Allow Aussie tech buyers to buy cheaper overseas: inquiry concludes
Australians should be able to buy technology goods and services from overseas websites when they are cheaper than those sold in Australia, a parliamentary inquiry has concluded.
The inquiry into IT pricing heard Australians pay up to double the price paid by overseas buyers for technology products and services, including for digital downloads, software and hardware.
In a report published on Monday, the House Committee on Infrastructure and Communications said the government should educate consumers on how to bypass ‘‘geo-blocking’’ measures that prevent them buying cheaper overseas goods.
But inquiry's chair, Nick Champion, said it would be impossible for the government to regulate IT prices, as some consumers had advocated.
‘‘We have no constitutional power to control prices,’’ the Labor MP told Fairfax Media. ‘‘Generally speaking we think it’s up to companies to set prices.’’
Instead, he said the inquiry attempted to ‘‘foster competitive, dynamic market places’’ by making recommendations that would allow consumers to more easily buy goods overseas, where they are often cheaper.
In an unexpected bold move, the report recommended the government amend the Copyright Act’s anti-circumvention provisions to ‘‘clarify and secure consumers’ rights to circumvent technological protection measures’’. Such measures prevent consumers from purchasing goods from overseas by using geo-blocking, which can identify where an online shopper’s PC is located through its IP address and block their ability to purchase goods in other jurisdictions.
The report also recommended the government investigate options to educate Australian consumers and businesses as to the extent to which they may circumvent geo-blocking mechanisms. Education would include naming the tools and techniques which could be used to bypass geo-blocking and the way in which consumers’ rights under the Australian Consumer Law may be affected should consumers choose to bypass blocks.
As a last resort, the committee recommended that the government consider enacting a ban on geo-blocking ‘‘should persistent market failure exist in spite of’’ recommended changes to the law. It also suggested that a company’s service should be declared ‘‘void’’ if it attempted to use geo-blocking to prevent consumers from purchasing cheaper goods from another market.
Such a mechanism could potentially stop multinational companies with a presence in Australia - like Adobe, Microsoft and Apple - from selling a product at a higher price in Australia than overseas.
When he appeared before the inquiry in March, Apple Australian and New Zealand vice president Tony King, blamed content owners for the high prices Australians pay for digital media on the iTunes store. He said the price of movies, music and TV shows on iTunes was ''based on the wholesale prices set through negotiated contracts with the record labels, movie studios and TV networks.
Champion said the recommendations, if enacted by government, ‘‘should reduce prices over time’’.
"This report in and of itself won’t suddenly wave a magic wand over prices,’’ he said, ‘‘but it might well begin the path to a more competitive market where people can shop around.’’
The Minister Assisting for the Digital Economy, Kate Lundy, said the government would ‘‘closely consider the report’’ and consult widely on it recommendations.
“The committee has done valuable work in identifying the extent to which consumers face price discrimination in Australia,’’ she said.
Consumer group CHOICE welcomed the recommendations and said they delivered ‘‘a clear blueprint to reduce the digital price discrimination faced by Australian consumers’’.
They provided ‘‘a much-needed trigger for government action to terminate the so-called ‘Australia tax’”, CHOICE director of campaigns and communications, Matt Levey, said.
In particular, Mr Levey congratulated the inquiry’s members for taking aim at the practice of geo-blocking.
He described geo-blocking as the ‘‘virtual walls put in place by global copyright owners and manufacturers to artificially carve up markets and sustain higher prices in regions like Australia’’