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Australian IT Price Hike Inquiry Kicks Off: Submissions Wanted

timothy posted more than 2 years ago | from the show-us-what-part-of-your-wallet-they-touched dept.

Australia 70

New submitter wirelessduck writes "After some recent complaints from a Labor MP about price markups on software and technology devices in Australia, Federal Government agencies decided to look in to the matter and an official parliamentary inquiry into the issue was started. 'The Federal Parliament's inquiry into local price markups on technology goods and services has gotten under way, with the committee overseeing the initiative issuing its terms of reference and calling for submissions from the general public on the issue.'"

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Now, now, now's the time right now! (-1)

Anonymous Coward | more than 2 years ago | (#40118411)

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Re:Now, now, now's the time right now! (4, Funny)

lightknight (213164) | more than 2 years ago | (#40119189)

Well, that customer testimonial has sold me! Unfortunately, I've already spent this month's IT budget on some Nigerian anti-virus software (they requested I pay for it in person, my flight leaves in an hour...busy busy), so I can't buy any.

However, a close friend of mine has confided in me that the company he works for is having some major, major security problems, and has given him a HUGE budget to buy whatever he needs to shore things up. His number is 202-324-3000, ask for "Bob" (his last name escapes me, I think it's Russian; lots of consonants, very few vowels).

P.S. Getting through the company phone system can be a bit of a pain (they have this automated system, and they are always changing their options...it can be quite trying). If you can't find him in the company phone book, just ask the operator to find his extension for you. Bear in mind, these people are all about security, so they may say things like "we do not have a Bob working for us" or "do you know who you are talking to?"; just relax, it's all a bluff. Bob's pretty far up there on the company hierarchy, and sometimes these annoying sales people dial the wrong number...just tell them that you "now exactly who you are talking to, and it's not Bob" (you need to be insistent at times with these people, so don't give up). There is, of course, a chance that Bob might be out of his office; if that's the case, ask them to put on their chief IT security guy (he handles purchase orders when Bob isn't around), and tell him everything you've told me here. Be sure to have him install a demo version of the software on his machine, and to walk him through the features; he'll be so impressed, he will probably ask for an on-site demonstration from you and your fellow coworkers. Also, remember to mention any other software your company makes, that he might be interested in.

Dear Australia... (2, Insightful)

fuzzyfuzzyfungus (1223518) | more than 2 years ago | (#40118435)

Because Kangaroos are pretty awesome(basically velociraptor sheep) I offer the following advice:

Y'know why vendors price their goods absurdly high in Australia? Because they can.

Y'know why they can? Because You, the government of Australia, let them.

Allow free importation of goods from the US and other markets and watch the vendor premiums for your mysterious island continent collapse. If Australians could simply buy from Adobe US, It'd be pretty difficult for Adobe to maintain a price premium...

Here endeth the lesson.

Re:Dear Australia... (4, Informative)

LordLucless (582312) | more than 2 years ago | (#40118551)

At least a part of the problem is that Adobe US will not willingly sell to an Australian. Actually, I don't know about Adobe, but that's the general problem they're trying to address. Companies are getting their US distributors to agree not to sell to Australians as part of their distribution agreement, specifically to stop Australians from getting them from overseas.

Re:Dear Australia... (0)

Anonymous Coward | more than 2 years ago | (#40118603)

Piracy it is, then.

Re:Dear Australia... (1)

AngryDeuce (2205124) | more than 2 years ago | (#40119785)

Pretty much this. Although, I admit, Australia seems to have problems with bullshit bandwidth caps that we don't have here in the U.S., generally speaking, so I can see how this could be a non-viable option.

They aren't just ripping of Australia. (2)

englishstudent (1638477) | more than 2 years ago | (#40119401)

Japan has a similar problem. Adobe CS6 Master Suite costs 334900yen ($4,203.59 USD), but if you buy it direct from Amazon http://www.amazon.com/Adobe-CS6-Master-Collection-Download/dp/B007USFTJM/ref=sr_1_1_title_1?s=software&ie=UTF8&qid=1337964816&sr=1-1 [amazon.com] it will cost you $2379 USD (189,613.80 JPY yen). That is about double the price!!! How can that be legal? For STEAM, the prices in Australia were 2/3rds what we were paying in Japan. It seems steam have recently changed that though and are bum fucking us too. I would love to hear an explanation for the change, especially considering the value of the yen at the moment.

