Matrix pricing

Matrix Games Forums

Forums Register Login Photo Gallery Member List Search Calendars FAQ

My Profile Inbox Address Book My Subscription My Forums Log Out

Matrix pricing

View related threads: (in this forum | in all forums)

Logged in as: Guest

Users viewing this topic: none

Printable Version

All Forums >> [General] >> General Discussion >> Matrix pricing

Page: [1] 2 next > >>

Message

<< Older Topic Newer Topic >>

Matrix pricing - 10/10/2011 6:39:46 PM

battles_atlas

Posts: 3
Joined: 10/10/2011
Status: offline

Having seen the review of Panzer Corps on the PC Gamer site I couldn't wait to buy a copy - it looked like the kind of accessible strategy I love. That was until I googled it and found it was a Matrix game, and thus exists in a strange 5th dimension where indie titles are permanently more expensive than AAA releases are in the first week of release.

I think the Matrix pricing policy is a shame. Ok, for the real hardcore mil strat games the market is pretty always going to be small so high prices make sense. However a game like Panzer Corps clearly has wide appeal, but the pricing strategy guarantees it will remain niche. Paradox manage to make good money off games like HOI with a mainstream pricing approach. Matrix's strategy is I presume profitable, but it's at the expense of the (small number of) purchasers. As long as it remains niche it looks less tempting for other devs to try their hand at it, and encourages the big publishers' argument that only dumb games sell big.

No doubt the regulars here (which lets face it will be all of you as the casuals wont stick around having seen the prices) will totally disagree with this, so I'll add one thing that perhaps is less contentious: not including VAT on your quoted prices is not something that any reputable retailer should do, particularly when the product is a game and hence highly unlikely to qualify for VAT exemption for anyone. I was actually gonna bite my lip and order Panzer Corps at �27.99, but when I clicked through I found the actual cost, at which point I thought enough was enough. If you're going to charge high prices for your games at least be honest about it.

Post #: 1

RE: Matrix pricing - 10/10/2011 7:06:42 PM

Murat

Posts: 803
Joined: 9/17/2003
From: South Carolina
Status: offline

No VAT in the USA. HOI is niche, as is EU and most other war games. The difference is the company behind them. The big corporations have a set pricing structure that takes into account initial high demand and they also do some degree of marketing to support the initial high price, after which time the price point drops and eventually the game that was U$60 in Best Buy (standard retailer) on release is 3 years later selling for U$6 at a Big Lots (discount store). This is because they really are only planning on getting about U$20 for a game on average and even then they make a profit due to extremely high volume across the many genres of games they produce. Here we have developers that can only look at their time and say 'I have invested X hours of my time and would like to get U$1 (which is like .25 Euro) per hour back so if I sell Y units (Y is significantly lower than for an EA game for example) at U$60 (which is what people will pay for those games on release date) then I can give Matrix their cut for printing and packaging and using their website and their dowload service and their various subcontractors for same, and make my U$1 per hour!'

So here are the many benefits U$60 will get you here, including but not limited to: a buggy game that is not ready for release to the general market but due to forum pressure after seeing cool graphics and playtesters who rave about how awesome the game is it gets released anyway; the ability to interact with other people in your niche to the extent that all of you share your OC disorder about history together; access to indy games that normally would never get made without the efforts of the devs here; and unparallelled game support since how many people can say 'hey, I saw this glaring flaw in my game and I chatted with the developer and he fixed it (go ahead, try and tell the people who made Assassin's Creed that their game is ahistorical and see where you get).

Panzer corps is only U$50 by the way + tax + shipping and if you are not used to tax and shipping then congratulations on your first attempt to purchase something online.

If you do not want to pay that much for those and other associated benefits, keep your money.
If you do not like the VAT or any other tax, get rid our your politicians or become one yourself and change the tax structure.
If you don't like shipping, I am sure Matrix will be happy to let you come pick up your copy from their warehouse.

But don't get mad when the price is clearly posted and claim Matrix is being dishonest in their pricing.

(in reply to battles_atlas)

Post #: 2

RE: Matrix pricing - 10/10/2011 7:21:19 PM

bairdlander2

Posts: 2264
Joined: 3/28/2009
From: Toronto Ontario but living in Edmonton,Alberta
Status: offline

I think Panzer General is free for download.Its the same thing more or less.

(in reply to Murat)

Post #: 3

RE: Matrix pricing - 10/10/2011 7:21:51 PM

Perturabo

Posts: 2614
Joined: 11/17/2007
Status: offline

Try the NWS store. They usually have lower prices on Matrix Games titles. I got BftB physical edition with shipping there for lesser price than the download edition at Matrix site. Yeah, the VAT thing is annoying. Happened to me once when I wanted to buy Cross of Iron.

G.O.G has Panzer General 2 and Panzer General 3D for 9.99$ each.

< Message edited by Perturabo -- 10/10/2011 7:26:18 PM >

_____________________________

People shouldn't ask themselves why schools get shoot up.
They should ask themselves why people who finish schools burned out due to mobbing aren't receiving high enough compensations to not seek vengeance.

(in reply to Murat)

Post #: 4

RE: Matrix pricing - 10/10/2011 7:22:11 PM

terje439

Posts: 6813
Joined: 3/28/2004
Status: offline

Here in Norway, initial prices for Matrixgames are about 20$ below other games...

Terje

_____________________________

"Hun skal torpederes!" - Birger Eriksen

("She is to be torpedoed!")

(in reply to Murat)

Post #: 5

RE: Matrix pricing - 10/10/2011 7:27:29 PM

L�tzow

Posts: 1517
Joined: 7/22/2008
From: Germany
Status: offline

quote:

If you do not like the VAT or any other tax, get rid our your politicians or become one yourself and change the tax structure.

