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arn
May 12, 2004, 06:14 AM
According to MacPlus sources, Apple's iTunes Music Store for Europe should be launched in France and other countries starting in mid-june. More countries will be added over time.

MacPlus claims that the songs will be priced at 1.29 Euros as compared to $.99 in the United States. The cost is due to the licensing fees and taxes

skunk
May 12, 2004, 06:40 AM
http://www.macplus.org/magplus/article.php?id_article=6093

Human translation please.

thanks
arn

iTMS Europe: set for June and at €1.29 per song?

From a source close to the major labels, MacPlus has learned that iTMS Music Store Europe is in the final phase of optimization, but at any rate the per-song rate has been fixed at €1.29. This could seem expensive, above all in relation to the 99c US price, but since the amount payable to writers, performers, producers and labels has been fixed at 0.80€, if you add the 19.6% tax, bank charges and the store profit, it all adds up pretty quickly, especially if you want to create a viable, long-term business model.

In summary for the rest:
All being well, mid-June for iTMS availability in France and several other EU countries, and anyway before October, when four other challengers including Real are due to start.
iTMS moving towards video (no surprise there), iTunes increasingly compatible with QT since version 4. Clips already available.
Online store positioning itself to market Ring Tones for mobiles, evidently with the prospect of also providing a gadget to use them with. Rumoured evolution of the iPod combining music, video and phone to be shown in Paris.


That's the gist of it. There's more comment, mostly about the "mastodons" at the record labels, but no further "news".

unfaded
May 13, 2004, 05:08 AM
Sure it sucks, not being as cheap as the American (especially because the euro is stronger) iTMS, but it's hardly more expensive, and at least it's coming (and hey, it seems to be a lot of non-apple people doing this anyway. Hard to bitch out Apple for TAXES.)

Windowlicker
May 13, 2004, 05:11 AM
that's ************! 1.29 euros for a song is almost the same I pay for my music that I buy on CD! how the hell can there be so big differences in taxes and licensing fees? I mean, 1€ is like $1,20! So the music in europe would cost about $1,5! nice one. I really hope this isn't true.. else the itmseu will fail

filipp
May 13, 2004, 05:21 AM
I know I'm not buying 'em for €1.29 a piece, I would accept €0.99, though
/ filipp

Thanatoast
May 13, 2004, 05:22 AM
Ouch. That sucks. I suppose it's better to have a store than to not, but man that's expensive. I'm not sure I'd pay a buck-fifty per song. The pricing schedule may make it viable for Apple, but how many songs do they have to sell to stay that way? At that price, it may be hard.

NOV
May 13, 2004, 05:31 AM
A imts song in Europe should be around € 0,85 (based on $ > € exchange rates), if it had a comparable USA tag.
But with general Apple pricing in mind, which always seems to be way higher outside USA, it does not really surprise me.

Pricing is moderate compared to another online music store (OD2), which charges € 1,79 for popular songs :rolleyes:

Veldek
May 13, 2004, 05:35 AM
I thought the songs would cost 0.99€ plus taxes which would bring them to 1.15€ in Germany. That’s why I was willing to pay up to 1.19€, but 1.29€ is hard to accept.

caveman_uk
May 13, 2004, 05:35 AM
£0.90 a song - maybe for the occasional song that I would have got off of the P2P networks. But I won't buy albums if they want £9 for them (my guess going on the US 10x the single song price model). I'll buy the CD from play.com for the same money - that includes delivery - and I can rip it at a decent bitrate without restrictions. If whole albums were at £6 (the US price) I'd think about it.

Colonel Panik
May 13, 2004, 05:40 AM
Watch the iTMS fail in Europe (at those prices). €1.29 per song will work out at €12.99 for an album. That ain't gonna work.

It really sucks how the American market gets preferencial treatment from almost every multi-national. Take the Nikon D70. 4-6 weeks wait in Europe for the camera. In the States, 1-2 days. And then they shaft us with prices which are significantly more expensive than the dollar price (when exchange rates are taken into account). Sometimes living in Europe is a rip-off. I think that we subsidize US prices.

AlanAudio
May 13, 2004, 05:47 AM
So Apple defends the price of $0.99 as being appropriate for US customers, but considers that 50% more is fine for Europeans.

Presumably that isn't the same Apple which recently denied disadvantaging European customers.

UKMacBod
May 13, 2004, 05:49 AM
... Well that roughly translates to 85p in the UK.

Now if that includes VAT, that's not too bad, is it?

caveman_uk
May 13, 2004, 05:50 AM
Presumably that isn't the same Apple which recently denied disadvantaging European customers.
I did wonder how Jobs' managed to say that with a straight face. Maybe the reality distortion field was especially powerful that day? :rolleyes:

whooleytoo
May 13, 2004, 05:54 AM
That price could be bad for iTMS US as well. If iTMS Europe succeeds at these prices, it'll just encourage the RIAA to raise prices in the US to something similar.

eric_n_dfw
May 13, 2004, 05:59 AM
Nearly 20% in taxes! Ouch!

Tracks cost me $1.07 each after the 8.25% sales tax where I live. Is the 19.6% tax a EU wide thing or would individual local gov'ts add on any further taxes?

Vroem
May 13, 2004, 06:00 AM
US song: $0,99 = €0,83
EU song: $1,53 = €1,29

I can live with that, but only if they offer high (musical) quality classical music, because that's what lots of Europeans like. ;)

iBook
May 13, 2004, 06:00 AM
One of the key differences in pricing for iTMS in the United States vs. Europe is taxation.

Taxes in the U.S. aren't as high as they are in Europe, and there is no national sales tax. Our sales taxes are levied at the state and county level and are not reflected in the "sales price" as they are in Europe.

The 99 cent price tag you see for American consumers is a bit deceptive because it does not include the sales tax.

In the state and county where I live, the tax is 7%. An iTMS purchase actually costs me $1.06. In other American states, it would be more or less depending on the actual tax rate.

caveman_uk
May 13, 2004, 06:02 AM
Nearly 20% in taxes! Ouch!

Tracks cost me $1.07 each after the 8.25% sales tax where I live. Is the 19.6% tax a EU wide thing or would individual local gov'ts add on any further taxes?
The sales taxes in various countries vary across the EU. The UK's is 17.5% but around 20% is pretty average AFAIK

gekko513
May 13, 2004, 06:03 AM
Is the tax rate 19,6% in the whole of EU? I thought it was 25% in Denmark.

It is 24% in Norway, but we're not in the EU so it doesn't count :)

edit: oops ... should've read the most recent posts

UKMacBod
May 13, 2004, 06:06 AM
Exactly - people are forgetting that the price given INCLUDES a fixed pan-european tax rate - iTMS USA is 99c plus tax...

However, VAT tax is different in each country - as previously stated it's 17.5% in the UK and different in other places. So I'm not quite sure how they've managed to get a fixed tax rate, or whether this figure only applies to France?

JDOG_
May 13, 2004, 06:06 AM
I don't know about all this talk about Americans getting the better deal. In all my travelling of Europe in the past 3 months (I'm a US citizen studying in London for the last 5 months) I can honestly say that there's more money floating around the EU than the U.S. and it's Europe's fault for providing such large taxation that would lead up to 1,29 euros a song.

You can't place blame on the American iTMS for having cheap prices when IT'S the country providing the majority of the music on its service from within its borders to the people in IT'S country.

I can also say with a straight face that people in Europe are getting ripped off on the prices of most international goods, with a drumset that costs $800 in the states costing £800 or 750 Euros...also CDs tend to be a bit ridiculous with a $9.99 CD running at £11, 30 swiss francs, 18 euro and so on.

If you don't like it, don't buy it.

eric_n_dfw
May 13, 2004, 06:08 AM
US song: $0,99 = €0,83
EU song: $1,53 = €1,29

I can live with that, but only if they offer high (musical) quality classical music, because that's what lots of Europeans like. ;)
hehe - I thought Europeans all liked Dieter from Sprockets! (http://www.gawth.com/~desolate/sprockets.html) ;)

iBook
May 13, 2004, 06:11 AM
So Apple defends the price of $0.99 as being appropriate for US customers, but considers that 50% more is fine for Europeans.

Presumably that isn't the same Apple which recently denied disadvantaging European customers.

This point seems to be overlooked....

the amount payable to writers, performers, producers and labels has been fixed at 0.80€

Are you suggesting Apple sell music on iTMS at a loss? That it subsidize European consumers because of licensing fees and tax rates it doesn't control?

winmacguy
May 13, 2004, 06:22 AM
I don't know about all this talk about Americans getting the better deal. In all my travelling of Europe in the past 3 months (I'm a US citizen studying in London for the last 5 months) I can honestly say that there's more money floating around the EU than the U.S. and it's Europe's fault for providing such large taxation that would lead up to 1,29 euros a song.

You can't place blame on the American iTMS for having cheap prices when IT'S the country providing the majority of the music on its service from within its borders to the people in IT'S country.

I can also say with a straight face that people in Europe are getting ripped off on the prices of most international goods, with a drumset that costs $800 in the states costing £800 or 750 Euros...also CDs tend to be a bit ridiculous with a $9.99 CD running at £11, 30 swiss francs, 18 euro and so on.

If you don't like it, don't buy it.

Our CDs are pretty expensive in NZ as well. But hey welcome to European taxes and beaurcracy!

123
May 13, 2004, 06:35 AM
US song: $0,99 = €0,83
EU song: $1,53 = €1,29

I can live with that, but only if they offer high (musical) quality classical music, because that's what lots of Europeans like. ;)

No, that's what you can't easily download from p2p networks.

gekko513
May 13, 2004, 06:39 AM
the amount payable to writers, performers, producers and labels has been fixed at 0.80€
The interesting question here is how much the fixed amount to writers etc. is in the US?

LaMerVipere
May 13, 2004, 06:43 AM
Watch the iTMS fail in Europe (at those prices). €1.29 per song will work out at €12.99 for an album. That ain't gonna work.

It really sucks how the American market gets preferencial treatment from almost every multi-national. Take the Nikon D70. 4-6 weeks wait in Europe for the camera. In the States, 1-2 days. And then they shaft us with prices which are significantly more expensive than the dollar price (when exchange rates are taken into account). Sometimes living in Europe is a rip-off. I think that we subsidize US prices.

I wouldn't say that Americans get preferencial treatment. (we are the world's largest consumer, afterall)The reported prices are out of apple's control, and would be as high as they are reported to be because of YOUR economic system and its high taxes, not a world conspiracy to charge europeans more.

gekko513
May 13, 2004, 06:55 AM
I wouldn't say that Americans get preferencial treatment. (we are the world's largest consumer, afterall)The reported prices are out of apple's control, and would be as high as they are reported to be because of YOUR economic system and its high taxes, not a world conspiracy to charge europeans more.
By using the current exchange rate and then adding the 19.6% tax you would get

$0.99 * 0.85 * 1.196 = €1.01

There're some unknown expenses (or profits to someone) that would make up the 28% price difference here.

