Tech Blog

[#1]

Critics of Apple products have long pointed to the "Apple Tax" as a crux of their arguements against the products. Apple 's gadgetry is consistently higher priced that similar products with similar horsepower.  Fanboys respond by touting the company's esthetic qualities and point to the high profit margins that continously propel the stock. (Disclosure, I am a small shareholder of AAPL )

This week's announcements by Steve Jobs that pumped new life into the iPod line and his Apple TV 'hobby,' posed a curious currency calculation.  In his Stevenote, he presented American prices that are impressive.  $99 for the Apple TV is astounding.  $4.99 for first run movies is right on point.  $0.99 for tv shows is right in the wheelhouse to have people second guessing their cable subscriptions.

But those are American prices.  On September 1, the Canadian dollar closed at 95 cents US.  In the recent weeks, the currency charts have had our loonie between 93 and 97 cents US.  A premium between 5 and 10 percent should be factored in to the prices, but that's not what Apple is doing with this latest product line.

The current Apple prices accurately reflect the current currency climate:

Product	US Price	Cdn Price	C$ Premium
iMac	$1199	$1299	+8.3%
Macbook	$999	$1049	+5%
iPad 16GB Wifi	$499	$549	+10%
iTunes Music	$0.99	$0.99	-5%

The new product and price announcements take the Apple tax to new heights:

Product	US Price	Cdn Price	C$ Premium
iPod Shuffle 8GB	$149	$159	+6.7%
iPod Touch 32GB	$299	$319	+6.7%
iPod Nano	$49	$59	+20%
Apple TV	$99	$119	+20%
iTunes Movies	$4.99	$5.99	+20%
iTunes TV Shows	$0.99	$0.99	-5%

Granted, Canadian consumers come out ahead of the game when we buy our music or rent our tv shows through Apple . In the long run, that may prove to be a big win if you consume a lot of content.  However, if you just do a straight currency conversion on the new iPod Nano , Apple TV and iTunes Movie pricing, you see a calculation that doesn't make much sense.

Lovers of Apple products understand there is an Apple tax to be paid.  If you want the elegance of a BMW or a Mercedes , you're willing to pay a premium for the privelege - same with Apple products.  The problem comes when the Apple tax is extended to an all out money grab with an off base currency conversion.

What do you think of the new Apple product line and the pricing structure?

catch the buzz ... pass it on.

[#2]

If Canadians just said NO and stopped buying unfairly priced products, manufacturers such as Apple would have to make pricing more competitive. With the Canadian dollar being so close to par the last few years, it is good to see that many Apple products are fairly priced. But just ask the auto industry how stupid Canadian consumers are when we keep paying 30% more than Americans for the same car. I looked at a $29000 car yesterday that is only $21000 in the US and that is before they charge more than double for delivery.

While the auto industry does not seem to care, Steve Jobs does, and if we all email him, perhaps pricing will come down. I have seen several addresses that supposedly work and that he personally answers. Try: [email protected] ; [email protected] or [email protected]

[#3]

fyi.... CTV notices this too...

http://www.ctvbc.ctv.ca/servlet/an/local/CTVNews/2 0100902/apple-canada-100902/20100902?hub=BritishCo ...

[#4]

Thanks for posting, XL, but that CP story is a little thin.

Of course things will cost more in Canada, the issue is the rate of exchange at which some products are converted - *that's* the story that the CP (and CTV) missed. It's an arbitrary target that Apple doesn't always hit because they're addicted to prices ending in "9"