Or simply purchase digital products by using an US ip.

_____________________________

(in reply to Murat)

Post #: 6

RE: Matrix pricing - 10/10/2011 8:04:01 PM

Wargamer74

Posts: 78
Joined: 3/30/2010
Status: offline

I have to agree to a certain extent. Panzer Corps in my opinion is not that expensive since it is a new title and looks like alot of fun (I'll be buying it soon) but on the other hand some of the games here are way over overpriced. For example one of my favorites is Gary Grigsby's World At War A World Divided and bought the game back in 2006 when it first came out and got a discount because I own the original but unfortunately the forums are now completely dead which really sucks, so one day I looked to see how much Matrix was charging for the game and there still charging $50 bucks five years later! To make it even worse tcp/ip play doesn't even work properly and 2by3 games refuses to fix it or ever put any updates out for the AI or anything else in the game. Its know wonder the forums are so dead. I do love the game but that is a little pathetic.

Hopefully none of you will take to much offense to that, just my opinion.

(in reply to L�tzow)

Post #: 7

RE: Matrix pricing - 10/10/2011 8:05:17 PM

redcoat

Posts: 1035
Joined: 8/31/2005
From: UK
Status: offline

quote:

ORIGINAL: L�tzow

quote:

If you do not like the VAT or any other tax, get rid our your politicians or become one yourself and change the tax structure.

Or simply purchase digital products by using an US ip.

The cost of buying Panzer Corps by download in the UK:

�27.99 + �5.60 VAT = �33.59

The cost of buying Panzer Corps with a U.S. ip:

Around only �25.51 � depending upon the exchange rate used

(in reply to L�tzow)

Post #: 8

RE: Matrix pricing - 10/10/2011 8:40:50 PM

Hertston

Posts: 3564
Joined: 8/17/2002
From: Cornwall, UK
Status: offline

quote:

ORIGINAL: battles_atlas

No doubt the regulars here (which lets face it will be all of you as the casuals wont stick around having seen the prices) will totally disagree with this, so I'll add one thing that perhaps is less contentious: not including VAT on your quoted prices is not something that any reputable retailer should do, particularly when the product is a game and hence highly unlikely to qualify for VAT exemption for anyone. I was actually gonna bite my lip and order Panzer Corps at �27.99, but when I clicked through I found the actual cost, at which point I thought enough was enough. If you're going to charge high prices for your games at least be honest about it.

There's nothing 'dishonest' about the VAT; Matrix are an American company contracting out their internet sales and hence have no dealings with VAT themselves at all. Why Digital River and now Plimus have never been able to show gross prices is a different question, but it is nevertheless the norm for US companies without the sort of international set-up Steam has, for example. If you buy direct from indie developers using Paypal the first you will know about the VAT is just before you hit the final Paypal authorization (the irony being that it's exceedingly unlikely they have the turnover level that requires they account for it, anyway).

As to pricing levels, I agree with you, IMHO they are too high for some titles like Panzer Corps and Battlefield Academy. As with yours, though, my opinion means diddly; Matrix have far more information for an informed pricing decision than us. If I think a game is too expensive I don't buy it.

By 'AAA' titles, I assume you mean such stellar efforts as Brink, RAGE and Duke Nukem Forever. Hmm...

< Message edited by Hertston -- 10/10/2011 8:43:49 PM >

(in reply to battles_atlas)

Post #: 9

RE: Matrix pricing - 10/11/2011 2:37:58 AM

sabre1

Posts: 1928
Joined: 8/15/2001
From: CA
Status: offline

I'm on the side of buy or don't buy. A company has the right (at least for the moment) to charge whatever they want, and we can decide to buy or not to buy.

I never bought War in the East or Battles for the Bulge due to prices. My choice. They are great games without a doubt, but I draw the line on some things that are nonessentials.

OT: I also will not buy games with DRM schemes. Matrix's scheme is as much as I will stand for, but just barely.

I get to read more that way.

(in reply to Hertston)

Post #: 10

RE: Matrix pricing - 10/11/2011 6:10:49 AM

Perturabo

Posts: 2614
Joined: 11/17/2007
Status: offline

Same here. Except that the only game that I bought (besides the ones I bought from a bargain bin a years ago) was BftB as it was the only that I considered worth that price (taking in account how much I have to work for it here).
So, naturally, everything that isn't exceptional and I won't play for years or even decades is a no-buy for me. So, it's only great games like BftB and only from the NWS store, but no casual buys.
Generally, more than 30$ is a no-buy to me unless it's something like BftB or comes with a big printed manual and a box, so the vast majority of Matrix Games games are no-buy for me.

_____________________________

(in reply to sabre1)

Post #: 11

RE: Matrix pricing - 10/11/2011 10:29:34 AM

battles_atlas

Posts: 3
Joined: 10/10/2011
Status: offline

Appreciate the general lack of flaming in the replies, always nice to find an outpost of decency in the interwilds. Just to clear up a couple of things, I absolutely am not holding up the standard of AAA games as something to aspire to, if I was I wouldn't be here. I do think though that in the age of Steam, Matrix's pricing ensures that these games remain niche, at the expense of the paying customer. They might not make any more profit from selling twice as many units at half the price, but it would cost each fan less and create a bigger community. And who knows, maybe they'd sell four times as many units at half the price?

Murat - I don't get your point about Paradox. Yes they're niche, that was why I mentioned them, but they manage to be profitable without keeping all their games permanently priced at �30/$50. And they're not a 'big corporation' which you seem to be suggesting. Also whilst their games are sometimes released in a poor state their patch support is hard to criticise.