Re:They aren't just ripping of Australia. (1)

ewok85 (1705550) | more than 2 years ago | (#40135347)

My steam prices in Japan have always been exactly the same as in the US, with the exception that many games are not available in Japan (VPN fixes that!)

Re:Dear Australia... (0)

Anonymous Coward | more than 2 years ago | (#40127799)

Like the GERSHON review that also failed to make any dent in the price of inflated software?

The Financial Managemet Act (FMA) or whatever they call it DEMAND's public expenditure get VALUE.
Strange how our PBS (Medicine scheme) pays 38% too much on a global basis - that's a waste of a billion dollars or so per year.
That minister is silent on the matter. They set up boards and common purchasing agreements - that fail to get the 'international' price.

The BATER Shoe case (Law) made it legal for suppliers not to sell to people they disliked, such as no service discounters.
Now we have companies like SONY and NIKE colluding (whether such fix fixing agreements have been registered and approved from ACCC - is unknown). Web discounters also get the cold shoulder. Such deals WERE illegal, but the TPA has been watered down - abuse of market power is much harder to prove.

The Govt should simply buy offshore AND also buy discounted Chinese MS versions - as about 12% of the Australian population are fluent Chinese literate. As stated, no real change will happen, as the GERSHON review failed to tackle it.

Re:Dear Australia... (5, Informative)

bds1986 (1268378) | more than 2 years ago | (#40118593)

Allow free importation of goods from the US and other markets and watch the vendor premiums for your mysterious island continent collapse. If Australians could simply buy from Adobe US, It'd be pretty difficult for Adobe to maintain a price premium...

I hope this is intended to be sarcastic. Firstly, Australia already has a Free Trade Agreement with the United States [wikipedia.org] . Secondly, the reason I can't buy from Adobe US, or Steam US, or iTunes US, or Whatever US has nothing to do with the government, but that each of those respective entities won't let me purchase from them and will refuse to accept my Australian credit card and billing address. Why? So they can slug me a 200% markup on the Australian store, despite $1AUD frequently exceeding $1 USD. The massive marking up of digital products downloaded over the internet is not the fault of the government.

Y'know why vendors price their goods absurdly high in Australia? Because they can.

And because international retailers selling products to Australians online are colluding with domestic retailers to raise prices or eliminate online sales entirely [smh.com.au] . From that article:

THERE are growing calls for Australia's competition watchdog to conduct an inquiry into local apparel distributors who are preventing overseas suppliers from selling their products to Australian consumers on international websites or instructing them to increase their web prices. The calls come after The Age last week revealed that a growing number of Australian fashion importers and wholesalers are reaching agreements with international brands to lift prices or cease shipping here.

In Australia, retailers will frequently impose 300-400% markups on items found easily online. That is why an inquiry is needed.

Re:Dear Australia... (2)

bug1 (96678) | more than 2 years ago | (#40118775)

In Australia, retailers will frequently impose 300-400% markups on items found easily online.

And said retails also complain when people buy stuff online.

Re:Dear Australia... (2)

davester666 (731373) | more than 2 years ago | (#40119039)

The main reason: localization

Do you know how rare it is to find somebody that understands both Australian and either US or UK English?

Re:Dear Australia... (1)

Kell Bengal (711123) | more than 2 years ago | (#40119213)

Do you know how rare it is to find somebody that understands both Australian and either US or UK English?

'struth!

Re:Dear Australia... (0)

Anonymous Coward | more than 2 years ago | (#40131955)

umm everyone? except for US of course, they talk funny

Re:Dear Australia... (2)

hairyfish (1653411) | more than 2 years ago | (#40119403)

but that each of those respective entities won't let me purchase from them and will refuse to accept my Australian credit card and billing address.

And not just that. With the dollar at parity I wanted to buy a Fender guitar, retail in US for $299, here $500+. Even with $100 freight it's still cheaper to buy in the US and ship here, however Fender US won't allow their dealers to ship outside the US, so I ended up using a shipping service in California. So buying from the retailer, shipping local to US, paying CA state taxes, then shipping international and paying international shipping and insurance I still managed to get it for under $500. The best example of us getting shafted is the Holden Monaro. Built in Australia, and sold to locals for $60k, it was then exported to the US as the Pontiac GTO and sold there for $30k.

Re:Dear Australia... (0)

Anonymous Coward | more than 2 years ago | (#40119913)

Isn't the minimum wage in Australia 15.xx per hour? Don't you think that might have something to do with retail prices being a little high?

Re:Dear Australia... (1)

barvennon (2643433) | more than 2 years ago | (#40123915)

Absolutely!

