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back to article Australian Parliament issues summons to Apple, Microsoft, Adobe

The IT Pricing Inquiry being conducted by Australia's House Committee on Infrastructure and Communications has issued summons to Apple, Microsoft and Adobe. The inquiry kicked off in 2012 and is investigating why Australians pay more for hardware and software than those overseas. At current exchange rate one Australian dollar …

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And the net result will be?

Squat!

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Re: And the net result will be?

That's probably true but if they do anything it will be raise the US prices to match.

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Meh

Listen

We've lived with this in the UK for years, happens on everything from computers to cars, the excuse is always that it is more expensive to import goods to the UK, something to do with being surrounded by water.

It's a load of tosh, the real reason is that it it not as easy to jump into a car and pop across to another country (like in the EU) to buy it cheaper.

Just like Australia, surrounded by water the shysters consider us a captive audience.

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Anonymous Coward

Re: Listen

I kinda wish they'd do this in the UK. It may only be a good gumming but still.

I get so annoyed when I hear USA folks complain about "oh it's so expensive to buy X and Y these days.

Oh no it costs $3.50 per gallon of petrol, vs £6.50 (roughly) it costs in the UK. (which is about $10.20)

Or the glorious "$600 for the PS3? That's far too expensive!" vs out £600 which at the time equated to $1164 (at the time the exchange rate was 1.94 £ to the $)

Admitadly we get taxed out the wazzoo. But still I'd love to see a better explanation, since the 20%VAT doesn't nearly cover such a huge amount.

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@AC 08.32 Re: Listen

"Oh no it costs $3.50 per gallon of petrol, vs £6.50 (roughly) it costs in the UK. (which is about $10.20)"

I'm not saying that you're entirely wrong, but i've no idea where you go and pay £1.45 a litre for petrol - accordign to OFT the average price is £1.36.

The next point is that the US gallon is only 3.5 litre's, whereas the UK gallon is 4.5 litres.

The actual comparison would be $3.50 vs £4.76, so around $7.15. You also need to compare the cost of UK petrol against what the US calls "premium". Our normal petrol is much better than the US, they run (IIRC) 85RON, whereas we run 95RON (burns far more efficiently) - the US premium petrol is what we consider normal.

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Headmaster

Re: @AC 08.32 Listen

US gallon is 3.78541 Litres, but yeah, not the same.

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Happy

Re: @AC 08.32 Listen

"The next point is that the US gallon is only 3.5 litre's, whereas the UK gallon is 4.5 litres."

Umm no - the US Galleon is 4.25 liters, and the Imperial Galleon is 4.5 liters...

And yes I spelt Liters rite, because that is the way it's sed. "Leet-ers" not "Leet-Res."

Frog bastards.

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Re: @AC 08.32 Listen

"Our normal petrol is much better than the US, they run (IIRC) 85RON, whereas we run 95RON (burns far more efficiently) - the US premium petrol is what we consider normal."

They don't use RON to determine the octane content over here, they use AKI (written on pumps as (R+M)/2 ) . The basic stuff (87 in most places, not 85 unless you are in high elevation places) is pretty much equivalent to European 92 RON. The US premium at 91 AKI is pretty much equivalent to European 95 RON.

Still and all, I (a Brit living in the US) laugh when they complain about how gas is costing too much (it's all Obama's fault apparently) here. It's cheaper than most places, so quit whining. Additionally, whilst it costs half as much, I use more than twice as much here as I did in the UK. Cars are horribly inefficient and distances are much further (I live on the West coast). There is no equivalent to parking in the town center and walking around all the shops, we have to drive to each one we need to visit.

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Joke

Re: @AC 08.32 Listen

@0h4FS: A 4.25 litre galleon? That's not going to be of use to any bugger!

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Gallons

1 gallon (UK) = 1.2 gallons (US). Not much point in converting each to metric measures just to do the comparison.

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Anonymous Coward

Re: @AC 08.32 Listen

Way to split hairs evilgav

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Anonymous Coward

Re: @AC 08.32 Listen

"Cars are horribly inefficient and distances are much further (I live on the West coast). There is no equivalent to parking in the town center and walking around all the shops, we have to drive to each one we need to visit."

Sounds like poor city planning.

