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Software Price Gap Between the US and Europe
Kensai7 writes "A quick comparison between same versions of mainstream software sold in the USA and the EU markets show a big difference in the respective price tags. If you want to buy online, let's say, Adobe's Dreamweaver CS3, you'll have to pay $399 if you live in the States, but a whopping E570 (almost $900 in current exchange rates!) if you happen to buy it in Germany. Same story for Microsoft's newest products: Expression Web 2 in America costs only $299 new, but try that in Italy and they will probably ask you no less than E366 ($576!). How can such an abyssal difference be explained? I understand there are some added costs for the localized translated versions, but I also thought the Euro was supposed to be outbuying the dollar. Where's the catch?"
There's no complicated reason, companies charge more for products in europe because they can.
A bullet may have your name on it but splash damage is addressed "To whom it may concern."
How can such an abyssal difference be explained?
Greed? Well, two can play that game.
All the money they are spending trying to make other countries respect our copyrights has to be made up somewhere. Plus, because they can.
Even those who arrange and design shrubberies are under considerable economic stress at this period in history.
Probably won't make up for all of the difference, but I expect that the US prices don't include sales taxes etc...
Thou wilt be charged what thou art willing to pay for it.
Quite simply Adobe, Microsoft and probably others have determined that Europe will pay that kind of money for their software where the United States won't pay that much, and have computed the optimal price point right there. Sad but true Europe.
Having said that, time to start an import/export business with cheap software in the United States going to Europe :-)
...in bed
Because products often aren't priced based on cost, or based on a sense of fairness, but rather on what the market will bear...
The cost of localizing everything is not inconsequential. You can't just run it through a translator and go and you still have to do acceptance testing on the localized version. The number of German or Itallian consumers is small compared to those who use English and the price reflects the marginal production costs per unit.
To make it even worse, as far as I'm concerned they can either keep their localized versions and just give me the US English one, OR make their app multilingual and just ship one version. (I'd prefer the latter option). Apple does this for most (all?) of their software and it's great. I can have an English language version if I log into my account and a Dutch version on a guest account if someone who doesn't speak English should want to use my computer.
They have to do the translations anyway, so why not ship all translations with every copy. This also saves on costs for making several master CD's, boxes, etc.
One thing often forgotten (which doesn't explain the examples, but many others) is that in Europe, prices are always (AFAIK) given with taxes, while in the US they are (AFAIK) without. Since sales tax in Germany is 19%, that explains quite a bit of difference already.
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Well, you have import taxes (tariffs), Value Added Tax and probably the prices still set based on the old exchange rates.
A: European prices usually include a very high VAT (sales) tax, that can be 10-20%.
B: The european prices were set before the dollar went down the toilet.
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There's probably a lot going on that isn't covered. Tariffs, taxes, and other items. Microsoft probably has to get an entire location in Europe as well as local lawyers and all that good stuff to protect themselves. It doesn't come cheap.
Otherwise I think you're saying the difference goes down an abyss.
Very easily. The US and Europe are different markets. Analytics for pricing have shown time and again that Europeans and Britons are willing to pay more for consumer electronics and for software. Hence, suppliers charge more.
As time goes on and the "global" market homogenizes, this will change. But until then, pricing decisions based upon local markets will continue to create situations like those described in the summary.
As for the reasons that Europeans are willing to pay more, any input I'd have would be speculation. The fact that the development of most commercial software happened in the US (historically, not necessarily presently) probably has something to do with it.
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
I Heard you can get it from P2P for the same price world wide ... I don't know where you get YOUR sources.
Isn't it more like a result of the weakening dollar?
Sorry to be pedantic, but it's EUR or Euro or that funny lowercase 'e' that my keyboard does not type.
The main reason prices are higher in Europe is that the market for translated software has less competition and people place a higher value on getting stuff in their own language than in US English.
Also, maybe because Europeans are nicer and less willing to complain when they get ripped off.
Anyhow, the price reflects the market, not the product.
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A possibility might be that the companies simply never took the changed exchange rate into account.
In 2001 the exchange rate for USD/EUR was 1/1.5, now it's 1.5/1, so that's pretty much the whole difference explained right there.
So basically people in Europe are/were used to paying that price, and that hasn't changed, the only thing that changed is the exchange rate.
Coz eternity my friend, is a long *ing time.
Probably won't make up for all of the difference, but I expect that the US prices don't include sales taxes etc...
Value added tax, the EU counterpart to sales tax, definitely doesn't make up for all of it. As I write this, Google says the euro is 57 percent higher than the dollar, but a typical VAT in Europe is about 20 percent. Or have European governments enacted Brazil-style prohibitive tariffs on imports of copies of proprietary software?
For example, the game Rock Band for Xbox 360. It costs USD 150 (~ euro 95) in USA (on Amazon.com) and SEK 1990 in Sweden (euro 211 or USD 332). It's more than double the price!!! Did we get anything extra? NO! Oh yes, sorry, we had to WAIT more than 6 _months_ for a European release, which didn't bring anything new/better compared to the American version. FU EA!
were not that dumb
http://thepiratebay.org/
There is no catch, it's a rip off...
E570 is not $900; it's stearic acid. E366 is potassium fumarate.
At the bottom of the
there is no catch, there is only greed and shamelessness ... or in other words, normal business.
"There is nothing more frightful than ignorance in action." Johann Wolfgang von Goethe
In Canada, most everything is priced in a similar manner, mostly its the taxes, and then the middleman want a larger cut...
The number of German or Itallian consumers is small compared to those who use English and the price reflects the marginal production costs per unit.
Ireland uses euros, and the UK uses pounds, which as I understand it are in near lockstep with euros. Both countries have English as an official language.
Its probably largely historical. Prices are set based on a currency exchange at the time and they rarely change. Even the core exchange rate was probably fixed early on. Add to that taxes, increased operating costs, support costs, localization, and overhead (shipping, etc) and you run into what probably drove the initial pricing. Once the initial price is set then people (sales execs) are loath to change the price because it is on so many lists including those of large institutions (banks, government, education, etc) where it is not only hard to change the price because of the way that these institutions work but also because of the discounts they receive. Once you give something at one price it is hard to go back so lowering the price is something that they hate doing. Add to this the added revenue of the current price and there is little incentive to change pricing if sales are good. Also the holding companies (the headquarters) uses these fluctuations in price as a natural hedge against exchange rate induced losses so they don't want to change it either.
European countries add taxes onto goods to pay for all the people who don't want to get a job and earn a living.
The reason is that the companies create artificial monopolies by creating sole distributorships in each country. On top of that, name/brand recognition goes a long way in semi-First World countries like those in Europe, so something like DreamWeaver is going to gather a lot more interest than XMLSpy (or what have you). So you have a market focused on one product, and only one supplier of that product. The math is pretty simple; consumers lose out to asymmetric market forces.
It's not just "because they can", but it's actually the market that has created those conditions. If Europeans would wake up to the alternatives (like China and India have), software prices would be much more reasonable.
Yeah, how much of the European prices include VAT, etc?
Don't single out software. Go ahead and price other things in Europe relative to here.
The reason the price of oil as gone up is because the value of the dollar has gone down. The same is true for software.
Consider it a trade off... for a lot of industries, such as medicine, the US ends up paying the cost of R&D plus the cost of the med while a lot of countries end up paying just for the cost of the med.
I will bend like a reed in the wind.
Because Free Software is more popular in Europe, the commercial software companies must make up for the lost stales by increasing prices.
If those damn users would only stop using Free Software, the price of commercial software could come down to a more reasonable level.
hurrah! lets take everything for free!!!!!!!!!! information wants 2 b free!!!!!!!1111111
Whats that dad? you lost your job working at the software company today? why???????? how do I get my allowance now????????????
Windows XP N --> Someone has to pay for the lawyers.
Don't forget trade tariffs and import costs on a high ticket item (er sorry, 'high ticket license fee') there would be a proportional tariff (even more so depending on it it his certain categories that a country to trying to regulate trade-wise.
As most consumer education courses say, if it's too expensive - just don't buy it. And there are alternatives.
"Enjoy what you're doing! If it becomes drudgery, you're doing it wrong!" - Jim Butterfield
In way or another, the difference can be explained. However this didn't help them in my case. At some point we wanted to purchase Dreamweaver. I used to remember the US price but the online Store in Germany showed me a ~700 EUR price tag for the English version. I didn't buy it and looked for other software and found something else which worked for us.
Nothing can explain the price difference: tax and localization expenses can not add up to a 200%-%300 difference. What they are doing is not moral, people who are aware of this are not happy with that.
1) As far as I know European countries use VAT. US does not 2) Increased cost for operation 3) Regulation of EU which forces products to be sold on same price across EU 4) High profit margin + monopoly
Simple. They can get away with it.
Sure, the US price probably doesn't include VAT while the European price does. So let's take those 20% (roughly) of the European prices: that will be $720 for Dreamweaver (1.8 times US cost), and $460 for Expression Web 2 (1.5 times US cost). And I've checked with a local retailer; those are prices for non-localized versions, so that excuse does not apply.
The catch is that we are being ripped off, plain and simple.
Incidentally, the same is true for books. Books are ridiculously overpriced here, and for scientific or technical books it is _always_ _much_ cheaper to order them from Amazon than to buy them from a local bookstore. Even including transportation cost, the difference can be well over a factor two!
The silver lining is of course, that Amazon sells software as well...
Well they have all the money now so they get to pay the price!
You go where the money is. The economy in the U.S. is spiraling down. The EU is doing well. So you charge those that have the money and take what little money those that don't have it too.
Same items in different countries do not cost the same amount when taking into account only the exchange rates.
There are several reasons for this. A couple that are easy to explain are:
Do you think national healthcare is free?? Where do you think these countries get the money for that and other social[ist] programs? They tax the hell out of companies, imports (and individuals)
Don't worry. With the current US economy suffering from too much spending, already high corporate taxes, soon to be way higher taxes, mismanaged and over-promised social[ist] programs, a falling dollar and interest rates designed to trick people into thinking everything is ok while causing inflation to skyrocket it won't be long before the prices you mention even out for us. Maybe even compared to Zimbabwe.
I will never live for sake of another man, nor ask another man to live for mine.
It's the same thing with Canada; identical products will cost 10% to 25% more, and in some cases, like automobiles, manufacturers will go to extreme lenghts to insure that canadians cannot buy stuff in the US and import it themselves.