Re:Dear Australia... (1)

cibyr (898667) | more than 2 years ago | (#40123981)

High local wages don't explain high prices for imported goods, often purchased online with no humans in the loop (e.g. Steam).

Re:Dear Australia... (0)

Anonymous Coward | more than 2 years ago | (#40119981)

I hope this is intended to be sarcastic. Firstly, Australia already has a Free Trade Agreement with the United States [wikipedia.org].

So does Canada, and as a Canadian, I've seen that they're completely fucking useless.

When the stimulus package was being done a few years back there were all these "buy American" provisions and it took months and months of lobbying for Canada to be exempted—as it should already be under NAFTA. Then there's the whole softwood lumber thing that went on for years.

Canada has filed numerous complaints with the WTO with regards to unfair trade practices with the US and has won every time, and yet the US politicians still introduce fresh bullshit.

Signing free trade agreements with the US is a complete waste of time IMHO.

Re:Dear Australia... (3, Interesting)

mjwx (966435) | more than 2 years ago | (#40118697)

Allow free importation of goods from the US and other markets and watch the vendor premiums for your mysterious island continent collapse. If Australians could simply buy from Adobe US, It'd be pretty difficult for Adobe to maintain a price premium...

Ummm...

Parallel importation of software is perfectly legal. I buy all my games from Hong Kong or the UK. I can order Photoshop from B&H PhotoVideo in New York and they'll deliver it to me in BumFuck, Western Australia. Ooops, sorry, that's Perth, Western Australia.

What I have a small problem with is the fact that I cant buy from Australian stores, who pay Australian taxes and support the Australian economy. The government has a very big problem with this.

But my prediction is that the report will tell us what we already know, Aussies are getting ripped off, the distributors are gouging prices and they'll have a nice list of recommendations that'll never happen because if for no other reason, the opposition will stop it because it wasn't their idea.

BTW, Kangaroo's aren't like Velociraptor Sheep, first they are bigger then a Velociraptor or a sheep. They are more like 6 ft tall bounding rocks because it looks like your car has hit a rock after running into one.

Re:Dear Australia... (1)

TapeCutter (624760) | more than 2 years ago | (#40119433)

Sounds like a job for the ACCC to me, they have the independence and the teeth to tackle something like this, as you say the opposition are not going to want to help the government look useful. The US could benifit from a similar institution, particularly wrt to pharmecuticals.

Re:Dear Australia... (2)

drsmithy (35869) | more than 2 years ago | (#40119585)

Sounds like a job for the ACCC to me, they have the independence and the teeth to tackle something like this, as you say the opposition are not going to want to help the government look useful.

After ten years of Liberals in Government, the ACCC is but a shadow of its former self.

5 subsequent years of "New Labor" has (unsurprisingly) done little to remedy the situation.

Re:Dear Australia... (1)

Meski (774546) | more than 2 years ago | (#40131799)

a - Setup a US redirecting service
b - Get an Aussie creditcard
c - Set the billing address of b to a
d - Setup a proxy


Order software via d on c.

Re the 'roos: I'd sooner hit the rock, it doesn't fight with you after it comes thru the windscreen.

Re:Dear Australia... (0)

Anonymous Coward | more than 2 years ago | (#40118757)

How do you suggest that it is the Australian government's fault?

Much of the problem is that the restrictions on distribution and sale are being put in place by foreign entities.

As an example outside the digital world, foreign clothing companies like ASICS put restrictions on overseas retailers, preventing them from shipping to Australia.

Re:Dear Australia... (1)

jbmartin6 (1232050) | more than 2 years ago | (#40119241)

Try shipping IT equipment to a company division in Australia, the taxes are enormous to the point where we always try to get it sourced locally. Some US reps will give you a substantial discount if you say you have to ship it to Australia.

Re:Dear Australia... (0)

Anonymous Coward | more than 2 years ago | (#40118841)

Australians CAN simply buy from the US and do, actually there is a big furor amongst traditional bricks and mortar retailers who don't like Australian's buying from overseas and bypassing the GST as well as the higher prices they charge (which the incumbent distribution channel model most vendors use to get their goods into Australia brings about and don't want to change).

FYI Australia does have a Free Trade Agreement in place with the USA since back in 2004 [http://www.dfat.gov.au/fta/ausfta/index.html]

The problem is that many vendors in Australia have RRP's which are substantially higher than prices for the same product overseas. The real question is WHY?! Hence the Price Inquiry.

The thing to remember is that all countries protect certain markets for strategic purposes. The USA included.

