GW petioning Australian Competition Watchdog to ban online stores

GW is attempting to ban its independent stockists from offering bits, painting services or online stores similar to what was done in the US.



Unlike the US, Australia has a fairly powerful Consumer watchdog that polices anti competitive behaviour, and so GW has petitioned to have an exception made in their favor.



Below are links to some of the correspondence to and from the ACCC from GW;



[url]http://registers.accc.gov.au/content/index.phtml/itemId/1178319/fromItemId/776499[/url]



These are the new proposed terms (Starts at the bottom of page 2);



[url]http://registers.accc.gov.au/content/trimFile.phtml?trimFileTitle=D14+59305.pdf&trimFil eFromVersionId=1180413&trimFileName=D14+59305.pdf[/url]



[url]http://registers.accc.gov.au/content/trimFile.phtml?trimFileTitle=D14+103741.pdf&trimFi leFromVersionId=1180413&trimFileName=D14+103741.pd f[/url]



Some nice tidbits I gleaned from it;



According to GW under 4(a);



"The notified conduct does not have the purpose of substantially lessening competition. Further, it is GWOP's view that the notified conduct will not have, or be likely to have, the substantial lessening of competition."

Their justification;

B&M stores will be encouraged to increase their range of services in order to get larger discounts (no specific amount of discounts are mentioned.) "As a result customers will benefit from the higher standard of service and support"

The new way of business will "offer consumers a high professional level of service" as well as "reduce the risk of Distance Selling Channel Outlets free riding on the investment made by Shop Front Channel Outlets"

Also note, GW was asked to provide 'Facts and evidence' to support their claims. GW declined...

GW recognizes the following as substitutable products;

Heroclix, Mage Knight, Star Trek Attack Wing, Monsterapocoloypse, Warmachine, Hordes, Iron Kingdom, Flames of War, Dust, Smallworld, Ticket to Ride, Battlestar Galactica, Star Wars X Wing, Dark Crusade, Carcassone, Dominion, Axis and Allies, Battlecry, Diplomacy, Risk, Spartacus, Firefly, plastic model kits, model trains, model scenery, diecast models, millitary action figures, radio controlled vehicles, Magic the Gathering, Dungeons and Dragons, Yu-Gi-Oh, Star Wars: The old republic, World of Warcraft, Starcraft, The Eldar Scrolls and Fallout.

"GWOP submits that there is no discernible public detriment in the proposed conduct"

"Consumers remain freely able to buy Hobby Products from a number of other third parties"

Once again; no facts given when requested by the ACCC

GWs response regarding the above list of products;

"The competitive suppliers listed in the Notification offer similar experiences to GWOP in relation to Hobby Products and Hobby Activities, however the Hobby Products and Hobby Activities which customers invest their time and money in are interchangeable. All Hobby Products within the Hobby Activities market may be substitutable for one another."

"To give an example, "Magic: The Gathering" (as referenced in section S(a)(iv)(A)(l) of the Notification) is a very popular collectible card game produced by Wizards of the Coast (a subsidiary of Hasbro) and sold by almost every Trade Account of GWOP. It is sold in the form of starter decks of cards, booster packs of cards, and individual cards. The cards are collected to form "decks" which are used to play in competitive game against opponents. These cards directly compete with the products sold by GWOP."

Ban online only stores it would seem.

I have mixed feelings about online only stores.

On the one had they usually offer a far cheaper product than any real store, which for the consumer is a good thing. After all once you start dropping a few hundred pounds that 10-30% discount suddenly adds up.

On the other, all it does is take customers away from flgs. They don't actually do anything for the hobby, the exist to serve the market that others grow like the flgs (independent or chain). So in someways they are quite parasitic and if you take way a high street present then exposure of the hobby is limited to more word of mouth rather than any potential shop window captures.

I also feel that phyiscal stores are good for the hobby, the provide somewhere to meet up and play the game you spend monies on, they run tutorials and organise other events that probably wouldn't happen in a virtual community.