Bear
May 13, 2004, 06:56 AM
US song: $0,99 = €0,83
EU song: $1,53 = €1,29

I can live with that, but only if they offer high (musical) quality classical music, because that's what lots of Europeans like. ;)Don't forget to add the sales tax to the US prices. The EU prices already include VAT. While not making the prices identical, to does bring them a tad closer.

JFreak
May 13, 2004, 07:08 AM
Is the 19.6% tax a EU wide thing or would individual local gov'ts add on any further taxes?

that is local but varies only a little, and in finland that's 22% (which i believe is the highest in eu area.

somebody said royalties etc are fixed at 0.80 euros, but can that be true? american itms - if i remember correctly - pays 0.66 dollars which equals 0.55 euros currently, so where does this additional 45% come from?

if apple can make a good deal, they will give european itms equal price (without taxes) than american itms. so if a dollar equals 0.80 euros, plus -say- 20% tax, that would mean one euro per song.

anything above that is an outrage.

Stella
May 13, 2004, 07:19 AM
Actually not for all products.

Cell phones? North america is in the dark ages compared to Europe and other parts of the world.

40% of cell phones in Europe ship with bluetooth, 2% only in north america. A good yard stick for the decent phones floating around...

Really, here, cell phones suck - you have to wait months until they become available on this side of the pond. A lot of new phones available here aren't much better than the phones that were sold in Europe several years ago.


Watch the iTMS fail in Europe (at those prices). €1.29 per song will work out at €12.99 for an album. That ain't gonna work.

It really sucks how the American market gets preferencial treatment from almost every multi-national. Take the Nikon D70. 4-6 weeks wait in Europe for the camera. In the States, 1-2 days. And then they shaft us with prices which are significantly more expensive than the dollar price (when exchange rates are taken into account). Sometimes living in Europe is a rip-off. I think that we subsidize US prices.

Stella
May 13, 2004, 07:21 AM
Hello Apple, Canada?

How about providing a progress update for iTMS Canada?

filipp
May 13, 2004, 07:21 AM
Just FYI, indirect taxes (aka VAT) are 25% here in Sweden, and direct (income) taxes are 34%+

Take that! ;)
/ f

Savage Henry
May 13, 2004, 07:47 AM
Europe getting shafted compared to US on Apple products is hardly news anymore. I would have been very surprised if prices were closer to the $/€ rate, and therefore €0.84 per song.

I'm happy if it amounts £0.86 per song here in the UK.

Muzgal
May 13, 2004, 07:50 AM
Nearly 20% in taxes! Ouch!

Tracks cost me $1.07 each after the 8.25% sales tax where I live. Is the 19.6% tax a EU wide thing or would individual local gov'ts add on any further taxes?

Sales tax in the UK is 17.5% so that doesn't seem that much. I know that we have low sales tax compared to some EU countries, so this is probably a compromise. I should think that not all the extra is tax, but we enjoy the public services that higher taxes buy us, that means putting up with paying more tax. Doesn't it?

silverone
May 13, 2004, 08:00 AM
Those who know Apple's traditional policies know that Apple did not actually announce nor confirm these prices.
From a business case though, if the EU can show that it can carry the same "buzz" for both iPod lines, than Apple will be more than willing to "comp" the taxes and surcharges just to make sure the EU's iTMS web traffic mirrors or betters that of the US. Look at Apple's latest financial statement and it'll confirm that Steve and Cupertino are more than willing to not make a dime on the iTMS, period.
I think you'll be pleasantly surprised once the WWDC roles around and Steve can announce both the service debut in the UK and the per song price. If you do the math, if costs Apple no more than $60 US to manufacture an iPod Mini. At the street price they're fetching - Steve and the boys are bathing in money.... Heads Up guys, Apple is bound to take the World by storm again thru iTMS! -silverone ;)

chabig
May 13, 2004, 08:03 AM
that's ************! 1.29 euros for a song is almost the same I pay for my music that I buy on CD!

You can buy a CD for €1.29? That's darn impressive! No wonder you think the ITMS will be such a bad deal. But I'll bet most people pay a lot more than that for a CD.

Vroem
May 13, 2004, 08:16 AM
2 years ago it would have been €1,99. :p

mkwilson68
May 13, 2004, 08:19 AM
We're used to getting screwed on pricing by Apple in Europe, but this would be about 85p per track - I was expecting 99p, so this would be fine - our CD albums here cost £12.99 - £16.99...

iPC
May 13, 2004, 08:19 AM
that's ************! 1.29 euros for a song is almost the same I pay for my music that I buy on CD! how the hell can there be so big differences in taxes and licensing fees? I mean, 1€ is like $1,20! So the music in europe would cost about $1,5! nice one. I really hope this isn't true.. else the itmseu will fail
Remember, most Americans are clueless about the exchange rate, and just assume that the US dollar is strong.

piterpan
May 13, 2004, 08:39 AM
And I thought 0,99€ would be expensive. For 1.25€ I WILL NOT BUY ONE SINGLE SONG OR ALBUM FROM ITUNES OR ANY ONLINE MUSIC STORE!

I'll buy records (CD, VINYL) and download .mp3 from P2P, that's what I'll keep doing.

cheers from ...somewhere in Europe!

pedro

macker
May 13, 2004, 08:43 AM
I wouldn't say that Americans get preferencial treatment. (we are the world's largest consumer, afterall)The reported prices are out of apple's control, and would be as high as they are reported to be because of YOUR economic system and its high taxes, not a world conspiracy to charge europeans more.

Em, The European Union is now the largest trading block on the planet. The old crap about the US being a larger market, therefore having better economies of scale doesn't add up anymore.

I'll bet that its 1.29 + Tax. When you buy photographs through iPhoto 4 in Europe, its the price of the print plus your local tax (21% here in Ireland, where I live).

jxyama
May 13, 2004, 08:49 AM
we should remember that Euro has fluctuated between $0.80 to current level of $1.25 or so in the last few years.

it would be a logistical and marketing nightmare for apple to constantly adjust the song prices to reflect the exchange rates. for hardware, since updates and new product introductions occur on the order of half years, they can adjust for currency exchange rates then. but the same cannot be said for iTMS prices.

take Euro at $1, add in 20% tax/VAT and give some wiggle room: €1.29 per song.

doesn't sound all that unreasonable to me...

i imagine it will be 150 yen per song in Japan.

bumfilter
May 13, 2004, 08:55 AM
I can buy the CD's I want for £8.99 here in the UK. Say there are 10 tracks per CD, thats 89p per track, rather similar to iTunes.

Of course if you buy the CD you benefit from an actual hard copy of the music, a nice booklet, higher quality and often extra features like videos.

Record labels and Apple must be raking it in, as they are charging roughly the same to download the albums as they do if I bought the cd. They obviously don't need to pay for CD printing etc for the download version, so why is it so expensive? Running the iTunes service can't be that expensive.

The only benefit iTunes gives, that I can see, is that you get the music quicker and you don't buy what you don't want.

However, at that price, I'd rather buy a CD. I don't understand how it has been so succesful for such a high price. I hope they reduce the price as I won't use it and I would really love to.

edesignuk
May 13, 2004, 09:15 AM
... Well that roughly translates to 85p in the UK.

Now if that includes VAT, that's not too bad, is it?
You just know we'll get ripped off even more than europe...as per usual :rolleyes:
I ain't paying £1 per song (as I imagine they'll try) when I know they only pay $0.99 in the States. :mad:

snahabed
May 13, 2004, 09:15 AM
It still shocks me to read "I would buy a song for 1.19, BUT 1.29 IS AN AFFRONT TO HUMANITY AND I HATE APPLE AND I WILL NEVER SUPPORT IT... SCREW YOU GUYS, I'M GOIN HOME!"

What makes you think that Apple can get the same prices in every nation on Earth? Licensing and taxation vary EVERYWHERE.

That said, the source might not even be right. I am sure Apple is trying its best to get the price at that magic "99" number, and that may be a big reason it is taking so long to get iTMS in Europe.

AlanAudio
May 13, 2004, 09:17 AM
Another way that Apple shafts Euro customers is this pan-European sales tax that they like to impose.

In the UK, sales tax is 17.5%, but Apple sometimes charges a 21% rate ( for services such as dot Mac ).

Who pockets the difference between what the government take and what Apple actually charge ? With that sort of mark up, there would be no need to claim that credit card transaction charges need to be additionally factored in as well - are we to believe that US credit cards don't charge for their service ?

Apple always protests that it's adopting a uniform sales tax rate across all of Europe, but in the US, sales tax varies from state to state and Apple can accomodate that with no problem. What's so difficult about applying the correct sales tax rate for an entire country then ?

MongoTheGeek
May 13, 2004, 09:17 AM
Em, The European Union is now the largest trading block on the planet. The old crap about the US being a larger market, therefore having better economies of scale doesn't add up anymore.

I'll bet that its 1.29 + Tax. When you buy photographs through iPhoto 4 in Europe, its the price of the print plus your local tax (21% here in Ireland, where I live).

One of the reasons for the higher price was taxes.

21% tax seems absurd here in the US. NYC I think is only 13% and that supports county, city, and most of the state government.

There are people who advocate doing away with all other taxes and replace them with a 15% national sales tax and then give the extra back to the people as a $5000 check per person.

corvus
May 13, 2004, 09:20 AM
Europe has value added taxes and high ones. I have been told the European tax rate is much higher than that in the US. For example +19% is pretty high for a value added tax. But that is not Apple's doing. I actually pay 8% sales tax, so my total cost for a song is 1.07 US.

The thing to remember, however, is that with iTMS you buy just the songs you want. Instead of paying $15 for 4 good songs and 11 bad ones at some CD store you can just pay ~4 to 5 for the ones you want. If the artist are smart they track the sales by song and see what people like, then adjust to it.

This is good for everyone.

wordmunger
May 13, 2004, 09:21 AM
Just FYI, indirect taxes (aka VAT) are 25% here in Sweden, and direct (income) taxes are 34%+

Take that! ;)
/ f

But don't you get national health insurance? My income taxes (national and state) are more than 34 percent--probably closer to 40. My sales tax is almost 10 percent, and I have to pay for health care out of my own pocket. Personally I'd take your tax structure, plus free health care, over ours.

chabig
May 13, 2004, 09:22 AM
For 1.25€ I WILL NOT BUY ONE SINGLE SONG OR ALBUM FROM ITUNES OR ANY ONLINE MUSIC STORE!

I'll buy records (CD, VINYL) and download .mp3 from P2P, that's what I'll keep doing.

Pedro,

That's a very emotional statement, but it's not a logical argument. Would you really pay €15.00 for a CD with one good song, when you could just buy the song legally for €1.29? That's the beauty of the online store. You don't have to buy an entire CD to get the songs you want.

Chris

ktrout
May 13, 2004, 09:25 AM
One of the reasons for the higher price was taxes.