And no, in Canada too, prices are quoted without taxes.
It costs a lot to ship boxes of bits across the Atlantic Ocean.
-- Many men would appreciate a woman's mind more if they could fondle it
Sorry.. we here in the US were not given the memo that we had to give you things for cheaper. You see, with stuff getting expensive (remember we're fighting a war against the Islamic Jihad?), we've had to make it up in other ways. I don't know which is better... knowing that there's nothing you little socialist twats can do about it, or the fact that you little artsy-fartsy types are particularly impacted by this. Then, the really funny part came to me - it takes you more MONEY to get our product, and your little socialist experiment over there says that money is bad ergo you don't need it. Quit your bitching and pay the fee, or don't use it. Or, develop the alternative.
I think that the real reason is because they can, and we dumbass fuckers are (somewhat) prepared to pay for it (piracy is higher here than in the US).
I have personally written to Adobe complaining about the massive price differences, and Adobe wrote back claiming it was because of localisation costs (translating software plus documentation into 20 languages can be pricey).
BUT, the bastards are lying. The localisation of any piece of major software is now a matter of course. It's planned in right from the very beginning.
To the wankers from Adobe reading this forum, I think it's about time the EU took a look at this practice.
I thought Europeans paid less in general for medicine/etc (Ensuring that the USA drug companies get high profits from the US Market and allowing US consumers to subsidize health care for the rest of the world). The papers in the USA are full of stories about European companies buying US companies on the cheap due to the current low exchange rate. Suddenly, we are all supposed to be outraged that there is a discrepancy in software pricing? If this was a big issue wouldn't whatever office that was responsible for overseeing trade between the USA and Europe be trying to fix it? Or, have they consciously made the decision to let certain things go in exchange for others? Without a comprehensive review of the situation, this article is more of a troll than a serious source of discussion.
Can a software bought in US be used in Europe? Are there any restrictions in the license over the geographic use?
like in Asia require localization as well and don't show the price gap.
Since their Euro is so strong, we make up for it by overcharging them.
Screw the euro.
The US price does not include tax. The EU prices reflex the value added tax of the county it is sold in.
In the last 5 to 10 years the conversion has usually gone something like:
$1 = £1 = 1 Euro
Nice and simple just the way they like it.
Well, Bart, your uncle Arthur used to have a saying: "Shoot 'em all and let God sort 'em out."
its an old story: You enforce that US retailer can not sell to other countries. Then you step up the price. Or you drop it: compare also prices asked for the same products in China!
But that doesn't magically change income levels in europe, so why drop prices? You charge what the market will pay.
The difference is so large because the US dollar is going down the toilet, the prices will get closer from the other direction though. The US price will rise as the inflation that's pushing the dollar down takes hold.
Didnt you know that?
Its the new golden land of opportunities.
Try buying a car in Denmark, the government puts a 180% tax on them.. so basically we pay for almost 3 cars every time we buy 1.
Firebug does an excellent job editing html pages in real time. It's more standard compliant, works great with Javascript and is free as in speech!
Do a web developer need anything else?
The simple answer; we have more than you..... As far as I know the average pay in most of western Europe is higher than in the US.
Having worked for European companies in the States, I think it's a "business culture" thing. Europeans tend not to be as price-conscious when making business related purchases. US companies will fight until the bitter end negotiating over a few dollars, so software companies know they have to price competitively.
Not quite sure what drives it though; Europeans can be tough negotiators on most contracted services.
Take an example from my line of work -- air transport. Business class tickets sell very well in Europe, mainly because it's considered a perk once you get to a certain level. With the exception of consulting companies and others that can bill away expenses, most staffers and lower managers in the US ride in coach. Business and first are reserved for senior management, and even that requires justification when times get bad. If you're a road-warrior staff member, and fly legacy carriers, you'll eventually get to a point where (through FF miles) you're upgraded to business, but I've never worked for a company that would pay the extra money for a business class ticket, even on 17-hour torture flights!
Maybe there's some parallels to software too.
The governments of Europe hassle companies (in general) more than the US does. This hassle has a cost. The cost is reflected in the price.
Let me put it another way: Adobe considers it worth their while to sell Dreamweaver at $400 in the US. After all the hassle, they consider it worth their while to sell Dreamweaver for $900 in Europe. At $400, would it be worth their while to sell Dreamweaver in the EU at all? Maybe not.
Let me put it a third way: go on eBay and you find that a lot of US sellers won't ship outside of the US and Canada. Why not? Because it isn't worth the hassle. Would it be worth the hassle if the seller could check a box which said, "double price outside North America?" Maybe so.
Moderating "-1, Disagree" is simple censorship. Have the guts to post your opinion.
if you download a Linux distro in the USA it is free, but if you download a Linux distro in the EU it is FREE!, thats like twice as free as it is in the USA...
It's not just software that's more expensive. I think the main reason is that companies see america as their primary market and price their product there to break even. Europe is where you turn profits, since Europeans don't live their lives in major debt and actually have money to spend.
I hate localization by the way. It makes it more expensive, makes it harder to look up things (error messages are translated as well, even technical terms, so they don't make any sense to anyone whatsoever). You're basically forced to pay for the stupidity of your fellow countrymates and get an unrecognizable mess of an UI to boot.
It's even worse if they spend the effort to localize math. If you do not explicitly specify the locale in Java for example, the parsing library expects commas instead of points when parsing floats.
The Dutch google is a disaster as well. You consistently get the local baker's webpage as the top result instead of whatever similarly named technical term you were actually looking for.
The difference is that the software starts in the US. In order to get it to Europe, you've got to transmit it there, and hence, you have to pay for bandwidth.
Now, imagine the bandwidth of an ocean liner full of DVD-ROMS...
When our name is on the back of your car, we're behind you all the way!
I was living in Germany when OS 10.2 came out. It was $80, for the student version in the US, and E169 for the retail upgrade in Germany. So I bought it and had my dad ship it over to me. When it arrived in Germany, I had to pay about E25 in import tariffs.
"The problem with socialism is eventually you run out of other people's money" - Thatcher.
Don't get your knickers in a bunch just yet over the price difference. What we have here amounts to a single data point in time.
Perhaps a better question to ask first is "How has the price of software in Euros changed over the last couple of years?"
Why ask this? You are converting prices back to US dollars. The value of the US dollar as compared to Euros has been declining for the last couple of years.
IF the price has been relatively steady (I don't know if this is the case), and people are comfortable paying this price, there is less incentive for US companies to lower the price of their software in Europe. If the Euros are converted into US dollars, they would be keeping more $$$. It's their software, they can charge what they choose.
This only addresses part of your question. Since one US dollar has been worth less than one Euro (at least for the last five years), the price at any point in that period (assuming a relatively constant Euro price of software), would still be higher.
There is probably some holes in my reasoning, but I am sure smarter souls will be more than happy to correct me.
While it does not explain everything, software costs more in Europe because the cost of doing business is higher than in North America, plain and simple. Salaries, social charges, rent, taxes, etc., everything is more expensive.
Nothing complicated. In Europe you can get away with charging more for software, and in Treasure Island (otherwise known as the UK) you can whip out some lube, bend someone over a cash machine and give them a right screwing. Not only will they enjoy it, they'll also buy your software licenses at an exorbitantly high price.
In Thailand, software prices are low, in USA software prices are medium, in Europe software prices are high. The average European is now richer than the average American. That says something about the sad state of US economy.
The Wise adapts himself to the world. The Fool adapts the world to himself. Therefore, all progress depends on the Fool.
It's not just software. It's everything. I'm an astronomer and home-brewer. A barley mill in the US costs $115, whereas exactly the same product in the UK costs £150 ($298!). Yes, there is shipping involved, but even buying it from America and paying myself to have it air-mailed to me saved me over £30 on what it would have cost if I had bought it from a UK supplier.
Buying telescopes is even more ridiculous. They price them on a $1=£1 model, and given that telescopes can go for thousands of pounds, you can fly first-class to America, have a 3 week holiday and get the telescope in America for less than the price of the same model in the UK.
Unless the software is so poorly designed so as not to cleanly separate localizable data from the code, localization is a mere matter of translation. And if it is indeed poorly designed, you have bigger problems.
Doing the vaguest guesstimate, translating your average proprietary software package like Photoshop is probably going to cost on the order of 10k to 100k €. Let's say one licence costs €200; so that's roughly 50 to 500 units sold.
How many do they sell? They ought to suck hard if they sell less than 5000 units in one given european country, so we have at MOST 10% of the price going to l10n.
companies tend to adapt to business practices in the countries in which they operate. example: oil companies pay bribes to local officials in south america. seeing as america is a capitalism, it isnt really frowned upon to charge alot for a product. im sure the price goes down considerably for things like a site license, or say open source competition from gimp. prices are always negotiable.
Good people go to bed earlier.
Your first mistake is to think that the price of an item has anything to do with the cost to produce it. Very simply, the price of an item should be equal to what people will pay for it.
What's that dad? you lost your job working as a blacksmith? Why is that? People don't ride around on horses so much anymore?
Software is destined to fall to zero cost eventually, simply because it can. So you can either accept that and find a more long term proposition (ie work for a company that makes software as an aside to their core business, ie a hardware or support vendor) or you become obsolete.
Selling software isn't sustainable, there is no scarcity once software has been written, distribution can be infinite with no cost and code can easily be reused. People will move to the cheaper, more flexible and more open option long term, just like they did with x86 compatible hardware. People are also very much averse for paying when they don't have to, and it's only a matter of time before people realise that software doesn't need to be paid for.
The world changes, deal with it.
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This practice has been going on for years. In the UK the rate has often been a 1 UK Point == 1 US dollar (although the rate is about £2 - $1) In the rest of europe it is often even worse.
This is nothing to do with taxes (although VAT - sales tax does add 10-20% and import duty maybe a few percent more). And is certainly has little to do with transport costs - drop shipping from China is the same cost to Europe and the USA and the carriage costs on a DVD is a pittance. The simple fact is that where vendors in the US have to compete and therefore put pressure on their suppliers to lower margins, in Europe they don't. This makes a nice fat margin for american suppliers and they're in no hurry to change this.
politicians are like babies' nappies: they should both be changed regularly and for the same reasons
This just in - FreeBSD, Fedora, Ubuntu, etc, as well as OpenOffice, Gimp, Firefox, etc, are equally free *regardless* of what country you live in.
What is this 'buying software' concept you speak of?
