I am a Brazilian gamer, and that's a very expensive hobby to have here.
Since I studied the subject, using my MBA in foreign trade knowledge of taxes and fees, I happen to agree with the report.
I had to pay US$ 150,00 for my regular copy of Mass Effect 2, and I identified some causes that the report also points out, and one that it doesn?t:
1 - Taxes. Videogames are taxed as 'superfluous' items here. Over 70% Import tax.
2 - Freight. The volume of games imported here are low, so they come here by courier at premium price (and additional 60% tax).
3 - Total lack of marketing awareness by the publishers. Right now, our currency is strong in comparison to its historical standards towards the US Dollar. Even so, it is still worth 40% what a Dollar is worth. Also, our percapita income is 9 times lower than US's. That means, games are an average 9 times more expensive in relation to our incomes. Our minimum wage is about US$ 270,00 a month. Publishers are greedy and clueless to our situation.
We don't have lots of money, but we have volumes.
Microsoft translates LIVE and games to our market using Portugal's Portuguese, not Brazilian's. That is strange, since Brazilians are almost the totality of the world population of Portuguese speakers (we are 186.000.000 against 10.000.000 Portuguese). And our accent and choice of words differ a lot from the Portuguese's.
The previous generations were worse. Sony didn't launch Playstation 1 in Brazil, the only source we had for games were pirated games.
And there is at least one success story that proves that games at a reasonable price sell well here:
There is a publisher that figured out a loophole in the tax code, that allowed for a magazine or book to be released with media like cd's or dvd's. They made a very thin magazine with tips and manual for each game and the game itself came attached. Recently released computer games would come here for prices as low as US$ 8,00, due to the tax relief. They sell like water in the desert.
Please don't judge us third worlders for going after our fun in the black market. The only reason the few of us (me included) who play original games do it yet is for services like Live. Otherwise, it would be bootleg all the way!