Apple Hikes U.K. App Store Prices By At Least 25 Percent Due to Weak Pound

[iGeek2014]

I'll be honest-I'm surprised Apple have waited this long to increase prices.

Even if companies make out they haven't increased prices in lieu of the falling value of the £ vs. other currencies there'll be stealth hikes i.e. smaller packs of biscuits etc.

It's just irritating when the £ has been stronger yet prices haven't lowered.

 

[dilbert99]

I'll be honest-I'm surprised Apple have waited this long to increase prices.

Even if companies make out they haven't increased prices in lieu of the falling value of the £ vs. other currencies there'll be stealth hikes i.e. smaller packs of biscuits etc.

It's just irritating when the £ has been stronger yet prices haven't lowered.

Thing is the exchange rate is not currently 1:1

 

[0098386]

Unfortunately the bulk of Leave voters won't understand the consequences of their actions. It's like those right wing americans who want to see the removal of the Affordable Healthcare Act, they're okay now but wait till a few of them get long term illnesses. As I've said before I'm interested in and okay with self-destruction like that.

 

[macbookhair]

**** them, the grossly overpaid soulless beancounting bastards.

 

[dazzerman]

My basic maths says £1.49 --> £1.99 is NOT 25% - more like 33% = sheer profiteering!

 

[UKgaryb]

Let's be honest here any currency fluctuations will be relatively short lived, apple are so short sighted here the price of hardware has become prohibitively expensive and if the ecosystem is expensive it will drive people to alternatives. They won't be as quick to drop prices. I'm seriously considering jumping off the apple bandwagon. It's been a fun 20 years but they've priced themselves out.

Very customer hostile.

 

[macbookhair]

The pound won't recover as we stupidly voted to leave the stability off the EU.

Yes it will. The financial markets are a law unto themselves. In the longer term, things will settle down.

 

[Jsameds]

Yes MR, it's definitely Brexit that's to blame.....

http://www.xe.com/currencycharts/?from=GBP&to=USD&view=10Y

 

[Bakerman]

This is funny. Because im Sure when Steve announced the App Store he said developers will decide how much the apps cost?

The developers choose freely between different tiers, like $0.99, $1.99 and so on. Apple then calculates prices for different currencies to that users everywhere pay about the same for an app, and so that the prices comes to a nice round level.

 

[KennethS]

Thing is the exchange rate is not currently 1:1

It's £1 = $1.21. But you have to factor in that VAT in the UK is 20% and included in the price charged in the Apple UK App store. In the US, state sales tax varies by state and the tax is added on top of the price of the app. So net of tax, the pricing is pretty similar.

I'm not defending Apple, just pointing out the difference in the tax systems.

 

[steve62388]

It's £1 = $1.21. But you have to factor in that VAT in the UK is 20% and included in the price charged in the Apple UK App store. In the US, state sales tax varies by state and the tax is added on top of the price of the app. So net of tax, the pricing is pretty similar.

I'm not defending Apple, just pointing out the difference in the tax systems.

How does the variable US State tax work when you're buying digital products, how is it decided what level to charge?

 

[SarcasticJoe]

Of course not, that would be too fair.

I'm not a business man but surely currency fluctuations should be looked at long term. The pound isn't doing great, I'm aware, but it's due to uncertainty around us leaving the European Union. Come March we will know much more and the currency will recover.

Sure, change if taxes increase. But a very clear and explainable currency dip is surely a poor way of producing future incomes?

Either that or this is opportunistic money making?

If Apple kept their prices the same they'd essentially be giving UK residents and others paying in british pounds a discount equivalent to how much value the pound has lost compared to the U.S dollar. Keeping prices as they used to be would have simply been bad for business.

The pound rebounding isn't all that certain ether. If Theresa May decides to take the UK out of the EU the hard way with severe restrictions on the working rights of EU citizen in the U.K and in return receive an end to free trade with the EU then you can be pretty sure the pound will go trough another drop of the same magnitude as the one after the Brexit vote ended in victory for the Leave camp.

tldr: consumers and savers lose, app developers and mortgage holders sort of win

I wouldn't say that App developers win ether. Only those living in the UK get extra money, everyone else is just brought back to a roughly pre-Brexit level per-sale revenue.

 

[steve62388]

Does anyone know if Apple has ever lowered digital or physical prices when a currency is strong (in any country). I can't recall.

 

[KennethS]

How does the variable US State tax work when you're buying digital products, how is it decided what level to charge?

There is a billing address associated with the payment card used for payment, and the tax is charged at the rate of sales tax of that state (and I presume paid to that state by Apple). That is how it works when I make purchases from the US App store.

 

[hagar]

Yes MR, it's definitely Brexit that's to blame.....


View attachment 684072

http://www.xe.com/currencycharts/?from=GBP&to=USD&view=10Y

Yes, indeed. Why do you feel the need to proof this?

 

[0lf]

it's where we're in charge of our destiny

You mean, not like Scots ?

 

[bulldoze]

The pound won't recover as we stupidly voted to leave the stability off the EU.

Stability of the EU.

Stability of the EU.

Nope, does not compute.