For those of us just north of the border, the price difference is much more noticeable. For the exact same product there's at least a minimum of a 30% difference, more often it's more. It's especially apparent recently when the US dollar dropped and the exchange wasn't as much.
When the USD tanked all the economic experts up her said the same thing about pricing. It's not that rest of the world is willing to pay more, it's that Americans aren't willing to pay more. European companies charge more in their own countries than in the states simply because the US market won't tolerate a higher price. I mean the US economy is quickly going in the toilet, yet the only major price hikes have been in oil.
Powerful and annoying market.
Because translations are frequently paid for by (and as a result owned by) the regional distributor.
I can't think of one instance in recent times where a distributor does this. It used to be the case, probably up until the 80s. But not now, with the internet. And besides, a translation is a derivative work, so the translator, if a third party, has to get a licence to do so from the copyright owner, so it's not like they could find themselves surprised by this.
Microsoft has always charged less in developing nations with weak or fragile economies.
... why can't I use it?
And Perl -- slashcode's language -- has been fully UTF-8 for years now. What's the excuse for not using it?
For the UK market, companies more or less convert the dollar price straight to sterling. So something that costs $75 in the US has a RRP of 75 pounds in the UK.
It's been like this for ever. I've even importing in bulk and resold on ebay, just so that I personally am not being ripped off!
I've seen a bit of a mix. In finland there seemed to be lots of english software, but in france the majority seemed to be localized.
Of course finlands probably the only country in the world where all the mcdonalds employees speak english
Europeans have more money to spend than Americans. Simple as that.
All the more reason for us Europeans to move away from commercial software to free software. Unfortunately for the payware-peddlers once a company has moved to free software it will be hard to get them to accept their ransom notes ever again - unless the free software turns out to be a dud of course... but that has yet to happen in my personal experience. So, from Adobe to whatever company starts with a Z, maybe you should think twice before pricing yourself out of the mark
--frank[at]unternet.org
The price of the dollar. Currently, the US$ is pretty much toilet paper. It's so bad that 3 German banks refused to exchange US$ for E. So it's no wonder that *right now* things cost more.
But I've always wondered at the seemingly high prices in Europe for certain things. I think Europeans value money differently from Americans. Some things are very cheap; others are expensive. And some places are just plain expensive all around; buy a soda in Amsterdam and you will know what I mean.
I can only guess that salaries in Amsterdam must be higher than in the US.
Americans tend to talk quality and then buy the cheapest thing they can find. From my limited experience, Europeans tend to value quality a bit higher than Americans. Also, service tends to be better in Europe than in the US. (OK, these are gross generalizations but I have relatives in Europe who work in the same industry as I do...)
Frequently companies have tried to charge different prices in different parts of the EU. In some cases, they have tried to keep dealers from selling across borders inside the EU. Which is illegal and leads to news like this:
http://www.businessweek.com/1999/99_43/b3652195.htm
C - the footgun of programming languages
people don't ride horses, because something better cam along (the car).
People use more software, more often now, and place a greater reliance on it than at any point ever in human history.
So the comparison isn't exactly right is it?
How do you expect to get high quality software in future? it will be made as a side project by people making hardware? Be serious.
DRM-free indie games for the PC and Mac: Positech Games
the only software I buy (and the only non-free software I use) is Mac OS X, and I'm actually a major version behind on that, so I can honestly say I haven't paid money for software in years, and all the software I use is legally licensed. I put all the money I saved into buying a motorcycle, and the money I save on gas (55mpg v. 19mpg in my car) I'll use to pay down all my debt I accumulated before I grew up :)
I know pricing very well for my company, and the way the pricing was originally done against the euro was that a dollar and the euro symbol were exchanged at the time the dollar and the euro were relatively the same. So a $200 product was 200 Euro. It makes accounting easier too by not having to recognize odd numbers, like trying to charge customers 1000.21 cents instead of 1000 when doing a conversion.
Conversion to other currencies were done against the euro price list as well, so the UK price list was based on a factor against the euro.
Over time, the euro got stronger, but the market already was used to the price. The prices don't change (up or down, depending how favorable the exchange rate is to your country)
For instance, just because the exchange rate of the china yuan fluctuates against the dollar, Apple doesn't adjust the Made in China iPod to vary in price from day to day. In fact, it usually only goes down (not up).
For the European customer, the price gap is now huge, and you CAN get the products cheaper if you either travel to the US, use a global purchasing agreement negotiated through a US subsidiary or deal with a greymarket importer. But usually there is territorial pricing practices/warranty support issues (i.e. do you need to have your US purchased product serviced at a US warranty center)? However, YMMV
Of course there are products that do vary in accordance significantly with the daily exchange rates, but computer software doesn't tend to be one of them.
Remember when the EU whacked Microsoft with one of the biggest fines EVER http://news.bbc.co.uk/1/hi/business/3563697.stm ?
Maybe Microsoft is just pissed at everyone in Europe and the other software comanies are just being prepared?
i mean us Europeans are all a pain in arse - we all hate each other, we still fight each other, we all speak different languages, we still use different currencies, one day we are all for something and the next we are all against it! It's amazing that anyone outside Europe wants anything to do with us at all!
The number of German or Itallian consumers is small compared to those who use English and the price reflects the marginal production costs per unit.
Those costs are still a tiny fraction of the actual development costs...
And smaller still when you consider that engineering costs in general are rarely more than 15-30% of total costs for any software company. Don't take my word for it, look at the financial statements for Adobe and you'll see Sales and Admin expenses greatly outweigh any engineering costs. This is pretty much universally true for almost any software company you might care to mention.
I'm not too sure if anyone has mentioned this before, but rather than complaining about the price disparity (I live in Australia, and things are significantly cheaper outside Australia), I would suggest that all of us take a stand with our wallets, and start buying goods from overseas.
The cost of shipping goods is no longer terribly high, and in many cases (if you live in Australia, or in this case Europe) the savings from buying overseas will cover the price disparity.
Check local laws (Parallel importing has been made legal in Australia). Hopefully this will make manufacturers realise that they cannot push around consumers for more money just because they are located in a particular geographical area.
Depends on the model. For a tech that's happy to fix all their own issues, and do tweaking of config files in an editor and really get under the hood, then the cost of software is going to approach zero.
However, for almost everyone else, they want to know there's someone out there to phone when things to wrong, who is knowledgeable enough about the product to fix the issue. That's part of the cost you pay in Software, the 'maintenance lifecycle' part. Your software will slowly be improved, or fixed.
Really, more akin to saying "The cost of car maintenance is going to approach zero simply because it can". If you're a mechanic, sure. If you know nothing about cars, and don't want to, there will always be support costs (some which are built into the cost of providing a warranty of the car, if you're on the 'upgrade cycle').
There will always be 'pay for' software, and there will always be free software, which is as things should be. It maintains a diverse ecosystem, which is far more resilient and flexible than a monoculture.
I live in CH. Prices are higher here than anywhere else on earth. Not only for software but for any kind of product.
The CH government protects us living in CH from bad product support by making parallel imports illegal. Only one company can import a specific product.
Privates are allowed to import goods themselves so that is what I do. But there are companies making it vary hard to purchase directly from another country.
I went through all kinds of emotions/opinions (patronizing bastards, cartel members, corrupt ring of buddies, unethical, etc...) and having noted very few people sharing my opinions I sort curbed my hopes to have a fairer/saner local market to buy my stuff.
I hadn't the slightest objection to his spending his time planning massacres for the bourgeoisie... (P.G. Wodehouse)
It's no different for hardware. Games too are disturbingly more expensive over here.
---
"The chances of a demonic possession spreading are remote -- relax."
...and despite what anyone here might like to believe, Microsoft is making money hand over fist, with profits rising all the time. If selling software is dead, why is the industry making so much money selling software?
It is clearly true that copying software, once it has been created, is essentially free. However that ignores the fact that software costs a lot of money to create. If there is no financial motive to create software, very little software will be created.
Cue GPL zealots....now! :)
.there is enough of everything for everyone.
If not.. then your argument is moot; especially for software.
No, Europeans can't just go ahead and buy the much cheaper version of a CS3 product from the American store - Adobe just won't have it. Heck, if you're in Germany, you can't buy in Belgium.
So it's not just that Europeans are willing to pay it - they often don't have a choice (presuming that they have already established that the Adobe product is the only viable product).
I've looked into the numbers (I haven an ODF for the curious), and you can expect several English CS3 products to go for -more than twice- the price of the U.S. English version in Europe, if you take into account the exchange rate. Europeans used to feel shafted thanks to the "$100 -> 100" thing that was played, but now they add some extra on top.
I agree with the GPP poster, though - they get away with it because Europeans let them get away with it.
See also:
http://www.amanwithapencil.com/adobe.html
IIRC illegal copying rates of proprietary software is much higher in Europe too, I know for sure in the Netherlands that this is so.
American companies tend to charge more for software here, because they can.
European 'customers' tend to use more illegal copies here, because they can.
I know for one this price difference is no motivator for me to buy my software legally.
---
"The chances of a demonic possession spreading are remote -- relax."
Actually, I'd go on a modification:
[x] You price the product based on what people will pay, regardless of ability, that have enough of them paying to net the greatest profit.
That means that you don't sell at a loss* regardless. Malaysia, while poorer, is also closer to the production facilities(china), doesn't have the huge taxes of Europe, or the moderate ones of the USA. You can still make _some_ money, so why not?
*in many cases, when they're selling at a loss it's either counting as advertising(more bought later), or charity(tax deductible and they get to make nice ads about how nice they are).
I don't read AC A human right
I think the proper economics term for that is "what the market will bear," but feel free to correct me on that.
"When information is power, privacy is freedom" - Jah-Wren Ryel
How much of the price represents the VAT (Value Added Tax)? I don't know the current rates in the counties ...
mentioned but the rates are significant.
Somebody has to pay for the national health care etc
I dont see how they can justify making software in the UK cost more than in the US, they have no language translation to do, short of adding a U to make colour. Yet they are charging
$663.755 for Dreamweaver here in the UK and $339 in the USA, whilst this price gap exists and I am unable to buy the USA versions i will continue to refuse to pay at all.
These are numbers for The Netherlands, as of July 14th, 2008.
The exchange rate for USD -> EUR was at that time: 0.629019
The following prices are EXCLUDING VAT/Sales Tax (BTW in NL).
The products are the English editions of the products. Note: only a handful of the Adobe products have Dutch localization.
