Microsoft: Australians think our pricing is fair

Microsoft: Australians think our pricing is fair

Summary: If Australian customers do not view Microsoft product prices as fair, then they would vote with their wallets, according to Microsoft Australia managing director Pip Marlow.

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If Australian prices for Microsoft products weren't fair, customers wouldn't buy those products because there is now a wide range of alternatives available in the market, according to Microsoft Australia managing director Pip Marlow.

The cost of Microsoft's offerings in Australia are often higher compared with other countries, and the IT vendor does not deny that fact.

At the IT pricing inquiry parliamentary hearing on Friday, Marlow clarified that Microsoft does not have a standard global price for its products, and local pricing is decided by a number of factors. These include cost structure, customer perception, and most importantly, competition in the market, according to Marlow.

"I have been working for the company for 17 years, and I would say it's the most competitive time for Microsoft that I have ever experienced," she said. "So ultimately, our customers have choice, and at the end of the day, if we priced our products too high, then our customers would vote with their wallets and we would see our sales decline."

Marlow also noted that Microsoft sells a lot of its products through its channel network, and its partners determine the final pricing of products. But when confronted about Microsoft charging Australian channel partners more for its products, she said that partners have a choice to work with other vendors.

"We are competing lawfully to win our customers' business every day," Marlow said.

According to Marlow, Microsoft will consider different pricing structures as it executes on its cloud strategy. The company, like Adobe, is hoping to encourage customer adoption of its cloud subscription-based services, which offer lower prices compared to its boxed and downloadable products.

Both Apple and Adobe also fronted the IT pricing inquiry parliamentary hearing earlier on Friday.

Topics: Government AU, Legal, Microsoft

Spandas Lui

About Spandas Lui

Spandas forayed into tech journalism in 2009 as a fresh university graduate spurring her passion for all things tech. Based in Australia, Spandas covers enterprise and business IT.

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10 comments
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  • How can we?

    How can we vote with our wallets when Windows is bundled into the cost of a pre-built machine, or when retailers do not stock other Operating Systems. I'd guess that most people wouldn't know how to install linux on their computer, or know that they can actually ask that Windows be removed from their computer and be able to get a refund for that component of pricing.

    Note, I'm just using Windows as it's usually the only full version of MS software installed at purchase time. Other parts are usually trial or hobbled versions.
    Psychaotix
    • More evidence that MS lives in a fairy-land

      The initial "cheap" price for Windows 8 was reasonable but the historic prices of Windows products have been astronomical. I do not think that over AUD$500 for Vista Ultimate was even remotely fair. The prices for Windows 7 products were not far behind. And then there is the cost of Office . . .

      MS have done everything that they can to screw Australian computer users. No, they are not alone, but they are towards the top of the pack.

      Some of the responses to the Senate Committee from various IT groups have been extraordinary, but those by MS and Adobe certainly top the list as the most stupid!
      Wakemewhentrollsgone
    • @Psychaotix

      I agree with the Windows being pre-bundled with the computers and raises the cost. However, if there are many people who can work in Linux then definitely you will also get a choice of a Linux machine or a windows machine in the market.

      Anyhow, those who knows well to work in Linux, in my opinion, can buy components separate and do the assembling themselves or through a repair vendor. In case of laptops, tough luck though. You have to get a laptop without OS and it is made next to impossible by the dealers.
      spicycheeks
    • BYO

      Build your own PC.
      Azzras
  • I vote with my wallet

    It's called piracy.
    wakieAU
    • So you're saying

      You have no ethics or respect for intellectual property?
      Sam Wagner
      • Re: You have no ethics or respect for intellectual property?

        Since when was there anything ethical about "intellectual property"?
        ldo17
  • What?!?!?!

    Ms Marlow is either a dill or takes consumers for dills. To get to the top in Microsoft she couldn't be a dill so she must think we are. Her statement that consumers will go elsewhere if we think prices are unfair is simply breathtaking and ignores the reality we face.
    KRP1950
    • To be fair...

      One thing I'll say for Microsoft here: At least they're owning up to their bald contempt for their customers, instead of trying to spin it.
      Third of Five
  • Once more, America decides....

    ....then hides behind a local!

    If an AMERICAN receives Windows for (let me pick a round figure out of the air for the heck of it) $100 but an AUSTRALIAN receives the exact same thing for $200, how is that actually right if every single thing with and about the package is the same? If you added $20 (20%) to the American price that would STILL be far too much to justify getting the product here yet a heck of a lot lower. So why do AUSSIES pay more?

    How about we put the shoe on the other foot? Let us say that AUSTRALIA had some product made here that gets shipped overseas and AMERICANS were paying twice the price of Aussies? Where do you think this would end up? In COURT of course and as we have the Free Trade Agreement, they would SUE there and get the price reduced and the company slapped with heavy fines. Why, then, isnt the reverse done here? Why isnt our own ACCC or whichever department would cover this scenario taking them to court using the free trade agreement to sue the living daylights out of Microsoft both here in Australia and at home in USA, getting a whopping big payout and forcing prices to be equitable? Why are our supposed "free trade" protectors not protecting or is this just proof that the FREE TRADE AGREEMENT is ALSO only for AMERICANS and Australians can whinge and whine but if they dont pay, end up being sued in an AMERICAN court?
    greg-w-h