iPadding - the cost of cutting edge cool

So we know when we're getting the iPad in New Zealand - Apple has announced New Zealand will get iPad in July, along with Austria, Belgium, Hong Kong, Ireland, Luxembourg, Mexico, Netherlands and Singapore.

Australians get theirs two months before - the iPad is already available for pre-order there and will be on sale in Australia May 28th, along with Canada, France, Germany, Italy, Japan, Spain, Switzerland and the UK.

A note to those geographically-challenged who just have to have iPads before the everyone else - Sydney is much closer to us than Hong Kong, Dublin, Toronto or Tokyo.

This list alone has generated some discussion. For example, the Economist in Britain thinks Apple has something against Eastern Europe, going by what's available in different iTunes Stores.

You have to admit, Luxembourg will probably not generate as many iPad sales as Russia (population about 144 million), which is not on the list. But I guess Luxembourg (population: under half a million) being surrounded by ready European markets and transport networks is a factor there. But China - where iPads are mostly likely all made - is also not on the list. China was also very late to get the iPhone.

Apple sold a million iPads in its first month, beating iPod and iPhone sales records; this US demand forced Apple to push back the worldwide product launch date by a month for some countries, three months and counting for others. 

But how does Apple set its prices? That's long been a bone of contention. In New Zealand, it appears Apple sets the local price on release going by the exchange rate at that date, plus freight and GST. Sometimes, for this reason, one product seems to sell at a relatively good price for months while another seems relatively (compared to other Apple products) steep.

After the international announcement, iPad prices around the world started to trickle out. Apparently, iPads in Germany start at €514 for WiFi and €614 for 3G. They'll cost €15 more in Germany than in France or Italy due to new German government copyright levies on 'computers without burners' (optical drives).

Italian site setteB.it posted a page of comparative iPad prices in Euros.

Meanwhile, Japanese Wi-Fi iPads will cost 48,960, 59,040 and 68,880 yen, for 16, 32 and 64GB capacities; 3G models are 61,920, 72,000 and 81,840 yen.

In Australia, as I said, preordering is now available. The Australian prices start at $629 (about NZ$786) for the WiFi 16GB, A$759 for the 32GB and A$879 for the 64GB. (The Australian prices for the 3G versions are respectively $799, $928 and $1049). Australia has GST, too.
It's interesting to see what these prices are, translated into NZ dollars (on May 11 when I wrote this):

Once upon a time, you might have said Apple products were cheaper in the US because of transportation distances, but this was only really true when Macs were made in the US.

Now they all come from China - when you order a Mac or iPod online in New Zealand, it's certainly not shipped here from the US. Shanghai, China to San Francisco, California is 9922 kilometres. Shanghai to Auckland, New Zealand is 9346 kilometres. Shanghai to London is 9235 kilometres, and Shanghai to Sydney is 7835 kms. Shanghai to Berlin is 8443. Shanghai to Tokyo? Just 1781kms ...

But of course, volume has to be calculated. A million iPads sold in the US probably equivalent to just a few thousand in our market, and the more you ship of one thing, the cheaper it is.

But Japan loves Apple products. There, iPhone has taken around 70% of all smartphone sales, and Japanese Mac use has been higher than US Mac use, as a percentage, for years. That's one massive market for iPads right by the manufacturer, in relative terms.

Also, of course, we get a GST addition on every product that arrives in the country. So add a higher rate of GST in, if Bill English has his way.

After lots of speculation and criticism online, Apple CEO Steve Jobs has been moved to defend the company against accusations of high international iPad prices. German and English prices seem particularly steep (but we haven't seen ours yet!).

Regarding the UK, Jobs is said to be offering the same explanation across multiple emails.

"Please educate yourself," the response reads. "UK prices must by law include VAT, which is around 18%. US prices do not include tax." Standard UK VAT is actually 17.5 per cent, which would make the 16GB Wi-Fi iPad roughly £365 (about NZ$757) before tax (VAT is like GST).

This is still, however, about US$40 ($NZ55.40) more than the equivalent US cost.

Jobs was more aggressive in terms of Germany, which has the highest prices of any country in Europe, even after taxes.

He wrote "Blame your government. Germany just added a new copyright levy for computers," he wrote. As stated, German prices are €15 higher (nearly NZ$28), because of the iPad's new government device classification.

Anyway, I guess we'll see, come July. I hope it will start at around $800 for the cheapest, but that may be unreasonable. That said, I know people who paid $1300 to be among the first in Aotearoa to have iPads. Who knows?

- Mark Webster mac-nz.com