Published on the 27/03/2013 | Written by Newsdesk
A Government Committee investigating the prices Australians pay for information and communications technology is now mulling over the responses of industry giants Apple, Microsoft and Adobe…
Appearances last Friday by senior executives from Apple, Microsoft and Adobe at Australia’s inquiry into pricing in the ICT sector have thrown some light on the way global technology giants charge their international customers.
The House of Representatives Standing Committee on Infrastructure and Communications began its investigations into ICT pricing in 2012. According to committee chair Nick Champion MP, “The committee has been told that big IT companies and copyright holders charge Australians, on average, an extra 50 percent, a practice consumers call the “Australia Tax”.
Last week the three tech giants were at pains to dispel that notion, although Microsoft managing director Pip Marlow acknowledged that the company did charge customers in each country differently, and also used geo-blocking to prevent Australian customers from downloading software from Microsoft offices overseas. Marlow also confirmed the committee’s suggestion that current regulations allowed ICT companies to charge “what the market could bear”.
The committee asked Marlow to explain how the same suite of Microsoft software could cost a US consumer AU$2324 while an Australian was expected to pay AU$4136. She maintained that in most cases prices paid by US and Australian consumers were similar.
Apple vice president Anthony King meanwhile told the Committee that Apple’s products were “not materially different” in terms of price charged in the US and Australia. He lay the blame for the increased cost of digital content on iTunes at the feet of IP rights holders.
King said Apple would communicate with the music labels about the issue because, “We are hearing comments in Australia that frankly make us uncomfortable”.
Paul Robson, the managing director of Adobe, said that ICT companies, “strive to find the optimum selling price in each market” accounting for issues such as the cost of acquiring customers and the “price elasticity of demand”.
While the Standing Committee referred to significant differences between the amount Australians were expected to pay for Adobe products compared to their international peers, Robson claimed that the pricing of cloud-based services was roughly aligned globally.
Adobe however only reduced the Australian price on its Creative Cloud in February – the month during which it was summonsed to attend the pricing inquiry.
