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Adobe To Australians: Fly To US For Cheaper Software
angry tapir writes "It's been a long-running joke that it's cheaper for Australians to get a plane ticket to the U.S. if they want to buy Adobe's Creative Suite instead of paying local prices. But appearing before a parliamentary inquiry into the disparity between IT prices in Australia and elsewhere, Adobe's local chief appeared to suggest just that."
Other companies gave their responses to the inquiry as well. Microsoft said they'll simply charge what the market will bear. Apple tossed out a host of reasons for the price difference; its retail partners, digital content owners, exchange rates, taxes, import duties, and an apparent inability to alter the price set by its U.S. parent company.
I don't know if this applies to software, but I know that music and movies have been seriously hindered by archaic regional licensing agreements going back to the days when physical media was the only means of distribution. It's why a certain DVD may be available in a certain region at price x, while completely unavailable or at a different price in region y (with a different distributor or even with a completely different edition of the movie/song). This old system has become a HUGE annoyance in the modern streaming era, particularly if you're trying to watch Netflix outside the U.S. (since those movie licensing agreements are still such a goddamned mess, even in an era when streaming crosses every old national and regional border). It's also why I have to import my blu-ray of "More American Graffiti" from the UK instead of being able to buy it here in the U.S.
This may also explain why these weird prices apply specifically to the standard physical boxed sets of Adobe products, and not the newer cloud versions or student editions (as per the article). It may also explain why Adobe is so reticent to talk about it. If they have some long-standing regional licensing/distribution agreement in Australia, they may be reluctant to bad-mouth their local licensees/distributors (who have jacked up the retail prices for whatever reasons).
Your political party doesn't care about your rights and only represents corporate interests.
And you think the company wouldn't pass that cost along to the customers?
It's just so darn expensive to rewrite all the software upside down for Australia and the rest of the southern hemisphere. That's the entirety of the additional cost!
If my knowledge of Australia is any indication, they're not socialist. They're either a vast wasteland where people in dune buggies fight over gasoline, or the place where young Einstein learned to party. One of those. Either way, I know they all carry VERY large knives.
Your political party doesn't care about your rights and only represents corporate interests.
These companies have agreements with online merchants like Amazon to block sales of US-priced products to Australia. Trying will get you a "This product is not available in your region" message.
A few people sending packages to friends doesn't make a dent in the gouging.
"I've got more toys than Teruhisa Kitahara."
Longer warranties, import taxes and sales taxes are just costs of doing business. And costs of doing business are passed along to the customer. Did you really expect a commercial company to let higher costs eat into their profit margin? If taxes are being raised, prices go up. If legislation is passed that makes it more expensive for companies to operate, prices go up.
Adobe is just being greedy.. that's all.
They can charge what they want to with pretty much no competition. Why not fire up a kickstarter campaign to add whatever features are missing to their open source competition? Maybe it'd be cheaper to hire some programmers to do that, as well. Especially since that could be a project funded and worked on globally.
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
In case of Adobe and Microsoft it certainly does not. And they both admitted as much.
With regards of Apple it isn't as simple. Their hardware isn't much more expensive as in the US and the difference can be explain fairly easy by taxes and increased costs of doing business.
The iTunes store is a while different matter. Apple has to license the content from local copyright holders and prices are set by those local companies.
For example take a song created by an American artists. The American record company holds all rights to the song, but exclusively sub-licenses it to a local Australian company for distribution in their local market. If Apple wants to sell that song, it has to deal with the American record company for distribution in the U.S. and deal with the Australian company if they want to sell it in Australia. And the Australian company wants more money from Apple which leads to higher prices.
Most likely the Australian company is owned by the American record company, so guess where all the profits go to...
In my experience Adobe software is more expensive outside the United States in general. It's understandable in Europe where they've got 20% VAT, in addition to a ton of other tariffs. But in Australia their VAT is 10%, considered one of the lowest in the world; I suppose, except for the US which has none. There may be import duties that are not being mentioned here, but it still wouldn't explain why the software is $1000 more expensive than in the US.
However, I've noticed the trend elsewhere, including where I worked in Taiwan. Where Adobe software was considerably more expensive. It was ironic considering how rampant piracy was there. In our case we went through grey market channels, where someone purchased a bunch of copies in the US and resold them there. That or we'd get someone in the States to buy us a copy. Either way, we definitely weren't rushing out to buy the latest versions. So if anything, Adobe was discouraging sales.
There was a lot of weirdness. Some software was cheaper than in the US. But then electronics were barely on par, and in some cases even Taiwanese-made laptops, for example, were actually cheaper than you'd find in the US. I do know that companies were levied various taxes and tariffs so that may have accounted for some of it.
