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Windows in Brazil Costs 20% of Per Capita Business Income

mjasay writes "Ever wonder why open source is so popular in Brazil and other BRIC nations? As one study suggests, one big reason may well be Microsoft's punitive pricing, which exceeds 20 percent of Gross National Income for businesses in Brazil (and 7.8 percent of consumer GNI). This leads to a second, related reason: At those prices, there's little hope that Brazil can build a home-grown software economy on the foundation of proprietary software. This factor is exacerbated by Brazil's widespread disdain for the United States, which also tends to favor software that is not perceived as American. Of late the free and open-source Brazilian dream may be fading a little but its importance to the long-term growth prospects of the Brazilian economy shouldn't be understated."

31 of 236 comments (clear)

  1. 20%? What are the customs duties? by Tsu+Dho+Nimh · · Score: 5, Informative

    Duties on imports may have something to do with the 20%. Right as Intel started putting manuals online, I was working on that project, and Brazil was high on the list of downloaders. We tracked them to a technical university, did some emailing, and found that the duty on a printed manual nearly tripled the cost of the manual (in USD).

    1. Re:20%? What are the customs duties? by LurkerXXX · · Score: 2, Insightful

      Shhh, if you tell folks the Brazilian government is the one that's hiking up the price so much, Microsoft might not look as totally evil!

    2. Re:20%? What are the customs duties? by annodomini · · Score: 3, Interesting

      From the article: "I imagine Microsoft charges about the same and Brazilâ(TM)s brutal tax burden makes up the rest." The summary was pretty confusingly written, but the article actually covered that.

    3. Re:20%? What are the customs duties? by Flavio · · Score: 4, Informative

      That's weird, I'm brazilian and last time I checked, books (and possible other printed materials) weren't taxed when imported. It's why I tend to buy books at amazon.com.
      If you ever imported _anything_ in last 10 years (which i doubt) you surely knew this is not the reality.

      Eerything you import, even those things that are explicitly not taxed, gets abusive taxing. Brazillian Customs sets tax according to their mood, and if you ask for a tax analyse, consider your tax doubled.

      In brazil, the product price plus shipping (yes they tax shipping too) gets taxed 60% (import tax) plus 20% (ICMS, another tax).
      Bullshit. I import goods at least once a month, and this is not the case. Printed material, such as books and magazines are NOT charged an import tax. Software is also exempt from import taxes.

      The tax for imports over the mail are very clear: 60% over the value of the goods and shipping. The 20% ICMS charge only counts if you're importing with a courier such as FedEx or UPS. Regular mail does not get charged the 20%.

      If the package does not accompany an invoice, or if the invoice's value is obviously fraudulent, then the customs official has can attribute a value which he believes is fitting. If you disagree with this value, you can challenge his value, but this will entail a lot of effort and you will most likely lose. You may also not import used goods, or prohibited items (such as firearms, explosives, live animals and organs).

      Customs officials are corrupt bastards if you have to deal them in person (for instance, if not importing through the mail), but I've never had them charge me anything other than 60% over mail order items. In particular, I've imported at least US$ 5000 in books over the last 10 years, and I've never been charged an import tax.
    4. Re:20%? What are the customs duties? by morcego · · Score: 3, Informative

      I find it hard to blame the government on this one.
      The manuals are printed in Brazil. So are the CDs/DVDs.
      Having access to the price list of a Microsoft distributor (not resaler), I can see some very big price differences, as I'm pretty sure happen everywhere else. The OEM license (which include media and manual, btw) costs about half the shelf price. And I'm not talking bulk here. I'm talking a guy with a computer store buying a single OEM license for a computer he is selling. Educational licenses are even lower (and no, there are no tax differences there).

      Taxes on software in Brazil are far from high, if you compare it to other taxes. Actually, they are lower than taxes on books.

      Even if the government completely removed the taxes from software, Microsoft prices would still be too high for a developing country like Brazil.

      --
      morcego
    5. Re:20%? What are the customs duties? by glgraca · · Score: 2, Informative

      This is simply false. The brazilian constitution exempts books, magazines, newspapers, and the paper they are printed on from all taxes. It's in article 150 (VI - d). If you buy books from abroad, you don't pay a centavo of import duties. This I can also attest to from personal experience.