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Joke

"They have got a growing number of retail outlets, which I am happy about—they are creating jobs locally; that is great—but surely those outlets do not cost $5.5 billion to maintain.”

A quick Google gives the number of Australian Apple stores as 18. Well, that's only ~300 000 000$/outlet, seems legit... I assume each store employs 5000-6000 people?

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A quick Google gives the number of Australian Apple stores as 18. Well, that's only ~300 000 000$/outlet, seems legit... I assume each store employs 5000-6000 people?

You're forgetting the R&D costs associated with the Apple Store - that arrangement of tables didn't happen by accident! I bet the Geniuses spent weeks moving furniture about before they came up with that.

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Joke

(but maybe not a joke)

The $5.5 billion is to pay for a small army of world-class psychics, who work in shifts 24/7, to maintain a reality distortion field over Australia. This is the only explanation I can think of for why Australians spend so much money buying Apple products.

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Pint

Re: (but maybe not a joke)

Just stop buying the shit.

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Go

Re: (but maybe not a joke)

Apparently Apple spent $5 billion of that profit in a (failed) attempt to map out the city "Mildura" in the middle of Murray-Sunset National Park.

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Anonymous Coward

Re: (but maybe not a joke)

or $5 billion on buying Mildura so they could move it to where Maps said it was and avoid having to admit they were wrong.

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Anonymous Coward

I always wondered if these multinational companies didn't double dip in taxes. Profits are taxed but what would keep them from using costs in another area to be used locally? Say for support as an example. Apple needed to employ x number of people to support their product, the support staff may be elsewhere though. Then in that other region, Apple uses those same support staff to reduce their profits yet again locally.

Given that if they were audited, the two tax authorities would not be in communication and thus not know that Apple is using the same cost more than once.

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"Profits are taxed but what would keep them from using costs in another area to be used locally?"

This is, as I understand it, the basic idea. Apple US set up a company called Apple AU (say) and then charge Apple AU $5bn for the "intellectual property rights" to use the Apple name. That, of course, costs nothing for Apple but enters Apple AU's books as a tax deductible cost.

In fact, it would not be Apple US which levied the charge as that $5bn would incur tax in the US. It's much more likely to be Apple LUX who levy the charge and incur a tiny Luxembourg taxation level. The money is then laundered out of Luxembourg by various methods.

All of which is almost certainly illegal - in that the original charge is fraudulent - but because so much money is being pushed into making governments treat IP as a real thing it has become difficult for politicians to act on it, as saying "this IP isn't worth $5bn or anything like it" will instantly remove them from the IP lobbyists' Christmas list of bungs and non-exec directorships and various other funds for their cozy retirements.

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Presumably

their "R&D centres" are "located" in high tax nations, whilst their "sales" departments are "located" in low tax nations.

One can only hope that their expenses are given a thorough going over, at least the groundwork has been done in forcing them to appear and publicly disclose information. In lieu of this development, perhaps they'll even give El Reg a response to any questions they have? Perhaps that's asking a bit much...

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Unhappy

Re: Munich doesn't pay more. It uses Linux and open source

Well Munich must have more sense than all of Belgium.

Here if you mention Linux or open source, everyone thinks you are talking about something new to put on your fried chips.

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Re: @Eadon

govt lives on taxes, so if they spend less, there won't be need to overtax Apple, Microsoft etc -- everybody wins.

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Anonymous Coward

Re: Munich doesn't pay more. It uses Linux and open source

You might be able to use Linux, but there are numerous public servants who have only ever used Windows XP.

Try to put yourself in the shoes of a non-geek. You really think such people would embrace the challenge?

Sure, you save money on licences with FOSS, but in the short to medium term your productivity falls through the floor.

You will have a few months of little or no productivity while people are off on training courses, that can result in the need to bring in more staff to ensure a backlog doesn't build up.

Free software is not the answer to every problem.

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Anonymous Coward

Re: Munich doesn't pay more. It uses Linux and open source

If it was so easy then why has it taken 10 years and why did they need to create their own distro to do so?

10 years is a huge amount of time to migrate and shows that moving to open source isn't a simple task.

Creating their own distro just shows that the state of Linux as a desktop office platform is a bloody mess. You need to spend time and put some expertise into creating a distro which meets all of your needs.

