Coffeehouse Thread

33 posts

Australian Pricing Inquisition

Back to Forum: Coffeehouse
  • elmer

    http://www.smh.com.au/technology/technology-news/tech-giants-to-face-it-gouging-probe-20130211-2e80e.html

    In short, Apple, Adobe and Microsoft have all been called before a govt inquiry into apparent price gouging of Australian users.

    As the article says: 'Choice found that for one Microsoft software development product you could fly to Los Angeles return to buy the software and still save thousands of dollars.'

    I presume that is a reference to the outrageous pricing of Visual Studio in Australia.

    I'm not expecting much, but nevertheless, hope something comes of it.

  • evildictait​or

    If it's true, I'm glad that the Australian govt. is taking action against it.

  • Kental2

    Not that I don't sympathize with Australian users, but I'm having trouble understanding this.  Are companies not allowed to set prices for their own products?  Isn't the whole point that if you're not being competitive nobody will buy your product?  What would the ruling be here for the Australian people to get what they want (reasonably priced software)?  You can't tell a company it has to sell it for the exact same rates in one country as another.  Exchange rates change all the time, plus the cost of importing/exporting, and so on.  I don't understand what ruling they could possibly make that would have a meaningful impact on the problem.

  • elmer

    @Kental2:

    Australian VS pricing is about 160% of USA VS pricing.

    Our exchange rate is currently sitting around 105% of USA's, and has been for a long time.

    The product is provided electronically and supported from USA, so it's not as if MS Australia actually does anything or has any costs to cover.

    VS USA Pricing includes taxes, so even the argument of our local tax seems a red-herring.

    Edit: The inference is that Apple, Adobe and MS are all running a scam to inflate Australian prices across the board, effectively negating the 'competition' argument.

  • Kental2

    @elmer: I see what you're saying, and honestly I'm not arguing that point whatsoever.  There may be egregious pricing concerns.  What I'm confused about is what the Government intends to do about it if they come to that conclusion, that's all.

  • evildictait​or

    @Kental2: If Microsoft, Apple and Adobe were Australian companies that all practically all US customers had to buy for business reasons, and the US cost per product was 160% of what it cost in every other country, do you seriously think that Congress wouldn't demand that the heads of those companies come in and explain themselves?

    Microsoft, Apple and Adobe combined are not small. If their products are 160% more expensive than the exact same product in other countries, then that makes it more expensive for small businesses in Australia to do business compared with if those businesses set up shop somewhere else.

    Even if MS, Apple and Adobe are not doing anything illegal, if I was australian, I'd be demanding that the government take action to stop this behaviour.

  • elmer

    @Kental2:I don't have much hope of anything, as govt inquiries into pricing never seem to result in anything, but I guess that if they are suggesting some sort of collusion (even if it is only by tacit agreement) to charge Australian users more for all three product ranges (note, these three are only first off the rank) and effectively remove the option of competition driving prices down, then our local Trade Practices Act certainly has the teeth to deal with that. But the question is whether or not the authorities empowered with it, have the bottle to apply it. In the past, they have been reluctant to use the powers they have, even when blatant violations of it seem obvious, and one can only wonder why that is.

  • kettch

    @elmer: At the very least it will be interesting to see what justification there is for charging more. (If it's anything other than *shrug* "Because we can")

  • elmer

    @kettch:Yes. If they can justify their pricing (even if only by enough to kill the suspicion that they have no justification at all) then it will be hard to see this inquiry producing any change. However, given the way software is distributed and supported these days, and our proximity to where hardware is actually manufactured (i.e. Shipping to Australia or USA from China or Singapore is not that different) then it will be interesting to see what they each claim as the extra overheads involved.

  • Kental2

    @evildictaitor: I don't disagree, and I didn't mean to imply that I did Tongue Out  I was just trying to ask, genuinely, what the Government would (or could) do.  I'm not sure what recourse the government has.  If they just forbid selling the products that would be terrible for end-users.  Would it be fines, perhaps, or...?

    That's all I'm asking Tongue Out Elmer spoke to that point, so I guess we'll just have to see.

  • elmer

    @Kental2:If they are found to be in violation of the TPA (and that is a really big IF) then the penalties (usually fines for corporations) can be quite significant.

  • evildictait​or

    I'm not sure what recourse the government has.  If they just forbid selling the products that would be terrible for end-users.  Would it be fines, perhaps, or...?

    The EU fined MS billions of dollars twice for unfair business practices in the EU. I'm pretty sure if the ozzies wanted to they could make life hard for MS, Adobe and Apple.

    Even if the government is wrong, pissing them off is pretty much always a bad idea. They always have the last laugh.

  • magicalclick

    I blame their government. The price is very likely not a problem on MS side, but, their import tax, ridiculous laws, regulations, and bans. It is not saying US is free from ridiculous laws. The same exact medicine from the same company, sells 10x cheaper in Taiwan because they don't sue the drug company every hour.

    Leaving WM on 5/2018 if no apps, no dedicated billboards where I drive, no Store name.
    Last modified
  • elmer

    @magicalclick: WTF? 

    There is no import tax, ridiculous laws, regulations or bans that apply to software.

    As with most things sold here, there is a 10% GST applicable, but there are sales taxes applicable to the USA prices, and our $ is worth more than the USA.

    Our wages (and cost of living) are a bit higher than the USA, but as already mentioned above, when you are talking about electronically distributed software, and no local support, that is hardly a consideration.

    This is not a problem caused by govt, and one would hardly imagine them holding an inquiry if there were any chance it was. I recall a classic line from Yes Minister - Never hold an inquiry unless you already know the answer.

  • magicalclick

    , elmer wrote

    @magicalclick: WTF? 

    There is no import tax, ridiculous laws, regulations or bans that apply to software.

    I don't know about MS products. But, Australia government's ban on gaming software are just ridiculous.

    Leaving WM on 5/2018 if no apps, no dedicated billboards where I drive, no Store name.
    Last modified
  • elmer

    , magicalclick wrote

    *snip*

    I don't know about MS products. But, Australia government's ban on gaming software are just ridiculous.

    Personally, I have no issue with the short list (about 25?) of games that are banned.

    http://en.wikipedia.org/wiki/List_of_banned_video_games_in_Australia

     

  • evildictait​or

    , magicalclick wrote

    *snip*

    I don't know about MS products. But, Australia government's ban on gaming software are just ridiculous.

    Since MS, Adobe and Apple's products are in the majority not gaming software, I fail to see how the Australian government's alleged ban on gaming software makes any difference to the price of Visual Studio or an iPhone.

  • elmer

    @evildictaitor:iPhone is perhaps open to some fuzzy argument by Apple, because of those stupid Apple stores they insist on running - rents in local shopping malls are extortionate.

    Where Apple does have a problem however, is that Australians pay significantly more for electronic purchases (Tunes, Apps, Books, etc) and it's hard to see the reason for that.

Comments closed

Comments have been closed since this content was published more than 30 days ago, but if you'd like to continue the conversation, please create a new thread in our Forums, or Contact Us and let us know.