I certainly agree with you on one thing. Vendors do price things higher because they can. But I think its got more to do with Australian consumers being willing to pay absurdly higher prices because we are an island nation with high average incomes, than it is because the Government "lets" vendors sell at inflated prices... this is a capitalist nation after all, it's not like higher margins are forced on vendors by the Australian Government.

Re:Dear Australia... (2)

wintermute000 (928348) | more than 2 years ago | (#40118903)

You're commenting on the case with an arrogant uninformed attitude. Other posters who have replied have basically demolished your argument. What in the world made you assume Australia has government mandated import barriers towards overseas IT products? Its the exact opposite: market collusion amongst the big players to extract monopoly rents. Or are you suggesting Australia, er, goes 'commie' and starts regulating the, er, 'free' market? ROFL

Please in future do at least a modicum of research before getting on your soapbox. GET A BRAIN MORANS GO USA

Re:Dear Australia... (0)

Anonymous Coward | more than 2 years ago | (#40122309)

GET A BRAIN MORANS GO USA

Cute. No one in the US complains about the cost of purchasing Australian products.

I wonder why that is?

Thanks for the money, though.

Re:Dear Australia... (1)

Meski (774546) | more than 2 years ago | (#40131803)

Here, have some Vegemite. You need to apply it about 6mm thick.

Re:Dear Australia... (2)

rtb61 (674572) | more than 2 years ago | (#40118909)

Prime example of this, price of DVDs in Australia, often very closely align with the price of DVDs in the US, why http://www.amazon.com/ [amazon.com] , that's why, plus low cost of transport, import duties on the medium only and you still pay GST. Add to that the ACCC made region coding non-enforceble and you can buy most dvd players fixed to be region free (you notice boc has been opened and inspected and confirmed sticker placed on it, the media companies dont want it continually advertised that Australia has legally broken region coding).

Commercial software seems to be the biggest problem mainly because the government is in the pocket of the BSA and routinely buys their product and data locks to it. Free open source software is only recognised by the Greens and the Democrats. Liberal will never want a piece of it and Labour has been horribly slow coming to the party with it comes to software that thrives on 'BLOODY LOCAL SUPPORT AND DEVELOPMENT' not on billions of dollars disappearing overseas.

Re:Dear Australia... (1)

drsmithy (35869) | more than 2 years ago | (#40119493)

Allow free importation of goods from the US and other markets and watch the vendor premiums for your mysterious island continent collapse. If Australians could simply buy from Adobe US, It'd be pretty difficult for Adobe to maintain a price premium...

There are few import restrictions to Australia in general and even fewer from the US thanks to the "Free" Trade Agreement.

Re:Dear Australia... (0)

Anonymous Coward | more than 2 years ago | (#40120623)

Have you been eating that FuzzyFuzzyFungus?

Yeah those "free importation of goods from the US ..." on downloads from US servers ... Tell that to the poor bastards stuck using the iTunes shop

So explain to me again why Adobe charges Australians 50% more for the identical product, downloaded from the same US servers as you seppo's (y'know, yank, yank, septic tank) download it from ?

Why? Because Adobe, Apple etc, etc, have been ripping us off blind. Hence why they are now being investigated.

I was able to buy a boxed copy of a software suite from a US shopfront retailer, and freight it back to Australia in a one off consignment, for just over half the price they sell it for locally.

Ever heard of the US-Aus free trade agreement? And no - It's not like the Ameriscam government doesn't put massive tariffs on imported goods to "protect" US business' and industries. Have you every tried to bring a competeing product into the US when there are existing US interests ? More hops and tape than Circ de Sole ...

Complaining about proprietary software prices... (2, Insightful)

thatkid_2002 (1529917) | more than 2 years ago | (#40118449)

Is as useful as tits on a bull. Companies can charge whatever they damn well want for their software. Who is anybody to tell them different?

Complaining about the lack of funding into open source or at least home-grown software is much more useful.

Re:Complaining about proprietary software prices.. (4, Insightful)

LordLucless (582312) | more than 2 years ago | (#40118511)

It's not so much about high prices - it's about price discrimination. Yes, companies can charge whatever they damn well want for their software. And if they sell it for half the price in the US as compared to Australia, then customer's can damn well buy it wherever they want. And if companies introduce artificial barriers to stop the customers doing just that, that's when the government needs to smack them down.