21% tax seems absurd here in the US. NYC I think is only 13% and that supports county, city, and most of the state government.

There are people who advocate doing away with all other taxes and replace them with a 15% national sales tax and then give the extra back to the people as a $5000 check per person.

NYC combined sales tax is 8.25%.

What are average album prices in the EU?

jxyama
May 13, 2004, 09:34 AM
The only benefit iTunes gives, that I can see, is that you get the music quicker and you don't buy what you don't want.

However, at that price, I'd rather buy a CD. I don't understand how it has been so succesful for such a high price. I hope they reduce the price as I won't use it and I would really love to.

and apparently, those are big benefits: people feel that for $10, they'd rather have 10 songs they've heard and like rather than one album with two songs they've heard.

and it's quick, like you said. it's like buying candies at checkout lanes - you just get one because you want it. instant gratification. i suspect it's not the rational purchase that's driving iTMS - if you want one snickers bar and decides to get one at the checkout lane, you don't go back to the shelves to see if multipacks are cheaper, do you?

chabig
May 13, 2004, 09:35 AM
Record labels and Apple must be raking it in, as they are charging roughly the same to download the albums as they do if I bought the cd. They obviously don't need to pay for CD printing etc for the download version, so why is it so expensive? Running the iTunes service can't be that expensive.

Yes it can. Which do you think is more expensive, printing CD inserts or buying massive server farms, building network infrastructure, and paying for the bandwidth needed for distribution?

The only benefit iTunes gives, that I can see, is that you get the music quicker and you don't buy what you don't want.

I think those are exactly the benefits. And to me, they are worth the price. People pay for convenience and selection. Ask any retailer. People also pay for speedy service. Ask Fedex.

Chris

MCCFR
May 13, 2004, 09:41 AM
... Well that roughly translates to 85p in the UK.

Now if that includes VAT, that's not too bad, is it?

And if it doesn't - that's £1.00 (100/117.5=0.8510).

bluefido
May 13, 2004, 09:49 AM
So Apple defends the price of $0.99 as being appropriate for US customers, but considers that 50% more is fine for Europeans.

Presumably that isn't the same Apple which recently denied disadvantaging European customers.

It is as if Apple is violating peoples' civil rights if they set a price that is too high....the sense of entitlement always makes me cringe. The best way to express your dissatisfaction is to not purchase Apple products.

Yes, I do think $1.50 (is that the price in dollars?) is high, but people act as if it is the end of world. There are far more things to be angry about than a price of a song. And no, it is not discrimination. They set a price point that makes sense for Apple and its bottom line and not for North America.

Mynd Glider
May 13, 2004, 09:50 AM
I,m not surprised at the price as the EU ipods r quieter than the US ones .Mabee we r paying for LOUDER tracks

Applespider
May 13, 2004, 09:53 AM
But don't you get national health insurance? My income taxes (national and state) are more than 34 percent--probably closer to 40. My sales tax is almost 10 percent, and I have to pay for health care out of my own pocket. Personally I'd take your tax structure, plus free health care, over ours.

Yeah...tho there are so many demands on it that it doesn't work particularly well. There are suggestions that those who can afford to should be encouraged to take out medical insurance and leave the 'free' service to those who can't afford to.

If you earn over £34K in the UK (or thereabouts - fairly easy to do in London with the high cost of living), you pay 40% in income tax, plus tax for national insurance plus 17.5% VAT...

bluefido
May 13, 2004, 09:54 AM
Em, The European Union is now the largest trading block on the planet. The old crap about the US being a larger market, therefore having better economies of scale doesn't add up anymore.

I'll bet that its 1.29 + Tax. When you buy photographs through iPhoto 4 in Europe, its the price of the print plus your local tax (21% here in Ireland, where I live).

US is a larger market for Apple. European Union may be the largest trading block but that does not necessarily translate into being a more important market for companies. Also, the cost for Apple to do business is higher in Europe than it is in the US.

bluefido
May 13, 2004, 09:57 AM
Yeah...tho there are so many demands on it that it doesn't work particularly well. There are suggestions that those who can afford to should be encouraged to take out medical insurance and leave the 'free' service to those who can't afford to.

If you earn over £34K in the UK (or thereabouts - fairly easy to do in London with the high cost of living), you pay 40% in income tax, plus tax for national insurance plus 17.5% VAT...

It is odd that this somehow turns into a contest between the U.S. and Europe. This is a forum about a specific company that happens have its home in the U.S.

By the way, there are advantages in U.S. and Europe. Each has their own qualities that are admirable.

Chisholm
May 13, 2004, 09:59 AM
Yes it can. Which do you think is more expensive, printing CD inserts or buying massive server farms, building network infrastructure, and paying for the bandwidth needed for distribution?



I think those are exactly the benefits. And to me, they are worth the price. People pay for convenience and selection. Ask any retailer. People also pay for speedy service. Ask Fedex.

Chris

I just went to all the trouble of logging in to mention the same point regarding the costs of hardware. If we can assume that Apple uses its own hardware to run iTMS their costs would be astronomical for hardware upkeep. We have a number of XRAID boxes and the drives kill out on a regular basis.

takao
May 13, 2004, 09:59 AM
NYC combined sales tax is 8.25%.

What are average album prices in the EU?

in austria it's for most new albums 17-18 €..thats about 20-21 dollar (including 20 % VAT)
sure i can get some new albums for 15-16 sometimes but that are special deals

for old cds or classics you have to pay 11-12...

3 years ago it was about 2 euros less...because of that prices i don't get music in the stores...

at 1,29 € a 12 track cd (which is more logical than a short 10 track cd) will cost me 15,48 euro but i have no colored inlay,case and cd...
so in the end it is the same amount of money..

but i doubt a price at 1,29..i would rather say 1,39 because prices are already going up to 19 € for a new cd...

_when_ i buy a cd i buy those cheap 8-10 euro cds
12 euro is the absolute maximum for me (if i buy 4 cds a year)

Victoriatus
May 13, 2004, 09:59 AM
It still shocks me to read "I would buy a song for 1.19, BUT 1.29 IS AN AFFRONT TO HUMANITY AND I HATE APPLE AND I WILL NEVER SUPPORT IT... SCREW YOU GUYS, I'M GOIN HOME!"

What makes you think that Apple can get the same prices in every nation on Earth? Licensing and taxation vary EVERYWHERE.

That said, the source might not even be right. I am sure Apple is trying its best to get the price at that magic "99" number, and that may be a big reason it is taking so long to get iTMS in Europe.

I have a bad feeling that this might have something to do with record labels wanting to push prices up. Remember Apple denying such news by saying they have a multi-year contract with the labels, and the 99’ price is fixed in the contract? Apple doesn't have multi-year low price contracts with European labels and ditributors yet, so they might be able to push the price higher if they wanted.

How about that?

bumfilter
May 13, 2004, 10:02 AM
I guess it depends on how you buy music. I prefer buying CD's from artists I like, then I don't mind having a whole album's worth. I don't usually need one or specific track(s), so I guess buying CD's suits me better. So in the case of your candy bar, if you plan on eating 10 bars it makes sense to buy a multipack rather than 10 seperatley.

While I can understand how buying massive server farms can be expensive, this is Apple were talking about. I'm sure they can afford to give themselves a nice discount on a couple of Xserve's. Even so, the initial investment would pay for itself eventually, then from then on all they need to pay for is staff and upkeep, which must be far cheaper than mass-producing CD's.

I love the idea of iTunes and I would love to buy from it but I still think the price is too much for what you actually get, especially when album prices are so similar. All it takes is one day for the CD to get here, and I can wait that long and as I said, I usually buy just albums, so I guess CD's suit me best. :p

ITR 81
May 13, 2004, 10:04 AM
Not a bad price considering it's including taxes and a huge license fee from the Euro record companies.

I use to buy CD's and carparts all the time from the UK and Germany and most of the time the VAT(Value Added Tax) is included with the purchase unless they say it's not.

Most CD's I bought from Germany cost me around $25-30 US back in the late 90's. I can imagine those prices are even higher now with the current exchange rate.

CD's I got from Japan cost me around $22-25 for one album.
Sometimes they include their 5% tax and sometimes they don't.(depends on where I buy)
Most imported Japanese Albums I've found sell here for around $28-30+a pop.

(ALL prices included taxes but no custom charges or shipping charges I had to pay.)

If I can buy my music through these International iTMS's I will..because it's just cheaper for me.

Stike
May 13, 2004, 10:21 AM
Alright people, time to shift one gear back.
There ARE currently online music providers available in Europe, and Germany, where I am from.
Most of those (rare) services use "Phonoline" a service cooperating with Deutsche Telekom AG. Lets do a quick comparison of services I stumbled across while SEARCHING for them (right, they are not advertising that much).

1. Popfile.de - Codec: WMA - Price: from 0.99 € (seldomly) to 1.49 € (regular) Selection: about 100.000 songs (!)
Comments: The client application "MyPlaylist" (iTunes ripoff) exists even for Mac OS X, but is hideously designed and a nightmare in user interaction. iTunes wins...

*Using OD2 music service:*
2. Tiscali Music Club - Windows only. Website not accessible, just like buy.com
3. Karstadt.de - the same
4. kontor.cc - the same
5. mtv.de - the same
6. MediaMarkt Music - Preview works, each title is 0.99 € but order is for Windows only

7. eventim-music.de - using Phonoline (again) - WMA - MyPlaylist jukebox - 0.99 € EACH!

Conclusion: At least 2 services here, (though only 1 works on Mac) provide a price of 0.99 € per track. If iTunes has to compete, they should offer the same price.

Bad Beaver
May 13, 2004, 10:26 AM
Rumoured evolution of the iPod combining music, video and phone to be shown in Paris.



Isn't this more interesting? An Apple branded smartphone would be *great* (the given "PDA" functions of the iPod suggest a smartphone) as frankly, syncing a P800 with iSync is *the horror*. I wonder about the battery though, it would have to be much stronger than the current one.

I'd bet such an iPodphone would enable you to buy songs from the iTMS on the go, and I wouldn't be surprised if it did not look much different than an iPodmini.

MCCFR
May 13, 2004, 10:31 AM
Another way that Apple shafts Euro customers is this pan-European sales tax that they like to impose.

In the UK, sales tax is 17.5%, but Apple sometimes charges a 21% rate ( for services such as dot Mac ).

Who pockets the difference between what the government take and what Apple actually charge ? With that sort of mark up, there would be no need to claim that credit card transaction charges need to be additionally factored in as well - are we to believe that US credit cards don't charge for their service ?

Apple always protests that it's adopting a uniform sales tax rate across all of Europe, but in the US, sales tax varies from state to state and Apple can accomodate that with no problem. What's so difficult about applying the correct sales tax rate for an entire country then ?

But sales tax is not the same as VAT.

