I Admire Honesty in Corporate Communication – The AU PS3 price is "Obscene"

Australians are generally subjected to some degree of price gouging when a product has one official importer. Only the degree of gouging varies. I buy my laptops from Japan, because by the time an ultralight makes it to Australia at least six months later it has lower specs and a much higher price tag.

The PS3 will launch Australia at AU$999 for the 60GB model. That is a significant, but not remarkable premium on the US or Japanese price. For comparison it is about US$700 plus tax. US price is US$600. Japanese price is US$520. So Australians will pay about 17% more than Americans and about 35% more than the Japanese. (at today’s rates from oanda.com).

Sony Computer Entertainment Australia’s Managing Director Michael Ephraim naturally has to claim that the price of the PS3 is justified. To point out that he is also doing it tough, he points out that he pays an obscene premium for his BMW in Australia.

In an interview with Jason Hill, he says “If you look at any other products it’s the same. I drive a BMW and I pay a price that is completely obscene – 80 per cent higher compared to the US.”

When you look at it like that, a 35% premium on the PS3 is quite restrained I suppose. Well at least if you ignore the fact that in Australia cars over $57K are subject to luxury car tax of 25% in addition to normal GST. If his hypothetical BMW cost AU$200K, then about AU$50K would be tax. His 80% premium means it costs the equivalent of AU$111K in the US. The Australian price of AU$150K plus tax is then an “obscene” 35% premium over the US price.

I’m with Michael . I don’t know how BMW Australia can live with themselves.

It reminds me of a speaker I heard once suggesting more people take up polo. “Many people,” he said, “think polo is only a rich man’s sport, but it is no more expensive than many other hobbies like sailing or motor racing”. He did not actually compare the price of polo to playing video games but that was back in the days of the original PlayStation, so it might not have compared so favourably.

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