I suppose then if the Brand had a distribution set up in Australia and got direct from the China factory, everything should be even-ish, hmmm? Maybe this just doesn’t happen much.

That $106 to ship a box, steep huh? If I was a shop I’d be pretty dark about my supplier undercutting me and steer customers to an alternative.

But the subpoena won’t help, this is a pretty easy concept, Adobe is just in a great position right now and the extra gov’t charges just help them more, they must be laughing to themselves that our pollies are so dumb. So they just feed them all that unquantifiable shit like, ‘cost of doing business’, warranties, the’ve probably got lobbyist working on getting the gst increased.

They could have just asked any retailer or economist what the scene is. They should just create a level playing field or get rid of gst/duties completely if you can drive a truck through the anomolies.

These guys just piss me off ‘cos I reckon they know this with all their advisers and they just want to look like they are being tough, you could see this coming from 5 years ago.

Photoshop works out like this:

Full Version. English.

Downloaded version:
USA – $700 USD ($675 AUD)
Australia – $1062 AUD

Shipped:
USA – $700 (no change)
Australia – $1168 (price goes up a whopping $106 to ship a box).

It is a disgrace.

The government should subpoena them, introduce legislation to remove blocks to parallel importing, increase the threshold that Harvey Normal was complaining about, remove ridiculous pro-USA copyright laws and make geoblocking Australian users illegal.

Then they will take notice.

Failure to put forward their point of view risks having no alternative argument and the committee finding 100% in favour of consumers, resulting in such recommendations to parliament to;
- amend laws around parallel imports that would specifically permit large scale parallel importation of products where significant retail price difference between source and market are apparent, and
- making it illegal to enact measures that prevent goods purchased in a foreign country from being used locally (as in failure to activate, or geo-locking software), with fines levied at a 10x multiple of the cost to purchase locally.

That might spur them in to action

I’ll just point out when Sony aggressively litigated against online shops that chose to grey import PSP’s and PS3′s when it was released a few years back because Jp units came before NA units and EU/AU came even later. Note we’re not talking about jail-broken units here. Plain off the box new units just grey imported from Japan for resale.

http://www.youtube.com/watch?v=2FVqnQm-w14

Pricing is Australia has traditionally been higher for imported goods.

The genuine reason for that is that costs were higher. We had high import duties. We had to pay support staff which weren’t busy all the time. We had to pay for the development and placement of our own advertising campaigns. For example, when Imagineering first distributed Microsoft’s products Imagineering did all of the support and all of the markettting, even printing the (then hefty) product manuals here in Australia.

The Australian economy is massively more efficient than it used to be: import duties are massively lower for electronics and software, Customs’ clearance is weeks faster than it used to be (and with consumers less and less interested in physical holders of bits, moving physical software is less and less of a concern). The globalisation of corporations means marketting development are done from the overseas’ headquarters, with only minor edits and placement done in Australia. Support is much more efficient. If support is run in Australia then it is as part of a global 24×7 support organisation. Web applications and e-mail allows support tasks to queue for much longer than were acceptable in the days when support was predominately done on the phone, so support staff are much more higher utilised.

Another genuine reason for past higher prices is that computers were not then mainstream. Computer companies now reap the benefits of economies of scale. Once upon a time you would employ a “programmer” and then spend the next few months teaching them how to use the mainframe you owned. There were about eight manufacturers and they were all different, and then they were all lovingly customised differently, so it was unrealistic to expect staff from elsewhere to be able to use your computer. In those times I was competent with 8 operating systems and over 30 programming languages. Today it is expected that people can drive a WIMP interface and a touch interface and programming isn’t required for most of what people do with a computer.

You’ve also got to remember that Australia has a small demand for technical goods. The has changed for a lot of electronics and software, as they have become tools of business and consumer goods. But you don’t have to most too far away from those to talk with an importer who thinks a sale a week is good news. For example, one manufacturer of electronics test equipment sells more into MIT than into the whole of Australia.

