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Sunday, 15 March 2015 19:32

Apple prices blowout in Australia Featured

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Psst, do you want to buy a cheap Apple Watch for A$600? That may well be the price Australians will have to pay for the base model when it hits the market here next month. Watches aside, all products in the already expensive Apple stable are ballooning in price as a result of the strong US dollar and this could spell trouble for the company’s Australian sales and its exports in general.

A few months ago, when the Aussie dollar was at parity or better with the US dollar, we were screaming blue murder that Apple products were still more expensive here than in the US because of the so-called “Apple tax”. Now, with the Aussie hovering around 76 US cents, Apple products are moving from being merely expensive into the realms of the unaffordable.

Yesterday, on a tip from a friend, I called an Apple reseller in Melbourne known for cutting prices below the Apple Stores and other resellers. My test product was a current model MacBook Air with 256GB storage. A few months ago this product could be had for a discounted price of $1250. Today the special offer lowest possible price was $1530 (discounted from $1699).

I asked the salesman the reason for the price rise and his response was that the processor had been upgraded to run at 1.6GHz. “Is that an i7 processor?” I asked. “Oh no, it’s still an i5 processor,” he replied. In other words, instead of telling me the truth, which was the price has now skyrocketed by more than 22% because of the weakening Aussie dollar, the salesman justified the price rise because of the cranked up CPU speed.

So now if you want a practically obsolete underpowered MacBook Air with just 4GB RAM and half the storage you really need, you have to fork out A$1700 at an Apple Store. However, if you want a decent model, say a version with an i7 processor running at 2.2GHz, 8GB RAM and 512GB SSD, you will need to find A$2,479!

Remember the iPhone 6 and iPhone 6 Plus folks? The base models made their debut in Australia last September for A$869 and A$999 respectively. Well as high as those prices were you can kiss them goodbye.

The iPhone 6 now starts at A$999, while the starting price for the iPhone 6 Plus is A$1149. However, as any iPhone 6 and iPhone 6 Plus sales person will parrot, you would be crazy to buy the base models with just 16GB of storage because iOS takes up more than 5GB. So opting for the middle of the range models with 64GB will set you back A$1149 for the iPhone 6 and A$1299 for the iPhone 6 plus.

And here I was thinking that technology tends to get cheaper with volume sales. Apparently, this is not so for Apple products.

No doubt some of you may argue well the Aussie dollar has dropped so that’s that. Well this is true to a point but other smartphone manufacturers seem to be able to keep prices reasonably within range of Australian consumers’ hip pockets. For instance, the 32GB 4G version of the Google Nexus 5 can be had for A$480 including postage and handling. The 32GB 4G Samsung Galaxy S5 can be found for A$640. Meanwhile the 32GB Nexus 6 and Galaxy S6 can be bought for A$799 and A$839 respectively.

So there you have it. Apple no doubt believes that its products are so good that it can charge Aussie consumers like wounded bulls.  To date, this strategy has worked but with Europe deep in recession and the Australian economy teetering on the brink, it will be interesting to see what premiums Apple thinks the Aussie market will bear for its new Watch. It will be even more interesting to see if Apple can maintain its current spectacular sales in its increasingly unaffordable iPhone and Mac products.


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Stan Beer

 

Stan Beer co-founded iTWire in 2005. With 30 plus years of experience working in IT and Australian technology media, Beer has published articles in most of the IT publications that have mattered, including the AFR, The Australian, SMH, The Age, as well as a multitude of trade publications.

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