Then they try to deny us the same opportunity. It's hypocritical.
Your argument is basically like saying it would be fine to charge people different amounts for your product based on what's in their bank account. Maybe you could do this, but people would be just as annoyed about it.
Same thing goes about say, smartphones in Russia. It is an accepted practice to buy iPhones from smugglers where they are 60-70% of the price in a retail store due to Apple price policy for Russia, i am fine with that. There are different prices for different places based on a lot of factors, trying to fight it will only increase price levels EVERYWHERE because the volume will go down.
An ideal-perfect pricing system is where the product is sold to the maximum number of people who want it and can afford to pay at least an equivalent of incremental cost of production and delivery (which is, for digital goods, near zero), yet everyone pays a maximum amount he can afford. One of the criterias for price setting is the country (there must be many others of course, again look at the airlines and learn from them).
Do you have any proof that this will happen exactly as you say?
It is perfectly fine to charge wealthier segments more, but others don't have a duty to protect or facilitate your desired way of segmentation; it is also perfectly fine for a community to facilitate a marketplace that is less favourable to you and more favourable to their citizens.
Going onto international markets, country is a very good criteria, because GDP per capita is a well known hard figure. It would be stupid not to use it as a segmentation criteria.
This shows you have absolutely no idea what this discussion is actually about. Arbitrage, a key component of a free market, keeps major price discrimination in check within national markets.
This is about corporations using the force of law to prevent arbitrage working across international boundaries.
But I don't, and I don't expect to, because I am relatively far more wealthy. Therefore differential price levels are acceptable in general: because otherwise our villager could not afford to eat.
And that is for an essential item. To hear fat, comfortable westerners complaining about the price of Photoshop is just revolting.
You forgot about transit prices. Getting rice from that village to that village is much cheaper than getting it to you. This is not the same with digital downloads, where there is zero cost difference to the vendor once the network traffic leaves their LAN.
To hear fat, comfortable westerners complaining about the price of Photoshop is just revolting.
Well, the important thing is that you've found a way to feel superior. I mean, how dare anyone complain if they're not starving? How dare fat, comfortable people A complain that they're being charged more than fat, comfortable people B?
After all, it is a strawman you're making, suggesting that Australians are bitching about paying more for software than people in developing nations. They're not, they're complaining about paying more than those who are at a similar level.
But Australians aren't at a similar level. Australia has a price level 144% of that of the USA.
So the local pricing seems about right given the local distribution of wealth (the US has a much higher Gini coefficient of income/wealth disparity), which makes the price elasticity of demand much lower.
there is zero cost difference to the vendor
No market participant has a moral obligation to keep their price down.
In terms of standards of living, not price!
No market participant has a moral obligation to keep their price down.
Yeah, they often do. Medicine, food and essentials should be kept to a reasonable cost. And I suppose you've never heard of price gouging?
Which was traditionally hand-waved away because goods had a much longer shipping route to get here, plus the minimum wage was higher (meaning higher staff costs). Neither of these things have any meaning to digital downloads.
No market participant has a moral obligation to keep their price down.
No market participant has a moral obligation not to ask a vendor to justify a higher price, nor to question a vendor's protectionist activities.
I find it really weird that you seem to be so strongly in favour of the free market, yet also like the idea vendors can prevent third-parties reselling things through different channels, or using similar blocks to artificially constrain supply.
And as for supporting this proposal; I have read it, and in fact I do support part of it: the removal of anti-circumvention clauses in copyright law. I just checked and I don't think I ever said the opposite.
But I'm dead against legislating directly against geographical segmentation. It's a ridiculous notion, on the one hand almost laughably unenforceable, and if you could enforce it, it'd have a terrible effect on the pricing in developing nations with a lower price level than ours.
Just as there's nothing wrong with the various Parliaments in Australia legislating to modify consumer laws.
If that doesn't suit sellers, they may withdraw their products from sale.
(Given that the marginal gross on software is basically infinity ... they won't).
Is it ok to charge different prices to black people vs white people? For the sake of argument, assume there is a genuine difference in demand between races (I would imagine it is true, but let's not debate that).
If it is not OK, why is it OK to charge Australians differently to other people, beyond the genuine differences in actual costs to deliver software here?
Racial discrimination is a special case because it has a very long history which is rooted in bigotry and prejudice. Due to this history any current policy of racial discrimination - even one based on a rational profit motive - would foster bigotry in some people and deeply-felt resentment and hostility in many other people. Other forms of discrimination don't have this problem, at least to the same degree.
For this reason all race-based discrimination should be illegal, but other types of profit-based discrimination should be legal: (a) Senior citizens pay less than other people for cinema tickets; (b) Women pay less for car insurance than men; (c) Students pay less for drinks at the bar; (d) US citizens pay less than Australians for software licences.
By the way, it sounds like you want to see both race-based and country-based discrimination banned. If so, do you think that (a), (b) and (c) above should also be banned? If not, by what principal are you allowing businesses to segment their customer base?
I think the root of it all comes from our base expectation that humans should be treated equally. We expect that as a base and small deviations from it, especially favorable ones. But anything else has to be tied to very rational reasoning about why the discrimmination is happening.
