Tech giants to answer for high digital prices

Apple, Adobe and Microsoft summonsed to appear before Parliamentary Committee

CHOICE welcomes the move by the Federal Parliamentary Committee investigating digital prices to make international tech giants front up and explain the high prices paid by Australians.

The inquiry into digital prices has been running since last July however CHOICE says it has been hampered by stonewalling from Apple, Adobe and Microsoft. The companies have so far refused to publically front the inquiry and explain why they charge higher prices to Australians for their products.

CHOICE has provided evidence showing Australians pay around 50 per cent more than US consumers for identical music, software, games and hardware(1).

“We welcome the move by the Committee to force these companies to front the Australian public and explain why they think it is okay to charge Australians more,” says CHOICE CEO Alan Kirkland.

The consumer group hopes that now the inquiry can create real pressure for lower prices in Australia. CHOICE is calling on the companies to come to the hearings prepared with answers and not just excuses.

“Australians are waking up to the fact that we are being ripped off. We believe it’s time that these companies realise this and start pricing fairly in the Australian market,” says Mr Kirkland.

“We found that with one Microsoft software development product(2), you could fly to Los Angeles return to buy the software and still save thousands of dollars.”

“With price differences this stark, the same old excuses just won’t cut it anymore.”

While it is good that the industry is finally being held to account, CHOICE has also released a guide for navigating around international price discrimination for consumers wanting to take matters into their own hands.

CHOICE is also calling on the Government to investigate whether measures used to sustain international price discrimination, like geo-blocking, are anti-competitive.

(1)CHOICE found significant price differences across a range of IT hardware and software products in our submission to the House Standing Committee on Infrastructure and Communications Inquiry into IT Pricing.

(2) CHOICE research found Microsoft’s Visual Studio 2012 Ultimate with MSDN (New Subscription) has a monetary price difference of $5,975 (at parity) between Australia and the US.