Australian Govt Forces Apple, Adobe, Microsoft To Explain Price Hikes 371
An anonymous reader writes "Live outside the U.S.? Tired of paying huge local price markups on technology products from vendors such as Apple, Microsoft and Adobe? Well, rest easy, the Australian Government is on the case. After months of stonewalling from the vendors, today the Australian Parliament issued subpoenas compelling the three vendors to appear in public and take questions regarding their price hikes on technology products sold in Australia. Finally, we may have some answers for why Adobe, for example, charges up to $1,400 more for the full version of Creative Suite 6 when sold outside the U.S."
No, we're not price gouging (Score:5, Interesting)
Interestingly, one Australian company made the submission that it was cheaper to send an employee business class from Australia to the US to buy a certain piece of software there, stay for a night or two in a hotel, fly back, and pay import and/or GST at customs than it was to get the software locally.
Re:bad idea ? (Score:5, Interesting)
difference in pricing models like this encourages piracy.
True, and then companies will hike the prices up in the regions with high piracy rates to "compensate", which makes the piracy problem even worse, and you have an ever-escalating cycle.
But the problem here is price fixing, using protectionist legislation as the method of artificially controlling the prices of products that have a near-monopoly in the market.
The only real solution to this is to disallow region based controls, and turn the laws around so that it becomes illegal to restrict users based on geography.
A free market is anti-competitive unless it's free for the buyer as well as the seller.
Struth (Score:1, Interesting)
Adobe is going to hear more bitching from their paying customers
Julia Gillard is going to win the next election because Joe Hockey will take over leadership from Tony Abbott and G comes before H.
Re:Because they can (Score:5, Interesting)
"That is the only honest answer that there is. As long as artificial monopolies like 'regions' are tolerated it will only continue. There is no valid reason why software or other companies should be able to use globalism for cheaper labor whilst denying consumers globalism for cheaper products."
You might find this story interesting.
I think it was 1992, Texas decided to build another prison, located in New Boston, Tx. A Pennsylvania company won the contract, and part of the contract covered employment of local workers. A journeyman carpenter was supposed to get $13.00 or $13.50/hr.
When the company started hiring, they were paying $11.00/hr for journeymen craftsmen.
This obviously violated the contract - but the Pennsylvania company went to court, and successfully argued that because they were working in an "economically depressed" area, that $11.00 was equivalent to the wages stated in the contract. That is, $11.00 in the Texarkana area was equal to the $13.00 or $13.50 in Pittsburgh, Pa.
There is always some imaginary bullshit excuse for ripping off the locals.
Re:Valve / Steam... (Score:5, Interesting)
No they shouldn't. The producers determine the price for Austrailia if they sell there at all.
This is similar to the philosophy in China. Everyone watches the latest Hollywood movies and uses the latest software. If the price is low enough they may decide to actually buy the legitimate copy instead of the bootleg. It sure is great when the government doesn't get involved... gotta love the free market system :).
Re:Valve / Steam... (Score:5, Interesting)
Canada and the US share a boarder, so it is somewhat ridiculous for them to charge more in Canada than in Hawaii, that's a fair complaint. However, what I think is even more ridiculous is a car that's made in South Australia, the Pontiac G8 [wikipedia.org] is cheaper to buy in the US than in South Australia. The average price in South Australia is around $50,000 the average price in the US is around $30,000. Remembering that the dollar was at parity or close to parity. This means it was $20,000 cheaper to purchase a car that had been shipped to the US. GM has consistently done this to us, and just about every large company does this to us.
Valve actually doesn't do it that much, though some game producers that use Steam do.
Re:No, we're not price gouging (Score:5, Interesting)
Don't worry, that won't be the case for long, (and not in a good way) companies would love to make buying something outside your local authorized dealer illegal.
It may not be illegal yet, but Adobe has already moved in that direction.
Adobe closed off their international sales for several weeks while they reviewed their international pricing, right as we needed to bring on more people for a new project. After a few weeks of being told we'd be able to buy more licenses any day now, we sent someone to the US to buy a couple of retail copies so we could at least have new people doing more than just surfing the net. Within 24 hours of installing the US boxed copies we had Adobe on the phone demanding to know why our company was running pirated copies of their software, and threatening to revoke *all* of our licenses if we didn't remove them immediately. Turns out they consider running a US boxed copy in a foreign country as a breach of contract and will cut you off. Eventually they had to admit that we had been trying, continuously, to buy a copy from them, and agreed to let us continue until their online store reopened so we could replace the copies we were running.
