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Australia threatens Adobe, Apple, with geo-blocking ban

IT pricing inquiry finds no reason for higher prices, suggests using VPNs

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Australia's Parliamentary inquiry into IT pricing has found no plausible reason hardware, software and digital downloads costs more down under, and recommended changes to copyright law so locals can access cheaper goods.

The Inquiry kicked off last year, as a part-populist, part-sensible probe into why Australian consumers and businesses are often asked to pay up to 50 per cent more than those in other developed nations for the very same goods.

The Inquiry went so far as to insist that representatives from Apple, Adobe and Microsoft front a public hearing to explain their pricing policies. Adobe's Paul Robson was wretched as he tried to explain why even Creative Cloud costs more in Australia than elsewhere, after saying local packaging and transport costs were the reason the company's wares are more expensive in Australia than elsewhere. Microsoft more or less toughed it out with a “we charge what we want to and/or think we can get away with” attitude, while Apple blamed higher download prices on music and movie rights holders and the vagaries of territorial copyright, rather than its own policies.

The Inquiry's final report emerged today and concluded “the price differences for IT products cannot be explained by the cost of doing business in Australia. Particularly when it comes to digitally delivered content, the Committee concluded that many IT products are more expensive in Australia because of regional pricing strategies implemented by major vendors and copyright holders.”

That'll play well domestically, and five of the recommendations penned by the House of Representatives Standing Committee on Infrastructure and Communications may also raise eyebrows elsewhere, as they would be very interesting precedents if adopted.

Those recommendations suggest Australia:

  • Remove restrictions on parallel/gray market imports;
  • Changes its Copyright Act “to clarify and secure consumers’ rights to circumvent technological protection measures that control geographic market segmentation”;
  • Create a “right of resale” for digital goods
  • Educate Australian consumers and businesses on how to circumvent geoblocking and what it will mean for their rights;
  • A ban on geo-blocking “as an option of last resort, should persistent market failure exist in spite of the changes … recommended in this report.”

The second recommendation is tantamount to legitimising VPNs for avoiding copyright controls, which would throw the cat among the pigeons for the likes of Hulu and the BBC. The latter recently signed a new deal with Australian pay TV operator Foxtel to create a dedicated Australian channel after receiving an offer said to be rather larger than the sum Australia's national public broadcaster, the ABC, could match.

If Australia clarifies the use of VPNs, allowing people to easily watch Hulu or iPlayer for free rather than Foxtel's subscription service, one imagines Australian courts will quickly become rather busy.

The report also ponders whether its recommendations are feasible in the context of Australia's participation in the Trans-Pacific Partnership (TPP), a controversial and largely-secret trade treaty considered a close relative of SOPA and ACTA inasmuch as it is thought to insist on tight trans-border copyright restrictions.

Intriguingly, the Committee received a response from Australia's Attorney General's Department stating that it does not feel Australia's Copyright Act needs to change in order to comply with the TPP. That's noteworthy because, to date, no official TPP text has reached the public. The mere hint that TPP won't require a change will set some pulses racing. ®

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