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Jan 07
2009
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Apple's prices are questionablePosted by: Philip Roy on Jan 07, 2009   |
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Someone's not doing their maths right!! Or if it was someone in the States that did this...they're not doing their 'math' right!
In this news item....http://www.nzmac.com/news/apple/apple-introduces-ilife-09.html, site user Whitty and I have been having a chat. I confess I didn't really think much of the issue of price until I went and did some hunting around about previous versions of iLife and iWork and the exchange rate at the time....so well done Whitty. I knew that times are tough, but Apple's not playing fair.
August 07
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US Price for iLife '08 and iWork'08 is $79 each
http://www.apple.com/pr/library/2007/08/07ilife08.html
http://www.apple.com/pr/library/2007/08/07iwork08.html
At the time, $1 NZD = $0.7608157438 USD (thanks to http://www.xe.com). That works out at $103.84 NZD based on the exchange rate at the time.
The items go on sale at the time for $109 NZ...so a reasonable conversion
http://www.apple.com/nz/pr/library/2007/08/07ilife08.html
http://www.apple.com/nz/pr/library/2007/08/07iwork08.html
January 09
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US once again get either bundle of apps for $79 USD....
http://www.apple.com/pr/library/2009/01/06ilife.html
http://www.apple.com/pr/library/2009/01/06iwork.html
Today, $1 NZD = $0.595880 USD.
That works out at $132.58 NZD for the product at today's exchange rate.
It went on sale today at $179 NZD !!!!
http://www.apple.com/nz/pr/library/2009/01/06ilife.html
http://www.apple.com/nz/pr/library/2009/01/06iwork.html
That's the equivalent of it costing $106.83 USD for one of those packages!!
Someone must have done their math wrong??
Phil
PS...the ironic thing is that I got my order changed to an education price (which I forgot to do when ordering). Even so, that $159 NZD education price is still far more than the software should be!
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Richard Szabo
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I must confess, that in hindsight too, I thought it a little odd. The article I read about iLife'09 was an "upgrade" price of US$79. In NZ we can't do that and can only pay the $179 incl GST and "free" shipping. I remember thinking after I ordered that I'm *sure* it had been advertised cheaper, and put it down to the US$. Thanks to you and Whitty for the detail - I'm not going mad!!!  |
Murray Whittington
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Apple Pricing Well done Phil for the fantastic maths workout, now the big picture is opening here and I wonder what else is over priced.... that is locked away in a secret safe of formulas. Hopefully Apple will realise that their price is over marked, and I wonder is the dealers (Shops) now have a better margin) or no changes if not be interesting why Apple wants more money to keep going?? Key formula, better price for consumers to buy people buy products, if its expensive price people dont buy they wait until a sale kicks in... |
David Empson
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I checked some other international Apple stores and it seems that NZ has been singled out. We're being charged about a 20% markup on the single licence of iWork '09 and iLife '09, compared to more like 10% in most other countries. The family pack is worse. At NZ$249, it is about a 30% markup. I want one of these, but at this price it is cheaper for me to order it from the US and post it to New Zealand! I've had a brief look for a suitable contact at Apple to complain about this, but may have to resort to calling them. |
Philip Roy
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I'll contact Apple and see if there is a response...I imagine I may not get one in this instance. |
duck
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This might explain things. In the past Apple's NZ distributors have used a conversion rate lower than the current exchange rate to protect themselves against fluctuations in the value of the NZ Dollar when setting NZ pricing for Apple hardware and software. $179 - GST ~= $159. $159 is about twice $79. That suggests a conversion rate of about 0.5. That may not seem fair given that today the NZD is at about 0.6, but we don't know who Apple is getting their advise from on the future of the NZD exchange rate. |
Philip Roy
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I'd probably ask 1. When was the conversion rate last at 0.5, because I sure as heck can't find it? 2. Should they be basing prices on a prediction as opposed to the rate at the time? (This one the answer is easy to argue yes, although I'd disagree, but it needs to be a solid prediction) I appreciate there is fluctuation, but not to the extent that seems to bring about the $179 value.....unless we're doomed..all doomed I tell you!!  |
duck
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In the past when I've done the maths trying to understand the price difference and gone "Hm, are Apple NZ are using a XYZ conversion rate?" it's always seemed to be about ~5c below what the exchange rate was. If the prices were set back when the exchange rate was at 0.55 that could explain the 0.50 rate that seems to fit the maths. |
Diego Betanzo
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a few things to consider on pricing beyond exchange rate could be duty (if any) applied to these goods, not to mention the freight costs involved in transporting goods to nz - considering the size of the market here they are probably not sent directly from the factory in China (or wherever) but rather siphoned from stock in either australia or even the states - either way you've got to tag on a little for freight - add onto that the hedging that was referred to earlier and you'll find that the price probably works out pretty fair - also worth considering is the comparison to the equivalent microsoft software package - still a pretty sweet deal i'd think! |
Philip Roy
