The importance of IT products to every sector of Australian
society can hardly be overstated. IT products are woven into the fabric of our
economy and society, and have driven rapid change in the way Australians
communicate, the way we work, and the way we live.
Australian consumers and businesses, however, must often pay
much more for their IT products than their counterparts in comparable
economies. In many cases Australians pay 50 to 100 per cent more for the same
Consumer and business concern over IT price differences
prompted the Minister for Broadband, Communications and the Digital Economy,
Senator the Hon. Stephen Conroy, to refer the question of IT pricing in
Australia to the House of Representatives Standing Committee on Infrastructure
and Communications for an inquiry and report.
Evidence presented to this inquiry left little doubt about
the extent and depth of concern about IT pricing in Australia. Consumers are
clearly perplexed, frustrated and angered by the experience of paying higher
prices for IT products than consumers in comparable countries.
High IT prices make it harder for Australian businesses to
compete internationally and can be a significant barrier to access and
participation for disadvantaged Australians (in particular Australians with a
Based on the evidence received over a 12 month inquiry, the
Committee has concluded that in many cases, the price differences for IT
products cannot be explained by the cost of doing business in Australia.
Particularly when it comes to digitally delivered content, the Committee
concluded that many IT products are more expensive in Australia because of
regional pricing strategies implemented by major vendors and copyright holders.
Consumers often refer to these pricing strategies as the ‘Australia tax’.
While the Committee recognises that businesses must remain
free to set their own prices in a market economy, it has nonetheless made a
range of recommendations that are intended to sharpen competition in Australian
IT markets. The Committee hopes that these measures will increase downward
pressure on IT prices and improve the access of Australian businesses and
consumers to cheaper IT products.
Given the ever-increasing importance of IT products to
Australian society and the economy – in driving innovation, reducing isolation
in regional and rural Australia, or improving the lives of Australians with a
disability – it is essential that Australians get a fair deal.
Nick Champion, MP
Membership of the Committee
Mr Nick Champion MP
Mr Paul Neville MP
Mr Paul Fletcher MP
Mr Rob Oakeshott MP
Mr Ed Husic MP
Mrs Jane Prentice MP
Mr Stephen Jones MP
Mr Mike Symon MP
Ms Julia Morris
Ms Sonya Fladun
Mr Peter Pullen
Ms Jessica Hargreaves
Terms of reference
Noting the estimated value of the internet to the Australian
economy, and the importance of competitively priced IT hardware and software
being made available to business, government and the community, the House of
Representatives Standing Committee on Infrastructure and Communications is
asked to inquire:
n Whether a difference
in prices exist between IT hardware and software products, including computer
games and consoles, e-books and music and videos sold in Australia over the
internet or in retail outlets as compared to markets in the US, UK and
economies in the Asia-Pacific;
n Establish what these
n Determine why these
n Establish what the
impacts of these differences might be on Australian businesses, governments and
n Determine what
actions might be taken to help address any differences that operate to the
disadvantage of Australian consumers.
List of recommendations
2 Price discrimination and consumer impacts
The Committee recommends that the ABS develop a comprehensive
program to monitor and report expenditure on IT products, hardware and
software, both domestically and overseas, as well as the size and volume of the
online retail market.
Considering the importance of IT products to education, and in
the interests of greater transparency in this area, the Committee recommends
that the Australian Government, in consultation with Universities Australia and
CAUDIT, conduct a comprehensive study of the future IT needs of and costs faced
by Australian Universities, in order to provide clearer financial parameters
The Committee recommends that the Australian Government
consider a whole-of-government accessible IT procurement policy, to be
developed by relevant agencies including AGIMO, and in consultation with
relevant stakeholder groups including ACCAN.
4 Copyright, circumvention, competition, and remedies
The Committee recommends that the parallel importation
restrictions still found in the Copyright Act 1968 (Cth) be lifted, and
that the parallel importation defence in the Trade Marks Act 1995 (Cth)
be reviewed and broadened to ensure it is effective in allowing the importation
of genuine goods.
The Committee recommends that the Australian Government amend
the Copyright Act’s section 10(1) anti-circumvention provisions to clarify and
secure consumers’ rights to circumvent technological protection measures that
control geographic market segmentation.
The Committee further recommends that the Australian Government
investigate options to educate Australian consumers and businesses as to:
extent to which they may circumvent geoblocking mechanisms in order to access
cheaper legitimate goods;
tools and techniques which they may use to do so; and
way in which their rights under the Australian Consumer Law may be affected
should they choose to do so.
The Committee recommends that the Australian Government, in
conjunction with relevant agencies, consider the creation of a ‘right of
resale’ in relation to digitally distributed content, and clarification of
‘fair use’ rights for consumers, businesses, and educational institutions,
including restrictions on vendors’ ability to ‘lock’ digital content into a
The Committee recommends the repeal of section 51(3) of the Competition
and Consumer Act 2010.
The Committee recommends that the Australian Government
consider enacting a ban on geoblocking as an option of last resort, should persistent
market failure exist in spite of the changes to the Competition and Consumer
Act and the Copyright Act recommended in this report.
That the Australian Government investigate the feasibility of
amending the Competition and Consumer Act so that contracts or terms of service
which seek to enforce geoblocking are considered void.