USD = US Dollar
EUR = Euro
CNV = Euro price if simply doing a currency conversion
MUP = MarkUp in percent
CS3 Design Standard
USD: 1199
EUR: 1269
CNV: 754.19
MUP: 68%
Photoshop CS3 Extended
USD: 999
EUR: 1069
CNV: 628.39
MUP: 70%
InCopy CS3
USD: 249
EUR: 419
CNV: 156.63
MUP: 168%
I've got the numbers for all CS3 products in a nice little ODF. It needs updating and needs to have non-CS3 products added. But in the end, all of this is mostly the result of Europeans 'willing' to pay for the product at these prices. I put willing in single quotes because they don't have much of a choice. A dutchman can't just go to the U.S. store and order the U.S. version with a rather minimal shipping fee and be off cheaper than buying local - Adobe restricts it.
There is multiple factors that have already been cited: localization costs, taxes.
But other factors have to be taken into account. The first one is the foreign exchange risk: company are putting a premium to cover this risk.
Another one is history, a couple of years ago you the exchange rate was around 0.8 USD for 1 EUR, last year it was at 1.25 USD for 1 EUR and it currently is at 1.55 USD for 1 EUR (roughly). It is hard to justify to your customer that the software they bought 1 year ago is currently going for 30% cheaper, at least for consumers. (On a side note, the price difference is really not that big if its a company, European businesses get usually price close to the US prices.)
Hi from Spain
there is the same with other products, for example, one basic Volkswagen Passat (a German car) cost 25000 Euro, and there in US you can get it for only 23000 Dollars (is an imported car in US!!!!!).
The reason? maybe if prices are higher there you don't buy, but here we blame and then buy it.
(just for your info houses here are 400k as average, and average salary is 20k... and we buy it ;) )
Car maintenance is similar to support, some people can do it themselves, others will employ a third party. That is the work involved actually performing maintenance. Car parts are similar to hardware components, they each have a unit cost.
Software doesn't fit in this analogy, in one respect it's a component, but it doesn't have a per unit cost. If anything it's like the air that's drawn into your engine for the combustion process.
It's perfectly possible to purchase support without having to buy software, and some commercial software comes without support (sometimes charging extra if you want any). But the fact is... Having mandatory support by charging for the software is a scam...
Technical people don't need support.
Most end users will never call support, they will call a friend who fits into the technical category.
Many businesses, especially larger ones, will employ their own in house support staff.
Aside from that, open source introduces competition into the support provider market, whereas with a proprietary product you have to buy support from the original vendor or perhaps accept a massively reduced service from a third party (they don't have the ability to bugfix the product, nor do they have any of the original authors with in depth knowledge on staff).
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Not just software - compare prices on anything, Jeans, Coke, Cars etc etc, USA is much cheaper than Europe.
It's â449 in Germany and approx. 16.1% of that is VAT (rate is 19%), so it's more like $592 (Germany) vs. $399 (US). That's not terribly bad, but still a result of what most large companies are doing at the moment (including MMOs): having the rich european countries subsidize the US consumers, who are getting poorer and poorer in comparison, by sticking to a 1:1 USD:EUR conversion.
"I love my job, but I hate talking to people like you" (Freddie Mercury)
regulations regulations regulations
If Europeans are unhappy about the cost of products I'd argue they should be looking to their governments for the source of their problems.
I'm surprised that people here are actually saying Europeans are less cost-conscious than Americans. Having family in Portugal, France, England, Switzerland and I believe Luxembourg I've found the reality to be the opposite. They're very sensitive about price specifically because things are so expensive there and they earn less. That's why almost everything they buy is a more compact, economical version of what's available in the US.
I'd agree that software companies were trying to take advantage of European if it weren't for the fact that EVERYTHING is considerably more expensive in Europe. A $250 Nintendo Wii in Europe costs $400+.
I was recently looking at an Audi A3 and decided to check out the UK Audi site for comparison. The first thing that struck me was how every last detail was an option, including air conditioning cruise control of all things! But most appalling was how a car priced out to roughly $26,000 came to $51,000 in the UK, and it still didn't have all the features of the US model. The US model may not have taxes built into the price but even then it would only add a few thousand dollars.
I think there are a few causes for the high prices in Europe. The first obvious one is high taxes, but that doesn't account for everything. I think the biggest problem is over-regulation and excessive protectionism. European nations also love to impose tariffs on foreign products. For years now they've been looking to impose tariffs on Chinese-made products. And I believe they did so a few years ago as a so-called anti-dumping measure on Chinese-made clothing. They felt that the Chinese were dumping low-cost clothing in Europe and it was hurting European clothing makers. If they saw a threat it clearly means low-cost products appeal to Europeans.
I think this constant regulation has put an upwards pressure on the price of products. If the government is essentially saying product X should be set at particular price then makers of other products will inevitably want to price their good relative to product X.
Talking to my family there I sometimes can't help but wonder how they can afford things. Well, it's why they constantly have to compromise. I certainly don't think every company selling a product in Europe has decided they're going to fleece Europeans.
When I worked for a workflow/crm company back in the day our non-US version cost more for 2 reasons:
1) We had to localize(localise) the language
2) We had to license a different encryption algorithm because the one we used in the USA was illegal to export.
While in general it is true that companies apply the rule 1 Dollar = 1 Euro when selling items in Europe, you must not forget that in Europe (Germany for instance) prices are always with the 19% Tax included, while in America you need to add it to the given price.
At least from the perspective of an EU customer, copyright gets in the way of buying where it is cheapest. Because our equivalent of the first-sale doctrine (see http://en.wikipedia.org/wiki/Exhaustion_of_rights) does only count inside the EU. As a consequence, copyright holders can use copyright to block parallel imports from the USA.
The EU could change this by changing its legislation, but so far I see no sign of that happening.
C - the footgun of programming languages
The bright shining light of truth finally descends.
Importation tax too, not just the sales tax. In many countries it is 30% or more of the added costs. Protectionism at it's best.
I can't speak for Europe, but importing computer parts into Argentina basically doubles the price of the part.
Then there's the overhead in meeting local laws. These laws are simply different, not better or worse than what the parent company is used to in their home country. A simple example is the extra cost that 6 week vacations for each employee cost the business. In the USA, 2 weeks total over a year is normal.
Back in the 90's when I was shipping software to Europe, the price I'd charge the wholesaler was the same I'd charge local wholesalers. Getting through customs however, wasn't trivial. Import duties in the 90's which were separate from VAT were running around 15-20%. The wholesaler paid that on top of the price he paid us and added his markup which he passed on to the retailer. The retailer turned around and added his markup to the price he paid which included the duty cost plus the wholesaler's markup on the duty cost. By the time it got to the customer, the customer was paying markup on markup on duty plus regular retail-wholesale markups. What initially appeared to be a relatively small duty cost mushroomed into a sizable burden.
I was talking to one of the wholesalers about it and he laughed it off by saying 'yeah, but we get trains!' He'd then piss and moan about his more savy customers buying directly from retailers in the states and avoiding the double markups. That of course, reduced his market which meant he raised his prices more to cover his fixed costs.
Another factor driving prices in Europe was the fact that we'd sign exclusive distribution agreements so a wholesaler owned the market for a specific country. We did that because the wholesaler handled the translation and marketing costs in the specific country (we were a small company). Since he was the only source for a product, there wasn't any price competition. Here in the states, we'd wholesale with 5-6 distributors and those 5-6 companies were cut-throat with each other. The ones who couldn't compete on price, didn't survive.
Although I think selling something online for varying prices, depending on where the customer's IP address is, is a questionable practice, selling things from a physical shop must take into consideration the price levels of the local market.
Suppose I start a shop in the middle of London/Pars/New York/Tokyo (where I imagine the rents will be quite high) and sell nails and hammers. Then I open an identical shop in some out-of-the-way village (where I imagine the rents will be quite low). Even if I own both these shops I might very well have to charge higher prices in the metropolis than in the village, simply to make up for the higher rent. And since my employees in the metropolis will have higher rents to pay, their wages will need to be slightly higher than in the village.
All in all, the price level will be higher in the metropolis than in the village, and this must be reflected in my prices.
Let me know when every program ever needed has been written.
Back in the 90s on Usenet I used to tabulate and compare prices between MacWarehouse's UK and US catalogs. I'd subtract the VAT to ensure the comparison was fair. The result showed markups of 50-100% on a regular basis.
In most cases, any localization done was incomplete. For example, ClarisWorks still referred to "color".
As I recall, the #1 winner was Dave Winer's Userland Software. Their Frontier product had something like a 200% markup in the UK, and zero localization performed.
I actually contacted some of the winners about their UK pricing. One company told me that the markup was because a small number of distributors controlled the UK software market, and those distributors were the ones setting the prices.
It's worth noting one of the side effects of this practice: my experience in the 90s was that everyone ran the US version of Mac OS and ordered their software from the US in order to save money. This indirectly killed the market for Mac software in the UK.
Also, the BSA used to estimate software piracy by comparing the number of people running (say) Microsoft Word with the number of UK sales of Microsoft Word. So the gray market meant that US piracy stats were depressed, and UK piracy stats were artificially inflated.
(I was going to link to some of my 1992 Usenet posts, but Google Groups doesn't seem to have them.)
GCHQ Quantum Insert installed. If only our tongues were made of glass, how much more careful we would be when we speak
I think, that the cost difference has more to do with the numbers being sold in that country. The USA prices reflect more customers buying the software so the price per unit can be dropped, in the case of Germany and Italy the software resellers don't have as large of a base as the USA. Maybe if there were resellers who were EU entity (as opposed to being a German or Italian company) and could market to all of the EU and treat it in the same way states are here, then the prices would probably be the same.
TAXES
Nothing strange, the dollar has dropped against the Euro the last years, actually after the fight for terrorists begun.
This means that we (I live in Europe) can afford more expensive American products, the the companies aren't soon to take advantage of this.
The you (Americans) the other side if of course true too.. they lowered the prices to being able to sell the products.
It's a great moment to import for us, and a great moment for you to export products.
Software is destined to fall to zero cost eventually, simply because it can.
Pure bull. Software is never going to hit 0 cost, because you will never find competent programmers making all software out of the kindness of their hearts. Some software may hit 0 cost. Not all.
"16MB (fuck off, MiB fascists)" - The Mighty Buzzard
I don't know exactly how is the trade agreement between europe and U.S., but at least in Brazil, where I live, tech products are more expensive due to importation taxes. The government gets 50% on taxes on every product shipped to brazil, making them a lot more expensive.
