Microsoft control over indie prices 'legally similar to Sony'

XPG Darkside Aug 21, 2013

  1. XPG Darkside

    XPG Darkside Eating cake.... Gold Subscriber Lifetime Gold

    Oct 20, 2011
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    Microsoft will determine the final retail price of all self-published indie games on Xbox One, a spokesperson for the corporation has told CVG.

    It has emerged that this policy is the same as Sony's in the legal definition, however in practice both are expected to be distinguishable from one another.

    Chris Charla, the Microsoft executive who is the company's point-of-contact for indie developers, clarified the self-publishing policies in an interview with CVG.
    [​IMG] He explained that, while indies are free to set a wholesale price on their digital games (essentially how much Microsoft pays them per sale), the Xbox vendor can determine the game's retail price at will.
    This distinguishes Xbox One from the Wii U, Apple's App Store and to an extent Steam - which each allow developers to set their own final prices.

    Developers discussing the matter on Twitter also say this sets the Xbox One's self-publishing rules apart from the PlayStation 4's, claiming that Sony allows developers to create their own retail prices.

    Just Add Water executive Stewart Gilray, speaking to fellow UK dev Mike Bithell, said he is free to suggest the retail prices of his games.

    Yet a senior games developer fluent with Sony's policies has clarified that PlayStation reserves the right to set the final price of self-published digital games.

    The person said this is due to various Euro-wide laws, but stressed that Sony in practice allows developers to set their own price. Its legal right would only be applied, the person said, if a developer set a particularly unusual or problematic price for their game.

    Charla suggested that, in practice, Microsoft will do things differently.

    "Microsoft's store uses a retail model, so we set the final price of the game while developers set the wholesale price," Charla said.

    "When a self-published game is sold, developers get either their wholesale price back, or a standard industry percentage of the retail price, whichever is higher."

    It is implied, but not explicitly stated, that Charla is referring to a 30/70 revenue split, as found on the App Store, Facebook and other indie platforms.

    Clarifying the matter further, Charla offered a step-by-step explanation of the deal:

    "Let's just say you, the developer, set your wholesale price at $5, and we decide to set the retail price at $10, for each sale you would get the standard industry split [probably 70%] on that $10."

    In this example the developer would (probably) get $7. However, if Microsoft wanted to sell that game for $6, the wholesale price is higher than 70% and so they would receive that instead.

    "But we really want to work with developers to make sure the prices are where they're meant to be," Charla added.

    The deal gives Microsoft flexibility to, for example, reduce indie game prices if they are found to be cheaper on other platforms. There is technically no limit to how low Microsoft can go, though if it goes lower than the developer's wholesale price it would effectively be losing money.

    Source CVG.
  2. raisinbrand

    raisinbrand Member

    Jun 3, 2013
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