scheme, I would predict you find that Nintendo charged more in richer countries and less in poorer countries.
-Most people don't regard price discrimination as unethical. There are plenty of examples which demonstrate how this is cool with most people. Like Priceline's "Name your own price". Or the bazaar, where buyers and sellers haggle over prices, the buyer attempting to determine the lowest price at which the seller will part with a good and the seller trying to find the highest price which the buyer is willing to pay. There is no guarantee or even an expectation that such a system will result in the same price for each customer, and that's just cool with everyone.
-With progressive taxation, tax payers are assessed different fees according to their ability to pay. With price discrimination, buyers pay different fees according to their willingness to pay. Goverments make the "Different people pay different amounts" argument in the case of taxation. However, the argue against "different people pay different amounts" in the case of private sales. The reason for the contradictory approaches is that with taxation, goverment is as the recipient of tax revenues adopts the strategy which maximizes those revenues. In the case of corporate sales, they have little such insentive. My point here is not that one or the other is eithically correct, but that it is difficult to make the ethical case for one as you engage in the other.
With price discrimination, the rich lose out becasue sellers can exploit their willingness to pay more than the poor. Mario Monte stands for their interets here.
Re:Price Discrimination not Price Fixing (Score:3, Insightful)
This is exactly what the MPAA is doing with region coding. I don't know if they'll get slapped for it, ever.
There's a lot of confusion here + Why a fine??? (Score:3, Interesting)
Nintendo have been found to have formed a cartel with their distributors - who have also been fined a LOT of money. The EU decided that the distributors along with Nintendo had fixed prices among themselves. This means that there is no price competition on games (there can't be). This kind of thing happens a lot and a lot of people getted spanked when it happens. The car industry was famous for it for quite a while.
Apart from that I think fining the Big N is rediculous. I was an owner of a SNES and am the owner of an N64, GBA and Gamecube. Where does 150 million go??? Well - it comes from Nintendo so I guess as a paying customer I'll have to help Nintendo recoup costs.
There must be more elegant solutions than this - if the consumer was ripped then the consumer should be repaid. Not the EU. Free games!
Re:Ahem (Score:2, Funny)
Jaysyn