Apple blames high Aussie iTunes prices on content owners stuck in the old ways

By , Mar 22, 2013

australianmarkup

Why does digital content in Australia cost more than elsewhere? It’s not our fault, one Apple executive told a government panel investigating the pricing disparity.

The company (rightfully) blamed “old-fashioned notions” held by content owners for markups as high as 61 percent on music and other digital media sold in the region.

Apple’s Australian Vice President Tony King told the panel the company would prefer to offer music, movies, TV shows, along with hardware at lower prices, hinting that movie studios, record labels and other content owners are forcing the company’s hand…

According to The Sydney Morning Herald, King pointed the finger of blame at content owners:

The pricing of this digital content is based on the wholesale prices which are set through negotiated contracts with the record labels, movie studios and TV networks. The content industry still runs with perhaps old-fashioned notions of country borders or territories or markets.

As noted by MacStories, markup over U.S. prices for Apple products sold in Australia ranges from ten percent for the Mac, iPad and iPod to as much as a whopping 61.4 percent for music. Movie downloads carry a high 33.5 percent markup, while television shows cost 25.9 percent more when purchased in Australia.

The popular iPhone family includes a 16 percent markup for the iPhone 5 and iPhone 4S. By contrast, the iPhone 4 is cheaper in Australian than in the United States.

King, who oversees Apple’s interests in Australia, New Zealand and South Asia, defended the company’s pricing, saying it is “comparable to other Australian physical and online stores.” When pressed by Labor MP Ed Husic, King denied Apple could singly drop prices, saying lower pricing was up to content owners.

Apple was just one of a number of U.S. companies called before an inquiry into the issue by the Australian Parliament.

Adobe recently testified it charges Australian customers $1,000 extra for software due to “personalized” online service.

And software giant Microsoft also said a $2,000 additional cost for a software package was prompted by market competition. Besides, consumers could always reject the software fee by refusing to buy the product, the company argued.

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  • Gerard Hampton

    yes of course other people force apple to sell their hardware for a higher price in australia. PFFT. Our dollar is worth more than the USD and we pay more for the same product.. And they wonder why people pirate their software and jailbreak their devices.

  • epaper flip

    Good post man,
    just looking around some blogs, seems a pretty nice platform you are using.

  • Jordan Miller

    I kinda feel like a dick saying this but I’m going to any way.
    To the Aussies: Tough Tittie.
    This is nothing the government should be getting involved in. This is a civil matter. Not a federal. If I create a product and want to sell it 25% more in the United States then I do in Austraila then I will do so. Because its MY product. The Americans would just have to either pay up/not by the product/go on strike. Demand fairness as civilians. The government in no way should be involved in this.

    P.S I’m not from either country nor biased from either country. Just wanted to share my thoughts.

    Edit: And honestly can you blame those corporations for wanting to make as much money as they can? They won’t stop charging those percentages until Aussies take a stand against it. Corporations are faceless money munchers. Even our precious Apple who we don’t want to think of is this way. It’s just the way the world works.

    And to quote a famous scripture:
    “Money is the root of all evil.”

    • http://twitter.com/Duetschpire Duetschpire

      From us Aussies:
      Just because your “well, what you call government”, is so busy with what they presium is more important that the comfort, health, fairness and awareness of their citizens. The Australian government’s watch dog is one of many services that we do appreciate and vote for in this country.

      So whether it’s tough tittie or soft tittie, I think you and others in the states should be arguing getting a cosumer’s watch dog there as well instead of getting frustrated because others have it.

      Plus, let it be tough tittie this time, Australian’s average income is much higher than the American’s (sorry don’t have accurate numbers), and although we can afford the higher mark and tax, we still wanna get it cheaper (because we can and we will)… Cheaper is always better ;-)

      • Jordan Miller

        You must have not read my entire passage because I am pretty sure I state I wasn’t a yank.

        And I totally agree cheaper is always better. But the government ANY government doesn’t and shouldn’t have a say in what you charge for your products.

        I’m totally against big government. The smaller the federal government the better.

        In the end the government doesn’t have the right. That’s my only topic in this argument. I don’t give a wank about taxes or annual income.