Tuesday, 3 April 2007

Adobe's CS3 UK pricing

Adobe have just released their new Creative Suite 3 packages. The Web Premium edition has upgrades to several pieces of software I already use such as Photoshop, Flash and Acrobat as well as containing a few extra bits that would be very useful. Unfortunately the pricing just seems ridiculous.

It isn’t uncommon for US companies to set their sterling prices to be numerically close to their US dollar counterparts despite exchange rates but how can they justify these massive price differences for software?

  • Adobe CS3 Web Premium US: $1599 (£809)
  • Adobe CS3 Web Premium UK: $2344 (£1195 - ex VAT price)

I actually wanted to upgrade from Macromedia Studio where the pricing is even more disproportionate:

  • UPG from Macromedia Studio 8 to CS3 Web Prem US: $499 (£252)
  • UPG from Macromedia Studio 8 CS3 Web Prem UK: $1048 (£534)

Software media and packaging can be manufactured anywhere in the world so there are no extra shipping costs involved so how can these prices be justified?

The following quote from Adobe’s chief exec seems to sound like since buying up their main competitor (Macromedia) Adobe think they can charge whatever they want.

"Our customer is not typically price sensitive," Chizen said last week. "The cost of the tool isn't what's critical -- it's the productivity and what their output can be. They want to pay for value as long as we deliver innovative features that allow them to be more productive and creative."

There is another article on ZDnet highlighting the £1000 difference for UK customers buying the CS3 Master Collection. Adobe’s excuse here isn’t very convincing.

"Adobe sets pricing in each market based on customer research, local market conditions and the cost of doing business. The costs of doing business in European markets are significantly higher per unit of revenue than in the US. Pricing is higher in Europe on many goods, not just software. Adobe sets/evaluates pricing with each release, and has reduced up the delta [price differential] when possible."

I’m now investigating ordering CS3 from the US. Even if I can’t get it shipped over I could probably still save some money by flying across the Atlantic to pick it up myself.


Simon King said...

What did you do in the end? I'm also looking at buying CS3 Master but being put off for two reasons:

1) I will only ever use a small percentage of the features in each application (I'm primarily a web software developer)

2) The US/UK price difference is incredible!

Is it legal to buy US software and use it in the UK?

Rob Smith said...

Hi Simon, in the end I paid for the UK upgrade. The US didn't have the upgrade path I needed from Studio MX 2004 which the UK site did. I don't know of any legal reason you can't buy a copy from the US. I'd be interested to hear of your experience if you do.

Unknown said...

have a look at http://www.enn.ie/print/138350.html

It mentions how little corporate tax adobe is paying in Europe. The costs might be higher, but the tax is a lot lower. 2 million on 1.8bn turnover!

Anonymous said...

Hello all,

Yes it is legal to buy in the US and use in the UK. I have had that confirmed by Dave Burkett, Vice President for the CS3 products. In fact I have just managed to get a US colleague to buy my upgrade and I should get the details soon. I am setting up a web site to compliment the complaints I am putting to the Consumers Association (Which Magazine), The Daily Mail, and the OFT as there is price fixing and unfair trading practices.

Rob Smith said...

Thanks David, sounds like a great idea. Good luck and please post back with your website address when you get it up and running.