Re:Complaining about proprietary software prices.. (1)

Jimbob The Mighty (1282418) | more than 2 years ago | (#40132607)

This problem is not limited to software... Look up what prestige cars cost in Australia, vs what they cost in the US. Why do cars cost more here? The market can support it here, because there are enough idiots who don't question or aren't aware that they are paying so much more here than elsewhere.

Re:Complaining about proprietary software prices.. (5, Insightful)

Frogbert (589961) | more than 2 years ago | (#40118523)

Is as useful as tits on a bull.

No It's not

Companies can charge whatever they damn well want for their software.

Sure, but they shouldn't be allowed to stop you importing it from another region.

Who is anybody to tell them different?

The Australian Government

Re:Complaining about proprietary software prices.. (1)

ArchieBunker (132337) | more than 2 years ago | (#40118559)

Well its a bit unfair when the same game that cost $10 USD is somehow marked up to $70 AUD.

Re:Complaining about ... prices.. (0)

Anonymous Coward | more than 2 years ago | (#40130971)

There are also things that are relatively inexpensive in AU, but when sold in the US go for a 3+x premium.

If the AU people in general didn't like it, they have the power to change their own government. Whenever
a government oppresses the governed more than the governed are willing to accept, change happens.
This has been shown over and over again. Sometimes it takes a considerable time, but it happens.

I can only assume that most AU citizens are tacitly happy, since they are not 'throwing the bumbs out'.

On occasion even a majority of citizens can be misled/taken down the garden path, and it can be very
hard to come out of a direction when taken. But it does happen.

I might suggest reading/watching the book/movie "The Fountain Head" by Ayn Rand which speaks of the rights of the individual over the collective.

Re:Complaining about proprietary software prices.. (1)

cheekyjohnson (1873388) | more than 2 years ago | (#40118665)

Companies can charge whatever they damn well want for their software.

And people can criticize their decisions. But if people are indeed buying it anyway, I'd agree it's not useful.

Re:Complaining about proprietary software prices.. (1)

ghostdoc (1235612) | more than 2 years ago | (#40120919)

Going by the very same logic, pirating their software is OK.

If they can discriminate on their pricing I can discriminate on my sourcing.

Re:Complaining about proprietary software prices.. (0)

Anonymous Coward | more than 2 years ago | (#40122773)

Bingo. It's a free market, down with regulations!!!!!! Gotta make sure all those job creators make increasing profits every quarter. Cut regulations, Cut Taxes. Nothing else matters.

Re:Complaining about proprietary software prices.. (0)

Anonymous Coward | more than 2 years ago | (#40131181)

If I try to buy windows server datacenter edition from the USA the price is around half of that in Australia, this is online buying, no shipping involved. We're not the only country though. Someone in the UK said it would be cheaper to buy an Adobe package by flying to the USA, purchase it and then fly back to the UK rather than buying it locally.

Well ... (0)

Osgeld (1900440) | more than 2 years ago | (#40118469)

You do live in a very remote country with vast distances between major points, shit doesn't just teleport there by magic.

Re:Well ... (1)

AlanS2002 (580378) | more than 2 years ago | (#40118501)

Of course that's explains it all. It's the _very_expensive_ freight involved in the shipment of CDs. I knew there had to be an answer.

Re:Well ... (1)

davetv (897037) | more than 2 years ago | (#40118509)

What about internet supplied products such as music downloads. There is no reason at all us Australians should pay $1.69 when he same track is $0.99 in the US. Remoteness is not a factor. It is select companies deliberately price gouging us because they feel the market will bear it. I for one look forward to law changes to correct this problem.

Re:Well ... (0)

Anonymous Coward | more than 2 years ago | (#40118649)

So why doesn't anyone Australian start up a company and rather than get incredibly rich like those abroad, they just settle for becoming very rich?

Re:Well ... (1)

LordLucless (582312) | more than 2 years ago | (#40118529)

shit doesn't just teleport there by magic

There's this thing, it's called the internet. It teleports stuff there by magic. At least a part of this investigation is into price discrimination on software.

Re:Well ... (2)

Nursie (632944) | more than 2 years ago | (#40118681)

No, it gets here by mail order.

For some reason it is way, way cheaper for me to order stuff from the far east, the US or even the UK and have it shipped over, than it is to get it from an australian website or retailer. Don't tell me that bulk shipping adds a 100% plus markup over individual shipping, these things work the other way around.

And then there are other things like games, which you get online, which often launch at $50-60 in the US and AUD 100 ($102 right now) here. For the same thing, delivered over the internet.

There is no justification.

