Apple blames ‘old fashioned’ record labels, film studios, TV networks for high Australian prices

“Apple Inc blamed “old-fashioned” record companies, film studios and TV networks for the inflated prices Australians pay compared with U.S. consumers for digital downloads, as it defended its pricing strategy on Friday,” Jane Wardell reports for Reuters. “Executives from Apple, Adobe Systems Inc and Microsoft Inc were grilled by a special Australian parliamentary committee tasked with investigating allegations of price gouging raised by consumer watchdogs.”

“Software and hardware products in Australia sell for an average of 50 percent more than their U.S. equivalents, according to a 2012 survey of 186 songs, games, programmes and computers by Choice, a not-for-profit consumer advocacy group,” Wardell reports. “As soaring cost-of-living bills for basic services hurt the popularity of the minority Labor government ahead of a Sept. 14 election it is widely tipped to lose, lawmakers are considering restricting the ability of companies to set prices in Australia.”

Wardell reports, “Apple, Adobe and Microsoft executives told lawmakers the higher prices reflected factors including Australia’s 10 percent goods and services tax, higher labour costs, copyright issues and geographical product differentiation.”

Read more in the full article here.

“Apple also appeared at the pricing committee today, and its answers were expected but, to its credit, much clearer [than Adobe’s],” Jen Dudley-Nicholson reports for News Limited Network.

“It charges more for music, movies and TV shows in Australia because the record labels, movie and TV houses charge greater wholesale prices here,” Dudley-Nicholson reports. “It’s not fair, of course, for Australians to pay 70 per cent more for AC/DC’s Back in Black than Americans pay, but Apple is not behind the extra fee.”

Read more in the full article here.

18 Comments

    1. These days, whenever I hear someone going off on a government, I remind them that our Corporate Oligarchy REALLY rules our current fracked-up world. Look for the money and you’ll find the culprit. I call it Neo-Feudalism with the hateful, self-destructive Corporate Oligarchy as our overlords. Governments are merely puppets. Respect them, or disrespect them accordingly. 😯

      1. That line of reasoning is simplistic (blame the rich) and because of that, inherently deceptive. History repeatedly shows that government is not to be trusted.

        Look for the money alright, but the key is to look where money going to… not where it is coming from. No amount of money can buy something that isn’t for sale.

        Influence peddling, not influence buying, is the problem. Corrupt politicians/government bureaucrats/government employees.

        1. But in this case it’s not actually the government as the 10% tax was taken into account before calculations. Why do I limit my adobe purchases? Because of their horrendous markups.

        2. WRONG. Don’t be naive. We both know how the money system works. We both know how lobbying works. We both know that lobbyist write all the pro-corporate bills that go before Congress. We both know all the cash given to politicians for their votes. We both know that John Boehner was entirely unrepentant for handing out checks from the petroleum lobby to Republican members of the House. We both know the exact same garbage does on with the Democrats. We both know the MPAA and RIAA are pushing for CISPA, ACTA, SOPA, PIPA, all of which are unconstitutional violations of US privacy law and freedom of speech. We both know one single sharing of a tune online can cost over $100,000 in court thanks to the RIAA running the show. We know the entire Torrent system on the Internet is under attack by the MPAA.

          The list goes on for days.

          Again, don’t be naive, OR try to sucker anyone to believe an anything but corporate rule of our government and the institution of rule by the 1%, aka Neo-Feudalism. It’s dirt simple to document and understand.

          1. I understand and I don’t disagree that what you say is true.

            What we disagree on is the cause.

            However, I am neither naive nor wrong, as the dirt simple fact to understand is that none what you say could happen if (most) politicians weren’t willing to sell themselves. Also, if the past five decades has shown me anything, it’s that party affiliation has no bearing on this tendency.

            As I said before… no amount of money can buy something that isn’t for sale.

            As a aside, but in the same vein as this discussion, look at how well money has served Steve Forbes. It hasn’t. Despite all his wealth, he can’t get elected dog catcher.

            1. Ah. I entirely agree about politicians selling themselves. But then they are shoved in a corner and FORCED to do that thanks to our BS election laws and the recent Supreme Court ‘Citizens United’ unconstitutional decision. I expect that crap decision was Corporate Oligarchy inspired as well.

              This is indeed a complicated subject. But I cannot comprehend how people don’t bother to follow the puppet’s strings right up there behind the stage to the people PULLING THE STRINGS. You want to give these hateful, self-destructive biznizz and cazh bozoids a pass and blame it on the objects of their manipulation. No way is that acceptable. Yes way you are entirely capable of waking up and noticing what’s actually going on.

  1. I recently went to the US and was considering purchasing an iPhone after doing the math found it was about to purchase in Australia and to purchase a new MacBook Pro for only about $50 more.

  2. Would be great if the current gov had taken issue before being forced into publicity scampaigns…but it’s not all the government (this might be a hard concept for some (^) to grasp!). Government charges are not one of the excuses given because they are bit responsible. Am I a current government supporter? No I vote against them and hope they loose. But this part of the process and the guilty party should be punished. .

    Current Aus tax rate is 10% (GST).
    Current USD > AUD 1.04
    How much labor in Australia is used in iTunes content? Not much! What is geographical product differentiation? That leaves copyright.

    •Australians should be paying about the same as Americans for non physical goods•
    Aussies pay ~$6 for a movie rental via iTunes…
    Someone is ripping us off…Apple or the content providers. I know who I think and hope is responsible.

    1. And how does Apple control the prices for movies and songs anymore? Apple has gone to a multi tiered pricing system and the studios and music companies pick the prices at which the songs are priced. Apple just gets 30% of that.

      Remember, Steve was adamant about keeping prices down (the notorious [at least as far as the music companies were concerned] 99 cents a song) while the content owners wanted to raise the prices.

      Apple has absolutely no excuse for 50% or more higher prices for *Apple* developed software, but for content that Apple resells, Apple really has only partial control over those prices.

      Now Apple hardware is another issue…. We’ve recently learned that Apple gives a two year warranty in Australia versus only one year in the U.S. Does anyone think that repairing hardware under warranty during that second year costs Apple NOTHING? Apple needs to cover that cost somehow. Does that cover a significant fraction of the increase in hardware costs? Probably not, but it is a factor.

      And ploth, don’t forget import duties. As someone who has done export/import into and out of Australia, some of those fees are not trivial. I have no idea how much Apple is paying, but I somehow doubt it is zero.

      1. Yes I import / export too – which is why I clarified ‘non physical goods’. If there are any government fees / duties on the non physical please enlighten me as I’d love to know.

        It seems to be Apple is setting prices (or the tiers) for Australia for apps ( ie all 99c apps are 1.19 here etc.) this carries for their own apps. While our Aussie dollar is strong many argue that we should pay less not more but I think this 20% is acceptable for cross border purchases and agree there must be some extra costs. Movies are different though, and the pricing is terrible. Maybe you are right and the movie companies are picking the prices – but surely their response in this case would be just that? Then the movie companies would be answering the questions…

        Yes hardware is another issue, the 24 month warranty another. Personally I am disappointed that Apple don’t advertise this fact upfront. It seems like a legal move more than genuine customer support. 12 months for a. $1000 phone is not enough IMO. That said I would never purchase a non Apple handset and expect even 1/10th the customer care / support / warranty. Which is why I have bought every model iphone and iPad without any hesitation.

  3. The media branch of our Corporate Oligarchy has been GOUGING the HELL out of the Japanese as well, for decades.

    My personal respect level for the RIAA and MPAA is deep in the negative range, essentially matching their level of respect for their customers and clients. I believe the proper term for these companies is ‘asshats’. 😛

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