    6. Re:20%? What are the customs duties? by Flavio · · Score: 2, Informative

      I've never been charged an import tax ON BOOKS.

      I pay the 60% tax on other things all the time.

  2. There are "Studies" and there are Studies by Infonaut · · Score: 3, Interesting

    Duarte's blog post is interesting and cites some statistics, but calling it a "study" is a bit rich.

    --
    Read the EFF's Fair Use FAQ
    1. Re:There are "Studies" and there are Studies by gustavoduarte · · Score: 5, Insightful

      As the author of the blog post, I totally agree :)

  3. Did anyone RTFA before approving? by supabeast! · · Score: 5, Insightful

    The original article does NOT claim that Brazil pays 20.1% of its income to Microsoft, it only states that the âoeCost of Business Licenses as % of GNI per capitaâoe is 20.1%. Only a complete moron would read that as 20.1% of Brazilâ(TM)s income going to Microsoft.

    Furthermore, the OP claims that the linked article is a study; it is NOT a study, it is a blog post. It has not been fact-checked or reviewed by editors or peers, and could be a complete load of BS.

    1. Re:Did anyone RTFA before approving? by canuck57 · · Score: 2, Insightful

      The original article does NOT claim that Brazil pays 20.1% of its income to Microsoft, it only states that the âoeCost of Business Licenses as % of GNI per capitaâoe is 20.1%. Only a complete moron would read that as 20.1% of Brazilâ(TM)s income going to Microsoft.

      Furthermore, the OP claims that the linked article is a study; it is NOT a study, it is a blog post. It has not been fact-checked or reviewed by editors or peers, and could be a complete load of BS.

      First off, north of the border (Canada) we experience the same thing and I can assure you with NAFTA it isn't taxes. Check say amazon.ca and then amazon.com and check the prices. We see it on cars also. Be it Honda, GM, Toyota, Ford or others, the dual pricing happens all the time. Usually one price for the USA and a higher price elsewhere.

      The term is called price fixing to local markets. Or, what is the term where I will sell to US customers at one price, and sell outside the US for more (or less)?

      In some cases, Microsoft even charges less in foreign countries, often to prevent Linux from making too much headway.

      That is the way it works. And running open source is a great way to save money.

  4. Grossly Misleading (Fraudelent?) Headline by Jane+Q.+Public · · Score: 3, Insightful

    Nothing in the article states anything like what the headline of the post does. That was just plain irresponsible sensationalism.

  5. Re:That's OK. by truthsearch · · Score: 2, Insightful

    The biggest problem, as I see it, is Microsoft software's entrenchment. It's partly that the customers are hooked on it (the devil you know?), but it's also the expected difficulties in switching. It's becoming a lot less of a problem these days, but it's still a major concern. So while they may consider open source to be superior, they still may not be switching any time too soon.

  6. In Rich Countries Too!! by mmport80 · · Score: 2, Insightful

    It's not just Brazil. Look at any startup in the US. Flickr, Google etc etc, all used open source to get their businesses off the ground!

  7. Re:Time for us westerners to wring our hands... by chord.wav · · Score: 2, Interesting

    Backwards place to live? You get that from experience? I'd live in any brazilian coastal city over any US coastal city. Warm climate, nice girls, drinking caipirinhas all the time, hapy music, happy people.

  8. Valid point if title corrected by Exp315 · · Score: 3, Insightful

    The point which the author intended is valid, i.e., that commercial software licenses are much more expensive compared to local income levels in developing countries than in the USA. It's just unfortunately that the title is a bit misleading, deflecting the discussion. As a software publisher who has distributed my software in Brazil (in Portugese) in shareware and free-trial form, I can tell you that registration levels from Brazil are equal to those of the United States or Europe. I feel that's because my software is reasonably priced there for local income levels (about 40% less in local currency than it sells for in the USA). I would also like to add, as a frequent visitor to Brazil with many friends and family members there, I don't agree that there's any anti-U.S. attitude about software.

  9. It's not M$, it's Bra$il by SoTerrified · · Score: 5, Interesting

    The Brazilian gov't puts heavy taxes on any technologies that are imported. Their whole idea is to be so punative that companies that manufacture in Brazil won't have to compete vs. the outside world. The Wii costs over $1000 in Brazil and the Playstation 3 costs $1800. (These are 2007 prices, I'm not sure what's current) The games cost $300-$400 reais, which is probably about $200 US Dollars. It's not just a Microsoft issue.