Re:Well ... (1)

dkf (304284) | more than 2 years ago | (#40118753)

And then there are other things like games, which you get online, which often launch at $50-60 in the US and AUD 100 ($102 right now) here. For the same thing, delivered over the internet.

But those poor poor distributors have to pay for the game to be shipped to you over your narrow and long tubes. Oh wait, you pay for that part too via your network subscription...

Re:Well ... (1)

wintermute000 (928348) | more than 2 years ago | (#40118919)

The price difference is well above the cost+profit margin of transportation.
Why is it there are so many Americans who comment on stuff about other countries who automagically assume things that they have zero clue about.

Re:Well ... (0)

Anonymous Coward | more than 2 years ago | (#40119603)

The price difference is well above the cost+profit margin of transportation. Why is it there are so many Americans who comment on stuff about other countries who automagically assume things that they have zero clue about.

That's because, on the whole, Americans are stupid and think that their rules apply everywhere else.

Re:Well ... (0)

Anonymous Coward | more than 2 years ago | (#40121713)

and forigners constantly bitch and wine about how they are not up to par with American standards, see headline

Re:Well ... (0)

Anonymous Coward | more than 2 years ago | (#40127101)

I'm an American who's infrequently in Australia. I'm shocked at the prices that are charged for goods. I was just in Target in Brisbane today, and a standard candy bar (nothing special, just single serving Cadbury chocolate) was $2.50 AUS. I'd be fucked sideways with a chainsaw in the US if I paid more than $.75 US for the same thing at Target. Cans of soda go for more than $1 AUS, where proper buying in the US will get you a can of soda for $.25 US.

Same goes for Lego kits. I paid more than $30 AUS (on sale) for kits that would go for $20 US on sale at Target.

Re:Well ... (1)

Anonymous Coward | more than 2 years ago | (#40119023)

That's true - shipping costs theoretically should make prices different, on a dollars per kilo basis. For durable goods, there are many many cases where buying the item at retail in the US and shipping into Australia yourself will end up being far far cheaper than buying the item in Australia.

One of the examples is a Lenovo X1 laptop. I just checked, and the same laptop is AUD1299 vs USD1019. As of this moment, AUD1299 is USD1265. That means Australians are paying 24% more (about $250) for the same product. Now, I know you can Fedex a laptop from the US to Australia for under $100, and if you are Lenovo, you can handle the shipping for a lot less.

But consider that its not a matter of shipping from the US, but rather comparing shipping from China to the US vs from China to Australia. In this case, the shipping costs are basically the same. Australia is no more 'isolated' from China than the US is.

Basically, Australians are being raped.

Re:Well ... (0)

Anonymous Coward | more than 2 years ago | (#40119763)

That and localisation of the product is simply adding the correct $3 power cord into the box, the power supply itself is universal.

Re:Well ... (1)

ghostdoc (1235612) | more than 2 years ago | (#40120939)

But Australia is closer to China (where everything gets made) ... so why are Australians paying more than Americans?

And the boats that ship all our minerals to China can just fill up on stuff on the way back, so shipping should basically be free...

I have one! (1)

slashmydots (2189826) | more than 2 years ago | (#40118493)

All Microsoft licensing on all products! Oh wait, is this not the submission form? Whatever, I'm in America anyway, lol.

Free Trade... (0)

Anonymous Coward | more than 2 years ago | (#40118563)

for me (the multinational) and not for thee (the pathetic consumer).

Certain parties are far too used to having their cake and eating cake too: yours.

Technet (3, Interesting)

Anonymous Coward | more than 2 years ago | (#40118791)

Posting AC because of Slashdot's bug that prevents me from logging in.

A Technet subscription is mysteriously $200 more dear a year in Australia despite us being quite happy to use US English and keyboards. Yet in Thailand, it's $40 a year, where they need a full translation and separate keyboard support. What's the difference?

The Thai pirate software a lot. A *lot*.

So I ask you, what's the simplist way for Australians to reduce the price of Technet?

Re:Technet (0)

Anonymous Coward | more than 2 years ago | (#40118847)

You just gave me a very interesting business idea.

Supply chain mark-ups (3, Interesting)

Tim99 (984437) | more than 2 years ago | (#40119175)

About 20 years ago an Australian banker told me that the reason that imported goods were expensive was multiple markups in a small economy.