 

[Carnegie]

Does anyone know if Apple has ever lowered digital or physical prices when a currency is strong (in any country). I can't recall.

Yes, Apple has lowered App Store prices to better balance prices across different jurisdictions or because of another currency's relative strength. It doesn't happen as often, but it has happened.

 

[Spectrum]

Apple, Microsoft, Asus, Dell, Tesla, Electrolux, BA, Marmite, Lego, Tesco, Nestlé, Rolex, HTC, Unilever, Morrison's and we haven't even started yet.

For those who don't get basic economics, seems to be a pattern emerging here… Currency collapses, prices of imported goods go up.

If you have UK savings they are now worth about 20% less.
So if you had £100,000 you just lost £20,000. Was it worth it? What have you gained? What precisely has changed, other than the prospect of losing the European Medicines Agency, cooperation over Gibraltar and the Falklands, Russian warships cruising the English Channel, a trillion dollars of eurotrading etc etc etc. You'll still need to import labour from overseas unless you want negative GDP. You'll still need to trade with the EU. But wait, here comes a knight in shining armour… it's Donald Trump (and Vladimir Putin) lol, they're going to give the UK "a really great deal", in fact it's "the best deal ever" lol!!

On the other hand of course, if you have net debt, you just gained 20% - so for all those with fixed mortgages, congrats!

#Brexit


http://www.express.co.uk/life-style...oft-confirms-brexit-price-rises-satya-nadella
https://www.theguardian.com/business/2016/dec/22/tesla-uk-prices-new-year-currency-brexit-vote
http://www.mirror.co.uk/news/uk-news/british-airways-apple-prices-rise-9150131
http://www.standard.co.uk/news/uk/l...d-pound-fears-sparked-by-brexit-a3420286.html
https://www.luxewatches.co.uk/rolex-price-increase-2016/
http://www.econotimes.com/HTC-Vive-UK-Price-Hike-Additional-£70-For-VR-Headset-242777

tldr: consumers and savers lose, app developers and mortgage holders sort of win

I think the only words you missed to describe the consequences of Brexit are: "Practically Magic"

...sigh...
[doublepost=1484655414][/doublepost]

I am a UK resident, but not citizen, so perhaps it is not my place to comment. That being said, I lived and worked in the UK for >20 years. All I can say is that Brexit was a stupid idea. The £ has devalued, wiping out any pay increases we have had recently due to inflation (of which this increase in app price is an example) and eventually it will decimate trade, investment and government finances. All of this is predictable. What worries me is the unpredictable. Europe has been at peace mostly for a generation, largely due to the EU, and now....

Exactly. The EU has, overall, a massively stabilising influence. If we think of WWI and WWII, and the instability across the middle east and North Africa, I think some people have very short memories, and indeed rose-tinted spectacles about how great it will be to be a tiny nation adrift in the atlantic.

 

[Carnegie]

There is a billing address associated with the payment card used for payment, and the tax is charged at the rate of sales tax of that state (and I presume paid to that state by Apple). That is how it works when I make purchases from the US App store.

Yes. And not only is the rate different for different states, some states still don't apply a sales tax to digital goods such as App Store purchases - even if they otherwise have a sales tax (some states don't even have sales taxes). There are also differences in what digital goods the taxes apply to among states that apply such taxes.

 

[dannys1]

Great, these prices will NEVER go down now, even if the pound recovers and becomes better than pre-Brexit.
Same way we've never gone back to 17.5% tax

The two aren't really comparable.

 

[CJM]

No big deal, I'll just buy less things.

 

[dannys1]

Of course not, that would be too fair.

I'm not a business man but surely currency fluctuations should be looked at long term. The pound isn't doing great, I'm aware, but it's due to uncertainty around us leaving the European Union. Come March we will know much more and the currency will recover.

Sure, change if taxes increase. But a very clear and explainable currency dip is surely a poor way of producing future incomes?

Either that or this is opportunistic money making?

1. The pound won't recover in March, its dropped because we're leaving, not the uncertainty - the more certain we are that we leave the EU the further it drops, it'll drop again today based on Mays words of "we can't be in the single market".
2. You can't opportunistically make money when you've raised prices by the exact amount you were down since June.

 

[Ad13]

I am a UK resident, but not citizen, so perhaps it is not my place to comment. That being said, I lived and worked in the UK for >20 years. All I can say is that Brexit was a stupid idea. The £ has devalued, wiping out any pay increases we have had recently due to inflation (of which this increase in app price is an example) and eventually it will decimate trade, investment and government finances. All of this is predictable. What worries me is the unpredictable. Europe has been at peace mostly for a generation, largely due to the EU, and now....

And this is precisely the reason we need to be able to control our borders and stop the free flow of any Tom, Dick or Abdul. Unfortunately the world is changing and becoming a more dangerous place. Allowing people in who intend to cause us and harm was the objective - the unfortunate thing is that we had to leave the EU to get be able to get this.

Short term pain for long term gain!

 

[thekeyring]

But the money never goes back to the US anyway?

It's just to demonstrate the pound is worth less, so they need to ask for more of them for apps.