Print 31 comment(s) - last by Captin Crunch.. on Mar 26 at 10:03 AM

Apple says content providers like record companies, TV networks and movie studios are to blame

Apple, Microsoft and Adobe are currently being questioned for the high prices they charge Australians for digital products, but Apple accused traditional content distributors like record companies for the price hikes.

An Australian parliamentary committee is investigating Apple, Microsoft and Adobe for charging Australian customers around 50 percent more for digital products (and sometimes hardware) than customers in other areas of the world -- including the U.S. 

Tony King, vice president for Apple Australia, New Zealand and South Asia, said that traditional content providers like record labels, TV networks and movie studios are to blame because digital pricing is based on wholesale costs set by these content holders. 

"The content industry still runs with perhaps old-fashioned notions of country borders or territories or markets," King said. "The cards are in the hand of the folks who own the content, that is not in our hand to play."

Apple, Microsoft and Adobe also said that prices are higher in Australia because of higher labor costs, copyright issues, geographical product differentiation and Australia's 10 percent goods and services tax. 

A survey by consumer advocacy group Choice showed that both hardware and software sold in Australia were priced 50 percent higher than the same items in the U.S. 

While King pointed out that products like the iPad mini and Final Cut Pro software were the same price in Australia as the U.S., other products clearly are not. For instance, albums like Justin Timberlake's "20/20 Experience" and AC/DC's "Back in Black" on iTunes are priced 50 percent and 70 percent higher in Australia compared to the U.S. respectively. 

For Adobe, Australians have to pay A$3,175 ($3,300 USD) for CS6 Design and Web Premium software while Americans pay just $1,899.

On Microsoft's end, the committee said that Australians pay A$4,136 for the same products that Americans pay the equivalent of A$2,324 for. 

Source: Reuters

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am I missing the problem?
By Nortel on 3/22/2013 3:13:17 PM , Rating: -1
If any company wanted to charge 10x more to sell in one country vs another, how is that any business of the country? Is the USA going to sue Adobe because their products are sold in the US far too cheaply compared to AU?

Take a look at products from Amazon US vs Canada vs other countries, the prices can vary by over 100%. This isn't a new problem and is offensive that a lawsuit can arise over this sort of thing.

RE: am I missing the problem?
By bobcpg on 3/22/2013 3:17:26 PM , Rating: 1
In addition, some countries entitle their people to more than other countries. These entitlements are not free and need to be paid for somehow.

RE: am I missing the problem?
By Motoman on 3/22/2013 3:21:27 PM , Rating: 2
I can see letting Apple off the hook, since there's no way anything Apple makes can't be easily replaced with something else that's just or good or better, and infinitely cheaper. If Apple wants to price themselves out of the market, let them...hopefully people would be smart enough to pay $1 for an Android phone instead of $2 for an iPhone of equal or lesser spec.

With regards to Microsoft and can make a pretty compelling argument that those specific products are *required* - such that there's not an acceptable substitute. Yeah, we can go on about using GIMP instead of Photoshop, or Linux instead of Windows...but that doesn't fly in the real world. Alternatives to those products are not without penalty to the user.

RE: am I missing the problem?
By othercents on 3/22/2013 3:26:34 PM , Rating: 2
These issues make Australia less competitive in the global market due to products costing more even though the products don't cost anymore to be made available there. This should be especially true for products that are downloaded. There was a statement that Australians were flying to the US to buy software and then fly back due to the price discrepancy.

RE: am I missing the problem?
By MadMan007 on 3/22/2013 4:35:31 PM , Rating: 3
It's not as simple as saying the products don't cost more just because they're digital goods. Unless MS, Adobe, etc have literally no presence in Australia - in other words, all Australian users do is download from the US or whatever - there could be higher costs. If there are Australian servers, offices, or personnel who are employed by these companies, there very well could be additional costs to support the product in Australia.

By StevoLincolnite on 3/22/2013 7:48:14 PM , Rating: 4
Except... Say you buy a game, 99% of the time you will get charged 40-50% more for it in Australia.

That's all well and dandy... But then the game company's still don't provide any servers.
Heck, Blizzard doesn't even provide actual Australian servers, we use Singapore in South East Asia or choose the USA and deal with high pings.
So where are the extra costs? Support is usually handled by the retailer, so it's not like EA, Blizzard, Ubisoft are paying for it, support on services like Origin is all overseas, same with the telephone support.

