A government committee has investigated accusations that Australians pay significantly higher prices than consumers overseas for games and other IT products. The committee’s report, released today, includes extensive consumer submissions and industry responses, as well as a number of key findings and recommendations.
Committee chair Nick Champion said in a statement on the report, “The committee found that big IT companies and copyright holders charge Australians, on average, an extra 50 per cent; a practice consumers call the ‘Australia Tax’. High IT prices can have significant impacts given the critical role IT plays in many areas of Australian life.”
According to a comparison included in the report by Australian consumer advocate Choice, the majority of games sold online by EA were 40 to 90 per cent more expensive for Australians than US consumers, and price differentials on Steam could range from 200 to 300 per cent for some titles.
The committee conceded that some factors specific to the Australian market might contribute to higher costs. “Australia’s population is comparatively small and spread over a large geographical area, which means that higher distribution, wage and occupancy costs must be covered by smaller unit sales than in a market like the US,” noted the authors of the report.
But the committee concluded that “in many instances these higher costs cannot, even cumulatively, explain the price differences consumers experience in relation to many IT products, and especially those delivered via the internet.”
“While companies should remain free to set their own prices, the committee took the view that there are a number of ways in which Australia can act to increase competition in IT markets,” Champion stated, “which should reduce prices over time.”
The committee’s final recommendations include relaxing parallel import restrictions and amending Australia’s Copyright Act 1968 to “clarify and secure consumers’ rights to circumvent technological protection measures that control geographic market segmentation (geo-blocking).”