So we can say insurance for women vs men is generally OK because it is two large groups and the discrimmination is tied to real justifiable costs in the difference of insuring them. We can say students vs others is OK because everybody has the experience of and choice to be a student. Similarly with seniors - we will all get to be seniors one day, with luck :-) So you're not discrimminating between people - everyone will get to experience these benefits at some stage.
The geographical segmentation is difficult because (just like race), it's something beyond our control - we can't help where we live, and it will never change. Suffering a selective negative consequence for something that is beyond your control violates our basic sense of right and wrong about human equality.
The time honored way to segment a customer base is to offer tiers of product. Identify a few special features and sprinkle them into a "professional" version. Then sell that for a higher price. If Australians on average are more affluent, more of them will buy the higher priced version, and you will still be making (some of) your extra money. But the ones who are equally well off compared to those in other countries will not be disadvantaged.
But:
1. When given a free hand to segment their customers, businesses will generally set a higher price for people who can afford to pay more. This might be less equal but it is more equitable. For example, let's say Paramount Studios releases the latest James Bond film - they will want to charge an Australian cinema more for the right to screen the film than an Indian cinema. My sense of social justice says it is fair for someone whose income is £4/day to be charged less to see a film than someone who earns £100/day. If Paramount was forced to charge the same price then it would mean that Indian cinemas simply cannot afford to buy the rights to screen the film, and Indians would miss out entirely.
The argument is even stronger for medicine. If a pharmaceutical company can be sure there is no arbitrage between two countries, then it will want to sell a medical treatment cheaper in India than in Australia. That is A Good Thing.
2. If you say to a business, "You must offer your product to Person A and Person B for the same price" then you are restricting the total size of the economic pie in a similar way to saying "You must offer your product for $6". Take Paramount Studios again - if they are prevented from charging different prices in different countries then they will earn less revenue. This means they will be pay their scriptwriters less, have less impressive special effects and pay less tax. (Or quite possibly the film is not made at all).
3. You are happy for a car insurance company to discriminate on the basis of sex if there is a real difference in accident rates between men and women. Would you allow a car insurance company to discriminate on the basis of race if there is a real difference in accident rates?
Comparing regional pricing schemes to racial discrimination is quite a leap.
[1]: http://digitalcommons.law.yale.edu/cgi/viewcontent.cgi?artic...
Or are we talking about using Copyright to be limited to geographic location? (i.e your U.S Licensed Photoshop can't be used in Australia)... Because that would be a serious misuse of laws. (in my opinion)
It's just pricing.
The report observes a market failure - undesireable monopolistic effects caused by current legal restrictions on import&resale of goods, and proposes to remove these barriers with the expectation that free market competition will cause the local software prices to fall to global market levels.
I am not allowed to buy songs from the US iTunes Store, or the US Steam Store.
DVD's are region locked, and parallel importation is illegal.
I have no sympathy for those of my fellow Australians who think they have some valid complaint that the price of digital assets is "too high".
Australians simply do have a higher willingness to pay, and lower price elasticity of demand, for a whole host of economic reasons. Companies charge the price that maximises their returns, and this means price segmentation wherever it is legal.
Moreover it is, of course, also impossible to legislate against: the same laws would effectively peg the Australian dollar. This is just political grandstanding; nothing will change.
I don't get to say this often on HN: what utter rot.
When parallel importation of CDs and movies was abolished, the dollar didn't give a damn.
When region encoding was dropped on us via the AUSFTA Chapter 17, the dollar nary stirred.
The AUD is a small rowboat that navigates between the Scyalla of Chinese iron ore demand and the Charybdis of Ben Bernanke's public nut-scratching.
Selling to Australians takes place in Australian dollars and the transactions are cleared by Australian banks. This makes them pretty easy to get a legal grip on.
And you will also find that the large companies who are doing most of the price discrimination have local subsidiaries which can be dragged into court without too much fuss. If they try something like yanking funds to avoid court judgements, they're violating various laws and privileges and our government can and would be able to seek enforcement from courts in the USA.
People think that trading across boundaries gives you magical immunity from national laws. It doesn't. Where you have a nexus with a country, you can be enforced against through that nexus. Where the laws are similar, brother courts will typically reciprocally enforce them.
And the Australian government is not going to take legal action in the US to create border import tariffs.
I continue to be astounded by all the self-righteous outraged people here demanding cheaper Photoshop and cheaper Steam games like it was some basic human right.
That is not the observed and observable outcome of parallel importation in other goods.
> And the Australian government is not going to take legal action in the US to create border import tariffs.
Your terminology is incorrect. It's not a tariff. Making geo-segmentation harder or illegal is not a tax on imported goods.
> I continue to be astounded by all the self-righteous outraged people here demanding cheaper Photoshop and cheaper Steam games like it was some basic human right.
I'm likewise astounded that people think Australia's quite utilitarian, transactional political culture is going cleave to any particular ideological position.
I've always found this style of argument to be innately humourous, a sort of "oh no, they're fighting back somehow - only businesses should be able to make things more favourable for themselves!"
So naturally on a market with higher purchasing power and higher overall price level
Median wage in the US and Australia are equivalent - in the mid- to high- 40k range.
[1] http://mattcowgill.wordpress.com/2013/05/13/what-is-the-typi...
[2] https://en.wikipedia.org/wiki/Household_income_in_the_United...