Some of the software developing companies realized that it�s not a wise idea to charge US-style prices for their products in a country having a per capita GDP 7 times less than that of the United States.

One of the most controversial issues in the fight against piracy has long been the rights owners� insistence on charging the same prices in countries living in different economic reality. For example, Apple charges the same prices for their iTunes, although it�s considered a global digital music retailer. Still, the company doesn�t care of where their customers live and how much they can actually pay for the product. This means that Malawi people, living with $800 per capita GDP, are supposed to pay just as much as the Americans boasting $46,000 per capita GDP.

Until recently, the software developers failed to realize that such approach pushed people in poorer countries to turn to piracy in order to acquire content. Meanwhile, the rights owners kept claiming that piracy led to billions of dollars in lost profits abroad, though such claims seemed more and more irrational. It�s clearly not a �lost sale� when the person has to choose between the bare necessities and the latest U2 album.

The Wall Street Journal wasn�t the first to point out that pricing is the real key to fighting piracy. Fortunately, a number of software companies, like Microsoft and Autodesk, have finally realized this.

For instance, Autodesk�s AutoCAD 2011 software was priced at $3,975 in the United States, while its prices in China were around 20%-30% less. However, even at $2800 piracy was still a more attractive option for Chinese, who had to work for months to afford the program. Finally, since Autodesk decided to set prices in China 50% less than in the United States, its sales have more than doubled.

Microsoft�s CEO for Chinese market also admits that although their margin got squeezed when they lowered prices, they still had so much room to improve that the volume made it up.

Brazil and Pakistan were among those who criticized the United States for denying that each country has a different economic reality, and recommended it to adjust its prices accordingly. Of course, half of the world, living on less than $3 a day, will have to turn to counterfeit and pirated goods whatever the prices are, but the remaining half may want to pay if the prices are reasonably lowered.

============================================Sure took them a long time to figure this out.

Taike



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Bo pen nyang.