An importer would be lucky to get a 25% margin from a foreign supplier. They would then put a 30% margin on their sale to a wholesaler. The wholesaler puts a 20% margin on his sale to a distributer, and the distributer puts 20% on their sale to a retailer. The retailer then puts 30-60% on to you the purchaser. So a worst case is $(100 - 25) x 1.3 x 1.2 x 1.2 = ~$140 at the retailer - (Assuming parity between the US and AU dollar - The currency conversion only applies to the importer). You now need to add 10% Goods and Services Tax, which means that you could expect to pay $200 to $250.
A more efficient set up is where a large importer also acts as the wholesaler and distributer, so you would probably be looking at $(100 - 30) x 1.4 = ~$100, say, roughly $145 to $175 retail.
Compare this to an item bought directly on the internet from the US or UK. Even without a discount you are only going to pay $100 + shipping (say $15) - If you allow a small discount, the final price you pay is probably about $100. There is no GST on a personal import costing less than $1000. So even if retailers were able to persuade the Australian Government to impose GST on personal imports the most you would pay for the $100 item is ~$115.

Caveat: Obviously it can get more complicated than that as you have to pay someone to convert the currency for you (Expect to pay ~2%). The cost of shipping from abroad can vary wildly based on the carrier and the amount of business that you give them. The original numbers were based on an economy when, 20 years ago, the AU dollar bought about 83 US cents.

Re:Supply chain mark-ups (2)

tumutbound (549414) | more than 2 years ago | (#40119625)

This harks back to a practice among IT companies some years back called (I think) 'transfer pricing'. By charging the local branch of the company a very high cost price, the item could still be sold at a high price with little markup to be taxed in the local jurisdiction.

Re:Supply chain mark-ups (0)

Anonymous Coward | more than 2 years ago | (#40120539)

This mirrors what I've heard - that it is the number of middlemen involved in Australian imports that cause the price to be so high for a whole range of goods.

But that's for physical goods.

That doesn't apply for software that you download, unless folks like akamai, etc, are charging a premium also for delivering software to Australians?

Re:Supply chain mark-ups (1)

Zaelath (2588189) | more than 2 years ago | (#40131311)

And any of that relates to digital on-line sales, how?

There are some costs in shipping shit to Australia, but if you're too stupid as Harvey Norman to arrange purchase direct from the supplier and ship it yourself I'm not sure how that's my problem; when I can purchase direct from a retailer and ship a single unit for less even though I can't take advantage of the price benefits of shipping in bulk.

The real issue in your mythical supply chain is two-fold:

- Australian retail wages are higher than in the US, by around 50% (This is your biggest cost)
- Australian real estate is at unsustainable levels which forces the rents high on the retail space you hold the rapidly diminishing levels of JIT stock, and increases the wage pressure above so people can afford to live within a commute of their horrible wage slave job.

Nothing is going to make hardware cost the same in Australia, and the government isn't sugesting that, but the electronic on-line sales price discrepancy is just pure market gouging.

That said, if you want Americans to lower prices in Australia, stop buying their shit in Australia.

Re:Supply chain mark-ups (1)

Tim99 (984437) | more than 2 years ago | (#40133475)

And any of that relates to digital on-line sales, how?

I know this is slashdot where we don't normally RTFAs, but I (stupidly) actually read them. Excerpts from the articles:-

... described as “glaring price differentials” with respect to other “culprits”, naming Lenovo, which slugged Australians with a $560 markup on its ThinkPad X1 laptop when it was released locally in May ... ... and Adobe, which has regularly marked up its Creative Suite products substantially upon launch in Australia...

...The Committee will look into the cost of computer hardware and software, including games, downloaded music, e-books, and professional software, to name a few. The Committee is looking forward to hearing from the companies who set these prices and the consumers and businesses that purchase their products...

The real issue in your mythical supply chain is two-fold: - Australian retail wages are higher than in the US, by around 50% (This is your biggest cost) - Australian real estate is at unsustainable levels which forces the rents high on the retail space you hold the rapidly diminishing levels of JIT stock, and increases the wage pressure above so people can afford to live within a commute of their horrible wage slave job.

Economics 101 tells you that the price of everything in an advanced economy depends on demand, supply, wages, and access to credit. As Australian banks were/are stupid enough to lend money to buy a house based on up to 8x your income, housing prices were going to inflate to the level that the market can bear. In WA, where I have a house, State Government's through their agency LandCorp increased the price of a small block of land from about $25K 20 years ago to $200K - Building costs only rose from about $60K to $180K. So there is also a hidden tax pushing up the price of everything .

I have written and sold commercial software (and run businesses in Oz which imported stuff from abroad). Often the currency used was the US dollar, so I may have some insight into this. Now that I am retired, I have the time to directly import stuff for my personal needs, or buy it when I am abroad.