Accounting for VAT for cross-border transactions of the non-tangible type represented by .mac or iTMS would be a nightmare unless you managed it through a single EU nation-state. Where is the transaction executed? UK? That's 17.5% VAT to the consumer, but you also have to reclaim the 17.5% from the VAT you paid to the record company. But what if you're a British expat with a British credit card, living in Italy? Who gets the money? What's the relevant rate of tax?

Tangibles are easier. You're buying an item that your Apple end-market bought for a known price from someone else (normally Apple Europe, who in turn purchased it from Apple US). They know where they're delivering and the rate of VAT is consistent across the board.

whiskeybravo
May 13, 2004, 10:43 AM
But don't you get national health insurance? My income taxes (national and state) are more than 34 percent--probably closer to 40. My sales tax is almost 10 percent, and I have to pay for health care out of my own pocket. Personally I'd take your tax structure, plus free health care, over ours.

Well, your nominal rate may be close to 40% if you are quite wealthy (seems a bit unlikely for a student, but what do I know, you could easily have a large income producing activity), but if you pay anywhere near that you are a lonely fool who needs an accountant. I'm in the second highest tax bracket, and my actual federal taxation rate last year was under 15% and still under 25% including Social Security. My state income taxes are less than 5% which is typical.

In any event, if you desire a social utopia where the government takes most of your money and then decides what "services" you will be given, there are lots and lots of places that still think that works. Please go to one of them so that I will not have to support you if I should ever be so unlucky that you get your way with our government :) Denmark is very nice in the summer and the girls are quite pretty :D

Personally, I'll choose to control where my own money goes, thank you.

whooleytoo
May 13, 2004, 10:45 AM
Conclusion: At least 2 services here, (though only 1 works on Mac) provide a price of 0.99 € per track. If iTunes has to compete, they should offer the same price.

And bear in mind, when iTMS launched in the US, it blew all the previous online music selling models out of the water. In Europe, it's going to struggle to equal the competition at that price.

After all the furore in other threads about Apple (supposedly) being forced to sell songs for $1.25 in the US, now it's $1.50 here!

onemoof
May 13, 2004, 11:01 AM
I don't know about anybody else, but I don't get charged any tax on the iTMS store, but Minnesota tax is 6.5% so who knows.

In America there's no need to charge tax if the buyer is in a different state. Some companies do however, and it's always the buyer's location that determines the tax rate they're charged.

Why do they call it value added tax anyway? I don't see any additional value added in paying tax, it would be more valuable for me to buy products tax free.

CmdrLaForge
May 13, 2004, 11:02 AM
I personally doubt that it will be that successful at that price. Not as successful as in the states. If you look on the current exchange rate the price should be .89 cents instead of 1.29Euro.

But I doubted that the iPod mini will be a success as well...so don't listen to me.

The Red Wolf
May 13, 2004, 11:05 AM
[QUOTE=Windowlicker]that's ************! 1.29 euros for a song is almost the same I pay for my music that I buy on CD! how the hell can there be so big differences in taxes and licensing fees?...

VAT or Value Added Tax. That is what we're looking at. It's not across the board in Europe but it is in some countries. As for the Euro... There is no guarantee anywhere that says the Euro will not dive against the dollar at any point. If the exchange rate were 1.50 Euro to the dollar you wouldn't be complaining about this, you'd be complaining that the States pays too much for the iTMS .99 cents is still lower than a CD.

Does it bother anyone that a PowerBook G4 17" costs 3,023.79 Pound in Ireland and 1949.00 Pounds in the UK? The exchange rate does not support the drastic different between the Irish Pound and the English Sterling. Yet the PowerBook is still extremely successful. You cannot base the success of a product on it's price in other countries.

JFreak
May 13, 2004, 11:17 AM
the problem is, that even cd:s are overpriced. it costs an euro to make and distribute the cd to the local music store shelf, so while the new cd:s retail at over 20 euros (in finland), the profit is huge; of course, there are many instances eating from the cake and nobody really knows how much the label benefits from it.

IF...

the itms europe song price will be an euro (making an album cost ten euros) that would give the label 66 cents pure profit per track (or 6.60 euros per album), and they know we know that. and when we realize that we're okay with the fact that label is satisfied with getting 6.60 euros profit per cd, we will begin demanding that the regular cd price should be ten euros tops, including new hit albums.

that's what they have begun to fear.

JFreak
May 13, 2004, 11:22 AM
I personally doubt that it will be that successful at that price. Not as successful as in the states. If you look on the current exchange rate the price should be .89 cents instead of 1.29Euro.

i'd be happy if the price was 1eur per song and 10eur per album.

(i'd be willing to buy many hit singles from the hit albums that have one or two good songs and ten(ish) filler songs.)

takao
May 13, 2004, 11:36 AM
i jsut looked at the austrian store from coca cola
prices between
0,83 € and 1,89 €

but windows only

whooleytoo
May 13, 2004, 11:36 AM
Does it bother anyone that a PowerBook G4 17" costs 3,023.79 Pound in Ireland and 1949.00 Pounds in the UK? The exchange rate does not support the drastic different between the Irish Pound and the English Sterling. Yet the PowerBook is still extremely successful. You cannot base the success of a product on it's price in other countries.

In that case, the difference in base price (at current exchange rates) is only 20 euros. The majority of the price difference is due to a higher VAT rate in Ireland.

Colonel Panik
May 13, 2004, 11:47 AM
As for the Euro... There is no guarantee anywhere that says the Euro will not dive against the dollar at any point. If the exchange rate were 1.50 Euro to the dollar you wouldn't be complaining about this, you'd be complaining that the States pays too much for the iTMS .99 cents is still lower than a CD.
The Euro is more likely to stay high against the dollar. It had a very bad start, that's all.

Does it bother anyone that a PowerBook G4 17" costs 3,023.79 Pound in Ireland and 1949.00 Pounds in the UK? The exchange rate does not support the drastic different between the Irish Pound and the English Sterling. Yet the PowerBook is still extremely successful. You cannot base the success of a product on it's price in other countries.
Actually Ireland uses the Euro. And the VAT rate is higher than the UK, so that explains the price difference. £1949 = €2,905.69
When you take away the 17.5% VAT in the UK you get £1658.72...
When you take away the 21% VAT in Ireland you get €2498.34...
When you convert the £ to the € (and this fluctuates all the time), it's no so bad... €2498.34 = £1,675.49.

GeeYouEye
May 13, 2004, 11:53 AM
I don't know about anybody else, but I don't get charged any tax on the iTMS store, but Minnesota tax is 6.5% so who knows.

In America there's no need to charge tax if the buyer is in a different state. Some companies do however, and it's always the buyer's location that determines the tax rate they're charged.

Why do they call it value added tax anyway? I don't see any additional value added in paying tax, it would be more valuable for me to buy products tax free.

It's funny, I don't either, and I'm in California, barely 40 miles from Cupertino.

masterthespian
May 13, 2004, 11:55 AM
We might not have the itms but our Apple prices are about 5-10% less with exchange before tax. This is comparing it to the US.


some examples

12" pbook 1599.00 US exchange to CAN is 2231.38 on Apple.ca website it's 2099.00 CAN


or 15g ipod is 299 US exhange to CAN is 417.16 on Apple.ca website it's 399 CAN

So come on over eh! :rolleyes:

The Red Wolf
May 13, 2004, 12:09 PM
In that case, the difference in base price (at current exchange rates) is only 20 euros. The majority of the price difference is due to a higher VAT rate in Ireland.

Exactly. One can't argue about the price of tea in China. I mean iTMS songs in China em, Ireland, em, the UK, I mean the EU vs. America. It's all subjective based on taxation in the country.

Stike
May 13, 2004, 12:25 PM
Couldn΄t it simply be that the prices will VARY in the EU from country to country?
iTMS has a country check, so why shouldn΄t there be different prices, too?

Hattig
May 13, 2004, 12:28 PM
Another way that Apple shafts Euro customers is this pan-European sales tax that they like to impose.

In the UK, sales tax is 17.5%, but Apple sometimes charges a 21% rate ( for services such as dot Mac ).

Well, if Apple set up a company in a EU member state with 21% sales tax that you get .Mac from, then that will be why you are getting charged 21%.

If you are getting it from the States, then they must by law charge 17.5% UK VAT rate.

The law is getting changed soon I believe in Europe so that you charge VAT at the purchaser's country rate, not your own. So it should be 17.5% for Brits regardless of country. This, of course, is for online / shipped orders / services, not physical purchases if you visit the country!

To US people, in the EU, all prices must be shown inclusive of tax. I.e., final price shown up front. This is why it is a shock to most of us to go to the states, get the correct money ready and then get charged more!

Hattig
May 13, 2004, 12:37 PM
I use to buy CD's and carparts all the time from the UK and Germany and most of the time the VAT(Value Added Tax) is included with the purchase unless they say it's not.
If you are from outside the E.U. then you can claim back the VAT from the relevant government. Better still - don't get charged when you order. I was told that we don't have to charge VAT for non E.U. orders.

wordmunger
May 13, 2004, 01:17 PM
Well, your nominal rate may be close to 40% if you are quite wealthy (seems a bit unlikely for a student, but what do I know, you could easily have a large income producing activity), but if you pay anywhere near that you are a lonely fool who needs an accountant. I'm in the second highest tax bracket, and my actual federal taxation rate last year was under 15% and still under 25% including Social Security. My state income taxes are less than 5% which is typical.
I was talking about marginal tax rates, not "actual" rates, which is I assume what our Swedish friend was talking about as well. I don't know what America you're talking about, but in this America, the highest marginal tax rate is 38 percent, and most people pay at least some of their taxes at the 25 percent bracket. It only takes an income of $68,000 to hit the 28 percent bracket, for a total rate including state taxes of 36 percent (Here in North Carolina the top bracket is 8.25 percent), not counting social security and medicare.
In any event, if you desire a social utopia where the government takes most of your money and then decides what "services" you will be given, there are lots and lots of places that still think that works. Please go to one of them so that I will not have to support you if I should ever be so unlucky that you get your way with our government :) Denmark is very nice in the summer and the girls are quite pretty :D

Personally, I'll choose to control where my own money goes, thank you.
This is pretty much the same point I was making. If you're going to complain about the price in Finland, or whatever, and the price difference is primarily due to higher tax rates, then it's not about some type of Apple-sanctioned discrimination against Finns, its that Finns have chosen to support more government services through higher tax rates.

Now it does turn out that I'm in favor of national health care, for a variety of reasons, but in my post I was only suggesting that personally I'd accept the Finns' situation, with its "higher" prices, over my personal situation in America.

Floop
May 13, 2004, 01:28 PM
At the best exchange rates you will find, a consumer will not get better than

1.29 EUR = 1.52407 USD

So this turns out to be more than 50% more expensive than in the US?

You have to be kidding me. I love Apple, but there is no way I am paying that.


Floop

Doctor Q
May 13, 2004, 01:42 PM
The best clue that Apple isn't intentionally overcharging in Europe is that they don't appear to be running iTMS as a profit center. From what I've read, I think Apple's goal is to sell iPods, that iTMS is their way of doing that, and that they wouldn't choose to cut into iPod sales by padding iTMS prices.

