The Australia tax: More examples of overcharging by tech vendors come to light

Staff Writers
16 May 2012, 9:18 PM


The list is growing: more examples submitted of global tech vendors charging Australians more for tech products than consumers in other countries.


With the recent announcement of a parliamentary inquiry into why Australians are being overcharged for technology compared to overseas customers, more and more examples of companies that change Australians significantly more than their US and European customer are coming to light.

In this month's APC magazine, we've listed one blatant example: the cost to Australians of some games in the Steam Store.  In one example identified by APC (now updated with latest pricing), the game Call of Duty Modern Warfare 3 sold in the Steam Store costs AU$99.99 for Australians. The very same game, on the same order page is US$59.99 (around $63 Aus) for American customers. Even British customers pay less at 39.99 pounds, which is the equivalent of AU$67.87.

APC wants to help the parliamentary inquiry into overcharging of Australian customers. Please send in examples of overcharging and we’ll create a directory of the worst excesses. It’s time to truly expose the overcharging rorts. 

Give us your example of overcharging. We'll verify it and then publish it. It will help us if your submission meets the following requirements:

  • The product whose prices are being compared has to be EXACTLY the same product: same brand, same model. It can't be almost the same, or similar technically but a different brand or model, as these will invalidate any direct price comparison.
  • Products sold in Australia and outside Australia by the same company can have subtle differences, so check the model number.
  • Please provide a URL for the Australian and US sellers linking directly to the product page showing the prices.

Examples from readers below, listed in the order they were received.

PRODUCT AUS SELLER AUS PRICE OS SELLER OS PRICE SUBMITTER'S COMMENT
Call of Duty MW3 Steam Store AUD99.99 Steam Store USD59.99  
Call of Duty MW2 Steam Store AUD89.99 Steam Store USD20 This isn't even the latest game
Adobe Creative Cloud Adobe AUD62.99 Adobe [country detect] USD50 That's an extra AU$151 per year for software that's delivered electronically from the exact same file on the exact same servers.
Adobe CS6 Master collection Adobe AUD4,344 Adobe [US store] USD2,599 This is for a downloadable product. No reason for the price hike.
Bose SoundLink Wireless Mobile Speaker Apple AUD499 Apple US USD299 Nearly 65% more expensive in Australia than America...?? Even the UK price is $100 less than Australia..!!
Call of Duty MW3 Elite Subscription via XBox Live AUD64 via XBox Live in US USD50 The MW3 Elite subscription, is sold on XBox Live Australia for $64 (4000 MS points), compared with $50US for US customers.
Like iTunes, online distribution means there's no additional overhead, so we pay $14 extra, well, because we suckers.
Corel VideoStudio Pro X5 Ultimate (Download Version) Corel Aus AUD129 Corel US USD99.99 US customers also receive a 30 Day Money Back Guarantee, while Australians don't.
HP toner catridges Officeworks AUD118.56 HP US USD69.99  
Microsoft Windows 7 Home Premium to Professional Upgrade Microsoft Store Aus AUD 204.99 Microsoft US Store USD89.95  
Windows 7 Home Premium to Ultimate Upgrade Microsoft Store Aus AUD219.90 Microsoft US Store USD139.95  
Microsoft Office Home and Business 2010 (2 PCs / 1 user) Microsoft Store Aus AUD379 Microsoft US Store USD279.99  
Microsoft Office Professional 2010 (2 PCs / 1 user) Microsoft Store Aus AUD849 Microsoft US Store USD499.99  
Dell Alienware MX 14 Gaming Laptop Dell Australia AUD1,799 Dell US USD1,099 The price difference between the Alienware M14x, M17x and M18x is hugely different between DELL Australia and DELL in the US.
Cyberlink PowerDirector Cyberlink AUD106.95 Cyberlink USD82.95 All you need to do is switch the country on the Cyberlink site and you get different prices even though it is the same software from the same web site. Pick Australia and you get a higher price. Really annoying.
Max Payne 3 Special Edition for PS3 EB Games AUD148 GameStop (EB Games Parent Company) USD99.99 What can one say ....
CA ISS (Total Defense) Security Suite Total Defense AUD79.99 Total Defense USD48.99  
Lego Millenium Falcon (Falcon used as example of wider Lego trend) Toys R Us AUD249.99 Toys R Us USD139.99 Lego models far cheaper in US, example here shows Toys R Us in US vs Aus
AVG Internet Security (1 PC) AVG AUD69.99 AVG USD54.99 You can even get for 50% discount from US online seller or on eBay. You also can buy say 2011 version and use the free update to get the latest.
Adobe Acrobat X Pro Full Version Adobe AUD709 Adobe USD449 Program is a download from Adobe in both cases
           
           

 


 

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twharte (New user):

Anything Micro$oft....