As an aside, working for someone else is unlikey to create significant personal wealth...

Re:Supply chain mark-ups (1)

Zaelath (2588189) | more than 2 years ago | (#40138211)

Australian banks will lend what you can afford to pay, if nothing in your life gets worse. I would contend that foreclosure rates aren't up because people were overcommitted on their reported income, they are up because people lost that income.

In any case, I agree the land prices are a bit high (if it was actually $25K and 20 years, then it should be closer to $116K at 8% a year which isn't uncommon in Australia's messed up housing market), but that's because if the government sells that land at $25K it devalues the value of YOUR house retrospectively and you would lynch them. The government controls the price of land by limiting supply, which means you get "growth" in assets which keeps the baby boomers happy which keeps the government in power.

Re:Supply chain mark-ups (1)

Tim99 (984437) | more than 2 years ago | (#40140293)

Yes, 8% is not uncommon in the AU housing market. Wages and GDP over the same period have gone up by about 3.5% pa. A reasonable median salary now of $70K was about $35K 20 years ago, so that tracks well to 1.035^20. There is an overview of 20 years of economic growth at the RBA website http://www.rba.gov.au/speeches/2010/sp-dg-200810.html [rba.gov.au]
But, the underlying inflation rate for goods and services for last 20 years was only 2.6% ( http://www.rba.gov.au/calculator/annualDecimal.html [rba.gov.au] ) so the $25K for land would be ~$42K allowing for underlying inflation or ~$50K allowing for wage inflation - Therefore $200K for land is outrageous, even compared the $60K to $180K for building which "should" have been ~$100K @ 2.6%.or ~$129K @ 3.5%

The technology behind buiding houses has become cheaper, but our expectations are higher. Houses are bigger and have more rooms, aircon, smart technology etc., so we could perhaps justify the increase for building, but not land. That one is firmly within the remit of banks and government.

I was 'lucky' when I took out a 25 year morgage in the UK 30 odd years ago. Banks would only lend 3 times your annual salary (or if you were married and both partners had a secure job, 2.5 time your combined basic salary). Interest rates were up to 17%, but inflation was running at a similar rate; so after 10 years the mortgage payments looked small.

Australia Post (1)

jaminJay (1198469) | more than 2 years ago | (#40119527)

Australia Post love shipping stuff everywhere. Our governments know we can't afford to let such core infrastructure die, regardless of the whim and desire of powerful, rich tyrants like and the rest of the retail industry incumbents. You wanted a free market, and the free market wants your stale business model to die quietly. And don't start crying about jobs, there'll be new industries creating new types of jobs in the wake of the people you constantly "down-size" to prop up your bottom line or improve the new manager's performance statistics.

well obviously... (0)

Anonymous Coward | more than 2 years ago | (#40119635)

the extra cost is localising the software from english to australian. for example:

[ Yes ] , [ No ] , [Cancel] => [ Rippa ] , [ Bugga ] , [ WTF mate? ]

i tell you now, it's hard to find someone fluent in australian. i mean try find someone that can tell you what a "drongo" is. ask five aussie's and they'll all tell you different things. they also like to "take the piss", which equates to bullshitting people, making it much more difficult to confirm whether something is correct or not. as a result there are many things still in dispute such as dropbear, platypus, hoop snake, and bunyip. the platypus is the most suspect of those of course. i mean really, what kind of evolutionary process results in a beaver that lays eggs, is duck-billed, otters footed, and is venomous. don't go looking up the wikipedia article on it either. with over 4000 revisions in the history log and a near daily edit rate, odds are it's a battle between editors cleaning up the article to state it's still speculative, and aussies attack it again to add it all back in as fact.

Regulatory capture (1)

barvennon (2643433) | more than 2 years ago | (#40124183)

The real evil in our representative democracies is regulatory capture. http://en.wikipedia.org/wiki/Regulatory_capture [wikipedia.org]

For instance software. Ubuntu, Apache, etc have shown that Copyright laws are not necessary in the development of good software. I suspect the same is true in music, movies, books and a lot of other stuff.

The copyright laws funnel money to organizations (MPAA, RIAA et al) that advertise the product and "capture" favorable regulations. (is copyright really necessary to produce good movies? Then why does'nt the success of a movie correlate strongly with its production cost? Most of the profit comes from showing the movie in theatres).

Fortunately for everybody (except those few who benefit from regulatory capture) the copyright regulations are failing. Hence (I suspect) the recent involvement of homeland security in closing pirate sites.

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