App Store prices set to increase in United Kingdom, others

What goes up never comes down in the retail universe.

lkrupp said:

What goes up never comes down in the retail universe.

Only the price of apps didn't go up. The Apple App Store price their apps in US Dollars, in every country. And each country pays the equivalent in their own currency, based on the exchange rate of their currency. If the exchange rate goes up or down, then the changes in the price of apps (in their country) is reflected in their currency, when Apple makes the correction. But whether they end up paying more or less for the apps in their currency, they are still paying the same equivalent price in US Dollars for the apps. Apple did not raise (or lower) the price of apps in their App Store. The exchange rate between the US Dollar and other currencies, goes up and down daily. But I don't know what criteria Apple sets to determine when the changes are reflected in the Apple App Store pricing in other currencies. But I do know that when the exchange rate is not favorable for Apple, for too long, they report it in their earnings report to explain one of the reasons why earnings or profits might had taken a hit. (Remember, the exchange rate also affects the pricing of Apple hardware, in other countries.)    

davidw said:

lkrupp said:

What goes up never comes down in the retail universe.

Only the price of apps didn't go up. The Apple App Store price their apps in US Dollars, in every country. And each country pays the equivalent in their own currency, based on the exchange rate of their currency. If the exchange rate goes up or down, then the changes in the price of apps (in their country) is reflected in their currency, when Apple makes the correction. But whether they end up paying more or less for the apps in their currency, they are still paying the same equivalent price in US Dollars for the apps. Apple did not raise (or lower) the price of apps in their App Store. The exchange rate between the US Dollar and other currencies, goes up and down daily. But I don't know what criteria Apple sets to determine when the changes are reflected in the Apple App Store pricing in other currencies. But I do know that when the exchange rate is not favorable for Apple, for too long, they report it in their earnings report to explain one of the reasons why earnings or profits might had taken a hit. (Remember, the exchange rate also affects the pricing of Apple hardware, in other countries.)    

What naive tosh! It is true that Apple sets prices in $US in the US. Overseas prices are based on the US prices plus local sales taxes plus a hefty margin for exchange rate variability, plus an extra profit margin, then rounded up to the next price point. 

The  example quoted by JP234 of the Mac Mini going from $699 to $599 in the US. That same Mac Mini M2 is £649 in the UK. At the current exchange rate of $1.2395/£ that is $804.43. 

Apple has always charged much higher prices outside of the US. For a high-end Mac, the difference in price will pay for a holiday to the US to buy it. 

timmillea said:   

What naive tosh! It is true that Apple sets prices in $US in the US. Overseas prices are based on the US prices plus local sales taxes plus a hefty margin for exchange rate variability, plus an extra profit margin, then rounded up to the next price point. 

The  example quoted by JP234 of the Mac Mini going from $699 to $599 in the US. That same Mac Mini M2 is £649 in the UK. At the current exchange rate of $1.2395/£ that is $804.43. 

Apple has always charged much higher prices outside of the US. For a high-end Mac, the difference in price will pay for a holiday to the US to buy it. 

Perhaps we should demonstrate the example drawn out above correctly as the comparative being drawn seems to imply that there is over $200 of additional profit on the UK price when it’s no where near that.

Base cost of mini: $599

This price includes no sales tax in the US. When the product comes to the UK pricing includes sales tax, but it also includes import duties. So what are these?

Import duty: ~10% adds ~$59.90

VAT: 20% on base cost AND duty adds $131.78

So the “real consumer price” is actually ~$790.68

Converting this to UK currency at the rate above we get a UK price of £637.90.

The round up to the price point of £649 gives an additional margin of just over £11 in this case, so one can reasonably argue that the so called price gauging overseas is not as bad as first implied. The real issue is the duties and taxes that are added and go straight to the UK government.

We also need to remember overseas that the US price is not the real price paid as sales taxes get added, but this varies greatly depending on where in the US you buy (and use, technically) the item.

Naiyas said:

timmillea said:   

What naive tosh! It is true that Apple sets prices in $US in the US. Overseas prices are based on the US prices plus local sales taxes plus a hefty margin for exchange rate variability, plus an extra profit margin, then rounded up to the next price point. 

The  example quoted by JP234 of the Mac Mini going from $699 to $599 in the US. That same Mac Mini M2 is £649 in the UK. At the current exchange rate of $1.2395/£ that is $804.43. 

Apple has always charged much higher prices outside of the US. For a high-end Mac, the difference in price will pay for a holiday to the US to buy it. 

Perhaps we should demonstrate the example drawn out above correctly as the comparative being drawn seems to imply that there is over $200 of additional profit on the UK price when it’s no where near that.

Base cost of mini: $599

This price includes no sales tax in the US. When the product comes to the UK pricing includes sales tax, but it also includes import duties. So what are these?

Import duty: ~10% adds ~$59.90

VAT: 20% on base cost AND duty adds $131.78

So the “real consumer price” is actually ~$790.68

Converting this to UK currency at the rate above we get a UK price of £637.90.

The round up to the price point of £649 gives an additional margin of just over £11 in this case, so one can reasonably argue that the so called price gauging overseas is not as bad as first implied. The real issue is the duties and taxes that are added and go straight to the UK government.

We also need to remember overseas that the US price is not the real price paid as sales taxes get added, but this varies greatly depending on where in the US you buy (and use, technically) the item.

Whilst this is true, there have been plenty of times whereby that extra margin as a percentage is in the high teens. That and as Lkrupp rightly (???) said, "What goes up never comes down". As far as I'm aware, Apple has rarely (if ever?) corrected the foreign prices downwards in response to exchange rate fluctuations, only ever up.