ALoLA
May 13, 2004, 01:43 PM
Based on what I've read here, and correct me if I'm wrong, the increase in price is due to taxes (VAT, etc.) and the licensing fees/percentage. So why are some people putting the blame on Apple? :confused: I wouldn't be surprised if their equivalent of the RIAA is trying to milk the iTMS-Europe for what they can. But I seriously doubt Apple's margins are any greater than what they have here in the States. I'm sure Apple would like to have the prices as low as possible, too. :)

wordmunger
May 13, 2004, 02:00 PM
At the best exchange rates you will find, a consumer will not get better than

1.29 EUR = 1.52407 USD

So this turns out to be more than 50% more expensive than in the US?

You have to be kidding me. I love Apple, but there is no way I am paying that.


Floop
But in Europe the VAT is added before; in America sales tax is added after. So most Americans pay not $.99 but $1.07.

The best comparison is to strip off the 25 percent VAT: You get a price of about

1.03 EUR=1.22 USD

So there is a price difference US--Europe, even before taxes are considered, but closer to 23 percent, not 52 percent.

Omen88
May 13, 2004, 02:09 PM
Oh that's just TYPICAL!!!

skunk
May 13, 2004, 02:37 PM
Based on what I've read here, and correct me if I'm wrong, the increase in price is due to taxes (VAT, etc.) and the licensing fees/percentage. So why are some people putting the blame on Apple? :confused: I wouldn't be surprised if their equivalent of the RIAA is trying to milk the iTMS-Europe for what they can. But I seriously doubt Apple's margins are any greater than what they have here in the States. I'm sure Apple would like to have the prices as low as possible, too. :)
I agree. All this whining is ridiculous: nobody has done even a rudimentary calculation here. If Apple are having to pay €0.80 per track in fees, as opposed to 66c in the States, and you add the same 50% mark-up, you get €1.20. Add 20% for VAT and a margin for currency fluctuation, and what do you get?
€1.50 or thereabouts. It sounds like Apple are really cutting their margins to the bone on this.

kettle
May 13, 2004, 02:41 PM
We're used to getting screwed on pricing by Apple in Europe, but this would be about 85p per track - I was expecting 99p, so this would be fine - our CD albums here cost £12.99 - £16.99...

HAA HA!

You can get new release CDs from Play.com sent quicker than it would take to download 60 minutes of AAC over 56k, and you'd only have to pay around £8.25 for the privilege (cheaper again for less recent music) that's including airmail post and packing.

Why would I bother to use iTunes unless I can pay less for less quality?

Also, if it's priced for a euro only transaction, I won't be buying even if the price is right.

billyboy
May 13, 2004, 02:42 PM
At the best exchange rates you will find, a consumer will not get better than

1.29 EUR = 1.52407 USD

So this turns out to be more than 50% more expensive than in the US?

You have to be kidding me. I love Apple, but there is no way I am paying that.


Floop

So you wont buy a car because it can be had for less in the States, or a pair of Levis, or a can of beer? :confused:

85p a track sounds like a great price to me as a Brit. As someone said, the prices quoted would be all inclusive of tax, which sort of takes the wind out of the sails of direct comparisons with 99 cents a track in the US.

kettle
May 13, 2004, 02:51 PM
Oh that's just TYPICAL!!!


I was imagining more along the lines of...

"Isn't that just Rudy TYP-I-CAL!!!"

:p

NOV
May 13, 2004, 02:52 PM
BTW. the credit card companies involved (transaction clearing) want their piece of the cake too.
I don't think they are really happy with this sort of transactions due to low amount of money per transaction.

I know they will rate 3 - 5% of the order total, but I can not imagine this is the case with iTunes transactions.

daSilVetZ
May 13, 2004, 03:28 PM
The 19.6% tax is specific to France as that is their TVA (Taxe a Valeur Approchιe) so in other words it probably won't be the same price over Europe but rather country specific if the report is true.

LoloFromParis
May 13, 2004, 04:14 PM
The 19.6% tax is specific to France as that is their TVA (Taxe a Valeur Approchιe) so in other words it probably won't be the same price over Europe but rather country specific if the report is true.

TVA means Taxe sur la Valeur Ajoutιe !

It's our VAT :)

I think the price will be the same in Europe, Apple will make an average rate for everyone.

An audio CD here in France costs about 17/20 euros for a new release, and it can be more expensive when it becomes older (22/25 euros). BUT, there are a lot of web sites (discount) where we can buy new CD audio for about 13/15 euros. There are also a lot of mid price CDs.

At 1.29 euros, it's a good price for a single song because one title CD audio cost about 6 euros here in France.

nagromme
May 13, 2004, 04:51 PM
Based on what I've read here, and correct me if I'm wrong, the increase in price is due to taxes (VAT, etc.) and the licensing fees/percentage. So why are some people putting the blame on Apple?

Because typing is easier than thinking ;)

asif3
May 13, 2004, 04:58 PM
We're used to getting screwed on pricing by Apple in Europe, but this would be about 85p per track - I was expecting 99p, so this would be fine - our CD albums here cost £12.99 - £16.99...


I agree - I was expecting 99p - so 85p is fine by me.

We're in the UK, and therefore we have to pay a premium. I would have thought everybody would have got used to this by now?...

takao
May 13, 2004, 05:08 PM
1,29 € hmm
-20% VAT= 1,075 €
thats with current exchange rates: 1,26 $

if an american has to pay perhaps 5 percent sales tax average
were down to 20 us-cent difference...
10 cent regionalisation
10 cent greedy music industry..

well that doesn't look _that_ bad...it could be worse... but lets wait for official prices ..perhaps they are higher ...

thajeztah
May 13, 2004, 06:21 PM
NYC combined sales tax is 8.25%.

What are average album prices in the EU?

In the Netherlands, prices are pretty high. The largest record store charges you €21.99 for popular cd's! That's $26.23!

AlanAudio
May 13, 2004, 06:50 PM
The best clue that Apple isn't intentionally overcharging in Europe is that they don't appear to be running iTMS as a profit center. From what I've read, I think Apple's goal is to sell iPods, that iTMS is their way of doing that, and that they wouldn't choose to cut into iPod sales by padding iTMS prices.

Apple aren't saying anything about European iTMS prices, so it's all speculation ( with some very dubious calculations ), but Apple have already announced a considerably higher price for iPod mini when it appears in Europe.

So the line about not intentionally overcharging does seem to collapse.

Apple constantly claim that th business model for iTMS is to power sales of iPods, but charging a price per track for iTMS which exceeds that of buying the physical CD by mail order, isn't going to do much to boost the sales of inflated price iPods.

I dare say they'll make money, but they won't be making too many friends.

chabig
May 13, 2004, 07:25 PM
Apple constantly claim that th business model for iTMS is to power sales of iPods, but charging a price per track for iTMS which exceeds that of buying the physical CD by mail order, isn't going to do much to boost the sales of inflated price iPods.

Yeah, but who compares price per track when buying a CD? I think most people buy music based on price, not price per track.

singletrack
May 13, 2004, 07:33 PM
HAA HA!

You can get new release CDs from Play.com sent quicker than it would take to download 60 minutes of AAC over 56k, and you'd only have to pay around £8.25 for the privilege (cheaper again for less recent music) that's including airmail post and packing.

Why would I bother to use iTunes unless I can pay less for less quality?

Also, if it's priced for a euro only transaction, I won't be buying even if the price is right.

And you can, although it's illegal strictly, rip the CD into iTunes and then sell the CD for 4-5 quid. Then again ripping the CD and keeping it on a shelf is illegal in the UK also.

I still don't see how online music can be worthwhile until it's cheaper than £5 an album or say 50p per track. It's lower quality and you don't get to build that impressive shelf stack.

Doctor Q
May 13, 2004, 08:28 PM
Apple have already announced a considerably higher price for iPod mini when it appears in Europe. So the line about not intentionally overcharging does seem to collapse.That doesn't quite disprove my speculation that Apple is not trying to make more profit on iTMS in Europe than on iTMS in the U.S. Charging more for iPods in Europe than iPods in the U.S. could have two reasons: highest costs in Europe, or the expectation that they can make more money because the market will bear a higher iPod price. I'd believe both, even if iTMS Europe is not a cash cow.

guifa
May 13, 2004, 08:49 PM
I don't know about anybody else, but I don't get charged any tax on the iTMS store, but Minnesota tax is 6.5% so who knows.
I get charged 7.5% because my card is from Auburn, AL. Which also means it's far better for me to buy songs in pairs then with an odd one out, because they always round up :(

Why do they call it value added tax anyway? I don't see any additional value added in paying tax, it would be more valuable for me to buy products tax free.
It's a tax added to the value (price) of a product. We have VAT in the US, although you probably don't know about it. For example, cell phones in Alabama have a VAT, although I forget the exact rate. Gasoline everywhere has a VAT: it's higher in California, hence they pay $2+/gal. whilst over in Georgia they still pay $1.70-/gal. Tobacco and alcohol products also have them. Say that the going rate for a cart of cigarettes is $1.00 (I have no idea the pricing, I don't smoke, as I'm only 18, and too young to buy tobacco products, not that I would if I could). The state levies a 50% tax on the cigarettes. It's done in a VAT style, so when you go to the store, you actually see it priced as $1.50, then when you go to buy it, you pay $1.64 (9% sales tax in Tuscaloosa, AL, where I'm at now). Sales tax is added at purchasing, rather than before purchasing like VAT.

Krizoitz
May 13, 2004, 08:51 PM
GET A GRIP

Honestly all this b****ing and moaning is absolutely ridiculous. Do people choose not to read, or do they just enjoy looking ignorant.

First, this is a RUMOR. We have no idea what the real price is going to be.
Second, even if it is the real price it includes taxes and license fees. These are costs that the record labels have negotiated with the various governments. Apple can't change them.

I really think that way too many people on this forum will NEVER be happy.

Apple could introduce a quad processor G6 power mac tommorow for $50 and start selling iTunes songs for a DIME and people would still complain about something. Seriously.

1. Apple HAS to pay the record companies
2. Apple HAS to pay the government
3. Apple HAS to pay for the hardware
4. Apple HAS to pay for the internet connections
5. Apple HAS to pay employees to run the service

It costs money to do buisness. In addition they'd like to earn a little profit so they can continue to pay for future development and expand their markets.

It amazes me the ridiculous attitude that people have about Apple.

OMG they are charging me $50 for a new version of iLife that I was never promised for free and don't HAVE to have.

OMG they are charging $120 for an OS upgrade that I don't have to install and my computer will still run just fine.

OMG they are charging me $0.99 for a song that I don't HAVE to have.

You think money just grows on trees? Apple isn't a charity, they have to PAY for things to. So they SELL things at pretty dang reasonable prices too. I'm convinced some of you expect things for free. And people wonder why every thinks American's are lazy.