Plenty of high quality software has been written by hardware vendors and other companies who's primary business is not selling software (eg providers of various services)...
Apple make a lot of software, and a fair bit is given away for free and some with source code.
Sun make a lot of software most of which is free.
Linux is developed by many companies, some of which are hardware vendors.
Then you have other companies that give software away and make money from associated services...
RedHat give away software for free and sell support services based on it.
Mozilla - give away a browser, mail client and few other things, make profit through advertising revenue.
Google - give away various pieces of software and automated services, also make profit through advertising revenue.
Also the availability of source code makes future programs easier to write, since you can reuse code rather than wasting time rewriting something someone else already wrote but won't give you the code for. Linux is a good example of this.
Hardware generally requires software in order to be useful, so hardware manufacturers will need to write some anyway.
Hardware costs for each unit, and services cost money to provide each and every time, software does not so it's the easiest thing to go when cost cutting.
As for horses vs cars, proprietary vs free is the same:
Zero cost (save money)
Open source (modify to suit your needs)
No need to worry about license compliance (further cost and time savings)
Buy support from multiple vendors (cost savings as support vendors have to compete on a level field)
Guaranteed continued availability (ie you aren't relying on a company still being in business to sell you more licenses)
Open standards (no lock in, easily switch to different software if you find something better, not be held back on something inferior)
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I expect to be modded down to nothing but I think it has a lot to do with the fact that everything in Europe is a little less efficient. I was recently in Italy and I would say that prices there of basic items like coke and other food were about twice as expensive (I also have a funny picture of three people changing a light bulb, one holding the ladder, on directing people away from the ladder and one changing the bulb).
Comparing price /100ml for a 10 pack of coke on http://www.sainsburys.com/groceries/index.jsp?bmUID=1217342714871 0.11 GBP to price /100ml 12 pack of coke http://www.grocerygateway.com/GGFrames.asp?GUID=200048645912081772994052&Tab=0&Aisle=0 0.11 CAD yields a price difference of about double.
So to sum up my ramble, I think that software is pretty much in line with the cost of stuff in europe.
You'd think the standards-happy folks around here, who don't take kindly to software publishers and the like that just make things up as they go along, would be aware of and comply with ISO 4217.
They are trying to get some money back from all the fines that got from EU.
And if you compare average salary, then you will know why piracy is growing in low income countries - change strategy! $16 for CD in countries that make 4 times less money is a ripoff!
wooosh!
Microsoft make money because the market has not matured enough yet... They also snuck in through the back door as the hardware market was maturing - people went for the cheaper more open hardware, and overlooked the impending software lock-in because it was a relatively small cost compared to the benefits of cheap open hardware from multiple vendors.
As for your comment about little financial motive...
There are many ways to make money that don't involve directly selling software. IBM and RedHat make a lot from support, Many companies make a lot of money from hardware, while investing in making free software (including free as in beer like drivers).
And your claim that very little software being created without someone hoping to make money from selling it, just look at how much free software is available, there is a truly insane amount of software available for free these days.
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They do it because they can, we simply have no choice...we can buy or not buy a product, but we can't affect prices.
Even european companies charge far less in the US for the same product sold in Europe....take a look at the BMW web site, price for M3 in the US is about half of the european price, and average salaries are far lower in Europe than in the US.
It's not that we're WILLING to pay, but the companies have the market totally under controll in nearly every sector.
US has a far more advanced situation, where it's harder to have a total control of prices.
We've taken all the bad aspects of capitalism, we're very smart people and our politicians outsmart us!!
Clothes, media players, cameras, outdoor gear, toys, games etc. are all considerably more expensive in the EU than in the US.
In my job I have been making two or three trips to the USA a year, and have pretty much stopped buying these items in the EU. I take a couple of empty light holdalls in my hand baggage on the way out, and then check in a couple of full holdalls on the way back.
Offtopic, Inflammatory, Inappropriate, Illegal, or Offensive comments might be moderated up.
Europe dares to favor Linux
It is the same in Latin America (ex. Argentina and Brazil). It is usually cheaper to have a mailbox in US and get the goods send to your home by courier.
It's because of closed source.
If I want to exchange a document with a US company, it MUST be Word. Ergo, I MUST have Windows too. And I can't buy elsewhere because you won't accept OOo's version of Word (at least accountants/solicitors won't) so I must pay no matter what the difference is.
I can't buy the licenses over in the US and import because that's forbidden. I can't make my own copy because that's forbidden. And I have fuck all chance of getting the software company to charge less if there's "no substitute" to the suits.
So it MUST be Dreamweaver. It MUST be Photoshop. It MUST be MS Office. And because they are closed source *and* copyrighted, I MUST pay what they offer.
Or Pirate.
You Europeans are being punished for having anti-monopoly laws that actually do something. Bad EU, bad. There's nothing worse than laws that inconvenience the filthy rich, unless it's such laws which are actually enforced.
I noticed this apalling gap some years ago, when my (European) company wanted to buy a copy of Acrobat. The discovery of the huge price difference for the same English-language product from the same Adobe online store made me chose another company and product. We are now happy users of Foxit Sofware.
purchasing power does not care about exchange rates.
http://en.wikipedia.org/wiki/Purchasing_power
Protector of Capitalist views,
Meorah
It isn't free for the US to bomb Middle Eastern Countries for you.
UK import duty is nonsense. Some blindfolded staffer in customs spends his days pinning the tail on the donkey, there's no other explanation. I imported some electronics in kit form, 3 batches shipped and a different tariff code for each batch. If I'd contested it, they would have undoubtedly slapped the (IMO incorrect) tariff on all the shipments.
IIRC, it was 3 - 10% duty + VAT on the lot (including airfreight) and then there was the clearance charge.
A good chunk of the price difference can be explained away by the relatively exorbitant VAT charged by most European states, plus all of the little protectionist tariffs and other items that add to the cost of sales in Europe.
This does not explain the entirety of the price disparity, however it does explain a good chunk of it. As to exchange rate, I'd hazard that most of the companies find the Euro to be severely overvalued ATM, as do I. After all only 4 of the countries in the EU had currency worth anywhere near par to the dollar, and two of them still do not use the Euro, leaving France and Germany with the only pre-Euro currency that was close to the dollar, and even then it was no where near par. The rest of the EU had fairly high inflation rates, with fairly low economic output, which as far as economic output goes is still mostly true today although some countries like Spain seemed to have figured out what do, but not enough of them to explain away the imbalance. (Same goes for the overvalued Canadian and Australian dollars. There is no way that either of those currencies is worth what it's being trade at, and while we're at it there are price discrepancies between goods prices in Canada and the US as well, but not nearly as bad as between US and EU prices, although I still strongly suspect taxes and other measures explain most of that disparity as that between the US & Canada is fairly small, and Canadian prices don't have sales and GST builtin like European prices typically have VAT baked in already.)
Australia is just expensive because it's small, and relatively isolated which means just about everything has to be imported increasing costs.
the disparities have fueled a growth in open source software and their alternatives. And, as a result, some very good alternatives have come out of Europe. Enough that some companies like MS have set up lobbying efforts there to try to stop governments and businesses from adopting the alternatives (why would they cut the price, it's not their "way").
Me too. Lots. Evidently it worked pretty well for some guy name Willy Shakespeare, too. ISTR reading (and too lazy to google for it) that something like 10% of all words in the English* langauge were made up by Willy.
[*] which lets the Merkins off the hook, since they haven't spoken English in nearly a century...
New mod option wanted: -1 DrunkenRambling
Any MMORPG player has known that for ages. There's a reason a lot of people in Europe switched from CC payment for their MMORPG fees to game time cards. It's simply cheaper. You buy them at some online store in the US which cuts your cost by a fair lot.
Many MMORPGs started out when USD and EUR were at a rough 1:1 base. Accordingly, they charged the same in USD and EUR. The problem is, they still do. Now, they certainly don't want to raise the dollar price to match the weakening of the currency (would you pay 20+ bucks for WoW?), while also they certainly don't want to lower the price in EUR (because we DO actually pay 20+ bucks, when converted).
Now, some companies stopped dealing with Europeans, mostly for this very reason. So what I did was to open an account in the US. It's easier than you may think, banks usually don't care where their customers are (probably as long as they're not in, say, Cuba), and funny enough, most companies don't care where to ship their goods as long as they're paid from within the US.
Should they start to care, I already have a deal with a friend who'll send my goods over. So the only thing I have to worry about is our customs department. But with the moronic pricing policy and the dollar feeling like a clock in a Dali painting, even paying customs is STILL cheaper.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
As far as I know, prices in US$ on US Websites don't include VAT. But the prices wihtin the german store of adobe does include include VAT (a whopping 19% btw.)
Everything is more expensive in Europe, not just software. There's no conspiracy among the software developers.
Go look at the price of a car in Europe. My car cost $32K here, and 30K GBP. That's almost twice the cost.
Yet, if you look at their income, converted into equivalent currency Europeans (at least in places like the UK) make similar average incomes to people in the U.S.
There is no catch to this difference in price. The seller has evidently found out that software can be sold at a higher price in Europe. That market "can take it", so to speak.
Simply compare it to the Big Mac index — i.e. what's the difference in price between different regions? I wouldn't be too surprised to see the two curves (big-mac & software) to line up just fine.
Of course, the Big Mac index does not take work for everything. E.g., the price of petrol/gasoline has risen quite dramatically across the globe, but some places (read: Sweden) have quite high penalty taxes that further increase this. It was almost $2 per ISO liter before the summer... but you know, we can take it. ;-)
So will they sell you American English version for the same price as in the US then?
As the island of our knowledge grows, so does the shore of our ignorance.
By maintaining higher prices they can cleverly claim greater damages from piracy, giving them more leverage in attempting to influence politicians. They don't need to do that so much in the U.S., where they've already laid so much political groundwork.
But you need money to write it in the first place - even if everything is done by volunteers you've got their time costs in there.
To have a right to do a thing is not at all the same as to be right in doing it
I'm surprised no one has mentioned that the a huge fraction of the continent takes August off to go to the beach, that 5 weeks of vacation are standard, and 35 hour work weeks are standard in some countries (that's ~11 weeks less work per year then a 40 hour week with 2 weeks vacation)
Additionally, i think the quality of life in many European countries tends to be better then the US. Better health care, better heath in general, relaxed work environment, taking vacations long enough to really unwind, 3-6 months maternity leave...