Besides, costs/exchange rate were the excuses companies made for games being so much more expensive and that was when the Australian dollar was worth about 60 US cents, however when the reverse happened and an Australian dollar was worth more than 1 US dollar, prices didn't budge. At all.

It's simply price gauging, plain and simple.

RE: am I missing the problem?
By Justin Time on 3/22/2013 7:16:16 PM , Rating: 1
The issue is that *ALL* of the major players have a cozy situation where they charge similarly more. These multi-nationals are having a direct impact on the country's competitiveness, while eliminating any price competition between themselves, by what looks suspiciously like collusion.

RE: am I missing the problem?
By Reclaimer77 on 3/22/13, Rating: 0
RE: am I missing the problem?
By StevoLincolnite on 3/23/2013 2:01:17 AM , Rating: 2
Basically. Just a bunch of QQ. You don't have a "right" to a "fair" price on consumer goods.

Actually... That's not entirely accurate.

If you intend to do business in a country, you need to abide by it's laws.
If a country has laws protecting unfair pricing on consumers, then consumers do have a right to a "fair" price, which is why this was started in the first place.

Not every country allows companies to control the consumers.

RE: am I missing the problem?
By Reclaimer77 on 3/23/2013 9:41:55 AM , Rating: 2
Obviously if this was against some law, we would have had a suit by now.

Again, the problem is EVERYTHING costs more in Australia. And I mean EVERYTHING! Go Google it, you'll see what I mean.

Did you real anything I wrote? Government Protectionist policies caused this problem. It set a precedent for everything costing more.

So the Government can't really single out software companies when basically everything else there costs 2-3x more than everywhere else.

On the flip side, Australians make a crapton more salary than almost anyone else too.

RE: am I missing the problem?
By mike66 on 3/23/2013 8:07:58 PM , Rating: 2
So the Government can't really single out software companies when basically everything else there costs 2-3x more than everywhere else.
The FCC here take on all companies in all industries, it has taken on telco's, oil and mining industries, media, electronic. The government does not need to sue because it regulates by creating laws. Americans love to quote " for the people by the people" from your constitution, compared to us Aussies you guys haven't a clue. We wanted good gun laws, we got them. For such a young little nation ( 20 million people )we have a real voice in international affairs. All our best products are sold to the Asian markets as luxury items, sorry but America can't afford them. I have been to your country and what a mess. I live in a beach side mansion for $150 a week. People are literally dying to get into our country because we are a true free democracy. No attack drones killing our citizens within our boarders is also a bonus.

RE: am I missing the problem?
By runutz on 3/24/2013 12:02:47 AM , Rating: 1
Frankly, Mike..No one gives a Schlitz that you are a troll.

RE: am I missing the problem?
By mike66 on 3/24/2013 1:12:08 AM , Rating: 1
With that response you must be a septic tank also without a clue, bah ha ha, what's the matter jealous of our fine nation, oh well I forgive you as you must be upset at your failing nation. Can't win a war since Vietnam and now a failing economy, once the coal tar sands run out no more energy and owned by the Chinese because of the money you owe them. You nation is getting exactly what it deserves for it's sins against other nations. I prefer the term ogre for myself. I hope you are a dooms day prepper, it's your only chance.

RE: am I missing the problem?
By Captin Crunch on 3/26/2013 10:03:15 AM , Rating: 2
he's right. As an example, google the price of a car to buy in the UK, then google the price to sell the same car (similar mileage etc) in Aus and crunch the exchange rate...You will be shocked at the difference in price. And the more expensive the car, the bigger that margin gets!

Now before you run off to start an import/export business, consider this. Aside from all the shipping, insurance, landing costs, compliance etc, there will also be; Custom duty tax, stamp duty tax, Goods & Services tax and finally the Luxury car tax on more expensive cars. The luxury car tax in particular is what Reclaimer is talking about. It protects the Australian car industry and makes the gov a health bonus. So I would be surprised if you ever see the ACC targeting that particular industry.

IMO Australia has over inflated itself against the world economies and that's partly the reason Aussies get screwed. I paid $11 for a beer in Melbourne, which I thought was crazy, but apparently that wasn't uncommon. Australia is sitting on a cushion of Mining and big salaries and so the price of living goes with it. (speaking relatively of course)

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