The less genuine reason fpr historically high prices is geographical price differentiation. This used to be easy, you’d jack the price up in Australia as far as the market would bear. The parliament had foolishly passed strong laws against parallel importation; importation was a dark art; and overseas’ manufacturers wouldn’t sell to Bruce Bloggs because the manufacturers desperately needed to keep the distributor in Australia on their side (because they were doing the marketing, the warranty repairs and so on). The folk in Australia mostly knew no different, apart from hobbists who read the US and UK technology magazines, saw the prices in the ads and asked “wtf”? But distributors could easy apply a bit of fog and FUD to wave those questions go away.

Then a few things happened.

First off the rank was containerisation of shipping and air freight. This necessarily required the computerisation of import/export to tracks who’s shipment was in which container and to pack and unpack the containers without losing people’s packages. Customs was then under the hammer to computerise the entire import/export paperwork chain. This cleared out a lot of the oddities and simplified and harmonised international customs and shipping practices.

Secondly, a whole lot of small factors: the massive drop in the price of shipping and air freight (much of it due to larger ships and aircraft); the fast turn around off docks and through customs; the Hawke/Keating simplification of import duties; the Howard GST removing almost all duties and tariffs, or at least dropping them to single digits; the removal of the most onerous of the parallel importation laws; the global acceptance of credit cards; and the SWIFT system allowing inter-bank deposits.

Thirdly, the Internet informing consumers. It told them that prices where lower overseas, although we’d long known that. And it helped them find retailers who were willing to ship to Australia. You’ve got to remember that when Amazon first started most of the questions by Australians were “is it legal to use it?” The positive experience with Amazon went a lot way to validating all international e-commerce, not just Amazon for book imports.

It also allowed customers to share information about products. In some products it became very apparent that the goods sold in Australia simply didn’t measure up. For example, software release dates would be pushed back in Austraila and the unsold product from overseas’ markets sold here at full price. Or a good sold packaged in the USA would be brokem into multiple parts in Australia.

The Internet works the other way too. You can imagine the horror of some manufacturers when then compared customer’s experiences against what they were being told by their overseas’ distributors. Having said that, manufacturers are wary of disintermediation, if only becuase they aren’t really manufacturers and fear a direct customer-factory relationship (and when will Foxconn start marketing its own designs, as Giant has done so successfully with bicycles).

The fourth factor is the Chinese deflation. The cost of physical goods has fallen so much due to the lower prices of Chinese manufacturing that the cost of the intellectual goods have become a major proportion of the price. Thus countries with high prices for these goods can be at a serious competitive advantage. This is because computers aren’t only consumer goods, they are capital goods too (ie, are used to make other goods). Microsoft are leading the pack here, trying to make about $100 from every Windows 8 tablet sold.

There is a downside to software now bing a consumer product — fashion and branding. Why do people use Microsoft’s products when there are free software alternatives? This hints that price is only a small part in people’s choice of software. If people are willing to spend $1000 more for the Apple branding then should parliament do anything to save those foolish people from themselves? The government doesn’t stop bogans buying Von Dutch or ponces buying Dior from paying over the odds.

I’d encourage the committee to consider changes which will encourage competition where competition is possible and prevent expoitative pricing where competition is not possible. This has everything to do with parallel importation laws, patent policy, import taxes and duties, and trade practices law.

I’d encourage the committee to look at the first sale doctrine as it applies to software licenses. At the moment you can import a device (with its software) but software license contracts undermine the first sale doctrine by preventing the software license to be resold along with the device.

I’d encourage the committee to look at is the “lack of manufacturer warranty”. It seems to me that if a distributor is providing a repair service for a product, then competition would be enhanced by it not being permitted to decline the repair (at a fair price) of parallel imported goods.

And a fourth suggeation to add to David’s above three:

4. Abolish all restrictions on parallel importing to allow a free market to operate in this country.

Just three steps towards a FREE market. (A free market is one where trade takes place without coercionand no privilege on either side.)