It shows that most "community" distros aren't sufficient to work well in an office scenario and that the time taken to adjust the default configuration to that needed is too much. So you have to roll your own default set up.

Big companies tend to do this with Windows also, but this is largely down to enterprise companies wanting everything locked down by default, Linux tends to be locked down already.

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Re: Munich doesn't pay more. It uses Linux and open source

Billion? I think you mean million.

http://linux.slashdot.org/story/12/11/23/1732222/limux-project-has-saved-munich-10m-so-far

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Re: Munich doesn't pay more. It uses Linux and open source

"Sure, you save money on licences with FOSS, but in the short to medium term your productivity falls through the floor."

Whereas by migrating from Windows 2K/XP with Office 2003 or earlier to Windows 8 with Office 2010/2013 you can enjoy the joint benefits of paying for software AND having short-medium term productivity fall through the floor.

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Re: Munich doesn't pay more. It uses Linux and open source

1. Public servants (I was one) need to remember that they are public servants, with a purpose supposed to be keyed to the public good, not their own intellectual comfort zone. They don't have to embrace challenges directed by their managers (I was one of those, too), but they have to accept them.

2. At least in the (US) agency I worked in, you could pretty much forget about time lost for training classes in office applications. The Admins got some, but the rest of us pretty much had to learn by doing. And the truth is that OpenOffice/LibreOffice applications while perhaps a bit less polished and featureful than their MS counterparts, are no more difficult to learn; certainly the transition would be no more stressful than upgrading to MS Office 2007 or Outlook 2010.

3. I am not among them, but there are those who would claim that civil service personnel already are as unproductive as possible, so software transitions would have no real impact; and others who, while disagreeing, would claim that reducing their productivity could be beneficial.

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FAIL

Re: Munich doesn't pay more. It uses Linux and open source

AC @ 11:59 wrote : "You might be able to use Linux, but there are numerous public servants who have only ever used Windows XP. You will have a few months of little or no productivity while people are off on training courses"

A few MONTHS !!!??? Behold one of the biggest pieces of BS and FUD I have seen on here for a while. There is little difference between WIndows and Linux, or their apps, for the desktop user these days. There are differences under the bonnet, but the sysadmins are probably already familiar with Linux at home.

I remember PCs being introduced at work in the first place (DOS and Windows 3.0) including to people like typists, clerks and maintenance foremen who had never seen a computer before in their lives. We had a ONE DAY course, and they got the hang of it. Never had any more courses after that, with all the changes up to Windows 7, and people still "Got it".

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Re: Munich doesn't pay more. It uses Linux and open source

@Nuke:

Agreed. A lot of this nonsense is predicated on treating people like complete morons and thus teaching them to behave thusly. Treat them like intelligent humans who can learn, give them resources for when they get stuck, and then encourage them to GTF on with their jobs. Those who refuse to engage are a liability regardless of software platform.

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Devil

Re: Munich doesn't pay more. It uses Linux and open source

"Creating their own distro just shows that the state of Linux as a desktop office platform is a bloody mess. You need to spend time and put some expertise into creating a distro which meets all of your needs."

How is that different to creating the standard remote install image for Windows with the right drivers, service packs and applications?

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Flame

Re: Munich doesn't pay more. It uses Linux and open source

"Try to put yourself in the shoes of a non-geek. You really think such people would embrace the challenge?"

That and the "re-training cost", is that all so different to the retraining cost when the Office interface changes radically or when (if!!) organisation change to Windows 8? If MS had stuck to point increases and sublte change, you'd have a point, but when MS enforce such a major change I'm not so sure the costs are going to quite so much on a "one off" basis.

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Anonymous Coward

Re: Munich doesn't pay more. It uses Linux and open source

"If it was so easy then why has it taken 10 years and why did they need to create their own distro to do so?"

I think you misunderstand the mindset . Slow and steady, sort the problems out properly, move groups over, evaluate, iterate. What's the hurry ? The amount they'll save in the end will still be enormous.

You could rush, pay large numbers of consultants to get it all done quickly, but there's still be delays and problems and probably many more of them.

For much of my adult life the Swiss have been building a motorway up the Rhone valley, it still not finished, the terrain is very difficult and the decision was made to tunnel under or around large towns/cities. Other people might have thrown vast amounts of money at it in a wasteful attempt to finish it quickly.

