Apple, Microsoft and Adobe Required to Explain High Pricing in Australia

Discussion in ' News Discussion' started by MacRumors, Feb 11, 2013.

  1. MacRumors macrumors bot


    Apr 12, 2001

    Apple is one of three high-profile companies being required to explain to an Australian government inquiry why its product pricing in Australia is significantly higher than in the United States, reports Kotaku Australia. The issue is not a new one for Australian officials, but legislators are stepping up their investigations into prices being paid by Australians.

    The action comes after Apple, Microsoft and Adobe had all refused to send representatives to public hearings held by the IT Pricing Inquiry. The government has now issued summonses to all three companies, requiring them to attend and Parliament member Ed Husic warning that legal consequences will follow if they fail to comply.
    Apple's pricing does vary significantly by country, although comparisons often do not take into account taxes that are included in the base price in many countries but not in the United States. Different products also vary in their pricing comparisons across countries.

    For example, the base 27-inch iMac is priced at $1799 in the United States, A$1999 (US$2054) in Australia and £1499 (US$2352) in the United Kingdom. But when subtracting included taxes from the international pricing, the iMac comes in at A$1817 (US$1867) in Australia and £1249 (US$1960) in the UK, for price premiums of 3.8% and 8.9% respectively.

    For the 16 GB Wi-Fi iPad, the difference is even smaller once taxes have been accounted for, with the device priced at $499 in the United States, A$490 (US$503.38) in Australia and £332.50 (US$521.66) in the UK for price premiums of 0.9% in Australia and 4.5% in the UK.

    iTunes Music Store pricing shows a much greater disparity for Australian customers, with tracks that sell for $1.29 in the United States being priced at $1.99 before tax in Australia.

    Apple has traditionally priced its products somewhat higher internationally even when accounting for taxes, due in part to increased cost of business in many countries relative to the United States and as a buffer against fluctuating currencies. Customers and government officials in many of these countries feel, however, that pricing is still too high, particularly for digital content such as downloadable music and software that does not incur many of the overhead costs associated with physical goods.

    The Australian Financial Review reports that Apple had testified in private on the matter, but had refused to do so at the public hearings. It cited IBRS analyst James Turner as commenting that this was part of Apple's long-established approach to secrecy:
    The public hearing is scheduled for March 22.

    Article Link: Apple, Microsoft and Adobe Required to Explain High Pricing in Australia
  2. Number 41 macrumors 6502a

    Jun 15, 2009
    Look, Australia --

    Just because you've figured out how to sell a steak for $9 at Outback doesn't give you the right to go telling other people how to price things.
  3. Spetsnazos macrumors regular

    May 3, 2012
    The pricing in Aus is all over the place...could be gouging at this point...
  4. apple_iBoy, Feb 11, 2013
    Last edited: Feb 11, 2013

    apple_iBoy macrumors 6502a

    Oct 28, 2003
    Philadelphia, PA
    If Australia doesn't like it, maybe Australia should develop it's own home-grown talent and compete.

    Is this the same government that recently banned A-frame ladders? Now it has a panel that can require companies to show up to publicly defend their (arguably reasonable) pricing or face "legal consequences?"

    This is not like gouging on gasoline or milk during a hurricane. This is an iMac.
  5. reallynotnick macrumors 6502a

    Oct 21, 2005
    A 3.8% price premium is what they are complaining about? Do they forget to take into account their own taxes?
  6. Kebabselector macrumors 68030


    May 25, 2007
    Birmingham, UK
    The adobe tax in the uk does seem to be the worst of them at the moment. It'll be interesting to hear the answers from Australia
  7. MonkeySee.... macrumors 68040


    Sep 24, 2010
    The best bit about Apple at the moment is design and I think you have an Englishman to thank for that.

    Bloody Americans :rolleyes: ;)
  8. camnchar macrumors 6502


    Jan 26, 2006
    SLC, Utah
    That's how much it costs to ship products to the Edge of the Known Universe.
  9. WestonHarvey1 macrumors 68020

    Jan 9, 2007
    Outback isn't Australian. It's an "Australian themed" American restaurant chain.
  10. LostMyiPhone macrumors 6502

    Dec 19, 2012
    Let's imagine an Australia without any product from these 3 companies...
  11. keviig macrumors 6502

    Jun 7, 2012
    Norwegian pricing

    27" base iMac Norwegian price before taxes (25%): $2141...
  12. Number 41 macrumors 6502a

    Jun 15, 2009
    Next thing you know, you'll be telling me that Australians don't sit around tossing boomerangs and playing didgeridoo music all day either.
  13. Brian Y macrumors 68040

    Oct 21, 2012
    As for the UK - 10% more is MORE than justified. It's much more expensive to do business here in the UK than the US.

    Also, they need to account for worst-case scenario currency fluctuations - having prices go up and down based on current exchange rates would be impractical.
  14. basesloaded190 macrumors 68030


    Oct 16, 2007
    I think you missed the joke/sarcasm
  15. DeathChill macrumors 68000

    Jul 15, 2005
    I'm pretty sure he was making a joke...
  16. TMar macrumors 68000


    Jul 20, 2008
    I think the sarcasm was implied. Maybe you should look it up.
  17. mtneer macrumors 68020


    Sep 15, 2012
    This is ridiculous. Its not like we are talking about lifesaving drugs or anything essential. These are semi-luxury goods with plenty of alternatives that can perform the same functions.
  18. Sayer macrumors 6502a


    Jan 4, 2002
    Austin, TX
    Doesn't Oz overprice so-called junk food so as to make it less available to the general public? I guess that's ok since no one wants to look at fatties, right?

    And really Apple's prices show a measly 3.8% price hike after insanely high Aus taxes are removed. The UK is almost 9%, which should make the UK folks complain, yet they don't (unless its about an advertisement, go figure).

    This hub bub makes me think maybe Aus doesn't want its public to realize how badly their own government is treating them via taxation policies. Dangit Apple, you are making the Aus government look bad, and you should feel bad!
  19. WestonHarvey1 macrumors 68020

    Jan 9, 2007
    Read it again. No cues it was sarcastic. Sarcasm isn't always easy to convey in textual form - maybe you should look that up.
  20. Stella macrumors 604


    Apr 21, 2003
    The Australian government have every right to try and protect their consumers against price gouging.

    Other countries should do the same IMO.

    Unsure why above comments think otherwise?

    Even digital delivered content?
  21. MonsterRain macrumors member

    Jul 13, 2008
    25% tax?

    What. The. ****.

    Glad I didn't take that job in Norway last summer. :/
  22. inlinevolvo macrumors 6502

    Jul 11, 2012
    Ridiculous. It's called a free market. We don't tell you how to price your fosters.
  23. ItWasNotMe macrumors regular

    Dec 1, 2012
    Shenzhen - Sydney = 4587 Miles
    Shenzhen - Los Angeles = 6888 Miles

    So further you ship the cheaper it is:)
  24. econgeek macrumors 6502

    Oct 8, 2009
    That's government for you-- they're the mafia. "Youse got a mighty nice bizness here, be a real shame if something happened to it."

    All government does is shake people down.
  25. aidler macrumors member

    Jun 18, 2009
    Base 27'' iMac comes with a price tag of 1,879.00 € in Germany. Thats 1,578.99 € before tax or 2,110.53 US$. A 17.3% premium and nobody is complaining.

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