Why online prices are higher in Australia

One question we often notice in the computing industry is how much more expensive products are here than overseas. Sometimes, it’s warranted: for a physical product, there are different taxes, shipping costs, all of which add up. When it comes to a digital product, something is bought and used on a computer, like software, its transferred over the internet. Those same shipping costs no longer apply. While there are taxes, and the exchange between currencies can result in a price difference, Australia often gets left holding the short end of the stick. In fact, one study suggested that Australia sometimes pays over 40% more for digital products. 

The way it’s done is called ‘geo-locking’ or ‘geo-blocking’ which is simply looking at your information as it comes to a website and saying “This person is from Australia, divert them to this site with higher prices, block them from seeing cheaper prices.” 

What kind of services may you be affected by with geo-locking? Maybe you buy music from iTunes. Or photo-editing software from Adobe. Or subscription based software from Microsoft. Perhaps you would like to access Netflix or other entertainment that is not available in Australia. All of these services use geo-locking to some extent to force higher prices on the average Australian. 

In a recent Parliamentary report, the committee urged Australian consumers to find lawful ways to bypass ‘geo-locks’ and obtain more competitive pricing from the same manufacturer. Keep in mind that avoiding such geo-locks may change the terms and conditions applicable to you, and there are various risks with warranties and law. However, bypassing these geo-locks is not as difficult as it may seem. 

Watch out for our next article, which we will discuss an option to mask your location and get better pricing. 

Remember to speak to your local IT specialists about any issues you may be having.