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Duty and freight costs existed in August 2007 and wasn't added on in the same way (comparing Apple's with Apple's...oh, that's a bad pun!). Freight costs also must be factored in to the States. I believe it's a big place Also...we're looking at about $46 added per package....even with a fluctuation in currency, I don't think freight and duty would make up what is left. |
Diego Betanzo
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freight costs are definately going up in the states as the domestic costs are only set to get higher with DHL (who had traditionally undercut the competition) removing their involvement in that market - as far as international freight costs go, the market has been ridiculously volatile in the last year (and especially the last quarter, when they were likely setting their pricing) due to the fluctuations in oil prices - the fact that it's gone down now doesn't mean that apple will lower the price for the goods already moved - it does seem steep but i would seriously doubt that they would look to gouge the nz market when, if anything, you would expect them to take a hit just to maintain a presence here. as long as the software available in the states works here (default languages, measurements, etc., aside) i'd say you'd likely be better off importing it directly yourself - - in fact, if the software isn't protected by some region coding you'd benefit from shopping around (globally) for the best exchange rate/shipping cost combination...and then just wait for it to arrive (hopefully) in the mail.... |
Murray Whittington
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ilife and iworks price says it all on this link http://www.macworld.com/articl...html?t=101 indeed we are ripped off here in NZ see above link a decide for yourself... |
Philip Roy
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I don't get what we're meant to be looking at in the link you posted? I can't see anything we don't know? Phil |
Murray Whittington
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This and its in US$ and also a bit of a wait for the software to arrive While iLife ’09 won’t ship until the end of the month, the newly updated iWork suite of productivity applications is available now. All three components—the Keynote presentation application, the Pages writing and page-layout offering, and the Numbers spreadsheet tool—get new features. Apple also launched a new service, iWork.com, that lets users share and collaborate with documents online. The service is integrated into iWork ’09 as a button in the toolbar of each application. iWork.com launched Tuesday a public beta. Get more details on the iWork ’09 update Both iLife and iWork sell for $79, with Family Packs of each suite available for $99. Apple is also bundling the two suites with Leopard and selling them as part of a $169 Mac Box Set. The bundle will be available in late January when iLife ships. |
Philip Roy
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Sorry, I'm still lost. We knew the USD price...it's in the Apple press releases....that's where Macworld would get there info. Many sites have been repeating the price....am I missing something that's changed? Phil |
Diego Betanzo
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just out of curiousity i checked a handful of apple.com international online stores and compared prices for ilife 09. The following are the prices from the various pages exchanged at current rate (www.xe.com) into New Zealand Dollars: NZ = $179.00 US = $79 = $133.07 NZD Australia = $129 = $154.19 NZD Canada = $99 = $141.20 NZD Hong Kong = 650 = $141.01 NZD Malaysia = 299 = $142.18 NZD Spain = 79 euro = $182.29 NZD UK = 69 GPB = $176.87 NZD So I suppose this means the NZ price is based on the exchange rate with the Euro and not the USD.....? I take back earlier comments - we are getting shafted on this.....bugger |
David Empson
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If you are going to compare international prices for iWork/iLife, you have to take into account the local sales taxes (GST, VAT, etc.) The US price does not include sales tax. The NZ and Aus prices include GST (12.5% for NZ, 10% for Aus, I think). The UK price includes VAT at about 17%. In general, Apple seems to set international prices for products based on a weighted exchange rate, i.e. they include a safety margin. This typically results in international pricing being about 10% on average higher than US pricing, BEFORE you add local sales tax. What baffles me is how the NZ family pack price is nearly 40% higher than the individual licence price, whereas it should be about 25% higher (as in other countries). At no time in recent memory has the NZ$ to US$ exchange rate been low enough to justify NZ$249 = US$99, even with a markup. That figure has to be a mistake. The $179 figure may have just been bad timing, with the price fixed a few weeks ago when the NZ$ was lower. |
Philip Roy
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FYI, it's been 36 hours since I emailed Apple for a comment. I emailed 2 people, got one out of office. Usually if Apple doesn't want to make a comment about something, they just tend not to reply, so I'm nope hopeful of a response. |
David Empson
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It looks like the "Mac Box Set " price in NZ is similarly off the scale. Single licence: US$169, A$279, NZ$419. Family pack: US$229, A$380, NZ$559. (A$ and NZ$ prices include GST.) New Zealand prices seem to have been calculated at NZ$1 = US$0.45 (single) or US$0.46 (family pack). This is similar to the iWork and iLife family pack price (US$0.44). The iWork/iLife single licence price is about US$0.50 to NZ$1. A warning on the subject of ordering from overseas: I've seen comments from people in the UK that iWork '09 no longer includes a licence key in the box. This might mean you can't buy the product overseas, have it delivered to a local friend, and get them to e-mail you the licence key to activate the trial edition (which is how I got my .Mac account when they were ridiculously expensive here). You may need the physical media to install the full version of the software. I'd like to see confirmation of this when local copies turn up. Australian prices are reasonable, so anyone making a trip to Aussie could bring back copies of iWork (and the others) and make a good profit selling them in NZ at less than Apple's retail price. |