I have sympathy for your argument about the value of a company committed to its community etc, but that makes it all the more unacceptable to me that they hide the VAT. I totally disagree with those of you defending the VAT thing. When I click on the Panzer Corps link I'm quoted "�27.99 GBP". So they know where I'm coming from. When I click through to buy only then do I get the VAT, but its still on the Matrix site at this point. There is no legit reason why the first page doesn't include VAT for those arriving from a UK ip. If Matrix want to defend their business model as a necessity of offering high quality products and services, then dodgy pricing information seems a little contradictory.

(in reply to Perturabo)

Post #: 12

RE: Matrix pricing - 10/11/2011 11:02:22 AM

Phatguy

Posts: 1348
Joined: 3/1/2006
From: Buffalo,ny
Status: offline

Actually, Paradox are a pretty decent sized corporation these days.....They may put out a lot of niche pproducts but they themselves are not niche.

_____________________________

My life is complete. 1000 Matrix posts.....

(in reply to battles_atlas)

Post #: 13

RE: Matrix pricing - 10/11/2011 11:03:04 AM

jomni

Posts: 2827
Joined: 11/19/2007
Status: offline

I still like the old store better than Plimus.

< Message edited by jomni -- 10/11/2011 11:04:51 AM >

_____________________________

My Blog
Random Wargame Name Generator

(in reply to battles_atlas)

Post #: 14

RE: Matrix pricing - 10/11/2011 11:15:08 AM

Scott_WAR

Posts: 1020
Joined: 2/24/2005
Status: offline

quote:

ORIGINAL: apathetic lurker

Actually, Paradox are a pretty decent sized corporation these days.....They may put out a lot of niche pproducts but they themselves are not niche.

And that proves the point. Paradox makes a lot of niche products,...yet one of the reasons they are a mainstream developer is because they make a lot of profit from lowering the prices of their games after a while. . Thus,....they actually get a lot of sales they would not otherwise get, which means more profit. Do you know how many more Matrix titles I would have right now if the price wasnt the same several years after release as they were at release? As it stands I just will not buy them. YES,....I know there are sales,....but it always seems there isnt a sale on what I want when I can actually spare the money to buy a game.

Matrix,...with their pricing scheme,.... and refusal to drop prices after a certain amount of time,....essentially ensures that they will not sell nearly as many units as they could,...and thus will remain a niche publisher,....and then they turn around and use 'low number of sales' as an excuse as to why they dont lower prices. A self fulfilling prophecy.

EDIT- but an earlier poster pointed out the quality issue which most definately applies to paradox. All I can say is there are some release from Matrix over the last couple of years that have left a LOT to be desired in the support department. So while its true that Paradox isnt very good at supporting and fixing their games.....Matrix doesnt have a spotless record any longer either. Not to mention that making more money doesnt automatically mean less quality and support,...unless Matrix allows it to happen,.......which still wouldnt have anything to do with money but instead with character.

< Message edited by Scott_WAR -- 10/11/2011 12:03:47 PM >

(in reply to Phatguy)

Post #: 15

RE: Matrix pricing - 10/11/2011 11:34:08 AM

GoodGuy

Posts: 1506
Joined: 5/17/2006
From: Cologne, Germany
Status: offline

quote:

ORIGINAL: jomni

What's the definition of an AAA game?

Well, back in the day, it used to be big budget and big sales figures.

Wing Commander III (Heart of the Tiger) kind of started the big budget race, with an amount of 4 million dollars, a sum unknown in the game sector before (in 1994).
Origin used to have a rep as company that produced quality along with their AAA games, Blizzard used to have the same rep with say StarCraft, but quality is not necessarily part of an AAA game.
Nowadays, I guess it just comes down to the budget/marketing efforts, as even quite some AAA titles don't generate good sales figures. That, of course, may deal with the decreasing quality of games and the lack of time (or knowledge) for testing.

Some ppl may define AAA as professional quality game, with "high quality visuals" (one should add recent technologies) and "audio", professional and fleshed out script and professional (sounding) voice acting, like some guy (Weatherby) points out in a comment for this blog:

http://www.gameproducer.net/2009/10/24/what-are-aaa-titles-updated-definition/

I would agree there. For example, localized German versions of AAA game titles often sound like some students or high school nerds did the voice overs, basically turning the game into an A(A) title, for me. The bad localization then clearly shows that the producers were too miserable to put out a proper budget for that part of the production. Another reason for me to obtain US/EN versions.

In rating agencies, "Triple A" or AAA refers to "Excellent", Triple-A also stands for "high quality", premier or excellent. "Triple A" is also used in US minor league baseball - referring to the highest class in that league, which is one level below major league baseball (MLB).

< Message edited by GoodGuy -- 10/11/2011 11:59:53 AM >

_____________________________

"Aw Nuts"
General Anthony McAuliffe
December 22nd, 1944
Bastogne
---
"I've always felt that the AA (Alied Assault engine) had the potential to be [....] big."
Tim Stone
8th of August, 2006

(in reply to jomni)

Post #: 16

RE: Matrix pricing - 10/11/2011 12:04:24 PM

Martin James

Posts: 17
Joined: 12/28/2004
Status: offline

I'm reluctant to criticise Matrix about their pricing strategy. Matrix is a business and they will aim to maximise their profit. And why shouldn't they? If selling more at a lower price is going to increase revenue, I'm sure they would be keen to do that, but these games are never going to be mainstream. I think they are best placed to make that call on a game by game basis.

I agree with battles_atlas re VAT however. I live in the UK and purchased 'Decisive Campaigns' a few days ago. The Matrix site lists it as �27.99 for download, but the real price for UK purchasers is �33.59. The only people purchasing in � sterling will be UK residents, and I'm not sure how anyone could legitimately claim back the VAT. True, you do get the opportunity to change your mind part way through the order process once you know about it, but (as I know!) you are mentally committed by that time. Not illegal, but not good practice either.

