Rip-off Britain means pricier software

Photoshop is part of Adobe Creative Suite 3, which cost £1,000 more in the UK than it does in the US

As part of our investigation into price discrepancies between the UK and the rest of the world, the time has come to take a look at popular software titles.

The overwhelming trend lately is that British buyers are forced to pay huge price premiums over their US counterparts for exactly the same piece of software.

The EU has made occasional efforts to prevent unfair pricing, but on the whole it seems that UK customers should pay the same price in pounds as Americans do in dollars.

We recently discovered that buyers in the UK will pay up to £1,000 more for Adobe's forth-coming Creative Suite 3 suite. When Adobe unveiled the pricing details for its CS3 software suite it was obvious that the UK was at a disadvantage to everyone else.

Adobe price Premium

The most advanced package, Adobe Creative Suite 3 Master Collection - due to be available in the UK this month along with the rest of the CS3 range - costs $2,499 in the US. That's around £1,266 in UK money. Adobe, however, has priced the CS3 Master Collection at £2,314 including VAT - more than £1,000 higher than the US price.

Customers in the UK can't buy software from Adobe's US website so they're stuck with paying the higher UK price - unless you order a boxed copy from a US vendor.

Other versions of Adobe Creative Suite 3 are similarly priced. The Design Standard package costs the equivalent of £607 in the US, with an actual selling price of just under £1,052 here - a price increase of 73 per cent.

Adobe's Design Premium version is priced at £911 in the US , but £1,656 in the UK - almost 82 per cent more. And the Adobe Creative Suite 3 Production Premium retails for £860 in the US, but is nearly double that in the UK , at £1,656.

Office overpriced?

Adobe blames the small UK market size for the price hike. "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," a spokesperson told us.

"Pricing is higher in Europe on many goods, not just software. Adobe evaluates pricing with each release, and has reduced the price differential when possible."

The situation is the same with Microsoft's Office 2007 suite. The UK price of the Microsoft Office 2007 Ultimate Edition is set at £600 whereas buyers in the US pay $680 (£346) for a copy. UK buyers thus pay a 58 per cent premium on the same product.

Similarly, Microsoft Office 2007 Professional is priced at £450 in the UK, 56 per cent more than the $500 (£254) US customers pay.

The Small Business Edition version is priced at £400 (57 per cent more than the $450 (£229) US price), whereas the Standard version is 58 per cent more expensive in the UK compared to the US (£350 and $400 (£203) respectively).

Microsoft could not give a straight answer when we asked them for the reason for these differences in pricing structures between the countries. A spokesperson repeated the usual arguments that fluctuations in the exchange rate, regional taxation and different channels of retail distribution are possible reasons for the price discrepancies.

It was also keen to distance itself from blame. "It's up to our partners to set the pricing. We're not allowed to fix prices - that would be illegal," a Microsoft spokesman said.

Petition the PM

Microsoft is also in the firing line for the pricing of its Windows Vista operating software. A petition has even been set up, asking PM Tony Blair to put pressure on Microsoft in order to get the UK price of Windows Vista lowered.

So far, 9,629 angry computer users have signed the petition, which is open until 20 April. It will then be sent to the Prime Minister's office.

Paul Milne, who started the petition, is annoyed about the "huge difference in the price that people in the US and the UK are paying for Windows Vista".

He cites the prices of Windows Vista Ultimate, the premium version of Microsoft's operating system. The UK recommended retail price is £370 whereas the same product that costs $400 (£203) in the US.

UK will pay more

"I can see no reason for such a huge difference in price between the UK and the US other than Microsoft's belief that UK customers will pay more than their US counterparts," Milne writes.

Depending on which version of Windows Vista you're looking at, the UK price can be as much as double the US price.

Apple is also guilty of price-hiking. Its iTunes Store makes UK buyers pay more for the same tracks than people in the US or the rest of Europe, which the EU has recently taken issue with And so on...

As no-one we spoke to was prepared to give us a good reason why British buyers should pay more for software, it may be worth mentioning to these companies that the reason why they think is so expensive to do business over here may be that you have to pay double for software...