I think SOME of it is that local companies just have much larger overhead and people work to live, not live to work.
You have to pay for these perks some how, and as others have said there is a large "spread the wealth" sentiment there when you are spending the company Euro.
Ever heard a friend saying he paid 5 euros for a cup of coffee? That's USD 2.65 here @ Starbucks, so doing the conversion it's amost 8 USD. And what about Oil, which also goes 2x the price in the US? Do the Arabs sell to Europe at a different price?
There's more to the price than just VAT or other taxes.
Oil is dropping because congress has gotten serious about speculators, not because of drilling hell we are nowhere near approving drilling yet and the leading presidential candidate is against it!
Meanwhile investigations have started against speculators who gamed the market and all the sudden prices start dropping, couple that with Americans driving millions upon millions fewer miles this summer than last and that is why you have a drop in price..
"Ahh! Arrogance and stupidity in the same package, how efficient of you!" --Londo Molari
Wow lots of flaming going on here over this issue. How about something along the lines of ... ... every single European market (i.e. country) is more like its own market at companies need to contract different vendors to sell their products (i.e. different national vendors).
So while in the US they all throw their stuff at Wal-Mart, BestBuy, WhatNot in Europe they need to go to all sorts of different stores that are present on a national level only (thank god there's no Virgin Stores in Continental Europe).
Could this circumstance add to the price tag?
I pulled all this strait out of my as* by pondering why there also is a price difference between the US and the Land of the Canuck.
Use GNU/Linux! ....free everywhere, freedom everywhere!:)
Because the only people here that live in trailors do so by choice :P
Aside from the taxes, import duties. lack of competition and modifications to the software,
labour is also more expensive in Europe. In some countries it is virtually impossible to get rid of people, even though they are not performing.
Cutting labour is much easier in the U.S.A.
There is also the factor of the fluctuating currencies. Prices of software (or other goods) are not floating against the U.S. dollar. Typically prices are not adjusted every day, but maybe once a year (depends on the company). So if a currency rises or drops X% during a year, you will not see price adjustments there. Plus, the actual price of the software that a manufacturer charges are only part of the price. There's always a local component to the price as well.
$300 is far beyond anything I can spend on a single piece of software at home. I use such software at work where we have a large software budget, but unless people at home are running home businesses, I doubt they're very willing to spend that kind of money on software, either. Especially these days.
Guess why I tend to use free software or older version of software I find on eBay? Answer: cost.
Mainframe/UNIX Bit Twiddler and long time Windows/Linux Hobbyist.
The Theorem Theorem: If If, Then Then.
"I actually agree that the welfare state here is too generous, but in the US it's so ungenerous you see people literally starving and that's what leads to a massively higher homicide rate."
People in the US are not starving, we are one of the most obese nations on the planet (were number 1, were number 1)... The massively higher homicide rate has *nothing* to do with people starving to death, I dont remember the last time someone was murdered for a loaf of bread or a package of cheese, we have a culture which is more violent and a WoD which is causing many young African American men to become institutionalized at a young age.. but hey maybe you can point me at these states which show a massive disparity in starvation between Europe and the US and then tie it to crime..
"Ahh! Arrogance and stupidity in the same package, how efficient of you!" --Londo Molari
A can of beans cost 30% more at the Publix in poorer neighborhoods, less in more affluent neighborhoods.
Why? ---- Captive audience.
People with more money drive more and are willing to shop "over there" if necessary. People with less money do not drive "over there". Publix and all grocers know this and they price accordingly.
Is that why software costs more in Europe? I really haven't got a clue.
- I live the greatest adventure anyone could possibly desire. - Tosk the Hunted
is called exchange rate. The software is made in america and priced in american dollars. Since the dollar is cheap and the pound and euro are about double or more then prices everywhere else are going to be double as well. This is a non-story just to whip up the slash-idiots. The /. editors and moderators should be tased every two minutes until they stop putting out the meaningless shit stories that they have been putting out lately. I just went by the summary and didn't rtfa, assumptions right or wrong, the punishment would still stand.
Look at the other end of the market. Pick a s/w package widely sold in the EU, USA and China, for example. I'll bet that its cheaper in China. Why? Several factors, including piracy (more supply) and a poorer customer base (demand).
Although the piracy rates probably don't differ much between the EU and USA, the customers in the EU have more money to spend, the Chinese have less. Taking the gray market for US versions in the EU into account, one would expect that European distributors would hold down their prices, as they do in poor markets (China, India, etc.). In fact, they may be doing this, and the alternative (prices in the EU based only on demand) would be higher.
Flamebait mod in 3, 2, 1 ....
Have gnu, will travel.
A glance at the economist's "Big Mac Index" http://www.economist.com/finance/displaystory.cfm?story_id=11793125
shows that a Big Mac in Europe costs E3.37, or $5.34, compared to $3.57 in the US.
Price differences probably caused by exchange rate movements rather than corporate greed.
Isn't it funny how the companies can (and do) shop around the globe for the cheapest resources, but we consumers are forced to pay whatever price they charge within our borders, and treated as criminals if we dare shop around for a deal.
The way I see it, if a business is free to buy overseas and hire their cheap labor, so should we. It's just plain common sense.
-Billco, Fnarg.com
This is because of shipping charges. Yes, you can "buy online" from Adobe, but I do not believe it is for software download as the software is too large. Even if it is, I believe Adobe (and other products) end up shipping boxes to you. Granted, the shipping charges shouldn't be "that" much higher, but it is somewhat higher....
Talking to my family there I sometimes can't help but wonder how they can afford things. Well, it's why they constantly have to compromise. I certainly don't think every company selling a product in Europe has decided they're going to fleece Europeans.
I agree with you on the fact that things, especially high-tech ones, tend to be more expensive in Europe than in North America.
But if you wonder how we still can afford it, it's because you look at our way of living with american eyes.
As a french who's lived in the US and who's currently living in Canada, I can assure you I never felt like americans purchasing power was higher than the french. The reason is that even if we pay a lot of taxes on everything, we still don't have to pay for a lot of other expensive stuffs like education, retirement, health... or at least for now.
I know so many americans who are going to pay their whole life to discharge the loan they had to make to go to college or get the treatment they needed.
That's not something we need to take care of.
I guess both way of life is good. It's just a matter of choice.
2.) ???
3.) profit!
The simple reason for software (and other things) being more expensive in Europe is that the Europeans will pay more and they pay more because they can afford it.
The average income in the US is lower than in many parts of Europe and this is only half of the truth: The average income of the majority of the population is *much* higher than in the US. In the US, if you're not rich, you're probably working your ass off to make a living. In Europe "normal" people do not only work less, they also earn more. Minimal wages in many countries are about $1800.
There's an arms race in place right now between people who have stupid amounts of money to throw at development of new gotta-have features, and the large numbers of volunteers making quality software.
And while the volunteers have been catching up quickly, they've been playing catch-up for nearly 20 years.
As long as companies like Microsoft and Apple continue to ingratiate themselves with corporate and educational customers (which they will) and wow consumers with shiny new features (which they will), the open source community will be struggling to keep up.
While we're seeing the rise of some very good *nix based desktop operating systems, they're still far behind Microsoft and Apple for "just install and it's ready for your media junky kid to use" goodness.
Ubuntu (being one of the easiest to configure and use Linux distros out there) can't play MP3s by default because of their (quite justified) fear of patent lawsuits. Installing a mediaplayer and making sound actually work is still extremely painful in Ubuntu (or any Linux OS for that matter). The last Linux version of Adobe Flash Player was a year behind the release of the Windows and OS X versions. If you've got an Nvidia display adapter, you're in for even more of a treat. If you've got a laptop, you may never get the wireless working. Finally there's the tired (but still as valid as ever) argument that there are no games for Linux which aren't years old by the time they get there, and only about 1% of the games released ever get there.
I'd love to use only Linux for my desktop needs, and indeed, Linux based operating systems do 80% of what I need. The only problem is that the other 20% is where I spend 80% of my computing time - gaming, NetFlix, Adultswim.com, Dreamweaver, Visual Studio.
Safe to stop reading here unless you feel like chewing me about about Visual Studio.
Before anybody raises objections, I've yet to see one programming IDE which works half as good as Visual Studio for C++ development
I'd be very happy if somebody showed me an open source equivalent which can build DirectX apps as well as Linux apps, debug inline, has code completion for all data structures in the project (including ones I just wrote) and not just library functions, reads comments and includes those as tooltips in the code completion, and doesn't rely on some byzantine dependency tree which makes it run like frozen molasses.
Yes, I am fully aware that there are open-source tools which probably do every single one of these things individually. The point is that Visual Studio does them all together, and it makes it worth every penny for me (even if I hadn't gotten it for free from the university), however it does still tie me to the Windows platform and sort of remove the possibility of cross-platform compilation.
The land shall stone them with the bread of his son.
A fair price is "whatever the market will bear."
No, a fair price is one which recompenses you reasonably for the amount of effort that you put into the item/service which you sell. "whatever the marker will bear" is a price that people will pay you regardless. Most, if not all, businesses will charge the latter because they can. However this does not make it fair.
Has anyone considered tariffs or Value Added taxes? Europe has historically imposed tariffs and taxes on just about everything. If governments do not impose tariffs or other "fees" one would expect enterprising Americans to pack bags full of Dreamweaver CS3 and head east across the "Big Pond."
Can anyone shed light on the question of tariffs, inspection fees, entry fees, VATs and ad nauseam imposts of the European Union?
Australians get similarly screwed on software pricing. What's really heinous is how software publishers DRM it so you can't use another country's version half the time.
I can't remember the publisher name now, but one publisher specifically pulled their games off steam until steam would sell different versions to different countries because people were getting games effectively half price.
New games in the US are around $50 I believe, over here anywhere from $90 to $110, and our dollar is somewhere over the 96 US cent mark at the moment.
It is localization in the UK as well. The preferred ending according to the OED is -ize although -ise is acceptable and seems to be very common in modern usage. An Inspector Morse episode once hinged on the fact that en English professor would not write a suicide note using -ise because -ize is the more correctending. This is why I always get really irritated with spell checkers: the UK versions refuse to accept -ize as valid.
Long Beach, California is a closer port to China than Dover, UK. Shipping over the two oceans is still cheaper than land transport.
Also, I don't think John Lydon needed a video game to play music. The UK economy was much worse then. Suck it up!