(in reply to GoodGuy)

Post #: 17

RE: Matrix pricing - 10/11/2011 3:29:26 PM

IainMcNeil

Posts: 2804
Joined: 10/26/2004
From: London
Status: offline

Just wanted to comment on the VAT - the prices are shown Ex VAT but that is because we don't know what VAT to apply until you start the purchase process and enter your payment details. I can understand the frustration but VAT varies wildly and we don't have any way to keep up to date with it so have to rely on the payment processors to do that. Many places don't even have to pay it. We'd love to not charge anyone VAT but it's the law. We don't actually collect or see VAT on any payments. This is all collected and remitted by the payment provider. We never see a penny of the money for VAT go through our accounts. I'm not sure how others deal with it - maybe they require you have an account with a card set up already so they can verify your location. We don't enforce this and allow users to buy annonymously but that measn we can't tell the actual proce you'll pay till you enter that info. Even then, as I say we dont have any information on what VAt to actually charge so we'd need new layer of complexity on top of the current system to deal with that. All I know is it is not something we are able to do.

_____________________________

Iain McNeil
Director
Matrix Games

(in reply to Martin James)

Post #: 18

RE: Matrix pricing - 10/11/2011 3:51:07 PM

Erik Rutins

Posts: 37503
Joined: 3/28/2000
From: Vermont, USA
Status: offline

As Iain said, without requiring you to be logged in with an account with your personal information, there's no way we can show the VAT until we've collected that information. Currency is not an infallible guide to the VAT rate. There are many different VAT rates in Europe, and far fewer different currencies. Setting VAT based on IP as we do with the initial currency sleection is also not infallible and we have to make sure that we are charging the correct VAT.

As far as pricing in general, when we first started the company, there was the "budget bin" in retail. Now there are the Steam sales. In both cases, these generally deal with mainly mainstream titles that have already achieved most of their sales and are purely looking for incremental profit. While some of our games are aimed at a more mainstream audience, many are not and the pricing philosophies that work for mass market titles would simply put our developers out of business. The prices you see on Steam are set the same way as ours, to maximize profit and ensure that the business and our developers can continue to make these kinds of game. It would make us all very happy indeed if we could charge you $5 per game instead of $30-40, but that comes down to the reality of the economics, not to personal choice.

With that said, we do try to make our games available at a lower price point as often as we can. If our current prices are too high for your budget, we run sales on a fairly regular basis. Every month we have a coupon for a significant discount (up to 50%) in our newsletter and every holiday season we put most of our titles on sale for over a month at 33% or more off.

Regards,

- Erik

_____________________________

Erik Rutins
CEO, Matrix Games LLC

For official support, please use our Help Desk: http://www.matrixgames.com/helpdesk/

Freedom is not Free.

(in reply to IainMcNeil)

Post #: 19

RE: Matrix pricing - 10/11/2011 4:07:40 PM

GoodGuy

Posts: 1506
Joined: 5/17/2006
From: Cologne, Germany
Status: offline

quote:

ORIGINAL: Iain McNeil

We never see a penny of the money for VAT go through our accounts. I'm not sure how others deal with it

Well, other US businesses simply don't charge VAT, as they (or their payment processors) don't succumb to the impertinent (if not protectionist) European tax laws (governing overseas purchases of EU citizens), like Digital River does. They don't fall and they don't have to fall for European pressure to put up additional paperwork and accounting resources, which is (if carried out) a big burdon, especially on US small and medium businesses.

quote:

We'd love to not charge anyone VAT but it's the law.

L�tzow and me duscussed this in detailed postings in a Matrix Forum thread, Erik - you might remember that, a while ago.
Actually, it's not the law for US businesses. The European union has no authority in the US and in how US businesses conduct their payment processes. Matrix is an american business based in the US.

If you "would love" not to charge VAT, then you could have just ceased doing business with Digital River, there are many many other trustworthy payment processors out there, and I'm sure there are other feasable solutions regarding warehousing/prints for shipping to the EU. The VAT is being applied by DI, just because Digital River has warehouses and departments in the EU, so they have to play according to the EU rules. THAT is the only reason for them charging VAT, as their European HQ used to be registered in Luxemburg (IIRC) and probably still is. They even have departments in Ireland, Germany, Shanghai and Brazil now.

Let me word it a bit harsh: The question is whether Matrix really wants to support greedy EU authorities or not.... Whatsoever, EU authorites have NO jurisdiction in the US of A, and I'm sure every US lawyer and every reasonable US business owner will see it the same way. What I do know, for sure, is that most -if not all- EU customers of Matrix would really love Matrix to cease applying VAT (through DI or whatever payment service).

On a sidenote, the Digital River payment site charged 16% VAT for Matrix customers from Germany even AFTER Germany had raised import tax and VAT to 19%, for the longest time (2-4 years).
As a result, German Matrix customers owe German tax authorities money, just because DI failed to update their tax infos in the software.
That leads to the next question, which I already raised in the thread I mentioned above:
Does Digital River transfer the VAT for German (and other countries') tax authorities at all, or did they just transfer the 16%, where it wasn't noticed by German authorities (as they just received the total sum as one payment, every year)?
I still doubt that German authorities would have been satisfied with 16%, IF the actual VAT amount was 19% at the time, already.

Such payment processors should not be supported/used by Matrix, imho.

EDIT: By the way, it's against the law not to mention the VAT amount until AFTER you have authorized the payment, in Germany.

So, if you play by EU protectionist tax rules (which isn't necessary), you (or your payment processor) should at least play by national (means by each EU country's) customer protection laws and civil laws.