Philip Roy
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I can confirm there are no license keys to enter during the install....so you will need the original media. Phil |
Neil McCallum
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Questionable? I'd say bloody outrageous. I'm thinking of ordering from Amazon.com and using a mail forwarding company. Can anyone recommend one? |
olivernz
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Good 'ol times This reminds me a lot of when Renaissance was the Apple monopoly. Prices then were abysmal. Then Apple came along and there was a break. Now we're back to the status quo. I can understand them hedging their bets on hardware but this is software! There is MINIMAL fixed cost involved. They could even sell it worldwide for $79 no matter what currency. So why not be a little pro-consumer and give us a break in these hard times? But this is where Apple shows it's "Microsoftiness". They do have a monopoly and they are using it. I like iMovie and iPhoto but I can survive on '08. This is actually the first time I've even considderd pirating since I switched to the Mac 5 years ago (thinking about it isn't outlawed yet is it? Or is that 92d?). I always buy software esp. on the Mac because I like the price-value relation. With this release that's gone. I do feel ripped off and that makes me think of alternatives. I still want to buy but for the US price. ...can't we up the export price for milk to a 1 NZ$= 1 US$ ratio?... I think Apple is treading a slippery slope here. If they start pis*ing off consumers again (like Renaissance did at the time) most will start looking for alternatives... That's just the way the cookie crumbles. |
Philip Roy
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My understanding is that Renaissance had prices set for them by Apple and had little say over the price of Apple products in NZ. Phil |
olivernz
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Renaissance had a heap of stock answers. Depended on who you asked. I thought it was just overpriced. If they didn't get the conditions from Apple, then they should have tried harder I guess. But that's yesterdays news. Now it's Apple direct doing their bit. come to think of it why don't they just sell in us dollars? Then the whole thing would be done via the credit card company.... |
Philip Roy
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I didn't say it was Renaissance that said that. It was (and still is) practice I believe for resellers to be directed as to the price to sell Apple products at. |
olivernz
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Sorry my mistake but I heard that line from them a couple of years back too. In the end it probably is an Apple issue. We all know how there's no discount on an Apple. Now we're at the short end of the stick again. The economy has turned and Apple is charging premium again. Only option we have in protest really is "don't buy" but that defeats the purpose too. Since we're a country with only 4m+ inhabitants Apple could care less (most large american cities have more inhabitants). I'm just dreading the next hardware updates and the price hikes we'll see. |
olivernz
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Addendum: I just checked the prices on the 17" MacBook Pro.... no price hike to speak of! The USD/NZD exchange rate used is 0.54USD = 1NZD for all MacBook Pros. Since the 17" is not even in the shops yet I'd have guessed the new "iLife" exchange rate would apply but alas not so! Which is probably good but begs the question what's up with software?! Hmmmm.... |
olivernz
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Let me correct that a little. The exchange rate for MacBook Pros is 1.85NZD=1USD. iLife and iWork '09 that is 2.26NZD=1USD. Somehow that doesn't make one ounce of sense. That's about 22% more. Both products are imported at the same time. And I don't think they hedge currencies for each product/product line separately. |
David Empson
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Re the 17" MacBook Pro: since it was a "replacement" model slotted into the current product line, I think they deliberately chose to keep its price in proportion to the other MacBook Pro models, otherwise it would be ridiculously high by comparison. (i.e. they used the exchange range which was prevalent around October 200  . Expect future models to get much more expensive. The Mac Mini was last updated (and its price set) about the same time as iLife and iWork '08 (August 2007). If they follow the same rules as for iLife/iWork, then we could see a 65% increase in the price of the next Mac Mini models ($179 vs $10 . If they base it on the same rule as the family pack or Mac Box Set pricing, then it may be as much as a 79% increase ($249 vs $139). The last iMac came out in April 2008. We are looking at a potential 25% increase in iMac prices due to the drop in the NZ$ since then. (Assuming unchanged prices in US$, of course.) Would you pay NZ$1600 for an entry level Mac Mini? I paid only a little more than that for the previous high-end model, maxed out with memory and hard drive at Apple's inflated prices. |
David Empson
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Numbers in my previous comment which mutated into emoticons should read "October 2008" and "$108". (Wanders off muttering about web discussion mechanisms being too clever for their own good.) |
olivernz
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Ok, I think you've just ruined my appetite. I was looking forward to the new minis too but now.... I'm really contemplating running out and buying an iPhone now before the next model comes. I don't want to pay $1600 for a phone!!! ...well I don't want to pay $1000+ either but it's cool.... |
David Empson
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Price increase on an iPhone shouldn't be quite as bad as I'm suggesting for the Mac Mini. The current iPhone model came out in mid 2008, shortly after the iMac, so I'd expect an increase in price closer to 25%. |
duck
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When was the conversion rate last at 0.5, because I sure as heck can't find it? Six years ago. And... Today. NZHerald: Dollar at six-year low |
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