Apple blames Big Content

Apple has explained that the reason Australians have to pay more for their music content than the rest of the world is not its fault.

Executives from Apple, Adobe Systems and Microsoft were grilled by a special Australian parliamentary committee and served in a white wine sauce, over the fact that they have been charging Australians a special tax.

Apple insisted that it had to charge Australians 50 percent more for music and films than the rest of the world because the movie studios insisted.

Tony King, the vice president for Apple Australia, New Zealand and South Asia, said pricing on some products like the iPad mini and Final Cut Pro software was about the same as in the United States.

But the fact that Aussies were being charged US $20.87, the Australian price of Justin Timberlake’s album “20/20 Experience” on Apple’s iTunes music store is about double the $10.99 charged in the United States. AC/DC’s “Back in Black” is marked up 70 percent for Australian fans. But this is not Apple’s fault.

King said the pricing of digital content is based on wholesale prices set via negotiated contracts with record labels, movie studios and TV networks.

He said that the content industry is backwards and still, perhaps, runs with old-fashioned notions of country borders or territories or markets.

Jobs’ Mob had done its best to lean on content owners to lower Australian pricing.

He claimed that the cards are in the hands of the folks who own the content.

Of course, he failed to mention that Apple is currently being investigated by anti-trust watchdogs for doing just that sort of thing with the publishing companies.

According to the Sydney Morning Herald, the committee did not buy most of the excuses and said some of the executives’ answers were “evasive” and were sceptical about some of the answers.

It was not clear why, if it was all someone else’s fault, that there was a need for geo-blocking, under which companies prevent Australian web users from purchasing products at cheaper rates on US sites.

Particularly galling was the fact that Aussies have to pay $3,300 for Adobe’s CS6 Design and Web Premium suite, which Americans can buy for just $1,899.

Adobe Australia MD Paul Robson said Adobe’s Creative Cloud suite, which is bought on a $50-a-month subscription basis, was priced on par with the United States and this was “the future of the way we will deliver our technology”.

But committee member Stephen Jones said the subscription software placed “digital handcuffs” on users, forcing them to keep paying to continue accessing their files.

Committee deputy chairman Paul Neville waded into Microsoft for charging nearly double what Americans were paying.

He told Microsoft Australia MD Pip Marlow that he was just charging what you can get away with in any market.

Marlow denied this and said that if the Vole priced the products too high, consumers will vote with their wallets and move elsewhere.

Or they would call for official government inquiries which would bring in laws to stop software companies bullying Australians.