< Message edited by GoodGuy -- 10/11/2011 4:51:08 PM >

_____________________________

"Aw Nuts"
General Anthony McAuliffe
December 22nd, 1944
Bastogne
---
"I've always felt that the AA (Alied Assault engine) had the potential to be [....] big."
Tim Stone
8th of August, 2006

(in reply to IainMcNeil)

Post #: 20

RE: Matrix pricing - 10/11/2011 4:29:16 PM

wodin

Posts: 10762
Joined: 4/20/2003
From: England
Status: offline

quote:

ORIGINAL: Hertston

quote:

ORIGINAL: battles_atlas

No doubt the regulars here (which lets face it will be all of you as the casuals wont stick around having seen the prices) will totally disagree with this, so I'll add one thing that perhaps is less contentious: not including VAT on your quoted prices is not something that any reputable retailer should do, particularly when the product is a game and hence highly unlikely to qualify for VAT exemption for anyone. I was actually gonna bite my lip and order Panzer Corps at �27.99, but when I clicked through I found the actual cost, at which point I thought enough was enough. If you're going to charge high prices for your games at least be honest about it.

There's nothing 'dishonest' about the VAT; Matrix are an American company contracting out their internet sales and hence have no dealings with VAT themselves at all. Why Digital River and now Plimus have never been able to show gross prices is a different question, but it is nevertheless the norm for US companies without the sort of international set-up Steam has, for example. If you buy direct from indie developers using Paypal the first you will know about the VAT is just before you hit the final Paypal authorization (the irony being that it's exceedingly unlikely they have the turnover level that requires they account for it, anyway).

As to pricing levels, I agree with you, IMHO they are too high for some titles like Panzer Corps and Battlefield Academy. As with yours, though, my opinion means diddly; Matrix have far more information for an informed pricing decision than us. If I think a game is too expensive I don't buy it.

By 'AAA' titles, I assume you mean such stellar efforts as Brink, RAGE and Duke Nukem Forever. Hmm...

I do believe it's against the law not to state that the price doesn't include VAT in the UK..whether this applies in this case I'm not sure but I wouldn't be surprised if it does. Obviously if your charging VAT your registered in the UK. SO you may well be breaking the law.

Matrix has to have something to do with VAT as they have to pay it back to the UK government. It's a TAX not freebies for a company.

(in reply to Hertston)

Post #: 21

RE: Matrix pricing - 10/11/2011 4:50:22 PM

Erik Rutins

Posts: 37503
Joined: 3/28/2000
From: Vermont, USA
Status: offline

Hi GoodGuy,

quote:

ORIGINAL: GoodGuy
L�tzow and me duscussed this in detailed postings in a Matrix Forum thread, Erik - you might remember that, a while ago.
Actually, it's not the law for US businesses. The European union has no authority in the US and in how US businesses conduct their payment processes. Matrix is an american business based in the US.

If you "would love" not to charge VAT, then you could have just ceased doing business with Digital River, there are many many other trustworthy payment processors out there, and I'm sure there are other feasable solutions regarding warehousing/prints for shipping to the EU. The VAT is being applied by DI, just because Digital River has warehouses and departments in the EU, so they have to play according to the EU rules. THAT is the only reason for them charging VAT, as their European HQ used to be registered in Luxemburg (IIRC) and probably still is. They even have departments in Ireland, Germany, Shanghai and Brazil now.

First of all, we are both a US and a UK company now. Second, we no longer do business with Digital River, we now do business with Plimus, but all of these are global companies. For example, we have a warehouse in Germany to allow us to better server our customers in Europe and globally.

[quot]eOn a sidenote, the Digital River payment site charged 16% VAT for Matrix customers from Germany even AFTER Germany had raised import tax and VAT to 19%, for the longest time (2-4 years).
As a result, German Matrix customers owe German tax authorities money, just because DI failed to update their tax infos in the software.

That's not true at all. I remember that question being raised and we brought it to DR and resolve it and I posted with resolution in the forum. The rate being charged was the correct one, there is a special VAT rate for download purchases.

quote:

Does Digital River transfer the VAT for German (and other countries') tax authorities at all, or did they just transfer the 16%, where it wasn't noticed by German authorities (as they just received the total sum as one payment, every year)?
I still doubt that German authorities would have been satisfied with 16%, IF the actual VAT amount was 19% at the time, already.

We also discussed and resolved this a long time ago, on that thread. We confirmed that the correct rate was being charged and that all of the collected VAT was being legally paid to the proper EU authorities.

Regards,

- Erik

_____________________________

Erik Rutins
CEO, Matrix Games LLC

For official support, please use our Help Desk: http://www.matrixgames.com/helpdesk/

Freedom is not Free.

(in reply to GoodGuy)

Post #: 22

RE: Matrix pricing - 10/11/2011 4:59:05 PM

GoodGuy

Posts: 1506
Joined: 5/17/2006
From: Cologne, Germany
Status: offline

Hi Erik, I edited my post while you were writing your post, where I included the switching to a diff. payment processor, already.

quote:

ORIGINAL: Erik Rutins

That's not true at all.

Well, the total amount for German customers included exactly 16% of the Matrix price for a given Matrix product. So DI used the special tax for digital downloads, where I don't think that they applied it correctly.

quote:

I remember that question being raised and we brought it to DR and resolve it and I posted with resolution in the forum. The rate being charged was the correct one, there is a special VAT rate for download purchases.

Yes you did. But neither L�tzow (IIRC) nor me fully trusted their statement. L�tzow confirmed my observation that DI charged 16% only.

quote:

We also discussed and resolved this a long time ago, on that thread. We confirmed that the correct rate was being charged and that all of the collected VAT was being legally paid to the proper EU authorities.