More specifically, everyone who uses M$ AU online store to license office 2010 or get an anytime upgrade from Win7 home premium to pro or ultimate (eg buy a machine from Dell, JB or Harvey, etc that is home premium OS and only office trial preinstall).

If you buy these retail all you get is a plastic card with they key, from the online store you don't even get that.

If I didn't have technet I would be screwed, and even that costs more for AU.

17 May 2012, 8:13 AM (1 year ago)report abuse Send to a friend reply

deusexmachina (New user):

Go boys! You can see from your first example that prices are set for the $AUD at $0.60USD...the problem has been that with the strengthening AUD, most have not adjusted prices (Games an excellent example!) and just hope we don't notice it. You can bet that once the AUD starts falling, prices will go up real quick "because our dollar has dropped!" LOL

Also I think you need to consider that it is not necessarily the retailers to blame here, the greedy, useless distributors set the cost and the retailer gets stuck with having to pass this inflated crap onto us...


17 May 2012, 10:52 AM (1 year ago)report abuse Send to a friend reply

Tony Grooby (User):

Here In New Zealand We pay a massive premium. SAPPHIRE RADEON HD7970 OC 3GB GDDR5 PCI-E3.0 cost $799NZD and 449.99USD = 586.49NZD

17 May 2012, 3:29 PM (1 year ago)report abuse Send to a friend reply

reginald (User):

The blame for the excess sits squarely on Australian dealers, I buy books from Amazon USA cheaper Than i can get the same books from Angus & Coote in Australia. We are just a small market for the sellers of products and of course we are going to pay more, we are stupid enough in the first place to pay it.We just have to refuse to buy their overinflated items.
Bring it to the attention of main stream users and see what happens when some cowboy in parliament gets hold of it.

17 May 2012, 3:34 PM (1 year ago)report abuse Send to a friend reply

petert (Advanced Forumologist):

I have met similar situations. The cost of books in Australia can be very expensive compared to overseas. For the past few years, I have only bought eBooks, mostly from Amazon. It is the fastest and cheapest for my needs.

17 May 2012, 3:38 PM (1 year ago)report abuse Send to a friend reply

Tony Grooby (User):

I Buy all my Music and books dvds from amazon UK because it cheaper, and in 2-5 days it here.

17 May 2012, 5:15 PM (1 year ago)report abuse Send to a friend reply

petert (Advanced Forumologist):

This is a very important issue for tech consumers. Kudos to APC!

17 May 2012, 3:37 PM (1 year ago)report abuse Send to a friend reply

deusexmachina (New user):

Some good (albeit depressing) data there...interestingly Apple seems to get beaten up in the media about price differences but I find they do adjust their prices (eventually) to account for FEX. Their hardware prices are semi-reasonable atm based on the US price not showing any sales tax, which has to be taken into account with some of these prices already shown.

18 May 2012, 11:34 AM (1 year ago)report abuse Send to a friend reply

reginald (User):

getting away from subject but, Apple deserves to get beaten up, apple has been selling last generation tech to the public at premium prices for years, they being apple are known to sue other companies simply because they can get away with it and stop other manufactures items hitting the shops in time to compete with apples iphone releases deserves apple right to get beat on, I hope they get it in the neck a lot more very dirty players Apple.

Reginald Day

18 May 2012, 12:04 PM (1 year ago)report abuse Send to a friend reply

petert (Advanced Forumologist):

Have you read the list above? Company after company being shown to rip-off Australians and yet you reserve your attack for one company only. You rather lack perspective, don't you?

21 May 2012, 9:45 AM (1 year ago)report abuse Send to a friend reply

ek (New user):

it costs much more to do business in australia. the wages are higher, the rents are higher, the taxes are higher, the regulations are more inhibitive. blame the government for high prices, nobody else


19 May 2012, 11:44 AM (1 year ago)report abuse Send to a friend reply

Potoroo (User):

Quoting ek:
it costs much more to do business in australia. the wages are higher, the rents are higher, the taxes are higher, the regulations are more inhibitive.


