How much you pay for your Apple Mac products depends greatly on where you live. This we already know, but how big that difference actually is may come as a shock to many. We looked at the prices in the United States, Europe and Australia and found some pretty substantial differences.
Why do this comparison?
As you may know, Pingdom is based on Sweden (the country of IKEA, Volvo and yes, blond girls), and we are constantly amazed that the prices tend to be so much higher for Macs here than they are in the United States. We decided to get some actual numbers on how much of a price difference there really is on average.
Apple isn’t the only company having different prices for different regions, but we used them in this article since A) we like Apple’s products, and B) the products are well known and mostly identical all over the world. You could say it’s our version of the Big Mac Index, but with Apple products. Let’s call it the Apple Price Index. (We were tempted to call it the “iMac Index”…)
How we compared the prices
We looked at the prices for 17 Apple hardware products (computers) as well as the price of Mac OS X and Office 2008 for Mac.
For Europe, we didn’t check all countries. We included prices from Sweden, United Kingdom, Spain, Germany and France and averaged those.
Prices were taken from the Apple Store websites specific to the different countries, and we didn’t include taxes such as VAT to make the comparison fair to Apple (they don’t have control over taxes…).
We translated all prices to US dollars according to the current exchange rates (as of August 11, 2008).
Price comparison: USA vs. Europe
Based on the products we looked at in this survey, European consumers pay an average of 18.7% more for their Mac products than US consumers. For a thousand-dollar product, that is $187 that could have been used for something else.
On top of this, Europeans generally pay much more VAT than people do in the US. For example, Swedish consumers will have a 25% VAT added on top of the basic price and UK consumers will have a 17.5% VAT added. VAT is only paid by consumers, though, so companies buying Apple products won’t be affected by that part.
But poor Australia!
We thought we had it bad here in Sweden, but when we looked at the prices for Macs in Australia we couldn’t help but feel a bit sorry for them.
Australians pay a whopping 26.5% more on average for their Macs compared to Americans. For a thousand-dollar product, that is an additional $265 that an Australian would have to pay compared to an American. And that’s US dollars, not Australian.
From what we understand, Australia also has something similar to VAT that will add 10% on top of that, which is still more tax than you would pay in the US.
The Apple Price Index
We used a base price of $1,000 (one thousand) to illustrate the price difference between the different regions. Of course, Apple doesn’t have a product that costs exactly one thousand dollars in the US, but it’s a nice round number to use as a base.
So, if you want a thousand dollars worth of Mac, based on US prices, this is what you end up paying in the different regions (excluding tax):
- USA: $1,000
- EU: $1,187
- Australia: $1,265
Largest and smallest differences
We didn’t check the price for all Apple products, but here are some observations on the prices of the products we did check.
(All comparisons are against the US prices.)
Really big differences:
- Apple TV, the 40 GB version, is 59% more expensive in Europe and 73% more expensive in Australia.
- Office 2008 for Mac (admittedly a Microsoft product, but it’s sold on the Apple Store website) is 62% more expensive in Europe and 44% more expensive in Australia.
Smaller differences:
- Mac Mini 1.83GHz is “only” 6% more expensive in Europe, but 25% more expensive in Australia.
- Mac OS X on the other hand is 22% more expensive in Europe, while “only” 8% more expensive in Australia.
Why such a big difference?
Perhaps localization could be one factor affecting the price. Out of the European countries, the UK had the lowest prices. USA and the UK are both English-speaking countries, so perhaps localization comes into play here. On the other hand, Australia is also an English-speaking country.
Distance could potentially be a factor, especially for Australia. Perhaps freight costs can explain part of the price difference?
Another factor affecting prices could be differences in custom duties/fees between the different countries.
And perhaps sheer market size is also a factor. The US is a huge market, so perhaps that allows Apple to cut prices since such large volumes are handled. Or perhaps Apple simply has a larger profit margin in Europe and Australia? In other words, does Apple charge more outside the US because “they can”?
To summarize, here are some theories for factors causing the price differences:
- Product localization.
- Freight costs.
- Larger market in the US.
- Custom duties/fees.
- Different profit margin in different regions.
We hope that someone out there knows the actual answer and will tell us in the comments, because we honestly don’t know. 🙂
And even if you don’t know for sure, we would love to hear your thoughts on this.
For the curious:
The products we looked at were two different kind of Apple TVs, two kinds of MacBook Air, three kinds of 13-inch MacBook, three kinds of MacBook Pro, two kinds of Mac Mini, four kinds of iMac, a Mac Pro 8 core, Mac OS X 10.5, and Office 2008 for Mac.
For a list of the included products and their prices per country, you can download an Excel file we have included here.