EDIT: DI's statement was not really convincing there, and I remember now that they argued that the tax rule and rate for LUX (and/or Digital Downloads) would apply, if I am not mistaken, but I do still think that the VAT of the target country should be applied.

I don't blame you or Matrix in general there, as you depend on their statements to be honest. Their statement left/created some doubts, imho, though.

quote:

ORIGINAL: Erik Rutins

First of all, we are both a US and a UK company now.

Well, then have your US branch sell products without EU VAT, no?

quote:

For example, we have a warehouse in Germany to allow us to better server our customers in Europe and globally.

Is that warehouse operated and owned by Matrix?

Whatsoever, my guess is, that you wouldn't need a warehouse for "shipping" digital downloads to EU customers, coming from the US branch (physical location [US server] and regarding billing). Right?

< Message edited by GoodGuy -- 10/11/2011 5:26:40 PM >

_____________________________

"Aw Nuts"
General Anthony McAuliffe
December 22nd, 1944
Bastogne
---
"I've always felt that the AA (Alied Assault engine) had the potential to be [....] big."
Tim Stone
8th of August, 2006

(in reply to Erik Rutins)

Post #: 23

RE: Matrix pricing - 10/11/2011 5:23:09 PM

JudgeDredd

Posts: 8573
Joined: 11/14/2003
From: Scotland
Status: offline

I'm sure I tried to buy a game once and it told me I wasn't in that region. I may have been "trying" to buy through the US store - in fact I WAS - I remember it was for your ET game...and it told me I didn't belong to that region or something - so it knows where I am purchasing from...no?

By the way - I meant to say I don't actually mind the fact you don't specify VAT...I know it's not included now so either work it out on the initial page or carry on through to the end...quite often I get to the end and say "err...no" and don't buy...quite a few times.

Though I do see other peoples points where they regard the end point as being "committed"

< Message edited by JudgeDredd -- 10/11/2011 7:03:17 PM >

_____________________________

Alba gu' brath

(in reply to GoodGuy)

Post #: 24

RE: Matrix pricing - 10/11/2011 5:40:07 PM

Murat

Posts: 803
Joined: 9/17/2003
From: South Carolina
Status: offline

First let me deal with this erroneous legal argument.

The laws that are relevant here are not the US laws (actually US treaties are relevant, which are "laws" of the US but not in the strict sense), they are the laws of the nation where the CONSUMER resides since it is the CONSUMER who owes the tax, the corporation is only in charge of collecting the tax. So why would a US company want to collect the tax? Because they are doing business in the consumer's nation and want to continue to do so. If they refuse to collect the tax, at some point the government of the consumer's nation can go after the corporation for evading the taxes and fine them, often in vast multiples of the original tax and then enforce those judgments through the treaties they hold with the US. In extreme circumstances they can place an embargo on the goods from that company or find the principle officers of that company to be in violation of criminal laws and incarcerate them, extraditing them under treaties. EDIT well there you go, Matrix is UK and EU as well as US, they have to deal with all 3 legally.

But some US companies do not charge VAT. That is because they are set up so that you make your purchase in the US, probably in a state that will not charge a sales tax for an out of state purchase, and they pretend that they do not know you live outside North America (NAFTA guards Canada/Mexico). While it should be obvious that your card is not US issued, they choose to ignore this fact based on a cost/risk analysis. Small companies do not make enough $$$ to really be worth going after, big companies have the resources to win a legal case through tax attrition by running up legal costs until it is politically unsupportable to continue pursuing litigation in most cases. But some do not choose to pursue these little deceptions and instead comply with the law.

As for the Paradox Interactive example, even they issue between 500,000 and 1 million copies on an initial release and can do price pointing over time. I may be wrong but I do not believe the games here are issued in anywhere near that quantity so the fixed costs of production are spread over a much smaller product base making for a higher cost/lower profit margin situation which in turn lends itself to the fixed pricing schematic at what is felt the market will bear. Here when you pay for a game it is the price they need to make the proft they desire for the time invested by a handful of people, with a sort of co-op of several developers (many small units, developers only get the profit from their product, not from the products of other developers) working through Matrix and their subcontractors. At Paradox Interactive for example, they are paying 28 game developers and their costs of operation and distribution with multiple releases of games numbering in the millions, all done as a unit (all the work of all the developers is pooled together). They may only need to average U$20 a game to make a decent profit. Here we have a developer and Matrix who may sell say 100 games and need to figure out a good price, say U$60. If half the games are bought upon release and the rest mostly over the next 2 years (say 25/25), it is easy to see how Paradox can start at a price point of U$50 and then drop down to U$20 a year after release and then to U$6 the next year. So we are looking at a pool of U$31.5 million for a HOI (of which they really only needed U$20 million for their desired profit) -v- U$6000 for an EiANW (Empires in Arms), which probably paid Matrix and gave Marshall a food budget for a couple months in exchange for his 6 years of labor, probably netting him pennies an hour (he needs a lot more U$ to make a profit similar to Paradox but no one will pay U$2500 per copy). For EiA to achieve their desired sales goal of $6000 under the 50/25/25 scheme and locking in a U$20 for the 2d year and a U$10 for the 3d year, the release price would need to be U$105 for those first 50 units. It is more likely that you will sell the 100 @ at a flat U$60 than that you will get U$105 upon release for the first 50 allowing you to drop your price over the next 2 years.

Developers here accept a low return on their time investment because they make games they love and want to play. Even with that low return, due to economies of scale they need to charge more than a Paradox does. I would rather pay extra to have these choices at Matrix, even with their bugs and the slower support (I have always found developers very responsive to my concerns, they may not agree, but they do look into my issues). Sure maybe if we never bought these the developers out of the kindness of their hearts might suck up the costs and make shareware but then again, maybe they would not and these games would never see the light the day.