Please provide evidence for these claims. The article noted, for example, that CoD MW3 via the Steam Store is cheaper in Britain than in Australia, and by no stretch of the imagination could you argue that Britain's taxes or cost of living are lower than ours.

28 May 2012, 6:51 AM (12 months ago)report abuse Send to a friend reply

ek (New user):

i dont know in detail much about the UK tax/costs of business. maybe it has something to do with UK being a larger economy. what i can say is that overpricing is not unique to tech goods. cars here are ridiculously overpriced (e,g, a porsche 911 is $US70k, $AUD280k). as is pretty much everything here. its naive to simply say its just a huge conspiracy against the aussie consumer by *all* manufacturers. they makers all play under the freemarket, so any can reduce prices anytime to gain competitive advantage - but they dont. why? Because they can’t due to their operating costs. like i said, its all to with the cost of doing business in Aus. Here u dont just pay for the item and the taxes on that item, you are paying for:

very high company taxes
very expensive inhibitory business regulations, such as workers comp, insurances
very high wages
very high property prices/rents
multitude of other indirect taxes to long to list

its like when u buy a drink at a bar in sydney for $11.50, does the drink cost the bar anywhere near $11.50? of course not! u are paying for all the other rubbish associated with operating a business in Aus, listed above. your gripes should be directed at government, not manufacturers. if u dont believe me ask someone who runs a business about their operating costs

28 May 2012, 4:01 PM (12 months ago)report abuse Send to a friend reply

Potoroo (User):

Quoting ek:
i dont know in detail much


That's the truest thing you've said.

Quoting ek:
very high company taxes
very expensive inhibitory business regulations, such as workers comp, insurances
very high wages
very high property prices/rents
multitude of other indirect taxes to long to list


You got one item right, property prices/rents. The rest you just pulled out of your backside.

For example, Australia's tax burden, including company tax, is among the lowest in the OECD (which is why our social services suck - we refuse to pay for them). The ATO's web site has an entire section devoted to international comparative taxation. Check it out. Our wages and other costs of business are similarly low compared to our peers, lower to significantly lower than Europe but slightly higher than the US. Do some research next time.

The one and only thing you got right, more by accident than design, is property costs/rents. Our property markets are way over-valued, but I have yet to see a substantiated argument (substantiated means you have to show research instead of making up whatever rubbish suits your gripe) that property costs alone can account for the vast disparity in Australian prices compared to peer countries.

28 May 2012, 8:34 PM (12 months ago)report abuse Send to a friend reply

ek (New user):

ok Potoroo, it must just be a huge conspiracy against the aussie consumer by not just tech makers, but by anyone who makes anything. nothing to do with aussie business operating costs or the 60% effective taxrate for most of the population. nothing to do with the fact u need to apply for a permit to fart here and pay a fee on top

28 May 2012, 9:01 PM (12 months ago)report abuse Send to a friend reply

ek (New user):

i dont know in detail much about the UK tax/costs of business. maybe it has something to do with UK being a larger economy. what i can say is that overpricing is not unique to tech goods. cars here are ridiculously overpriced (e,g, a porsche 911 is $US70k, $AUD280k). as is pretty much everything here. its naive to simply say its just a huge conspiracy against the aussie consumer by *all* manufacturers. they makers all play under the freemarket, so any can reduce prices anytime to gain competitive advantage - but they dont. why? Because they can’t due to their operating costs. like i said, its all to with the cost of doing business in Aus. Here u dont just pay for the item and the taxes on that item, you are paying for:

very high company taxes
very expensive inhibitory business regulations, such as workers comp, insurances
very high wages
very high property prices/rents
multitude of other indirect taxes to long to list

its like when u buy a drink at a bar in sydney for $11.50, does the drink cost the bar anywhere near $11.50? of course not! u are paying for all the other rubbish associated with operating a business in Aus, listed above. your gripes should be directed at government, not manufacturers. if u dont believe me ask someone who runs a business about their operating costs

28 May 2012, 4:01 PM (12 months ago)report abuse Send to a friend reply

tl8 (New user):

I would be careful using Lego as an example. While prices in the US are much high, when compared to European countries, the prices are normally much more comparable. (Even though the distance is shorter (Everything is distributed from the Czech Republic).