Unfortuantely, a retail store will never be able to compete with an online store. After all, the retail store will need to be somewhere with a significant footfall and be quite central for people across an area to visit, which usually puts them in retail centres, be they traditional city/town centres or in shopping centres, which will then have a much higher rental cost than with a dedicated warehouse for an online only habbit.

I would like to think that people would have some form of loyalty to their shop that they use and just swallow the cost, but times are changing and sometimes it is just not possible to or convienent to visit the store.

And what is good for the hobby is ultimately good for the individual, that is, the more hobbyists, playing a game, teh more money they spend so the more and better stuff that the hobby supplier, err, supplies.

Plus if you are running your own little flgs and spend ages teaching someone to play and getting them enthusasitc about a specifc game system only for them to then drop £100 with an online only firm, then turn back up to your store to use it and get advice on how to build and paint it, would be irritating at best.

I think this is more universally true than just for the specific case of GW.

I guess what I am saying is "support your local high street".

Yup. Pay where you play, and don't blame GW if your local B&M goes under - the petition here shows they want B&M store over online stores.

Other cost B&M stores have to factor in? Theft. Take X-Wing stuff. Teeny tiny little blisters, very easily slipped into a bag when no one is looking. Two or three and those, and you could potentially wipe out a fair chunk of that day's profits.

Online stores, not so much.

No, the opportunity isn't there is it?

False reports of stuff not delivered I suppose.

I am surprised at my views on this as originally I was quite opposed to it, and when they tried to do it elsewhere.

Actually, they just want their OWN online store to be available. They intend to use the Australian government to put their online competitors out of business while not affecting their own. Hence, when they downsize themselves into being almost entirely an online entity themselves, they can try to get others to enforce their monopoly at no cost to themselves.

Given that GW have physical stores in Australia, I think it is fair enough and it seems to suggest that if I ran an independant phyiscal store which had an online store associated with it that would be fine. Unless I am miss-reading soemthing, whihc is probably the case as my office is far too hot 80+F and I was woken up at 5am this morning

Quote:

---

Originally Posted by Wolfshade

Given that GW have physical stores in Australia, I think it is fair enough and it seems to suggest that if I ran an independant phyiscal store which had an online store associated with it that would be fine. Unless I am miss-reading soemthing, whihc is probably the case as my office is far too hot 80+F and I was woken up at 5am this morning

---

What you are missing is that there is no protection whatsoever if/when Games Workshop decides that it will no longer sell its product through the independent stores or if/when it reduces its own Brick & Mortar to nearly nothing (if not nothing). The point is to get the government to step in to police the competition at no cost to themselves. If there was some kind of guarantee that Games Workshop wasn't going to downsize their own stores and eventually reroute all its product, I would feel less antagonistic to this step. In the long run it is very bad for the consumer.

That being said, I also am not a fan of limiting consumer options under the "guise" of protecting local gaming stores. Most local gaming stores also have an online presence. If the rules were set so as to EXEMPT stores with a Brick & Mortar location as well as their online status, I would trust the motives more.

Online only, and B&M facades that shield what is actually online only stores, hurt the community overall. It may be my tin foil hat at work but for some reason I still don't trust that GW won't try to throw the switch on all independents (even B&M) at some point.

Quote:

---

Originally Posted by Caitsidhe

What you are missing is that there is no protection whatsoever if/when Games Workshop decides that it will no longer sell its product through the independent stores or if/when it reduces its own Brick & Mortar to nearly nothing (if not nothing). The point is to get the government to step in to police the competition at no cost to themselves. If there was some kind of guarantee that Games Workshop wasn't going to downsize their own stores and eventually reroute all its product, I would feel less antagonistic to this step. In the long run it is very bad for the consumer.