EDIT Let me add here I am by no means a cash cow for Matrix. I have purchased probably 6 games over 8 years, one of which I would have personally chased down Grigsby for my money back ala South Park because it was such a piece of crap (GG's WAW) and he should have plenty of $$$ from his successful games and even that one had enough supporters to absorb my refund imho, but I would rather eat the cost to keep him trying to make games.

< Message edited by Murat -- 10/11/2011 6:07:11 PM >

(in reply to GoodGuy)

Post #: 25

RE: Matrix pricing - 10/11/2011 5:52:32 PM

Martin James

Posts: 17
Joined: 12/28/2004
Status: offline

Dear Erik

I wish Matrix well and do not think they are an unethical company. I would suggest you look at the VAT thing again however, at least as regards UK customers.

As a control, I have just gone through to check-out ordering a PC game from Amazon's UK website. The site quotes a headline price in � sterling, which includes VAT from the outset, so there is complete transparency. I am not sure whether or not that is a legal requirement in the UK, but it is certainly typical. In fact I cannot think of another online retailer here where quoted prices do not include VAT.

I hope you regard this feedback as constructive, which it is intended to be .

Kind regards

(in reply to JudgeDredd)

Post #: 26

RE: Matrix pricing - 10/11/2011 6:46:23 PM

battles_atlas

Posts: 3
Joined: 10/10/2011
Status: offline

I don't want to get into the legal fine points of charging VAT, and the explanation that you admins have given makes sense. Although the second page which does give the VAT is within the matrix site, its an embedded plimus page. That said there is no technical reason why your site couldn't take account of the ip as plimus does, but I get that its a complication that would cost to implement. A reasonable compromise it would seem to me would be to have a "(VAT exc.)" with the price quoted, so at least we'd be ready for it.

Murat - Your argument is assuming that the market for matrix titles is fixed, which clearly isn't true. Ok I don't dispute that a lot of the hardcore stuff on here is never going to shift big units, but a game like Panzer Corps, and also the Close Combat titles you have, could still sell in significant quantities. Close Combat originally was a mainstream title, and the PC market isn't that different from what it was back then in terms of taste (no matter what the suits at Activision might wish to believe). Champ/Football manager still sells huge amounts. That said, I get that its difficult for Matrix given they're a publisher with their own sales platform. I suspect if the devs behind Panzer Corp stuck it on Steam at �10 they'd make far more than they would on Matrix at �30, but for Matrix themselves they don't have the profile to attract the numbers necessary to make Steam economics work. Then again, high prices will ensure that they never will.

Its complicated

. I'd suggest Matrix consider selling some more mass appeal games like Panzer Corps on Steam instead, if only as an experiment, but its your business obviously. Wish you the best either way, PC gaming wouldn't be the same without its niches.

I should conclude by admitting that I've actually swallowed my doubts and bought Panzer Corps! Hope I get as many hours out of it as I expect to.

(in reply to Murat)

Post #: 27

RE: Matrix pricing - 10/11/2011 7:20:30 PM

Lord Zimoa

Posts: 837
Joined: 10/10/2008
Status: offline

I`m not going into sale details, but we worked on Panzer Corps for about 18 months now, and we pay for all development costs ourselves.

After reduction of costs and taxes, the profit calculated per month per person, is less than the average minimum wage per person/per month in the European zone, if you calculate what we make as a "profit" per month on a game like this.

Making these kind of games is a labour of love and passion in the first place.

So a big thanks for all those who have paid 39.99 USD for this game! Thanks for the support and trust, we hope to bring more fun, good and stable games in the future...

< Message edited by Iain McNeil -- 10/12/2011 9:49:44 AM >

_____________________________

www.thelordzgamesstudio.com
www.panzer-corps.com
www.commander-games.com

(in reply to battles_atlas)

Post #: 28

RE: Matrix pricing - 10/11/2011 7:20:59 PM

GoodGuy

Posts: 1506
Joined: 5/17/2006
From: Cologne, Germany
Status: offline

quote:

ORIGINAL: Murat

The laws that are relevant here are not the US laws (actually US treaties are relevant, which are "laws" of the US but not in the strict sense), they are the laws of the nation where the CONSUMER resides since it is the CONSUMER who owes the tax, the corporation is only in charge of collecting the tax. So why would a US company want to collect the tax? Because they are doing business in the consumer's nation and want to continue to do so. If they refuse to collect the tax, at some point the government of the consumer's nation can go after the corporation for evading the taxes and fine them, often in vast multiples of the original tax and then enforce those judgments through the treaties they hold with the US. In extreme circumstances they can place an embargo on the goods from that company or find the principle officers of that company to be in violation of criminal laws and incarcerate them....

Well, embargo? Well, the EU never placed an embargo on US software products, afaik. What they did was that they threatened to introduce (I am not sure whether that was ever put into effect) import taxes on say INTEL hardware products, for example, or on PCs (Intel, Dell, etc., everything containing INTEL chips) assembled in or shipped from the US, or on Microsoft products, for several reasons, where the next step (in this threat) could have been a possible ban of some US products. The issues had been resolved through negotiations, usually. Part of the issue back then with INTEL was Intel's market leadership and/or their actions to help suppress the competition, same with Microsoft.
And an embargo for a company of Matrix' size .... no further comment.

quote:

, extraditing them under treaties. EDIT well there you go, Matrix is UK and EU as well as US, they have to deal with all 3 legally.

As far as I know, the US have not agreed to/signed any treaty that puts domestic businesses at a major disadvantage (EU businesses are allowed to export to non-EU countries tax-free).

