There is a lot more than simple currency exchange rates at play here.
For Apps, Apple has no choice but to adjust pricing according to exchange rates and the varying costs of doing business from country to country. If they didn't do this, the developers wouldn't make any money and could refuse to sell their apps internationally. If there is no profit, there is no motive, this is what is required to turn a profit. VAT must also be considered here, though it is a simple calculation, (and really isn't a VAT) it does increase costs significantly.
For music and video, it's different. Those prices are contracted with the different industry groups on a regular basis. It's not something that Apple can just change any time they feel like it. In the US, royalties are paid out quite differently than the rest of the world (differently meaning artists & writers get less). Industry groups will demand more money in Europe and Australia as a result of the different payment schemes.
Hardware pricing is just going to be a mess, any way you slice it. Most European countries have a VAT. Shockingly, after reading the posts on this forum, most Europeans don't know what that actually is. The VAT is a value-added tax. That means that every time value is added to a component as the result of manufacturing, packaging etc. there is a tax placed on the value that has been added to it.
For products like iPads, iPhones & computers there are a ton of components that make up the product you buy as a consumer. Each one of those has had "value added" to it along the way. This leads to exponential taxation.
For example, (feel free to substitute your native currency symbol where applicable) raw aluminum might be valued at $1.00, but once it has been machined into a unibody, the value increases to (purely hypothetical) $100. The VAT incurred at 20% is just under $20. Now, once the unibody is used to build a computer, the finished product is valued at let's say $500. The VAT is for the difference from $100 to $500, resulting in another $80 in taxes. (Yes I know this was very rudimentary, but this is an Internet forum, not a textbook)
Now, apply that scenario to all the other components within the computer, and then factor in a standard markup. Then there are other taxes and costs as well. Taxes as a whole are higher for businesses in Europe than in the US. Those get paid and the costs are passed on to the consumer. Apple also pays higher wages in Europe due to the higher cost of living, this must be factored in as well. We also haven't mentioned the higher cost for better warranty service, shipping and storage and other regulations.
Governments love to use taxes like the VAT because they are hidden. Consumers are the ones who pay these taxes in the end, but they don't see that. They interpret it simply as products being more expensive, blame the greedy corporation that makes them, and move on with life.
In the US, product taxes (i.e. sales tax) are levied at the state level. This means that every consumer knows exactly how much they are being taxed on an item. Some states, like Delaware, don't have sales tax. Others, like California, have very high sales taxes. These taxes don't increase to the level of the European VAT specifically because they are transparent.
Those posters who live in the UK, I feel for you, price increases are no fun. They are however, the result of a weakened currency and exploitative tax policy--not the simple whim of a greedy corporation. You have every right to be angry, but that anger should be pointed in the right direction.
Don't worry too much though, the US Dollar is on its way right down the toilet. Assuming your central bankers don't do the same things ours are doing, you will most certainly see changes in the opposite direction soon enough.
For Apps, Apple has no choice but to adjust pricing according to exchange rates and the varying costs of doing business from country to country. If they didn't do this, the developers wouldn't make any money and could refuse to sell their apps internationally. If there is no profit, there is no motive, this is what is required to turn a profit. VAT must also be considered here, though it is a simple calculation, (and really isn't a VAT) it does increase costs significantly.
For music and video, it's different. Those prices are contracted with the different industry groups on a regular basis. It's not something that Apple can just change any time they feel like it. In the US, royalties are paid out quite differently than the rest of the world (differently meaning artists & writers get less). Industry groups will demand more money in Europe and Australia as a result of the different payment schemes.
Hardware pricing is just going to be a mess, any way you slice it. Most European countries have a VAT. Shockingly, after reading the posts on this forum, most Europeans don't know what that actually is. The VAT is a value-added tax. That means that every time value is added to a component as the result of manufacturing, packaging etc. there is a tax placed on the value that has been added to it.
For products like iPads, iPhones & computers there are a ton of components that make up the product you buy as a consumer. Each one of those has had "value added" to it along the way. This leads to exponential taxation.
For example, (feel free to substitute your native currency symbol where applicable) raw aluminum might be valued at $1.00, but once it has been machined into a unibody, the value increases to (purely hypothetical) $100. The VAT incurred at 20% is just under $20. Now, once the unibody is used to build a computer, the finished product is valued at let's say $500. The VAT is for the difference from $100 to $500, resulting in another $80 in taxes. (Yes I know this was very rudimentary, but this is an Internet forum, not a textbook)
Now, apply that scenario to all the other components within the computer, and then factor in a standard markup. Then there are other taxes and costs as well. Taxes as a whole are higher for businesses in Europe than in the US. Those get paid and the costs are passed on to the consumer. Apple also pays higher wages in Europe due to the higher cost of living, this must be factored in as well. We also haven't mentioned the higher cost for better warranty service, shipping and storage and other regulations.
Governments love to use taxes like the VAT because they are hidden. Consumers are the ones who pay these taxes in the end, but they don't see that. They interpret it simply as products being more expensive, blame the greedy corporation that makes them, and move on with life.
In the US, product taxes (i.e. sales tax) are levied at the state level. This means that every consumer knows exactly how much they are being taxed on an item. Some states, like Delaware, don't have sales tax. Others, like California, have very high sales taxes. These taxes don't increase to the level of the European VAT specifically because they are transparent.
Those posters who live in the UK, I feel for you, price increases are no fun. They are however, the result of a weakened currency and exploitative tax policy--not the simple whim of a greedy corporation. You have every right to be angry, but that anger should be pointed in the right direction.
Don't worry too much though, the US Dollar is on its way right down the toilet. Assuming your central bankers don't do the same things ours are doing, you will most certainly see changes in the opposite direction soon enough.
