Tim Gaden23 January 2007, 11:11 PM
Apple has confirmed that Australians with Macs capable of running the new, high-speed, wide-range 802.11n wireless standard will need to pay up for the forthcoming 802.11n wireless enablers.
Apple Australia has confirmed that Australians will need to pay for the forthcoming 802.11n wireless enablers.
As we noted in a previous story, Apple Australia was going to get to back to APC with a explanation of how much Apple will charge and why it's necessary to charge it in Australia, when it is relying on an obscure United States accounting rule.
Today, it did.
In its statement Apple said,
During the past several months, Apple has shipped some Macs with the hardware to do 802.11n, but the draft of the 802.11n specification was not complete enough to create the required software. Now that the draft specification is complete we are ready to distribute the software to make the 802.11n hardware in these Macs come to life.
This software comes for free with Apple's new Airport Extreme base station, and will eventually ship for free on Macs with appropriate hardware in the future.
However for the moment,
For those customers that have these Macs and wish to enable their 802.11n functionality but do not wish to buy a new Airport Extreme base station, we are making the software available for download for a nominal fee of $2.99 from the Apple Online Store.
This is less than the initially-rumoured price of $US4.99 ($6.36), but the price is not really the point. If you can afford a MacBook Pro, you can probably shell out a few extra dollars for the enabler.
It's the principle that rankles. Why, I asked myself, should I have to pay some extra money (any extra money!) because of an American law?
I took my outrage to Apple Australia, who hosed me down. The spokesperson explained:
The nominal distribution fee for the 802.11n software is required in order for Apple to comply with [US] Generally Accepted Accounting Principles for revenue recognition, which generally require that we charge for significant feature enhancements, such as 802.11n, when added to previously purchased products.
This is the Sarbanes-Oxley Act, introduced in the USA in 2002 in the wake of the Enron and WorldCom accounting scandals, to enforce stricter regulation and reporting requirements on corporate America. [Wikipedia]
Why does it reach so far outside the apparent jurisdiction of US law? The answer surprised me.
Apple Australia looks like an Australian company, has a registered company name (Apple Computer Australia Pty Ltd.) and an ABN number (46 002 510 054), makes its returns to the ATO and so on, but all is not as it seems.
Apple Australia "is not independent from a financial perspective" and all its earnings are returned to the parent company in Cupertino. Because the revenue from my MacBook Pro is recognised in the US, I need to pay the charge that the Sarbanes-Oxley Act requires.
Now if only it worked both ways. If only the Australian iTunes Music Store was covered by US law and able to sell me episodes of the West Wing! Here I am, more American than I know, but still not able to get me hands on Desperate Housewives. That's what rankles.
Meanwhile, the former SEC Chief Accountant Lynn Turner told the Wall Street Journal [subscriber-only link]: "GAAP doesn't require you to charge squat. You charge whatever you want. GAAP doesn't even remotely address whether or not you charge for a significant functionality change."