Doctor Q
May 13, 2004, 10:20 PM
Say that the going rate for a cart of cigarettes is $1.00 ... The state levies a 50% tax on the cigarettes. It's done in a VAT style, so when you go to the store, you actually see it priced as $1.50, then when you go to buy it, you pay $1.64 (9% sales tax in Tuscaloosa, AL, where I'm at now). Sales tax is added at purchasing, rather than before purchasing like VAT.If your example is right, you pay sales tax on the VAT, i.e., tax on your tax. Otherwise the final price would be $1.59. Is that true? Would you really pay $1 x (1+50%) x (1+9%) = $1.64 instead of $1 x 1+(50%+9%) = $1.59?

Hattig
May 13, 2004, 10:34 PM
1. Apple HAS to pay the record companies
2. Apple HAS to pay the government
3. Apple HAS to pay for the hardware
4. Apple HAS to pay for the internet connections
5. Apple HAS to pay employees to run the service


1. Why are the record companies charging .80€ per track over here, and .66$ in the US? That is just wrong, an example of regional price fixing which the EU is starting to get interested in.

2. Yeah, if you had read the thread you would have seen that most posts took this into account. Lets do it for the UK. .99$ == 56p -> 66p inc. VAT.
1.29 EUR = 0.865691 GBP -- that is an extra 20p (35 cents) per track.

3,4. I wouldn't be surprised if it will use the same download sites as for the current iTunes. Anyway, they had to do it for the US iTunes, so there is no point here

5. And the same in the US.

OTOH, 87p for a music track isn't that bad. A good price I think would be 75p or 79p. Great for when I want to get a song I've heard but don't want to get the whole CD. It means I could reliably get the newest songs for a party for a reasonable price without having to buy 20 singles for £60+.

guifa
May 13, 2004, 11:03 PM
If your example is right, you pay sales tax on the VAT, i.e., tax on your tax. Otherwise the final price would be $1.59. Is that true? Would you really pay $1 x (1+50%) x (1+9%) = $1.64 instead of $1 x 1+(50%+9%) = $1.59?

Eh, with cigarettes I dunno. I know with gas, all taxes are included in the price given, sales as well. My guess that, yes, the ultimate price should en up at $1.59 thus the posted price would be ~ $1.45, so you pay $1.59. But knowing our ********* up economics system here in Alabama, you probably do get taxed on your taxes (we tax familes of four on their income if they earn less than $12k a year. If it's not property, and we can tax it, we tax it as much as we can. So why not tax tax? It makes Alabama-sense)

Krizoitz
May 13, 2004, 11:17 PM
1. Why are the record companies charging .80€ per track over here, and .66$ in the US? That is just wrong, an example of regional price fixing which the EU is starting to get interested in.
Because they are competing with domestic music? These companies have to make deals with local distrubution companies and local record labels so that adds overhead. There are other buisness related costs as well I'm sure. Simply put it costs money to sell things, ANYTHING over seas because of laws to protect domestic companies. Digital distribution does lower costs, but it doesn't eliminate them yet.


3,4. I wouldn't be surprised if it will use the same download sites as for the current iTunes. Anyway, they had to do it for the US iTunes, so there is no point here

They can't just use the same sites for a couple of reasons. First distance slows down downloads. Second you have a whole bunch more people, i mean millions of more potential users, the servers need to be expanded to handle that. So it makes the most sense economically to put those new servers in Europe, which means hiring local people.

groovebuster
May 14, 2004, 01:00 AM
Most CD's I bought from Germany cost me around $25-30 US back in the late 90's. I can imagine those prices are even higher now with the current exchange rate.

Planet Earth to ITR 81... maybe CDs are expensive here, but not that expensive. In the late 90's the dollar exchange rate was comparable to now and even with sales tax included you would never get a price like that.

Stop inventing numbers! The prices for CDs in the late 90's in Germany were between 25-32 DM(!!!!!) and not US$! Including sales tax! Double CDs were around 35-45 DM.

1998 the exchange rate was 1$ = 1.54DM. So a normal CD would have cost you around 21$ at max. 30$ would have been more than 45DM. I never ever saw a CD that expenisve! Not back then and also not now!

And by the way... you can claim back the sales tax, if you are buying from outside the EU.

Have a nice day.

groovebuster

Windowlicker
May 14, 2004, 01:28 AM
I know I'm not buying 'em for €1.29 a piece, I would accept €0.99, though
/ filipp

yeah well I was expecting €0.99.. that would've been fair enough and actually a decent price. I think 10€ for an album is a fair price, but 15€ starts to be too much. I really really wish this 1.29 didn't come reality… there's some nice albums I'd like..

Krizoitz
May 14, 2004, 01:52 AM
yeah well I was expecting €0.99.. that would've been fair enough and actually a decent price. I think 10€ for an album is a fair price, but 15€ starts to be too much. I really really wish this 1.29 didn't come reality… there's some nice albums I'd like..

Ok, so Apple has to pay the record labels €0.80 leaving them €0.19 to pay for costs and any profit. RIGHT.

JFreak
May 14, 2004, 02:25 AM
Ok, so Apple has to pay the record labels €0.80 leaving them €0.19 to pay for costs and any profit. RIGHT.

the problem is exactly the 0.80 eur that apple supposedly has to pay for record companies. those greedy pigs! they are fine with 0.66usd they are having right now, so i can't see why they wouldn't be happy with the same amount of money in europe. i mean, currently 0.66usd equals 0.55eur.

what's the reason behind this supposed 0.25eur price increase the record labels are supposedly trying to get? it's effectively +45% before tax, so if the final official price becomes too high, this is the reason.

(if everyone played fair, the itms europe price would be calculated like this: take 0.99usd price and convert it into 0.825eur, then add an average vat of 20% and charge 0.99eur per song. that price would make me happy.)

groovebuster
May 14, 2004, 02:32 AM
Because they are competing with domestic music? These companies have to make deals with local distrubution companies and local record labels so that adds overhead. There are other buisness related costs as well I'm sure. Simply put it costs money to sell things, ANYTHING over seas because of laws to protect domestic companies. Digital distribution does lower costs, but it doesn't eliminate them yet.

So you are an expert for the european music business? ;) Last time I checked, the major labels were global players, even though they have their local branches. And you forget that there are already music services on the internet in europe, selling songs for 0.99€. The problem is, that most of the services are Windows only. With a price of 1.29€ the iTMS won't be able to compete, no matter if VAT is included or not. That's all what people are saying. They won't buy, because in most cases it would be too expensive! Period. I wonder why you are making it a personal crusade to defend Apple? If they can't sell songs for 99 cents, they will fail...

And by the way... it wouldn't be the first time that Apple charges way more for their products, just because they are sold in Europe. Tell me one time in history, when the exchange rate was in benefit for the european customers? Apple always charges at least 15% more for their products over here, without sales tax. No matter how the exchange rate was. People are very suspicious these days about the pricing of Apple.

They can't just use the same sites for a couple of reasons. First distance slows down downloads. Second you have a whole bunch more people, i mean millions of more potential users, the servers need to be expanded to handle that. So it makes the most sense economically to put those new servers in Europe, which means hiring local people.

1) Distance doesn't really matter anymore these days. You don't really think that a couple of million downloads per month would slow down the transatlantic backbones we have these days? Especially with the overcapacity we are facing?

2) One big server farm makes way more sense than having many little ones regarding the support and service costs. All big companies are hosting their download servers at one place. I stand corrected, if Apple chooses to decentralize the distribution of the iTMS songs. But especially from a pure economical point of view it wouldn't make sense. Could be that the servers have to be located in Europe when they want to make business here.

3) Why renting servers in Europe and hiring local staff would be necesseraly more expensive than in the US? Should cost the same overall, so what was your point?

Ok, so Apple has to pay the record labels €0.80 leaving them €0.19 to pay for costs and any profit. RIGHT.

Why so aggressive? Nobody said that. But if they are charging 1.29€ per song, the iTMS in Europe will fail. It doesn't matter in the end if it is Apple's fault or not. Maybe the MI even wants Apple to fail, because they are afraid of Apple becoming THE major player for worldwide music distribution, telling the MI in the end what they can charge for a song and not the other way around, just like it happens to many food manufacturers when negotiating with the big chains like Wal-Mart.

I think Apple better should admit defeat in this case instead of screwing around with their customers...

groovebuster

SemperMac
May 14, 2004, 02:40 AM
So many of you in this thread have had comments on Europan taxes (VAT = Value Added Tax) and so many of you have been wrong about levels in different countries... ;)

Here your find the correct details (please click the flag for the country of your interest): http://www.nikosax.com/sw355.asp

JFreak
May 14, 2004, 02:52 AM
apple most likely will not need new servers. think about the time difference - when the americans buy the most, the europeans are sleeping, and when the europeans buy the most, the americans are sleeping. it's just more efficient for apple server farm to have constant download rate instead of a huge peak for 12 hours and then another 12 hours of idlling.

if they need to boost their server farm a little, it's no biggie. most probably they wouldn't have to do anything for their hardware.

dekator
May 14, 2004, 04:41 AM
If your example is right, you pay sales tax on the VAT, i.e., tax on your tax. Otherwise the final price would be $1.59. Is that true? Would you really pay $1 x (1+50%) x (1+9%) = $1.64 instead of $1 x 1+(50%+9%) = $1.59?

With some goods, e.g. tobacco and oil it's true (at least in Germany) you pay a special tax + VAT.

As for the iTMS pricing: We'll have to see how that works out. One thing is sure, I'd never buy a song that costs me more than in the US. I'm tired of being ripped off. All this talk about 'labels, government' blah, blah, blah wanting more money is just plain bovine excrement. Prices are *made* by the labels. It's Apple's job to negotiate. That's all. The *only* difference between the US and Europe is VAT. That's 16% in Germany.
BTW, thanks for the nice advice (you know from who) that we don't have to buy the songs. Well, the whole point (for me, as I'm not going to buy DRMed songs anyway) is that I wish that the iTMS succeed, that Apple succeeds. The price situation in Europe (and I understand also in Australia/NZ) is dismal and Apple are only hurting themselves. That's sad.
I hope the occasional Mr. Evident is able to understand that this is not just about personal finance but about the success of a brand which we happen to like... although Apple clearly doesn't really care.

stuartea
May 14, 2004, 04:48 AM
Seems like a good deal. According to http://www.currency-converter.co.uk/ that works out at 66p (UK £0.66) and I'd thought it would've been 99p a track.

Who knows what it will be when it really launches but I'd be happy to pay 66p.

Getting into the comparing it to US prices is pointless. The pound won't be that strong foverever (I just wish we'd dump the £ all together. That's personal opinion so please save the flag waving & 'I was born here so it must be great' messages)

dekator
May 14, 2004, 04:55 AM
They can't just use the same sites for a couple of reasons. First distance slows down downloads. Second you have a whole bunch more people, i mean millions of more potential users, the servers need to be expanded to handle that. So it makes the most sense economically to put those new servers in Europe, which means hiring local people.