---

I am not sure I agree, I think online only stores are hurting the hobby as a whole. Indeed, online only stores are quite hurtful across the entire high street. These little niche stores get completely out costed by online only as the overheads of being a postal service are so much lower.

But the legislation won't actually force GW to sell its goods to outsiders, indeed, GW can just remove the "trade price" which at the moment isn't there and sell at £ cost + shipping, while absorbing its own shipping costs rather than passing it on.

Quote:

---

Originally Posted by Wolfshade

But the legislation won't actually force GW to sell its goods to outsiders, indeed, GW can just remove the "trade price" which at the moment isn't there and sell at £ cost + shipping, while absorbing its own shipping costs rather than passing it on.

---

That is the entire point. This legislation gives Games Workshop all the protections and all the options while not really giving the Brick & Mortar stores (which aren't Games Workshop) anything whatsoever. The simple fact is that the future is now and all Brick & Mortar locations will have to have a web store in addition to a web presence. Even Half Price Books a used Book Store wholesalers of considerable size has now added and is in the process of adding the ability to order the books from any location. History is one long march of technology forcing the little guy to upgrade. I'm not saying it is right. I'm saying it is here. Dirty legislative tricks like Games Workshop is trying to indulge in doesn't do anything for the little guy. That is just how they sell it. The only point of the legislation is to force Australian players to buy directly from Games Workshop. It is also important to note that Games Workshop itself would prefer its branded stores over independents entirely. That is the issue they face in the United States. Their stores can't compete with independents because those stores provide more. Thus, the long term plan for Games Workshop if it refuses to embrace a different pricing model and wants to remain the "Jaguar" or "Porsche" of games, is to eliminate any vendors besides themselves. This isn't a conspiracy theory. Every action they have taken over the last year in regards to their new website (and store) actions against online retailers (including stores in the States which have a real brick and mortar as well as online store) is in preparation for an ultimate move to cut the independents out. It is their belief that their customers are so loyal that when they can't get it at the independent stores or online from anyone but them, that it will reroute all that income to them and avoid a drop in prices. They are wrong about the U.S. market. American players by in large will just migrate as they are already. I can't speak for Europe.

Yeah it is. B&M stores can still sell at whatever discount they want. GW don't.

Therefore, B&M stores have an advantage, should they wish. What they can't do at the moment is compete with the discounts online only can offer.

The web stores in Australia that I'm aware of have bricks and mortars operating separate to their web stores (mil sims, Games Paradise, irresistible force, black cultist)

This is to offer products from the distributor (mil sims, games paradise) and Black Cultist is run alongside a LGS to offer GW stock that avoids the franchise fee every sale generates through the LGS - and the savings are passed on to the customer.

I also know of a few pro painters that get their stock from GW and eBay traders who still sell bits (bitz galexy has stalls at conventions and they sell bits and GW stock. These would all be forced to close.

For what? GW's 'intentions' to offer a sliding scale of discounts depending on how many gaming tables you have? Something that can be at best no higher than their already low industry standard stock discounts?

Trust me, GW isn't doing this just to help their bricks and mortar stores by helping them to provide a better service by limiting what services they can provide (LGS can't offer painting services or bitz services)

Doubt this will work. The competition watchdog has been extremely critical of companies abusing their power to impose an Australian tax/ engage in uncompetitive behaviour. So much so that they tolddus to essentially pirate digital media because of it.

So not worried

Edit: of course it is a typical GW tantrum in responce to yet another 10% sales drop in Australia. Blame everyone but themselves (for those interested GW has lost 10% of their sales in Australia each gear for roughly the last 4-5 years)

Edit 2: oh and GW requires you to have a B&M store so the argumeny that there are nline only stores is a fallacy.

Edit3: I LOVE their refusal to back up claims with actual data. That right their shows their BS

I have no issue with restricting online only stores. What I have a problem with it stopping bitz sales. It's totally uncalled for since people want it. If a store can make money doing it they should be allowed to regardless what GW thinks.