In at least one case, we pay less for european goods, than europeans. I purchased a BMW last year for around 45K USD. That same car costs around 45K in euros for European buyers! While the dollar has continued to slide, the price has not increased, yet.
Also, I learned recently that european employees at a well known int'l consultancy make significantly less than their US counterparts, for the same job? What's going on here? Is europe haves and have-nots (i.e. lack of middle class)? I'm not a hater, just curious.
It is a fallacy to think Europeans WANT to pay more. Nonsense.. everyone here is angry about that and I am sure it's part of the general feeling of anger that's so prevalent in Europe right now: high prices. Everyone looks at the prices in the USA and sees the difference. We're neither blind nor stupid. And it's not just software, it;s electronics, books, clothing.. lots of stuff. So why ? 1) Well partly it's VAT (almost 20 %), 2) partly people want it in their own language: so no choice. 3) I have no alternative. If everyone sells it to me for the same high price, then where do I go. and with that a MAJOR reason: 3a) Europeans are not so comfortable with e-commerce. They prefer stores.. or a website where they know there's an existing store. That has impact on prices, and choice. Stores are expensive: rent, social security of personell etc etc.. But the anger is there nevertheless.. whether warranted is another issue.
I think this is the MAJOR reason: RISK AVERSE. If people are concerned by buying over the web, unless it's a store with a website, then costs will be higher. If they're too afraid to buy from Amazon all the way in America.. then they see the price differences but still won't make use of them. It's an attitude issue. Not the attitude of "coolness" or early adopter.. but the attitude of taking risks. Better safe than sorry.
This is good for the US economy. How is this bad? Their money is worth more than ours, and we are an IP based economy... so we have every right to sell to these countries at high prices. It employs our US citizens (a tleast in theory)
Its no different then our own companies, making stuff in China for $10 cost, $1 labor, and selling it to us for $500 dollars.
We all get raped by companies, but in this new multi national economy, i sure as hell hope we charge an arm and a leg to countries that have the money... and even those that dont. Because i dont give a fuck. We lost millions of good manufacturing jobs to China, India, Mexico, Taiwan, etc. You're dam right we better charge high prices for our US built software and products. We need that money badly. Our economy is in the shit and we dont have almost dont have a middle class anymore.
The richer are getting rich at our expense, no shit they would get rich at the expense of Europeans as well. I just hope for the good of OUR communities, that OUR AMERICAN people get good paying jobs and a nice house to go along with it.
But probably the reality is that these corporations, will just eat up the profits, buy personal jets, large homes and fuck strippers.
After all, what you thought was an American company, is nothing more than a Multi-National Corporation with no loyaltiy to any country, and it exists as its own entity with rights its own that out way those of a citizen of any nation... even so called "Free America"
you should see the crazy markup dealers of pro-audio and studio gear get over here. it's insane. for what you would pay over here you can overnight fedex a whole studio of gear from LA and still have money left over for hookers and blow...
As simple as that: it's pure capitalism. They know their economy is a total shit, so they take money off other countries to keep surviving. Want to fight it? Take free software when you can, and pirate them enough so they'll have a drop in their prices to get the market. When they'll understand they can't continue to fraud people of other country they'll adjust the price. But as long as you keep buying it, they'll continue.
I use a french AZERTY keyboard, and € is bound to rALT+e . Furthermore, I use Linux, not Windows; but even then I have to wonder what difference that would make WRT /.'s non-handling of UTF-8.
...housing, movies, hookers, beer. Software really isn't that special. Check it out http://www.pintprice.com/
Why don't they just turn the servers off, that solves 100% of all security vulnerabilities. Except denials of service, of course.
That's what it comes down to. There is a whole generation of Europeans who believe in a better future and have the entrepreneurial spirit that has become so lacking in American culture.
Everything is worth what its purchaser will pay for it.
As many others have pointed out: "because they can".
As long as barriers to free trade and exchange of goods and IP exist, these kinds of pricing disparities will continue to exist.
While some people will pay only invoice on a new car (several thousands below sticker), others are willing to pay sticker with a little haggling. Haggling down to invoice takes effort and discipline (I won't buy this car unless I get it down to invoice pricing). Well, similarly, driving down software prices in your local market takes effort and discipline: don't use the software if the value it adds is less than the value consumed by buying the product.
Since programs like photoshop are a tremendous value-add for professionals, the best way to get the price down is to remove barriers between markets and support open software and open software methodologies (portable language packs, for example).
It's fairly simple: the Euro price was set a long time ago based on the exchange rate then. At the time, the price difference was mostly because of taxes. As the dollar has tanked, the prices in their respective currecies have stayed the same, but the comparative prices have doubled since the US$ has lost half of it's value in the past eight years. It's not that Euro customers are paying more, it's that American customers are getting the product at half price to make up for the 50% pay cut we've gotten while living under George Bush.
It's not only about software. Apple translates their hardware prices with their own, erm "special" exchange rates: For e.g. let's buy the cheapest macbook in the US store: http://store.apple.com/us/configure/MB402LL/A?mco=NzQ3Njk0 which sells for 1,099 USD. Vs. the same in the German store: http://store.apple.com/de/configure/MB402D/A?mco=NzU0Njc2 for 999 EUR, that's abt. 1,557 USD according to google.
It is clearly true that copying software, once it has been created, is essentially free. However that ignores the fact that software costs a lot of money to create. If there is no financial motive to create software, very little software will be created.
There's always a motive to create/improve software, which is the same as the motive for buying software it can help you do your job better/faster. Wasn't there some statistic about the majority of software actually being in-house tools rather than commercial products? But this doesn't work as well for software used primarily by people who aren't (and don't work with) programmers... I wonder how a model of "source is free, but precompiled binaries will cost you" would work?
We are the knights who say GNU! We demand that you bring us a shrubbery!
That's just as much BS as their old excuse for shipping things to Europe despite being closer to China where all the electronics are actually made and Microsoft makes their EU discs in Ireland so the cost is minimal for shipping.
As far as translation...for starters they never actually give you software that uses British English so we see no benefit in it and do you think they get "file", "save", "copy, etc translated for each version? A previous employer of mine only paid approx. £110,000 to get a whole book translated into about 26 languages. It was a small company so they certainly didn't get a good rate. Now if Microsoft or Adobe somehow pays double that, that means they only have to add £1 per disc if they sell 220,000 copies which they will. There is no excuse for something that should cost us £150 to cost £300 (or more).
The only reason they do it is to boost their profits because European currencies are worth more than the dollar. So they abuse their positions to sell over priced software to help their bottom lines. That's the only reason.
This is also yet another reason why I use products like Open Office and Gimp. Honest companies, like JCreator, will get my money too seeing how they don't try to rip me off for not living in the US.
And you believe that high-quality software will be written by companies whose entire business model depends on you and a thousand other people buying up the next version, and the version afterwards? come on.
High-quality software is written today by people paid to create specific solutions to the problem at hand, not to create generic solutions to a problem their marketing makes you believe you could have, and that business model has very little to fear from "piracy" or whatever.
No problem is insoluble in all conceivable circumstances.
companies charge more for products in europe because they can
They can and do because they must. The cost of doing business in Europe is much higher than in the US, shareholders expect profit margins to be at a certain level and WTO frowns upon the practice of favouring certain markets over others for no good reason.
The same sort of price differentials are apparent in Canada, where it seems unjustified to pay 20 percent more for a product made in California than people pay in New York, when Vancouver is closer to the source and transportation costs are cheaper. Before the US dollar devaluation this price difference was obscured because the CA$ was only worth US$0.70 to 0.85 and fluctuated enough to be an excuse.
Now the CA$ and US$ have been within a couple of percent of equal for most of a year, and though imported goods have come down in price, the retail numbers have settled at around 20 percent higher overall to what they are in the US. People have complained, the government has voiced its concern to retailers, but in the end it comes down to one thing: TAXES. Despite the fact stored charge 20% more in Canada, Canadian retail margins are actually LOWER than the US--they charge more and STILL make less profit.
Taxes are at the root of almost the entire discrepancy in prices between any two developed nations, because taxes accumulate in the price of everything. Manufacturers pay those same higher taxes and pass costs onto retailers. The retail stores pay more corporate taxes and municipal property taxes and pass those on to customers, along with the costs that manufacturers passed onto them.
Everybody pays more for everything here because everyone passes on the cost of fuel too. In Alberta, Canada right now gasoline in US units costs more than US$4.95 per US gallon. You can drive just across the border into Montana and suddenly you only have to pay $3.99, and here is the kicker: it is the EXACT SAME GAS from the SAME CANADIAN REFINERY, but we pay so much more for our own gas. The reason? Literally 100 percent of the difference is TAX. Companies can only partially write off the added expense too, so the cost goes all the way up the chain.
Anyways, I'm not sure why Europeans are whining about the prices. They have embraced a more socialist-oriented system for years and with added taxes come the benefits of the socialist infrastructure they wanted and are comfortable with. You want cheap gas and cheap computer toys and cheap software like the US? Then you have to settle for getting (another) mortgage on your house for that operation, or paying six figures to send your children to top-level universities. Otherwise, stop whining and live with it. You already live with paying 100 percent more than Canadians do (and we pay 20 percent more than the US remember) when you buy petrol, movie tickets, DVDs and CDs, clothing and much more. Video games are no different at all.
There are many ways to make money that don't involve directly selling software. IBM and RedHat make a lot from support,
The support model works because of (1) crappy software, (2) crappy documentation, (3) willfully-ignorant users, and (4) fearful/CYA users. A programmer's goal should be to get rid of (1) and (2), and I'd expect the corporate cultures responsible for (3) and (4) to make such customers less fit in the evolutionary sense. So the support model also only works because the market hasn't matured enough yet.
A first world country tends to have a service and information oriented economy. Manufacturing is so last world war.
One point that nobody commented on is that in (parts of?) Europe you can legally resell all software, including the OEM versions, unless you have made a written contract with the other party that says otherwise (if you sign one, you will get discounts).
When Vista came out, I made a small fortune importing a hundred Vista Ultimate licenses from the States, and after adding the VAT (~20%) and my profit margin (~20-25%) they still sold like cold beer on a hot day. (No remarks about Vista vs. your favourite Linux distro here, please.)
They were OEM-versions, but they are completely legal to resell, no matter what the box/DVD/EULA says. They activated just fine, but I could have legally bypassed it, if it had interfered with my rights. Those who bought them can still resell them. They still have high value, unlike in countries where an EULA can forbid you from transferring your legal right to use the software/bought song or video in digital format.
