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Apple defends iTunes and product pricing at parliamentary inquiry

applepreviewthumbApple Australia boss Tony King has blamed movie studios and record labels for the higher cost of music and movies in Australia after fronting a parliamentary inquiry.

Mr King said the content owners were the ones who set the price region to region which resulted in prices being up to 70 per cent higher for Australian customers.

“The cards are in the hands of the folks who own the content, that’s not our hand to play,” Mr King, Apple vice president Australia, New Zealand and South Asia, told the IT Pricing inquiry in Canberra.

“We would love to see lower content prices available for Australian customers for songs, movies or TV shows.

“That would drive a wonderful use of our products within the Australian market.”

And when questioned about the pricing of Apple’s hardware and software products in Australia compared to the US, Mr King was quick to defend the company’s position.

“When comparing prices it’s important to remember that US retail prices do not include sales tax. Here in Australia, of course, the price includes a 10 per cent GST,” he said.

“That fact alone is responsible for a great deal of confusion and has resulted in some inaccurate conclusions about our pricing.”

Mr King pointed out that the new iPad with Retina Display and the iPad Mini were actually within one and five per cent of the US pricing.

“Apple must consider differences between countries in products costs, freight charges, local sales taxes, levies, import duties, channel economics, competition and local laws regarding advertised prices,” Mr King continued.

“This detailed financial analysis results in product pricing that may be either slightly lower or slightly higher than the US pricing for the same product.”

Microsoft and Adobe were also called to the parliamentary inquiry to talk about the price disparity of their products between Australia and the US.

Microsoft’s Office Professional is priced at $599 in Australia but yet only $399.99 on the US.

Adobe was also grilled about why its Creative Suite 6 costs an Australian user $3175 while a US user only has to pay $US1899 for the same product but it failed to provide an explanation.

Speaking on behalf of Adobe, the company’s Australian and New Zealand managing director Paul Robson said the company had lowered the price of its Creative Cloud subscription.

But, co-incidentally, this price reduction only came after Adobe was subpoenaed to appear before the IT Pricing inquiry.

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