Saturday, 27 August 2011

Fair Deal and the EU Competition Law

No names, no pack drill. But here's an odd thing in this day and age.

So I wanted to buy a new Macbook Pro (yes, Ty, I have moved from the Dark Side). I have a nice reseller near me and so I rang them up, having priced up what I wanted on Apple's website.

'Could you please quote me for a Macbook Pro 13" i2.7GHz, 4 Gb RAM, 500 Gb HD etc,' I asked. I knew exactly what I wanted, even Apple Care and case. A PDF quote was sent to me with exactly the same prices as on Apple website, even though I was clear I was comparing quotes.

So I emailed back and asked for a best price, apologising for being unclear. Back came a mail saying this was the price. Looking at two other websites, one of which was Amazon, it was clear some savings could be made but I was keen to support my local shop. So I called up the chap.

He proceeded to give me a very strange answer. Basically, they were 'ordered' to only offer the same price as Apple as they were an authorised reseller and if they gave any discount then they would lose privileges with Apple. This came from their top management.

I laughed as this was a pretty poor excuse but it was also dangerously sounding like a flagrant violation of EU Competition Law. I mentioned this and the chap dug himself deeper. It appeared this was an Apple driven thing at first then his own management and then both. It seemed all 40 or so Apple Authorised Resellers issued the same policy.

Now, it was clear if I was a large company then I could get better terms but I was buying one laptop. That, frankly, is better reply.

However, to say that this was an 'ordered' collusion between Apple and all its Authorised Resellers was a highly dangerous reason to charge list price only - or Recommended Retail Price as it is called. When I asked about the other quotes, it was pointed out that non-Authorised Resellers can offer discounts.

It smells even worse! I am in the business and I know how cramping the EU Law is this area. This is blatant collusion which does not benefit customers.

But they are not the only company at it. If you want to buy certain Cloud software from any Authorised Reseller of the largest vendor in the world, they can demo it and then send you to a website hosted by the vendor where you actually make a purchase, so that your contract is with the vendor. One price, no person to negotiate with. The Distributor and Reseller, although not obviously in the chain get a fixed commission for the sale and the vendor makes a fixed margin too.

That means the thousands of resellers acting as agents for the product under their authorisation cannot negotiate an iota and everyone gets a fixed cut - one price to the poor end user, regardless of order value.

Hmm - the same software purchased on premise can be negotiated for at any of the same outlets. That's not price fixing the new product, is it? That's not collusion, is it? Surely not.

I mean other Cloud software vendors are often the only source of the product, aren't they? But they don't use their authorised channel to recommend sales - they don't have a channel at all, or limited at most.

These are dangerous times. Big vendors fixing prices under the EU's noses. Now who would have thought that?

- Posted using BlogPress from my iPad

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