19 May 2012, 6:41 PM (1 year ago)report abuse Send to a friend reply

aziraphale (New user):

Steam sells to Australians in USD, not AUD. That gap will widen as the currency drops again. Best to change this so as not to be misleading.

Also, the Alienware m14x in AU is specced considerably higher than the US (Core i7 3610QM vs i5 2450M, 8GB RAM vs 6GB, 750GB HDD vs 500GB, 2GB GeForce GT 650M vs 1GB, 1600x900 vs 1366x768), so the comparison isn't valid.

22 May 2012, 10:03 PM (1 year ago)report abuse Send to a friend reply

aziraphale (New user):

Steam sells to Australians in USD, not AUD. That gap will widen as the currency drops again. Best to change this so as not to be misleading.

Also, the Alienware m14x in AU is specced considerably higher than the US (Core i7 3610QM vs i5 2450M, 8GB RAM vs 6GB, 750GB HDD vs 500GB, 2GB GeForce GT 650M vs 1GB, 1600x900 vs 1366x768), so the comparison isn't valid.

22 May 2012, 10:05 PM (1 year ago)report abuse Send to a friend reply

davo42 (New user):

Martin

Thanks for your reply. We hear about overseas suppliers such as Microsoft and Apple ripping us off, but they can use excuses such as GST and frieght. However, when an Australian company making goods in Australia is charging Australians more than they charge people in other countries I ask why? Perhaps you can explain the factors that make your receivers more expensive to Australians than they are to people in other countries.

David

> Date: Thu, 10 May 2012 18:21:11 +1000
> From: helpdesk@winradio.com
> To: davo42@hotmail.com
> Subject: Re: WiNRADiO enquiry #130409201523 (Price of WR-G305e)
>
> Hello David,
>
> In general, prices of any goods (not only our receivers) in different countries are governed
> by a large number of factors that combine to affect the local retail pricing. These may not
> be always immediately visible to the end user, but nevertheless these factors do exist.
> It would be in fact a very rare exception if our products would cost the same in every country;
> and such situation is unfortunately not possible.
>
> Best regards,
> Martin Kent
>
> ---------------------------------------------------------
>
> Subscribe to WiNRADiO Newsletter to receive
> advance information about our products:
> http://www.winradio.com/subscribe
> >
> > Name: Davdi Hepple
> > Country: Australia
> > Email address: davo42@hotmail.com
> >
> > Subject: Price of WR-G305e
> >
> > Why does the above receiver cost $862.44 ex GST in Australia, but $749.95 in the US?

23 May 2012, 1:21 PM (1 year ago)report abuse Send to a friend reply

deusexmachina (New user):

Martin Kent needs to become a politician...notice how he fails to actually answer the question!!!

24 May 2012, 10:42 AM (1 year ago)report abuse Send to a friend reply
24 May 2012, 12:42 AM (1 year ago)report abuse Send to a friend reply

arjaytee (New user):

AV Equipment is also a big rip off this is but one example of many

24 May 2012, 4:53 PM (1 year ago)report abuse Send to a friend reply

ek (New user):

overpricing is not unique to tech goods. cars here are ridiculously overpriced (e,g, a porsche 911 is $US70k, $AUD280k). as is pretty much everything here. its naive to simply say its just a huge conspiracy against the aussie consumer by *all* manufacturers. they makers all play under the freemarket, so any can reduce prices anytime to gain competitive advantage - but they dont. why? Because they can’t due to their operating costs. like i said, its all to with the cost of doing business in Aus. Here u dont just pay for the item and the taxes on that item, you are paying for:

very high company taxes
very expensive inhibitory business regulations, such as workers comp, insurances
very high wages
very high property prices/rents
multitude of other indirect taxes to long to list

its like when u buy a drink at a bar in sydney for $11.50, does the drink cost the bar anywhere near $11.50? of course not! u are paying for all the other rubbish associated with operating a business in Aus, listed above. your gripes should be directed at government, not manufacturers. if u dont believe me ask someone who runs a business about their operating costs

28 May 2012, 4:02 PM (12 months ago)report abuse Send to a friend reply

anonymous user Anonymous user