  10. Regarding Open source and proprietary pricing by Anonymous Coward · · Score: 4, Interesting

    Think about it, would you pay 2500 to 5000 bucks for your OS?, or would you want something in the realm of what you can pay for it, Open source is becoming an avalanche in poor countries just because its free, and its current ( up to date), 3.1416racy is rampant in poor countries because people can pay 5 to 15 bucks for the latest M$xp, and they can pay 3 bucks for a 3.1416rated game,but they can not pay the salary of a whole year for brutally expensive software according to their economy, when somebody can get an OS that does what they need, for free ( Open source/Linux), they spread the word AND the CD to all their social group, creating a geometrical distribution into their circles of buddies, I have several friends in South America, and none of them have an original disk of anything, they used the underground market to get what they needed, for the price they were able to pay. The day that M$/proprietary software matches the price of their products to the economic environment in which they want to sell ( Marking it geographically) they will get a hold of the market, in the mean time, people will want the lowest cost for the maximum benefit.

  11. Not quite the price by iris-n · · Score: 5, Informative

    I live in Brazil. The anti-american wave has largely passed away: you don't find love for US here, but neither hate.

    As for the pricing scheme, it is really outrageous for the average income here, but I don't think that it has much to do with the linux adoption here. It's very rare to see someone that does care about copyright here. Even if Microsoft sold at reasonable prices (yes, it is the government's fault), just the fact we need to register, call for license keys and all that bullshit makes us just pirate the damn thing. And if it's hard to pirate (wga and all), we go away. And there's linux. It's free and it doesn't hassle us. Oh, it's open source and all? Cute. But that's not the main point.

    Don't get me wrong, there are plenty of people that care a lot about FOSS philosophy (myself included) but for the masses, the "software that don't get in my way" is more important.

    --
    entropy happens
  12. Re:Time for us westerners to wring our hands... by billcopc · · Score: 3, Insightful

    The only difference between the Brazilian coast and the US coast is you can get killed over less money in Brazil. They have problems, just like every other country on earth.

    --
    -Billco, Fnarg.com
  13. Re:Widespread disdain for US is a fallacy by Registered+Coward+v2 · · Score: 2, Interesting

    The experiences you have as an American tourist mean very little in terms of deciphering the true feelings of the civilian population. Especially if you're there for business. True, but as someone who has traveled abroad on business and pleasure; and have many friends and relatives abroad, disdain for American government policies does not translate to disdain or dislike of Americas, or even "America."

    Most people outside of the US can keep those things separate; something many Americans seem to have difficulty with, as demonstrated by the accusations of "unpatriotic" if you say negative things about GHB.
    --
    I'm a consultant - I convert gibberish into cash-flow.
  14. Backwards? by hummassa · · Score: 2

    I live in a nice 3,000,000 people city; we have theaters, movies, moderately high-speed Net access (2Mbps from my home), cable/sat TV, universities, ...
    Care to elaborate?

    --
    It's better to be the foot on the boot than the face on the pavement. ~~ tkx Kadin2048
  15. Re:Not American? by Shihar · · Score: 2, Insightful

    You joke, but the full name for Norway is the Kingdom of Norway.

  16. Re:Not American? by stoolpigeon · · Score: 3, Funny

    I was in Mexico City, hanging out with university students on a number of campuses. They were all pretty nice about it but made clear their preference. I had been warned ahead of time, but still slipped up.
     
    You mention Mexico being mistaken as part of Central America. Since I've been back I've had a couple people ask me how I enjoyed my time in South America. I wish I was kidding.

    --
    It's hard to believe that's how Micronians are made. Why don't we see it right now by having you both kiss one another?
  17. Re:Time for us westerners to wring our hands... by gregorio · · Score: 4, Informative

    Backwards place to live? You get that from experience?
    I don't know about him, but I do get that same impression, and from experience. A lot of it. Brazil IS a backwards place to live. While people from the US do complain about taxes and how their money is used by the government, things in Brazil are not simply "worse" on that point. They're completely different, as the people who pay taxes in Brazil are not the ones using governmental services at all. EVERY SINGLE NEED of the brazillian middle class (the ones who pay for that big joke named Brazil) is provided by very expensive private services.

