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Australia orders Apple, Microsoft, Adobe to pricing inquiry

These are stories Report on Business is following Monday, Feb. 11, 2013.

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Australia probes tech prices
An Australian government committee is calling the giants of the technology world to a hear into price discrepancies, similar to Canada's own probe of the difference in consumer prices for U.S. goods.

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Unlike in Canada, the Australian probe relates only to IT products, and it's a simmering issue Down Under.

The House of Representatives Standing Committee on Infrastructure and Communications said today it summonsed Apple Inc., Microsoft Corp. and Adobe Systems Inc. to appear at a hearing in Canberra March 22.

"Australian consumers often pay much higher prices for hardware and software than people in other countries," the committee said today in calling the companies to their hearing.

The committee has been probing the issue for months, and held its first public hearing last summer.

"Australians are often forced to pay more for IT hardware and software than consumers in overseas markets," MP Nick Champion, who chairs the committee, said when the probe was launched last May.

It is investing everything from hardware and software, including music, e-books and games.

Consumer advocates complain that tech products, from music to games, costs markedly more in Australia than in the United States.

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The consumer group Choice, which welcomed the move today, says, for example, that Australians pay, on average, 34 per cent more for software, 52 per cent more for iTunes music, 88 per cent more for Wii games, and 41 per cent more for hardware than in the United States.

Apple and Microsoft have submitted arguments to the committee already, saying there are many factors to consider, including the costs of shipping.

Last week in Canada, a Senate committee issued a lengthy report into the discrepancies between prices in Canada and the United States, and found a raft of reasons.

Currency wars in spotlight
Pressure is building on politicians to ease concerns over a global currency war.

G20 finance ministers and central bankers meet later this week in Moscow, and are expected to discuss the mounting concerns.

Other reports suggest the smaller G7, which includes Canada, is preparing a statement on currency manipulation.

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This has been a growing concern, particularly of late, amid moves by Japan's new government to deal with a soaring yen. France's prime minister is also fretting over the strength of the euro, and, just last week, Venezuela devalued its currency.

This also promises to be an issue for finance ministers of the 17-member euro zone, who meet today in advance of the G20 summit, though they're also discussing a bailout of Cyprus.

"This week's eurogroup finance ministers meeting is likely to focus on the recent rise in the value of the single currency after a difference of opinion between Germany and France last week in the wake of Japan's aggressive stance in weakening the value of the yen," said senior analyst Michael Hewson of CMC Markets.

"His comment that currency values should reflect fundamentals is a sound one; however that is a tricky balancing act when talking about the euro given the widely diverging fundamentals between Germany and the rest of Europe."

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About the Author
Report on Business News Editor

Michael Babad is a Report on Business editor and co-author of three business books. He has been with Report on Business for several years, and has also been a reporter and editor at The Toronto Star, The Financial Post and United Press International. His articles have appeared in major newspapers around the world. More


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