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pwl
Facepalm

Re: Munich doesn't pay more. It uses Linux and open source

- "non geeks" use the functions of the computer they've been shown. windows or linux will be equally confusing to them, so why not use the one with lower licensing costs?

- in over 20 years of working life, i've yet to see *anyone* be sent on training for microsoft office, including the many iterations where the user interface changed radically. the "training" rationale is a furphy.

- if you've got a modern user productivity environment, then everyone should be using standard-based web apps, and the desktop OS is irrelevant. granted this is more of an aspiration than a reality, but people are slowed being dragged into the 20th century [sic].

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Devil

Reasons?

There no reasons.

They do it because they can.

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Wishful thinking

I hope Ford, General Motors etc are worried.

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Gimp

Goods & Services Tax

Yes Simon, we who are fortunate to live in the Antipodes do often get ripped off. Some of this is because of our relatively small population, some of it is because of our long supply chain: As explained to me many years ago when I imported goods: a $100 item imported into Oz may have an importers markup of 30%, a distributer/wholesaler markup of 30%, then a retailers markup of at least 30%. Now adding local taxes could give a final price to the punter of ~$250. A direct import from an internet supplier including shipping would have the final price of ~$130 (At the moment, a personally imported item of less than $1000 has no tax payable).

Now as for your Apple price: "An example of the discrepancy can be seen in the price of a 16GB WiFi iPad with Retina Display. In the USA the fondleslab costs $US499. In Australia it's $AUD539."

As you say, the fondleslab punter pays AU$539; - Now using your numbers, in Oz we should pay US499/1.03 for currency difference = AU$484.46, add our 10% GST (Like VAT, but cheaper) and we get $532.91 - I think I could probably afford the 1.14% difference...

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Anonymous Coward

Re: Goods & Services Tax

That's one example. Here's another. The price for Windows Office Professional in the US is US$399.99.

The cost for the same item in Australia is AU$599.00 (http://www.microsoftstore.com/store/msaus/en_AU/cat/categoryID.61243300).

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Re: They have no factories here

Typical with hunting - "because she is made of wood", same kind of logic. Of course they have no costs in Australia, but the product isn't made in Australia either.

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Pint

The one that really bugs me

Is the digital download stuff, things like microsoft points for the xbox. depending on which site you go to the price changes, but they're region locked so unless you've got a proxy you're sh@t outta luck.

Although to be fair oz really needs to get it's own house in order before moaning at the multi-nationals. WA is always more expensive than over east.

Beer - cos over here it's AU$11 a pint :(

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Headmaster

Today's Engrish?

While the Inquiry has in the passed expressed very keen interest...

Passed? Really?

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Sorry, so what's the outcome going to be. A committee will find that they pay more than other countries, and then what? They'll legislate that an iPad can only cost $500? Somehow I don't quite see it. The only way this can be resolved is through the market (i.e. another company comes along and starts selling a competitive product at lower prices).

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Allow / encourage parallel importing. Then people can buy a container load of fondleslabs in Hong Kong, ship them to Australia and sell them for less than the official channels.

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Anonymous Coward

Too much collusion

There is too much collusion amongst the corporations for your suggestion to work. It's like politicians talking to lobbyists when no ones looking. It's hard to prove but we all know it happens.

This is one of many reasons that right-wing politicians who push for smaller government and less regulation lose my trust. It becomes even easier for them to side with corporations to line their own pockets.

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Well....

They can make recommendations to change the tax system... My suggestion would be to make money sent to parent and sister companies "Dividends" except where they actually reflect the true cost to the company above (no more buying an Item for 1, and selling it to overseas subidary for 10 to hide 9 profit from the taxman).

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Mushroom

"Allow / encourage parallel importing"

Absolutely! It's a global market, or so our Govts and multi-nationals keep telling us. They can move their manufacturing and supply sources around the world, moVe the revenues and profits around the world but "they" won't let us buy from around the world. "grey imports", DVD region encoding etc. Bastards!

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LDS
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EU won't ever do something alike...

... because higher prices means higher VAT as well.

If IE of Media Player could have been taxed, they won't have asked to remove them from Windows.

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Re: EU won't ever do something alike...

Except of course, all the times that they have.

Perhaps you should search this site for "Vivianne Redding"?

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