Original URL: http://www.theregister.co.uk/2005/02/07/regionalism_analysis/

Revealed: the tech consumer as prawn

Mouth open at sewage outlet

By Charles Arthur

Posted in Media, 7th February 2005 11:29 GMT

Comment "I wouldn't eat prawns," said Julie Walters, portraying a prissy housewife in one of Victoria Wood's comedy sketch shows. "You know how they are. They spend all day treading water at sewage outlets with their mouths open."

Somehow one gets the impression more and more that the bigger companies - both hardware and software - increasingly view you and I, the so-called "consumers" of the world, as just a bunch of prawns. Except real prawns don't have to pay for their food.

Take the instance of the mysterious exploding power supplies. The Wall Street Journal recently exposed the little-known fact that if you buy an Apple G5 desktop system in the US (which works on 110V AC) and take it to the Antipodes (Australia, New Zealand, Fiji, etc), which for historical reasons run on good old British 240V, your G5 will say "Bang!" and the magic smoke will escape. And you'll have a large, pretty and expensive paperweight.

Happily, if you buy a G5 in a European country and take it somewhere else, you won't face the same problem. Even though there's a 220/240-volt split between the Continent and Britain, the European Union obliges any company operating in its borders not to introduce "artificial barriers" to trade. (It's an example of "big government" actually helping us poor prawns.)

The reason why Apple does this? To prevent people from countries with stronger currencies than the US dollar - ie pretty much everywhere, at present - buying gear in America rather than from the regional office, whose currency once translated back into dollars will mean a healthier profit than the same item bought in the US. (Every multinational also takes options on the foreign exchanges, hedging against changes in exchange rates affecting the transfer of profits from their foreign operations back to their headquarters at the end of each quarter.) And they put up barriers to people buying kit where they "shouldn't".

Hang on, though - isn't the idea of the World Trade Organisation that trade barriers should be coming down? Yes, little prawn, but not for the likes of you and me. Even though it costs manufacturers more to make region-specific gear, the combination of obvious currency variations plus cheap international transport means "regionality" is a growing trend. Far Eastern companies can make cheaper versions of inkjet cartridges; so Hewlett-Packard, among others, is designing printers that will only work with cartridges with the right "region coding". You want to take advantage of free trade to get cheaper cartridges? The computer says no. (More precisely, the firmware in the printer itself says no.)

Just change the plug

We asked Dell, the world's biggest computer company (five times larger than Apple) whether it uses the same tactics. Not the currency-buying, but the regionalisation. Its PR said confidently that if you buy Dell kit in the US, "all you need to do is change the plug" to use it elsewhere. (Reg readers are invited to confirm this.) Though obviously not if it's for terrorism.

We're all already familiar with the completely artificial region coding found on DVDs, which prevents us, and would-be entrepreneurs, from importing DVDs from abroad. The movie studios introduced region coding partly because they could see that foreign counterfeiting might undercut the ridiculous prices they charge for the finished product, but initially because they were so bad at making enough physical copies of the film being shown in cinemas that it had to be shown in the US first, and the copies then shipped over to Europe. (This is why you could often first see a new Hollywood in Paris, with English dialogue subtitled in French, before it appeared in the UK: the subtitled films were part of the initial print run.)

But now that Hollywood actually makes more from DVDs than from cinema releases, the combination of region coding and staggered cinema and DVD release dates has started to really annoy ordinary people - who respond by buying knockoffs sold for a couple of quid by illegal immigrants in hock to Far Eastern "snakehead" gangs. Yes, Hollywood is helping organised crime by failing to meet consumer demand.

The problem though is that, rather like Julie Walters and the prawns, the big companies have lost trust in their buyers. They're happy enough for us to tread water with our mouths open. But they don't trust us not to take advantage of currency fluctuations; even though they do the same themselves. They don't trust us not to want to get inside their DRM-protected files; although as Cory Doctorow points out (quoting Ed Felten, who cracked the music biz's SDMI) "keeping an honest user honest is like keeping a tall user tall".

Doctorow adds that: "There has never been a DRM-covered file that was kept off the internet. Ever. DRM has never once in the history of the field kept a file from appearing online, or from being booted by organized crime pirates. Despite its rhetoric on this, Hollywood is perfectly aware of how bogus the DRM-is-protection claim is; any entertainment exec you put on this spot on this will retreat to a badly-thought-out mantra to the effect that 'DRM is a speedbump, it's not meant to keep files off the internet, it's meant to keep honest users honest'."

Companies that monitor file-sharing networks say every song that's ever appeared exclusively on iTunes or any other download site has rapidly resurfaced there. "DRM isn't protection from piracy," Doctorow notes. "DRM is protection from competition." The problem for the companies is that the competition isn't just other companies now; it's us prawns, using programs like BitTorrent to get the TV programs that haven't yet shown in the UK from US viewers, or been released on DVD.

Protect and survive

Certainly, for companies like Napster, DRM certainly looks like an attempt at protection from competition - from Apple's music service, in particular. But the numbers suggest it's bad news for the humble prawn, again.

The regionalisation of the music business, even (or especially) online, is a step beyond. Those getting Napster To Go subscriptions (which let you - lucky you! - download subscription music onto a not-iPod) in the UK are paying £14.95, whereas those in the US pay $14.95. At current exchange rates, and even allowing for VAT, that's a 60 per cent hike, as this article points out. And before you start feeling smug about using the iTunes Music Store, recall that its tracks cost 99 cents in the US, 99 Euro cents on the Continent, and 79 pence in the UK - another uneven range.

And why? Partly because the music industry likes that (though industry sources also tell me Apple likes the marketing feel of "79". It's ten more than 69, which is what the Continental price would be in UK money; and so more profitable.) The European Commission - remember them, our aid in times of voltage distress? - is currently investigating Apple's differential pricing.

In the hardware and software makers' fury at our natural reaction to being denied something we thought we already had - such as freedom to buy things where commerce makes it feasible - the protectionism is getting increasingly hefty. So much so that at the end of January the Electronic Frontier Foundation announced an endangered list of technologies such as the Morpheus filesharing network, virtual soundcards (which music, film and radio companies hate because they let you capture a copy of what's playing on your computer), and HDTV tuner cards (threatened in the US by the "broadcast flag" mandate).

You can see the rather discomforting list at http://www.eff.org/endangered/; after a week where climate scientists have been predicting the imminent demise of polar bears and coral reefs, it's salutary to realise that technology has its own "red list" of things that are in danger not because they don't work or that nobody loves them, but precisely because they work too well for the tastes of some.

Some companies have realised that a little sweetener goes a long way: the extras on DVDs are a big reason why that's now the most popular way to see a film. Apple and HP and the film companies might make a touch more money in the short term from regionalising us, but if all they end up with is customers who fume at the restrictions placed in their way, is it any wonder that subterfuge - or even outright criminals - seem like a preferable alternative? Perhaps we'll just have to keep treading water until they realise. But we don't have to swallow any of it. Honestly. ®

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