    And the impoverished are not just "poor", as in "lacking money for basic elements of life". They're also extremely indolent and dishonest. They lack basic culture and effort to achieve any kind of progress.

    They have access to an infrastructure that would be considered an impossible dream decades ago. The things is: a lot of jewish and italian people arrived at this very same land of crap, decades ago, without any money at all and none of the thousands of schools and no universal and free healthcare at all. Yet they managed to educate themselves and provide good education for their children (who are now 40-50 years old), without a single cent in their pocket. Their sons and daughters (who were impoverished children) are now members of the upper-middle class.

    I'd live in any brazilian coastal city over any US coastal city. Warm climate, nice girls, drinking caipirinhas all the time, hapy music, happy people.
    You forgot to mention "random drug-motivated murders". And also forgot to mention that all those "happy people" are actually impoverished idiots who would rather spend their entire day partying around the city than working hard to improve their lives. Remember the Ant and the Grasshopper? If not, it's a classic that explains a lot about those bozos you call "happy people".

    And if booze is something that motivates you to some kind of decision about where to live, you need treatment, not a better city.
  18. Re:Not American? by C0vardeAn0nim0 · · Score: 2, Funny

    actually, we should call ourselves "vespucians". if the continents were named after americo vespucio, by tradition we should've used his last name, not the first.

    so brasils is in "south vespucia", and the US should be called "united states of vespucia".

    --
    What ? Me, worry ?
  19. Re:That's OK. by Luscious868 · · Score: 2, Insightful

    Free software is only a better deal if it works just as well as the commercial alternative. In some cases open source does, in others it does not, and there are still many instances where an open source alternative for a particular kind of software simply does not exist.

  20. More: How to lie with statistics by redelm · · Score: 2, Insightful
    Sure, the statistic may be correct, but it can also be meaningless -- take BR biz income (a relatlively small number because it excludes local barter) and divide by a huge population and you get a small number, easily and incongruously compared against MS Windows licence costs.

    For a concrete example of abuse by statistics, consider that in the US, MS-Windows licence costs exceed the total annual income of at least 50% of all computer users [kids!]

    Please do not mistake me for an MS-toad. Personally, any MS licence cost above large negative numbers is overcharging. I have to be _paid_ to use MS products.

  21. Brazil free software dream is anything but fading. by nxsryan · · Score: 3, Informative

    Sorry, but this repetition about the "Brazil FOSS utopia fading" that I hear everyone talking about is largely, I believe, due to the Linux.com article that is linked to above which highlights a bunch of negative comments by a few individuals and talks about some of the licensing controversies that have come up as Brazilian society as a whole widely adopts free software (I -wish- the government in the US cared enough about the GPL to have a licensing controversy).

    In fact, the Brazil free software movement is an incredible phenomenon.

    Consider:
    1) Brazil's recent announcement at FISL of 52,000 computers labs (each with 15 terminals) serving over 50 million students -- with 29k of them coming online within the year -- all running Linux Educacional and KDE. Meanwhile, in -my- Ohio hometown, the public school system is fiscally doomed while still paying out enormous sums to Microsoft, IBM, Apple.

    2) My wife, who is Brazilian, worked in the Brazilian equivalent of the US's White House, the Palacio do Planalto, migrating even the President's -Secretary- to an open source desktop running OpenOffice, not to mention the rest of the federal agencies in Brasilia. How is the open source migration of federal agencies going in Washington DC? Oh, right...

    3) Brazil should be a model for much richer countries in this hemisphere, like the US and Canada, with their enormous and expansive Digital Inclusion program, which is entirely based on open source & free software. This program provides free training and computer lab access to bridge the digital divide in Brazil, with labs in urban favelas (ghettos that encircle the major metropolitan cities) and even remote indigenous communities living in the Amazon -- some of the Digital Inclusion projects are only accessible by BOAT. And in those areas, open source computer labs are, in many cases, the only computer access, the VOIP they provide are the only telephone, and so on.

    4) A recent study confirmed that over 70% of Brazilian companies with more than 1,000 employees are using open source software.

    5) Brazil has migrated the largest state-owned IT firm in Latin America (SERPRO) to open source software (including many more companies that are migrating).