Nowadays, there are so many people reselling imported software (for example English versions from Hong Kong and Singapore) that the profit margins are razor-thin.
By specializing it's still possible to use differences in prices and legal systems to make a nice profit; for example I currently have five Eee PC 901s with OS X installed for sale at a local auction site. The listing is currently at 580EUR (904USD). I have bought legal copies of OS X, and I can legally install them to whatever I want, modify them if necessary to exercise my rights, and (re)sell them.
In a nutshell: ...
1. My rights as a living person >> rights of immaterial corporations.
1b. No need to buy a mouse or motherboard or whatever with OEM software, no need to beg Apple's permission to use paid software,
1c. After taxes, my Blu-ray player was 21% more expensive than at Amazon.com, but it came from the factory both region-free and without HDCP. For me, it was the better deal.
2. Big retailers and official on-line shops charge vastly more than in the US, small shops and resellers barely more and quite often even less after deducting the VAT.
3. Without accounting for PPP corrections, direct price comparisons can be very misleading. In addition, my country's tax percentages look horrible, but in reality there are so many tax brakes and deductions that the real-world rates are very close to the US rates. One difference is that the rich really pay more taxes than the poor (due to higher VAT and progressive taxation).
I apologize if I made wrong claims about the practices at the States, I haven't personally been there since they started fingerprinting foreign travelers.
I have nothing to hide, so nobody has to take a look.
Capitalization is the difference between "Helping your uncle jack off a horse" and "Helping your uncle Jack off a horse"
Same reason food costs more in the EU. PPP baby.
As far as MS is concerned, it's only logical, and the others (like Adobe) are just following suit in a trend they see that works.
The EU, listening to complaints from companies some of which are worse than MS (and you may include some OS fanatics in there too), fined them a ridiculous amount just for being more successful than their competitors were when they were trying the same.
You didn't believe for a second that MS was going to let its own American customers be the victim of such lunacy, did you? The price of Windows was approximately the same in the US and Europe before the verdict (apart from import tax, which is another matter). When Vista came out, European customers got it at a 1:1 dollar/euro exchange rate, right from the start.
And because Kroes let that happen (she wasn't allowed to complain by her sponsors, and she didn't want the EU public to find out that she HAS sponsors in the first place, because that's illegal here), the current exchange rate for new products is 1.5 euros on the dollar. Not just for MS, but for al US manufacturers with somewhat of a name.
Who lost? The EU customer. Who's to blame? The EU voter.
I'm surprised no one mentioned this yet! I worked for a US software company in the Norway office. We charged substantially higher prices in Norway not because we could, but because we HAD to to survive.
We had office rent, employee salaries, very high (I would call them punishingly high) taxes, VAT, etc. Everything we purchased in country was also very expensive. Now, how many copies of our software will sell in Norway? I can give you a hint -> MUCH MUCH LESS than we sell in the US. In fact, our yearly unit sales were equal to about 2 weeks sales in the US.
What does all that mean? Well, we need to make a profit or else we'd be shut down. So we must charge a substantially higher price in order to survive.
Do you fools really think we could sell it at what essentially amounts to a discount when all local costs are much higher?
I actually thought that it was an EU rule that software or services provided over the Internet are not subjects to VAT, or maybe that's just in Denmark.
No matter what, this rules have saved me and my family a lot of Euros on software.
Anyway, if localisation is the reason, why's the International/English version of Windows more expensive than the Danish one here?
I will just keep buying my software as downloads from whoever has the best price (No I'm not talking piracy), I prefer English versions anyway and it takes less than an hour to fetch a DVD worth of software, while it would take more than 24 hours to get here by mail from a local distributor.
If I was as pragmatic and objective as I claim to be, would I be commenting?
I think you're right - and wrong.
I'm a British (well English) person so I count as well Europeansish I guess. Well I can talk the same language(ish) as Americans - but politically more aligned with 'Europe'... I guess.. Well actually my political compass seems to point to 'left-wing' libertarian - so left-wing swing to Europe, but US libertarian seems to be right wing... and and and....
I think the take-away point is that everybody is unique and tends to get painted by others by the country they belong to. US stomps across the planet gunning for resources with an illiterate army equipped with the finest munitions on the planet etc etc. I conversely appear to have forgotten my bowler hat and am curiously happy about the loss of 'The Empire'
Anyhoo - we're all just people and all different and most of us are quite struck by the blindness of others (Evangelicals spout pretty much verbatim that of Al-Quaeda, with just the odd noun transposed).
All boils down to the basic human instict that "I'm right" - and where would we be if we were all in a perpetual state of flux and indecision?
To take for example a 'secularism' - We're not going to have god in our legal system... instead that's replaced by people pledging allegiance to a flag? Nobody notices anything strange here???
*waves hands*
I've travelled the world. Americas, Europe, Asia, Middle East for work - everybody I've met has been lovely. Whole planet is filled with the same people and as a rule of thumb we're 'lovely'.
Sure any travellers here have had the same experience.
Oh I'm rambling on, losing my point, and this is going to be buried in the middle of an un-read thread - but... Oh - back to the original point. Yes - we're shafted on prices in Europe. But somebody has sat down and worked out these prices as what people 'are willing to afford'. If you don't like them, don't buy them *shrugs* it's a free market.
Still arsey over the price of my Rock Band instruments - but hey - it's only money.
weirdest international experience I had was 2 weeks in Atlanta Georgia. Flown in for 'critical problem' but than dicked around for 2 days before I got to meet 'the important person' (who then sortof mentioned an hour in the problem had been solved)
Still I did managed to pick up 2 invites from co-workers to churches on the Sunday - seemingly my non-existant soul was of a greater concern to the average American corporate drone.
The EU VAT must have something to do with it. After all, if you buy online interstate in the U.S. you are most likely not paying much, if anything, in taxes. Europe has the VAT, plus higher taxes all around on the sale of goods. I bet they wish they lived in the States! Then they wouldn't pay taxes like that! But then they'd have to pay for crappy healthcare, eldercare, daycare, schools that teach math, etc.
(3) you used the "fixed that for ya" meme, which makes you look like a pompous ass in nine out of ten situations, including this one.
... only to sensitive americans, who believe that the world revolves around them ;)
The US economy is not capable of allowing companies to charge that much for software. Improve the economy first and then prices will be inline.
You can almost judge the standard of living based on software pricing. Higher ticket prices for citizens with higher disposable income percentage.
flame: The US needs to start taking more oil from foreign countries to catch up. Iraq and the Afghan pipeline are not enough. Get on Iran or continue to slip in the world.
Why, for the love of christ, does any fucking post on slashdot that mentions some or difference between the USA and Europe descend into a hate filled slagging match by dolts who know almost nothing about the other region and touchy nationalististic dolts who take offense and go into denial on any subject?
We have the same issue here in Australia exactly. Buying a game for example the already old Red Orchestra Ostfront Gold version costs $80 here! I can buy it on ebay brand new in the US for $30 landed to my door. The disparity is rediculous and it is a joke. I am proud to be Australian and buy Australian made or from Australian retailers consciously but I cannot afford to support such a disparity. I only ever buy games from the US or playasia.com and never from this country.
There seems to be a disparity in the Big Mac index. Economist.
If anyone here has the time, it would be interesting to see how the index compares on software. EG. Big Mac is 2x more in Germany, is Adobe Photoshop 2x or more expensive?
Find the population variance of the price differences. If the population variance is low, then the cause is likely systemic: perhaps due more to foreign exchange rates or costs of translation to non-English languages than causes you might find under high population variance, such as price discrimination and/or lack of competition in a given product's market.
Determining the latter causes would likely show up in comparing the sample variances of products categorized as existing in markets of high competition vs. low competition...
I haven't the time to do such an analysis, but I'm sure there's an Econ. or Stats major out there willing to do it. :)
Is Capitalism Good for the Poor?
Commodore used to charge almost twice as much for PETs in Europe than it did in the US. European sales of PETs kept commodore alive before the C-64 made them the big player. Why Europeans would pay more, nobody fully knew.
Some speculated it was because the support system was better in Europe and people were willing to pay for that. But the support system was better because their sales were higher there, meaning they could open more stores with support centers. It was a positive-feedback mechanism. A threshold of sales volume justified support centers. They couldn't reach this threshold in the US because Radio Shack already had stores.
It may be the same with some software titles mentioned.
(Difficulty in setting up support stores in US was one reason the C-64 was designed as a mass-retail product. Commodore figured they'd back-door Radio Shack rather than compete directly with them by attacking a lower niche.)
Table-ized A.I.
Its the same thing with games. I remember Valve banning several american gamers last year because they had imported the Orange box from cheaper markets.
as they get it back.
The localization costs are of no real importance either - because most companies use English software anyway. No sane person would use, let's say Visual Studio to take a common example, in Norwegian, even though it's available for some odd reason.
Customs might charge some money but that usually never exceeds 15-25%, depending on which country you are importing into.
So charging 100% more for literally the same product is nothing but greed - and the stupid Europeans are paying the price.
Most importers in Europe are just ordinary thieves.
European prices used to be:
(US price converted to Euro) * (1,2 to 1,5)
It seems they still use that calculation but also the same currency exchange rate as years ago (when 1$ was more than 1 euro (or even 1.1-1.2), now it's close to 0,6 euro), so in fact we often pay around twice as much or even more.
So I suppose a lot of europeans are shopping on internet now :)
If your former Sun employee was responsible for the three versions, that's probably why he's a former employee.
In the US, printers are usually sold without USB cables. Many stores will sell USB cables for $10-$20 (closer to $20).
If they wanted to keep cost and prices down, manufacturers would just ship all items without 'optional' parts and include a coupon for the 'optional' part with the main device.
But they don't. Instead they find it easier to not ship the cable, not include the coupon, and not worry about selling their cable next to the printer. They let other companies such as Belkin eat their lunch at dinner prices.
Why don't Europeans just go to the various U.S. websites and download and pay USD for what they want? Its the beauty of the internet!
Are they so nationalistic that they don't look outside their own countries? I don't think so, so its a mystery to me.
I bought a Levi's 501 for about $25 last year while visiting Nebraska. In the Netherlands you'd pay about 100 EUR, six times as much. Two weeks later someone went on a killing spree in that very same mall, maybe that's the kind of thing that keeps prices down in the US?