As groovemaster already said, I don't think that's true. I get the same speed as ppl in the US when e.g. watching video from Apple's QT site etc.. The real question is how broad your connection is, distance hardly makes a difference. Especially not between Europe and the US.

dekator
May 14, 2004, 05:00 AM
Seems like a good deal. According to http://www.currency-converter.co.uk/ that works out at 66p (UK £0.66) and I'd thought it would've been 99p a track.

Who knows what it will be when it really launches but I'd be happy to pay 66p.

Uh, €1.29 is more like £0.86 isn't it ? €1 = £o.67 currently right? (At least that's what Apple's calculator says...

JFreak
May 14, 2004, 05:11 AM
Uh, €1.29 is more like £0.86 isn't it ? €1 = £o.67 currently right? (At least that's what Apple's calculator says...

yes, according to the national bank of finland, one euro currently equals 0.67 british pounds, so 1.29eur = 86p

CmdrLaForge
May 14, 2004, 06:09 AM
Based on what I've read here, and correct me if I'm wrong, the increase in price is due to taxes (VAT, etc.) and the licensing fees/percentage. So why are some people putting the blame on Apple? :confused: I wouldn't be surprised if their equivalent of the RIAA is trying to milk the iTMS-Europe for what they can. But I seriously doubt Apple's margins are any greater than what they have here in the States. I'm sure Apple would like to have the prices as low as possible, too. :)

Yes - I guess you are right. Its not Apple vault, but I am a customer. And I am buying from a company. I don't care what there deals behind are. I don't care where they procure things from and how much they have to pay for it. Its a customer - Apple relationship and I don't care about anythings thats going on behind the scenes.

In the end - I purchase a song for Eur 1.29. We will see if this is a good deal for a lot of people here in Europe or not. If it is - fine for Apple. If not ...

johngordon
May 14, 2004, 06:38 AM
got to say that i would have just expected it to be 99p here in the uk - so 85p isn't too bad.

its a very price sensitive thing tho' - depending on how much and how readily you can pick up a cd for will affect whether or not i'd buy an album off ITMS. if i can get a cd for £10, then its hardly worth paying £8.50. (although under £8 would just about clinch it i think - so 12 euros, not 13.

if however a cd is £13-16, then £8.50 from ITMS isn't so bad.

also - for single songs 85p is pretty good, rather than £3-£4 for a cd single. (although you don't get the b-sides, but half the time there's a good reason they're b-sides)

so i think ultimately i'll end up buying some cds, and buying some stuff off ITMS, depending on price, and depending on how much i like the band / album enough to make me want the sleevenotes / physical cd.

good news if it does come as soon as June.

with improvements to our digital cable just around the corner, my ipod arriving next week, and this to go along with the powerbook and the ixus digital camera, my didgital lifestyle will be complete.

Iain :)

the silver fox
May 14, 2004, 08:30 AM
Whilst everyone is bitching about Apple, please bear in mind that they are dealing with each countries' uniquely awkward legal system. That is why iTMS Europe has been delayed so long thus far. For example, French government and their pirating tax for mp3 players is also being considered for any online stores. Go figure. Anyway, each country has different labels dealing with individual artists. Take someone popular in Europe like the trashy Kylie Minogue. Her album may be released in France on the 20th May, but the UK label don't want it released until the 5th June. They have to increase their prices do deal with the additional legal costs involved in sorting out the red tape.

whooleytoo
May 14, 2004, 10:59 AM
Whilst everyone is bitching about Apple, please bear in mind that they are dealing with each countries' uniquely awkward legal system.

Rather than "uniquely awkward", how about "awkwardly unique". The only difference now is that Apple are dealing with more than one country. I doubt the legal/copyright systems are any worse than the US - remember getting the US store set up took a hell of a lot of work too.

greg75
May 14, 2004, 01:16 PM
For example, French government and their pirating tax for mp3 players is also being considered for any online stores.
In the UK it's illegal to make private copies. In France it's not, because they pay royalties. Even in the US such royalties are paid (see AHRA), although not on the iPod.

UK Fair Use rights (http://ukcdr.org/faq/#fairuse_ukrights):
In particular, note that there is no general right of private copying in UK law, even for "media shifting". Since making any copy is an infringing act unless specifically exempted, and the only exemptions made are those listed above, private copies of a work such as copies of CD tracks in MP3 format on a PC are infringing copies.
In other words, most iPod owners in the UK are pirates. Criminal scum.

Regarding your "being considered for any online stores" comment, do you have a link to back that up? The current law covers only devices, so that would require an amendment. I suspect that no such amendment is in the works.

frem001
May 14, 2004, 07:28 PM
Sure it sucks, not being as cheap as the American (especially because the euro is stronger) iTMS, but it's hardly more expensive, and at least it's coming (and hey, it seems to be a lot of non-apple people doing this anyway. Hard to bitch out Apple for TAXES.)

We're also being ripped off with other hardware and software pricing and not just from apple, but i thought they would be more fair considering their need to sell products and make money.And taxes aren't the only reason for the higher price... poor conversion is also responsible. Apple would be able to compete with dell if their prices were lower... don't forget that consumers in europe care about saving as much money as possible... students also have it difficult... on top of mounting student debts they only get 10% off apple products... and what about other equipment and software. This all adds up... (violin fade out :( )

frem001
May 14, 2004, 07:45 PM
I wouldn't say that Americans get preferencial treatment. (we are the world's largest consumer, afterall)The reported prices are out of apple's control, and would be as high as they are reported to be because of YOUR economic system and its high taxes, not a world conspiracy to charge europeans more.

How would you feel to be in our position?

skunk
May 14, 2004, 07:47 PM
We're also being ripped off with other hardware and software pricing and not just from apple, but i thought they would be more fair considering their need to sell products and make money.And taxes aren't the only reason for the higher price... poor conversion is also responsible. Apple would be able to compete with dell if their prices were lower... don't forget that consumers in europe care about saving as much money as possible... students also have it difficult... on top of mounting student debts they only get 10% off apple products... and what about other equipment and software. This all adds up... (violin fade out :( )
Apple are NOT competing with Dell. I can still hear that violin.... :rolleyes:

JFreak
May 15, 2004, 01:29 AM
Whilst everyone is bitching about Apple, please bear in mind that they are dealing with each countries' uniquely awkward legal system.

apple has dealt with each us states' unique taxes already, so it will not be so much more awkward here in europe. the tax rates just are something around 20% whereas in us they are i think under 10% everywhere.

if apple can do it in us, they can do it in europe also. it's just a matter of how they want to place their price point (and as i stated earlier, how the RECORD LABELS want to make profit, those greedy pigs, they are supposedly wanting +45% from us europeans...)

dekator
May 15, 2004, 04:36 AM
We're also being ripped off with other hardware and software pricing and not just from apple, but i thought they would be more fair considering their need to sell products and make money.And taxes aren't the only reason for the higher price... poor conversion is also responsible. Apple would be able to compete with dell if their prices were lower... don't forget that consumers in europe care about saving as much money as possible... students also have it difficult... on top of mounting student debts they only get 10% off apple products... and what about other equipment and software. This all adds up... (violin fade out :( )

Too right. In my generation of students (mid 30) a lot of students bought Macs because there were great offers. Today some switch to PC for price (although few, most being convinced of Apple being the right choice). Still, hardly any young students can afford a Mac. 10% off Apple products ??? In Germany we get 3% ! Can you dig that? That's more of an insult than an offer... Well, ok, there is currently a promotion going on that gives you 'up to' 8% on computers... but that's only temporary.
Ok, take the latest 12" iBook. That's $1099 in the US (AppleStore). Equals €931. Take €931 add 16% VAT for Germany = €1080. In fact tho', it costs €1199. Ok, that's only $140, no big deal you might say. Still, the difference is exacerbated in the 'Pro-Line'. The dual 2GHz G5 is $2999 in the US = €2541 + VAT = €2984. In fact though, the machine costs a whopping €3.246,84, €236 or $278,50 more. No big deal? Perhaps, but imagine the iBook 12" being at $1240 rather than $1099... it just sounds so much uglier.

Added note: Needless to say this has nothing but absolutely nothing to do with an 'economic system'. M$ products and virtually all other IT products aren't more expensive here (some are cheaper) regardless of whether stuff comes from US or other companies. Ever heard of global markets? It doesn't matter ****** where the company sits. A Mercedes is much cheaper in the US than in Germany even tho' it's produced here. That's because of marketing. No other reason. So please leave your bogey men at home. And quit defending Apple where there is nothing to defend.
"Herr schmeiί Hirn vom Himmel!" (referring to Apple, not fellow debaters).

the silver fox
May 15, 2004, 05:20 AM
Rather than "uniquely awkward", how about "awkwardly unique". The only difference now is that Apple are dealing with more than one country. I doubt the legal/copyright systems are any worse than the US - remember getting the US store set up took a hell of a lot of work too.

You seem to be missing my point. In the US all the music is controlled by the same Labels across all the states, therefore one set of labels to deal with. In the EU, each country has its own music and copyright laws and each label is independantly owned hence the problem. What is good for France wont make the German or uk labels happy (etc etc), which is why Gabriel's O2 service is so damn expensive.

takao
May 15, 2004, 05:55 AM
Ever heard of global markets? It doesn't matter ****** where the company sits. A Mercedes is much cheaper in the US than in Germany even tho' it's produced here. That's because of marketing. No other reason. So please leave your bogey men at home. And quit defending Apple where there is nothing to defend.

addition: before somebody can post "mercedes is an exception":
VWs are cheaper outside of germany.. because they want to gain marketshare
Peugeots are cheaper in germany than france...because the want to gain market share

"Herr schmeiί Hirn vom Himmel!" (referring to Apple, not fellow debaters).

that made my day ;)

ssloane
May 15, 2004, 08:04 AM
At 1,29€ each song (that's 15,50€ per CD with 12 songs. that's the same as in the store!) I will continue to buy pirate CDs on the street at 2€ each!

skunk
May 15, 2004, 08:09 AM
At 1,29€ each song (that's 15,50€ per CD with 12 songs. that's the same as in the store!) I will continue to buy pirate CDs on the street at 2€ each!
Well presumably you wouldn't be interested in iTMS whatever price they were charging, then. Why don't you make your own music instead of stealing it?

ssloane
May 15, 2004, 08:52 AM
Well presumably you wouldn't be interested in iTMS whatever price they were charging, then. Why don't you make your own music instead of stealing it?

If prices were more in line with the US prices I would happily use iTMS!!!! People need to bear in mind that in many countries in the EU salaries are very low and 1,29 per song is very high...

skunk
May 15, 2004, 09:32 AM
If prices were more in line with the US prices I would happily use iTMS!!!! People need to bear in mind that in many countries in the EU salaries are very low and 1,29 per song is very high...
€1.29 IS in line with US prices if you accept the rumoured €0.80 the fees are costing, and add on VAT. EU salaries are NOT "very low", and anyway, it's completely irrelevant.