    6) FISL, hosted in Porto Alegre, has got to be one of the largest free software conferences in the world, if not the Americas. This year, Lula made news by saying that he would do everything he could to attend FISL. When was the last time George Bush or Bill Clinton said anything about free software, let alone went out of their way to support it in person?

    It's really amazing to me how many open source advocates in the United States are indifferent to the open source phenomenon happening not only in Brazil, but throughout all of Latin America. One Linux.com article dismisses it as "hype" and that's enough for the most popular English-language open source news site? Meanwhile, an enormous free software movement goes literally un-noticed (when, in fact, there is plenty of room for voluntarism by wealthy North American developers in the region).

    Personally, I make my living as owner of a business which works with open source/free software in Latin America and the United States. My wife was employed for several years by the Brazilian government working exclusively on the widespread deployment of open source technology in Brazil. And, I operate a news website which provides English-language updates about the free software movement in Latin America - http://news.northxsouth.com/

    I urge everybody to take a look at our site and re-evaluate if Brazil or any Latin American country is a fading open source dream, or if, in fact, they are doing the hard work of converting their government to free software and, moreover, converting their society to open source software. We should take a look at what they're doing and ask ourselves: "why are -we- failing so miserably to influence -our- government?" instead of trying to find any gap in their impressive demonstration of the power of open source to transform massive social institutions.

  22. Re:Time for us westerners to wring our hands... by gregorio · · Score: 2, Interesting

    replace "brasil" by "US" in you post and you have a pretty damn good description of the USA, dumbass...
    No, I won't have a pretty good description of the US, because most things I described in my post can't be said about the US. That doesn't mean it's a perfect country.

    the economical and technological success of US in the 20th century was mostly imported talent from europe and japan that ran to the americas after both world wars.
    You're confusing a few, remarkable examples, with the whole thing. Your theory is based on the fact that noone from the US could create or build anything useful. Sorry, foreigners helped the US a lot, but not that much. Your anti-americanism is just part of being a sad, angry teenager.

    if more people went to US instead of brasil, it was because the ticket to north america was cheaper because of the proximity.
    Or maybe because the US was already a strong country, with a very strong economical and industrial base. And mostly because Brazil was just one giant farm, with São Paulo's economy mostly based on cofee magnates, and North-east's economy mostly based on sugar cane and other kinds of banana-republic crap.

    in other words, SHUT THE FUCK UP!!!
    No. Thanks.

    oh, and according to the grates brasilian composer of all times, raul seixas, "the ant only works because it can't sing".
    Quoting a drug-addict makes a lot of sense, considering my whole argument about being indolent and stupid.
  23. Re:Time for us westerners to wring our hands... by chord.wav · · Score: 2, Interesting

    Hey did your girl/wife just left you or something? Because there's no need to insult anyone to get some attention. I know it's more expensive than in ranting in /. but you should hire a hooker. You'd be more relaxed by now.

    And the impoverished are not just "poor", as in "lacking money for basic elements of life". They're also extremely indolent and dishonest. They lack basic culture and effort to achieve any kind of progress.

    Oh, do they? And you pretend to prove your point by tagging everyone as indolent, dishonest and with lack of "basic culture" and "lack of effort to achieve any kind of progress"? Oh you are so illustrated to think in black and white only. You really represent those ideals of "culture" and "progress", right?

    As unlighted as you are, you probably know this already, but I need to enforce my point: Culture is not just the "american" way to live.

    You forgot to mention "random drug-motivated murders". And also forgot to mention that all those "happy people" are actually impoverished idiots who would rather spend their entire day partying around the city than working hard to improve their lives. Remember the Ant and the Grasshopper? If not, it's a classic that explains a lot about those bozos you call "happy people".

    I didn't forgot "random drug-motivated murders". I never wanted to include any negative points so no, I didn't forgot to mention that or anything you said I forgot. They happen everywhere anyway, including every US city. The "happy people" I refer to are not those you are talking about. I'm referring to exactly the opposite of people like you, that rants and bitchs about everything, being grumpy and cheer-less all the time, and using that ant-grasshopper tale to justify their sad and boring existence.

    And if booze motivated my decision about where to live wouldn't be your business. But no, it doesn't. Never said it did anyway. It's that the world is so crowded with below-average ignorant people like you that I usually get sick of it.

    Your post only shows your lack of culture and education. I wonder if the education story to you told up there is really your family story there.