Why not just ignore the copyright... (Score:4, Interesting)
Simply don't enforce any copyright laws against these products until the pricing reaches parity. "Authorize" a local "distributor" to sell it at the cost of the blank media it is distributed on. Make sure businesses are aware that they can get in on this action too, and that any copy acquired in this manner will be free from any future prosecution of copyright infringement. If the companies don't play ball after that, Australia suddenly becomes a much cheaper place to set up a small business... win-win.
Re:Valve / Steam... (Score:5, Interesting)
While I have no love for those companies, I wonder if the answer to your questions isn't going to be obvious (and annoying). It's "known" here in the US, that Europeans are willing to pay more for the same goods, and thus we charge them more for the same goods. Americans are known for choosing to buy cheap crap that will break in a week because it's cheaper, therefore more reliable vendors have to go lower to make the sale. Going to the farthest extreme, the Chinese are known for stealing software, movies, etc. and thus to make a sale there the price has to be very low.
They call this "market based pricing", and I agree that it is actually quite a destructive practice, but I don't think it's illegal.
Re:Translate this to legalese: (Score:5, Interesting)
As far as media goes, I'm hopeful that something might come of this, it's one thing on physical products (where at least you can put it down to "shipping"),
This went out the window when I could import a kitchen from the US paying shipping, taxes and imports for 1/2 of what I paid here (we're talking oven, cooktop, fridge, dishwasher, stone benchtops). Well over A$1000 worth of stuff so no tax free threshold. Still managed to save near to $3000.
Even with Games/Media. I order DVD box sets from the UK with shipping it costs half of what the same box set costs here.
Dont even get me started on cars. How can BMW sell a car for $350,000 in Australia when the same model is $100,000 in the UK. Even sans the LCT (Luxury Car Tax), GST (Goods and Services Tax) and import duties, that's still $220,000 base price and the UK price includes their 20% VAT.
Re:Price Fixing? (Score:2, Interesting)
Aussies don't like price fixing, which hasn't been suggested, and they don't like be 'gahzumped' either. A similar problem happened 25 years ago when people realized that CD cost pennies to make and $20 each to buy. The music industry claimed it was the cost of innovation and something 'for the artists'.
The sad truth being anti-American politicians don't last very long in Australia, so our pack of officially elected cowards will do absolutely nothing.
Re:Valve / Steam... (Score:2, Interesting)
And your misguided belief is that this is "right". Oh, and don't go and reply to me with a lecture on the difference between business and right, or fairness and unfairness, or ideal scenarios, or any other bullshit. Don't go on about shareholders and the company's responsibility to their shareholders, or that it costs more to transmit data to such-and-such-country (that's definite bullshit as far as Adobe et al. are concerned anyway), or that "business is business", or that "businesses exist to maximise profit". All bullshit. Oh, "they're not a charity?" No, of course they're not. That doesn't answer the question though: "If they can make a profit in the US by selling the digital product for $200 [made up price] then why cannot they make a profit for selling it at the same price -- currency adjusted -- in any other country?" Oh, "support" I hear you think. Think again. They are profiteering. No more, no less.
Re:Valve / Steam... (Score:3, Interesting)
Australians buy the same TVs/Computers/Cars (when we can get a decent model on the market) as the USA does.
No, you don't.
On which side of the road do you drive and where is the steering wheel located?
Which Analog and Digital broadcasting systems does Australia use, it's most certainly not NTSC/ATSC, so you can't leverage the "we buy the same stuff as Americans" because you don't. You have to have your OWN models specific to a country no where near the other English speaking countries in the middle of a huge ocean.
And even with digital stuff, you don't use the same spelling as the US and you have a Wacky media rating system that makes no sense.
So yes, they're going to charge you more...because you're a tiny annoying market. You're damn lucky you're english speakers with a reasonable standard of living or else they'd just ignore you.