Also, a separate US business is in NO way bound to EU jurisdiction, the EU can come up with all kinds of new impertinent attempts to pester US businesses and to bolster EU sales to the US and other countries, but that will not change. The "Matrix department" in the UK is most likely Slitherine. So, question is whether Matrix really has to be a "Ltd" (which usually means that its HQ and main branch is registered in the UK). If Matrix does that for tax reasons or practical reasons, then why not form a US branch for digital exports only, which doesn't have to succumb to the EU's policy to disadvantage US businesses? I think "customer satisfaction reasons" (uh, I coined a new word

) are not to be disregarded by Matrix.

Then let the customer decide whether he wants to pay VAT or not, as the decision will then be in his domain.

quote:

But some US companies do not charge VAT. That is because they are set up so that you make your purchase in the US, probably in a state that will not charge a sales tax for an out of state purchase....

If I am not mistaken, most US states - if not all - either won't charge for export sales, or they will have a greatly reduced tax, as product delivery (be it electronically or physically) to foreign residents (even IN the US, let alone outside the US) qualifies as EXPORT.

US businesses, who follow the EU demands regarding VAT, only do that because they are concerned that EU authorities may put some punishment on their business. This usually turns out to be unfounded if it comes to a Niche business like Matrix. It shouldn't be too hard to find a legal and satisfying (for EU customers) form of business registration for that, anyway, imho.

quote:

Developers here accept a low return on their time investment because they make games they love and want to play. Even with that low return, due to economies of scale they need to charge more than a Paradox does.

That actually is related to the low sales numbers (compared to the majors) and the fact that wargaming is a Niche-market.
According to market laws, it's not wise to charge well above the average market price for a longer time. While I enjoy playing Matrix games (maybe except for CAW, due to the lack of content), I don't know if I, as a customer, want to be held liable for the chance that a given developer cannot make a living with such low sales numbers. It should then be in the distributor's interest (and it should be his job) to try and push sales. With the Matrix brand, there are still many people all over the world who never heard about Matrix, and who - even tho they're interested in wargaming - would never find or go to the Matrix website, be it a language problem (say potential French, German or Spanish speaking customers) or just lack of marketing. There are quite some inexpensive marketing efforts, too.

There is still a debate whether putting down the prices down to a bargain rate (and cooperating with distributors like Steam or - maybe less bossy/intrusive - say Direct2Drive) after say a year or 2 (even if for a short time only) will enhance the customer base/player base or not. I'd say it would have potential to create a big booster effect, though. Think about the bargain sales on D2D... I'd never have bought a Paradox game, if it would have cost me more than 9 bucks.... the one I got is so buggy and unfinished, it's unbelievable. And, besides the potential to get more wargaming folks to the bright side (Matrix), casual gamers (non-grognards) may actually pick up some games, if they are available on a well-known platform outside the Matrix domain.

< Message edited by GoodGuy -- 10/11/2011 8:34:46 PM >

_____________________________

"Aw Nuts"
General Anthony McAuliffe
December 22nd, 1944
Bastogne
---
"I've always felt that the AA (Alied Assault engine) had the potential to be [....] big."
Tim Stone
8th of August, 2006

(in reply to Murat)

Post #: 29

RE: Matrix pricing - 10/11/2011 8:14:25 PM

tgold

Posts: 9
Joined: 7/28/2011
Status: offline

There is-of course-the "pay peanuts get monkeypoop" school of economics which given the overall state of console-based twitch-gaming repetitive tat being flogged these days proves the second part of said school where "sell the sizzle not the steak" applies

.

To date I have purchased JTCS (despite owning the originals), FoF, and today (despite my eyes watering during checkout) I finally broke down and ordered GG WITE. All from Matrix and because I split between my home PC and work/travel laptop I always get the hard copy with the printed manuals as reading pdf's is annoying. And the simple DRM scheme associated with purchases through Matrix is perfectly tolerable and allows my required multi-platform needs (I have a 9 hour flight coming up later this month to Miami and hope to spend it getting my butt kicked on the Eastern Front). I am quite happy to support the price points simply because the enjoyment value over the course of literally years of playtime turns the initial outlay into...well...if not exactly nothing-perhaps a penny a day? Loose change in the car's ashtray?

I compare this with my recent impulse purchase of Deux Ex: Human Revolution which while looking lovely has pretty much zero replay value for your average grognard and is pretty damn short for what it actually costs. Not to mention that in order to "expand" the game the greedy producers dove full bore into the DLC model-and thats an area that makes me want to barf. Although I have to say the Steam bit is actually rather painless and it was pretty fun to find that my original Half Life 2 purchase from yoinks ago was still valid and installable despite my having lost the disc, box, and key code 4 years ago!

Look-I guess I am pre-disposed to shell out for quality after years of add-ons for MSFS and X-Plane. You want eye watering...go check out the prices for some of the add-on terrain and aircraft for what is-you guessed it-a niche market just like proper wargames.

Keep right on trucking Matrix. Quality is rare, stands the test of time,� and should be priced accordingly.

Just my opinion. And yeah VAT is rubbish!

p.s. I downloaded and booted Half Life 2 for a giggle and was blown away as the visuals seem to have been totally updated for modern systems. Looks great and still worth a play when I need a break from grognard land

p.p.s. I purchased Heart Of Iron 3 on the recommendation of a friend. What a hideous train wreck of a game. Promptly uninstalled and shelved. Although the Paradox offering "Mount & Blade" is awesome....and who wouldn't support a husband/wife games studio to boot!

p.p.p.s. Final ps I swear. How many games can actually provide a fully printed manual? Not many but darn if they all seem to be sold through Matrix. Although a bigger font would be nice for my aging eyes.

< Message edited by TedG -- 10/11/2011 8:23:05 PM >

(in reply to GoodGuy)

Post #: 30