The Price to Play - Mobile Edition

Games
The Price to Play
By Eli Green
September 21, 2007 - 10:00

As long as home video game systems have been around, Canadians have always paid more money to purchase their systems and their games because of the lower value of the Canadian Dollar. It's almost an unwritten rule. If Americans pay $49.99 for a game, Canadians will pay $59.99. If Americans pay $29.99, Canadians will pay $34.99 or, sometimes, $39.99. The list goes on, but the pattern is generally the same.

It makes sense, of course, that people purchasing any product with a lower valued currency would pay more. The pricing of video games and systems in Canada and the United States clearly reflected that, especially during the past two generations of systems. In fact, when Nintendo announced the price for a Wii, there was only a $30 difference between the Canadian and American pricing, a very accurate representation of the difference in currencies at that time (by the way, the MSRP is still $279.99 in Canada, not $289.99 like many major retail chains are charging). However, with the Canadian Dollar as high as it is, isn't it time the manufacturers lowered the Canadian costs of the systems and games to, once again, reflect the value of the Dollar?

When I originally began writing this article, the value of one Canadian Dollar was 97.22 cents American. In other words, the American Dollar was barely worth three cents more than the Canadian. The price had been hovering around the 95 to 96 cent mark for quite some time. With the value of the Canadian Dollar being so high, it's hard not to wonder, just how much are we paying for our games?

If you take a look at any currency converter you can easily find a very close exchange rate for the prices of any system or game. All you have to do is type in the cost of the game in Canadian Dollars and have the converter change it to American. The result is how much you pay. Keep in mind to calculate the prices before taxes, since the tax varies province to province and is usually lower in the U.S. Anyway.

Here are some conversions of prices commonly seen for systems and games at the rate of 97.22 cents*:

Wii: MSRP of $249.99 USD/$279.99 CAD – Canadians are paying approx. $272.19 USD before taxes.

Wii at $289.99 CAD price – Canadians are paying approx. $281.91 USD before taxes.

Xbox 360 Premium MSRP of $349.99 USD/$399.99 CAD – Canadians are paying approx. $388.85 USD before taxes.

Playstation 3 60GB MSRP of $499.99 USD/$549.99 CAD – Canadians are paying approx. $534.67 USD before taxes.

Average MSRP of Wii games $49.99 USD/$59.99 CAD – Canadians are paying approx. $58.32 USD before taxes

Average MSRP of Xbox 360 and PS3 games $59.99 USD/$69.99 CAD – Canadians are paying approx. $68.04 before taxes.

With the Canadian Dollar at that value, Canadians were coming very close to paying the Canadian price of systems and games in American Dollars. That means that since the Canadian Dollar has hit par with the American Dollar, but the prices have gone unchanged, a Playstation 3 or Xbox 360 costs $50 more in Canada, a Wii costs $30 or $40 more, and so on.

Under most circumstances it is understandable that retailers don't change their prices immediately when the value of the currency rises. Their products are commonly purchased in advance, at a specific price, which must be compensated for. However, with video games, things work a little bit differently. When a manufacturer drops the price on their product, the retailers make that price drop right away (as can be seen with Sony's recent drop for the North American price of the Playstation 3 or Microsoft's price drop for all Xbox 360 models). It seems that until the system manufacturers say they will be officially dropping the prices, the retailers won't change them, even with the value of the Dollar.

So what do the big three have planned for Canadians? We asked Sony, Nintendo and Microsoft if they are considering changing the Canadian price for games and systems to compensate for the higher value of the Canadian Dollar. Sony says that it has no additional price cuts planned as it has just recently cut the price of the Playstation 3, and that there are no plans to cut the Canadian prices of its other hardware or its software. Microsoft simply said that it will only speak about price changes at the time those changes are made, if at all (as we saw with the price drop on the Xbox 360). Nintendo was unable to comment.

As those comments were made when the Canadian Dollar was still a couple of cents away from parity with the American Dollar, we are hoping to get updated responses soon. If Sony, Nintendo or Microsoft make any changes to their comments, we'll let you know.

*Currency conversion results from Oanda Currency Converter

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