The Federal Government is launching an inquiry to investigate the disparity between local prices for technology and software, including music, entertainment and video games, and the prices paid in countries such as the United States.
Consumer groups have welcomed the inquiry, saying it is time something is done to ensure Australian shoppers and businesses aren’t being ripped off for software that costs as much as 50% less in other countries.
The huge gap in prices has caused furore among shoppers, and small businesses as well, especially as many products are not shipped but distributed digitally.
Federal MP Ed Husic, member for the Sydney seat of Chifley, has been complaining of the disparity in prices for several months and is part of the committee that is likely to chair the inquiry later this year. He was contacted for comment but no reply was available prior to publication.
The latest controversy began when Adobe announced Australian users would be paying several hundred dollars more for its Creative Suite software.
“People here scratch their heads trying to work out why they get fleeced on software downloads,” Husic told Fairfax.
“I’m hoping companies will take this opportunity to explain their pricing in Australia,” he also told GameSpot. “This will also give consumers the chance to talk about how this affects them.”
The inquiry has been all but confirmed after Communications Minister Stephen Conroy wrote a letter to Husic, saying there is evidence to suggest that innovation in technology is “not always matched with innovation in new business models”.
Guidelines are being drawn-up for the inquiry, which is set to take place later this year.
Critics point to platforms such as iTunes, where Australian users pay up to 50% more for songs and apps. The video game industry has also been up in arms for several years, with software costing as much as double the price compared to the United States.
Other products, such as business software, are constantly marked up.
The anger over this disparity has grown as the value of the Australian dollar has continued to rise.
It is understood major companies including Microsoft and Apple will be invited to speak at the inquiry.
The problem was also referenced in the Productivity Commission’s report into the retail industry, which cited the higher costs as a major reason for people shopping overseas.
It slammed the higher costs, saying that reasons given for charging more in Australia “in most cases are not persuasive, especially in the case of downloaded music, software and videos where the costs of delivery … are practically zero and uniform around the world”.