As far as I know, Australia's median income isn't higher than the US. So it seems that for whatever reason Adobe is gouging them. That said, good luck finding a plane ticket for anywhere near $1000.
FTFA: "Adobe’s US software can be used in Australia but not covered by warranty, he said."
Really? Since when do they have a real warranty on software anyhow?
The Christian Right is Neither (Christian nor right). See: Matthew 23, Matthew 25, Ezekiel 16:48-50
A company gave an honest answer? :D"
I was expecting all of these companies to give bullshit reasons, and Microsoft just straight up said "Oh, lol, cause we can
What do I know, I'm just an idiot, right?
Australia Adobe store - Creative Suite 6 Master Collection - US$ 4,530.00
Brazil Adobe store - Creative Suite 6 Master Collection - US$ 5,055.00
Brazil, where a car made here is sold for R$ 56.210, and the same car, but with more optionals, is exported to Mexico (over 7000 Km away) and is sold there for R$ 25.800. Take that Australia!
Fortunately, this particularly blu-ray was region 0, so there was no need for me to become an evil criminal to view it. I have, however, ripped many a tag off a mattress and jaywalked more than once in my life. So I do have a bad-boy side.
Your political party doesn't care about your rights and only represents corporate interests.
Except the UK has VAT too, so there's your argument blown out of the water.
What is it that the US has against VAT? You have sales taxes etc. instead that perform the same purpose. Do you even understand how VAT works (i.e. it only really affects the end-consumer and not the manufacturer or any of the businesses involved in supplying the product)?
I think it's a blanket hatred of something that you don't understand and that you think you have no equivalent of. Clue: Almost all developed countries in the world have the same amount of taxation on the average person. The exceptions are those with blanket-taxation rates and simplified taxation systems that actually tend to lower overall taxation.
You can whine about the TV Licence "tax", road "tax", VAT, and everything else that you like, the fact is that pretty much everyone pays the same amount of tax in all countries.
And hence, the question of why the UK software prices differ from Europe's (literally 30 miles south of us) so vastly is just as important as why Australian prices differ from the US (in fact, more so). And none of it can be attributed to any one tax that's not present in the other country. In fact, almost all of it can be attributed to just one thing - the people buying it don't complain enough.
Initially, yes. But it was overturned by the supreme court.
File under 'M' for 'Manic ranting'
Seriously. There are organized trips now to the US. Not just for TVs and games and stuff like that.
People will fly to US and buy their entire kitchen set. (Most can work both 110v and 220v now).
Even after paying the shipping container and the VAT, it is still significantly cheaper than buying in Australia.
Wow, Gimp does another thing that Photoshop can't do!
Here's the secret to immortality:
Actually, I've heard that nearly all open source sells in Australia for double what I pay for it in the US. It's everywhere, it tell you.
Is it just my observation, or are there way too many stupid people in the world?
My thoughts exactly, that's part of why I suspected from the start that a lot of people just don't get it.
VAT. The VA stands for Value Added. A company pays tax on the value it has added to a product, nothing more.
So if a company buys in parts from China, puts them into a device, and sells the device (onto another company, consumer, whoever), then it pays VAT on the things it bought and CHARGES VAT on the things it sold. The difference in VAT is the only thing it has to actually *PAY* to the government.
So if it changes prices, and the things that cost it £50 to build it then has to sell for £40, it actually GETS MONEY BACK from the government in the form of a VAT rebate. If it sells them for £50, it pays no VAT (effectively). If it sells them for £60 it pays the VAT on the £10 only (it pays VAT on £50 but it credited VAT on £60).
That's basically all there is to it. Every company in the EU knows how to deal with it and if they aren't "adding value", they don't pay VAT. It's basically a profit-based tax. No profit, no tax.
In terms of the end consumer, the only person who doesn't ever "add value", they pay a 20% sales tax, in effect. But because the company that produces it isn't subjected to lots of complicated and high taxes, and it isn't charged every time it goes through another company's hands, the price ends up about the same as anywhere else.
There is *nothing* stopping a company selling things cheaper with VAT. In fact, it positively encourages them to!
There is. There's a myriad of grey market importers based overseas like e-Global Digital Cameras, there's plenty of locally based (i.e. forced to comply with local warranty and tax laws) companies which offer drop shipping likw Kogan who you may have heard of since they've been featured on Slashdot a few times.
Then for everything else there's reshipping companies in the USA like Re-ship or Meimei who will provide you with a USA address to drop the product to and then forward ship your parcel onto you for a small fee.