JFreak
May 15, 2004, 03:58 PM
€1.29 IS in line with US prices if you accept the rumoured €0.80 the fees are costing, and add on VAT. EU salaries are NOT "very low", and anyway, it's completely irrelevant.

the problem is exactly the 80 euro cents the record labels are supposedly trying to get - apple should call their bluff and make them agree for same prices they have agreed on us store. 66 american cents equals 55 euro cents, and the additional 25 euro cents are effectively a 45% price increase.

skunk
May 15, 2004, 06:14 PM
the problem is exactly the 80 euro cents the record labels are supposedly trying to get - apple should call their bluff and make them agree for same prices they have agreed on us store. 66 american cents equals 55 euro cents, and the additional 25 euro cents are effectively a 45% price increase.
No it's not like that. You are forgetting the VAT. You have to allow SOME margin for currency fluctuation as well. This is supposed to be a long-term deal. Remember that the labels originally bargained for iTMS to be only on US MacOSX, and according to SJ they agreed to a long-term deal back then, before anyone knew what would happen. It began as a tiny percentage of the market, a sideshow for the labels. Now it's grown so fast, and moved to Windoze, and is moving to Europe, they realize they have a different scenario completely. Rather than being a sideshow, it might become the main event. Of course the labels ARE still being greedy, parasitic *******s, but you can see why they want to renegotiate now they have the chance. And Apple is under HUGE pressure to get this thing out of the door.

Omen88
May 16, 2004, 03:52 AM
€1.29 IS in line with US prices if you accept the rumoured €0.80 the fees are costing, and add on VAT. EU salaries are NOT "very low", and anyway, it's completely irrelevant.

There are big differences in wages in the EU, so there are countries where salaries are low. Poland and Portugal are 2 I can think of. Since we have the Euro everything has become a lot more expensive as well.

JFreak
May 16, 2004, 04:16 AM
No it's not like that. You are forgetting the VAT.

how many times have i calculated this? if the record labels would be happy with 0.55 euros per song (same as they are getting in us, 0.66usd, according to apple), then you could compare the price directly with itms us store, which is i believe prices before tax. so take that 0.99usd which equals 0.825eur, and add an average vat of 20% --> you get 0.99eur.

that is, if record labels agree with the same price they agreed in us, and apple is fine with the same marginal they are happy in us. 0.99eur per song can very well include the european vat, because of the currency rates, IF... just IF record labels don't get greedy.

if the final european itms price is more than 0.99eur per song, there's only record labels to blame. not the vat, not the currency rates, i believe not apple either. it's all about record labels, those greedy pigs, who some how think that europeans should be charged more than americans.

+45% is an outrage. if record lablels are happy with americans paying them 0.55 dollars, why on earth they believe europeans are happily paying 0.80 euros (0.96 dollars) for the same file? i'd somehow accept some small increase, say 5-10%, but +45% is something i will not even try to understand.

europeans are not stupid. if the song costs more than one euro, the itms europe will not be a success.

skunk
May 16, 2004, 04:30 AM
if the final european itms price is more than 0.99eur per song, there's only record labels to blame. not the vat, not the currency rates, i believe not apple either. it's all about record labels, those greedy pigs, who some how think that europeans should be charged more than americans.

+45% is an outrage. if record lablels are happy with americans paying them 0.55 dollars, why on earth they believe europeans are happily paying 0.80 euros (0.96 dollars) for the same file? i'd somehow accept some small increase, say 5-10%, but +45% is something i will not even try to understand.
Don't forget the US sales tax: few people in the US actually pay only 99c.

JFreak
May 16, 2004, 07:39 AM
Don't forget the US sales tax: few people in the US actually pay only 99c.

no i'm not forgetting; i compared us pre-tax price to an imaginary eu pre-tax price, and after that i added an average eu vat of 20% - is it hard to understand that euro is stronger than us dollar, and we could very well get a 0.99eur per song price with tax included, IF record labels (annd apple) would be satisfied with same kind of profit margins than they are right now getting from all the itms us sales?

to repeat myself: if eu price is more than 0.99eur per song, someone is not playing fair. either record labels or apple, or both.

(pre-tax 0.99usd equals pre-tax 0.825eur. add 20% and it results to 0.99eur, average 20% tax included.)

JLL
May 16, 2004, 01:25 PM
Exactly - people are forgetting that the price given INCLUDES a fixed pan-european tax rate - iTMS USA is 99c plus tax...

However, VAT tax is different in each country - as previously stated it's 17.5% in the UK and different in other places. So I'm not quite sure how they've managed to get a fixed tax rate, or whether this figure only applies to France?

Apple charges the same for Mac OS X and other things throughout Europe, but the price BEFORE tax is not the same.

CDs are €21.50 here in Denmark btw.

gopher
May 16, 2004, 02:30 PM
that's ************! 1.29 euros for a song is almost the same I pay for my music that I buy on CD! how the hell can there be so big differences in taxes and licensing fees? I mean, 1€ is like $1,20! So the music in europe would cost about $1,5! nice one. I really hope this isn't true.. else the itmseu will fail
Umm...remember, that's per song. And most songs don't require you buy the whole Album. When you are talking a 16 song album, and that there might be one or two good songs per album, you may have saved yourself as much as 8 times the asking price.

gekko513
May 16, 2004, 03:50 PM
to repeat myself: if eu price is more than 0.99eur per song, someone is not playing fair. either record labels or apple, or both.
This is also my view. And I think it's the record labels who are not playing fair. Hopefully this whole rumor is wrong.

frem001
May 16, 2004, 09:00 PM
Apple are NOT competing with Dell. I can still hear that violin.... :rolleyes:

Yes they are especially in the Education market... were have you been all this time? :o (you)

frem001
May 16, 2004, 09:02 PM
Too right. In my generation of students (mid 30) a lot of students bought Macs because there were great offers. Today some switch to PC for price (although few, most being convinced of Apple being the right choice). Still, hardly any young students can afford a Mac. 10% off Apple products ??? In Germany we get 3% ! Can you dig that? That's more of an insult than an offer... Well, ok, there is currently a promotion going on that gives you 'up to' 8% on computers... but that's only temporary.
Ok, take the latest 12" iBook. That's $1099 in the US (AppleStore). Equals €931. Take €931 add 16% VAT for Germany = €1080. In fact tho', it costs €1199. Ok, that's only $140, no big deal you might say. Still, the difference is exacerbated in the 'Pro-Line'. The dual 2GHz G5 is $2999 in the US = €2541 + VAT = €2984. In fact though, the machine costs a whopping €3.246,84, €236 or $278,50 more. No big deal? Perhaps, but imagine the iBook 12" being at $1240 rather than $1099... it just sounds so much uglier.

Added note: Needless to say this has nothing but absolutely nothing to do with an 'economic system'. M$ products and virtually all other IT products aren't more expensive here (some are cheaper) regardless of whether stuff comes from US or other companies. Ever heard of global markets? It doesn't matter ****** where the company sits. A Mercedes is much cheaper in the US than in Germany even tho' it's produced here. That's because of marketing. No other reason. So please leave your bogey men at home. And quit defending Apple where there is nothing to defend.
"Herr schmeiί Hirn vom Himmel!" (referring to Apple, not fellow debaters).

Thanks for doing the hard work to prove my point. :p

stuartea
May 17, 2004, 06:28 PM
I've a feeling that I may have read the 1 pound to 1 euro rating. Woops : ) though still at eighty something pence it's less than I thought it would be.

k2k koos
May 17, 2004, 06:35 PM
i'm sure, apple would have loved to introduce it for €0.99 and have peace, as that would cover the exchange rate and allow for added tax.
The rest of the added costs is pure greed on behalf of the banks and licencing agencies, that want to ride on the back of th huge success iTunes has enjoyed in the US.
It's all about making money, and nothing to do with serving the consumer, it would be great to be able to purchase the music from the US site, I would gladly pay our local VAT on top of it, it'l still be cheaper... just my two euro cents....

JLL
May 18, 2004, 07:31 AM
Ok, take the latest 12" iBook. That's $1099 in the US (AppleStore). Equals €931. Take €931 add 16% VAT for Germany = €1080. In fact tho', it costs €1199. Ok, that's only $140, no big deal you might say. Still, the difference is exacerbated in the 'Pro-Line'. The dual 2GHz G5 is $2999 in the US = €2541 + VAT = €2984. In fact though, the machine costs a whopping €3.246,84, €236 or $278,50 more. No big deal? Perhaps, but imagine the iBook 12" being at $1240 rather than $1099... it just sounds so much uglier.

Since Apple hasn't adjusted the PM prices since the launch you have to use the exchange rate from back then.

The price of MS Windows isn't adjusted every day either.

markie
May 18, 2004, 01:29 PM
"In the state and county where I live, the tax is 7%. An iTMS purchase actually costs me $1.06. In other American states, it would be more or less depending on the actual tax rate."

0% :) I love Montana!

skunk
May 21, 2004, 09:24 PM
Since Napster is now launching in the UK and charging 99p a song, I expect Apple to charge the same. We'd be lucky to pay only 85p/€1.29.

JFreak
May 22, 2004, 01:24 AM
Since Napster is now launching in the UK and charging 99p a song, I expect Apple to charge the same. We'd be lucky to pay only 85p/€1.29.

i'd expect napster to fail or be forced to lower prices... that's just too much. if it had the dvd-a resolution, then i'd buy it. but lower than cd quality? that has to be dirt cheap because that's a dirt quality.

iMan
May 22, 2004, 06:22 AM
http://www.napster.co.uk/

Also download service similar to iTMS - from £1.09 per track (£9.95 per album).
Apple needs to hurry up! There are now a lot of big name services already up and running in Europe (especially UK). Most disappointingly - none even support other platforms than Windows. Not to mention the iPod :(
They are going to loose both iTMS sales and iPod sales this way!

Only "good" thing: as most others it looks like a total rip-off of iTMS - only not as sleek (judging from the screenshots - can't run it myself).

skunk
May 22, 2004, 08:22 AM
http://www.napster.co.uk/

Also download service similar to iTMS - from £1.09 per track (£9.95 per album).
Apple needs to hurry up! There are now a lot of big name services already up and running in Europe (especially UK). Most disappointingly - none even support other platforms than Windows. Not to mention the iPod :(
They are going to loose both iTMS sales and iPod sales this way!

Only "good" thing: as most others it looks like a total rip-off of iTMS - only not as sleek (judging from the screenshots - can't run it myself).
I believe iTMS Europe will be up and running within a month. No panic. :cool:

sascha h-k
Jun 5, 2004, 01:18 PM
this price is impossible ....

€ 0.72 would be ok, and don't forget: in the EU there are more than twice people living, compared to US !!!

cheers
sascha