Gouging? The picture’s cloudy at Adobe

An accidentally hilarious press conference in Sydney earlier this month with Adobe’s global  chief executive Shantanu Narayen gives an indication why Adobe, Microsoft and Apple executives are frantically dodging and weaving to avoid fronting the Senate enquiry on IT price gouging.

Sharing the love: Senator Stephen Conroy, Adobe CEO Shantanu Narayen and NSW Premier Barrie O'Farrell at the Adobe office opening.

Sharing the love: Senator Stephen Conroy, Adobe CEO Shantanu Narayen and NSW Premier Barrie O’Farrell at the Adobe office opening.

The three companies’ supremely arrogant refusal to voluntarily appear at the enquiry into high local prices for their products has led to them being summonsed to appear on March 22.

(By contrast, both the Minister for Communications, Stephen Conroy and the NSW Premier, Barrie O’Farrell fronted at the opening of Adobe’s new offices in Sydney, the scene of the imaging software monopoly’s corporate communications fiasco.)

All three US companies offer products for sale to Australians at significantly higher prices than they can be bought in other countries, such as the US.

Adobe had announced a reduction in local prices for ‘cloud-based’ services the previous day, while maintaining the rip-off on more popular products. For example, the latest full version of the industry-standard image editing software, Photoshop CS 6, is A$1062 and US$699. Photoshop CS 6 Extended is A$1519 here and US$999 in the US. The comprehensive CS 6 Master Collection bundle is A$3945 here and $2599 in the US.

The Senate examination of these direct-to-consumer prices from distributors is of particular importance to photo specialists, as retailers have been identified by the media, consumers and consumer advocates such as Choice as the culprits for high local retail prices for cameras. So presumably if there’s no retailer in the middle, local pricing will be lower. The local pricing strategies of Adobe, Microsoft and Apple (iTunes downloads) point to distributors having a role in setting high local prices.

If Mr Narayen’s embarrassing performance is anything to go by, there is apparently no good reason for the three IT giant’s gouging of Australian consumers – or not one which a corporate executive would want to share with customers, anyway. (I’m thinking here of that old dog’s rationale, ‘Because he can.” KS)

Mr Narayen had his head in the clouds when questioned on Adobe's price gouging in Australia.

Mr Narayen had his head in the clouds when questioned on Adobe’s price gouging in Australia.

Instead of Mr Narayen directly addressing the journalist’s repeated questions on high local prices (credit here to IT journalist Renai LeMay, Delimiter for his polite persistence) , he chooses to stick with the mantra ‘the creative cloud is the future of the creative’ for several excruciating minutes, until the whole embarrassing episode is over.

(Note particularly the constipated unease of the local Apple suit in the background. Probably not looking forward to the ‘counselling’ he is about to get when the local media and politicians move out of earshot!)

It could have been worse – three years ago a visiting Adobe executive said prices were high in Australia because Adobe didn’t want to undercut its retail partners. ‘We don’t want to undercut the entire channel in Australia,’ said the executive in 2010.

To view the footage and for more background from Delimiter, click here.

 

 


2 thoughts on “Gouging? The picture’s cloudy at Adobe

  1. Even taking into account the gst factor, the US is still $300 cheaper than Australia for CS6. No wonder there are so many pirate copies getting around. We’re still running CS becausae we can’t justify spending $1100 on CS6. If they halved the price we’d get it.

  2. Here is a conversation with Adobe chat on the pricing difference between AUD and USA. I have cleansed up some text to make it more readable. I personally am off Adobe.

    Thank you for choosing Adobe. A representative will be with you shortly. Your estimated wait time is 4 minute(s) and 10 second(s) or longer as there are 3 customer(s) in line ahead of you.
    You are now chatting with Adobe:.
    Adobe:: Hello! Welcome to Adobe Customer Service.
    Adobe:: As I understand that you want to know the reason for price difference, am I correct?
    AUD: Why is there 30% between the Adobe USA site and the AUD site for download software
    AUD: Sorry AUD site is 30% higher
    Adobe:: I will be glad to help you with the information.
    AUD: OK, tell me how I can upgrade Elements by USD$80 versus AUD$122.+
    Adobe:: I would like to inform you that due to currency rate, the price is difference.
    AUD: AUD is higher then USD – try again.
    Adobe:: I can understand your concern.
    AUD: At present exchange 80.00 USD = 78.1861 AUD
    Adobe:: However due to the tax, the price is difference.
    AUD: Same tax – buying online – download.
    AUD: Tell me how can I buy the Adobe Elements upgrade for $80USD.
    Adobe:: AUD, it is not possible.
    Adobe:: However if you want to purchase the upgrade I can transfer this chat to our Sales Team.
    Adobe:: Would you like me to transfer the chat?
    AUD: Tell me how can I buy the Adobe Elements upgrade for $80USD. – I am happy to terminate my support of Adobe and use this conversation to add to evidence of pricing fixing by Adobe in Australia. Adobe’s choice.
    Adobe:: I’ll be right with you.
    Adobe:: I am sorry for this there is no option to buy the product with the US price in Australia.
    AUD: OK, then sell it to me for 78.1861 AUD in Australia
    Adobe:: AUD, you can purchase the product as per the price.

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