Australia to adopt parallel import system for software?

Australia to adopt parallel import system for software?

The Australian Consumer Association is pushing for the abolition of import and distribution restrictions on software in response to a survey conducted indicating Australian companies and consumers are paying too much for software products.

Undertaken in six countries and across a range of products, including Windows 98, Word 97, Access 97, Quake II, Adobe Pagemill 3.0, QuarkXPress 4.0 and Norton Utilities Gold V4, the survey discovered that discrepancies as large as $1205 were apparent in the sale of QuarkXPress between here and the United States.

The proposed adoption of parallel importing in Australia would follow the path that New Zealand has recently taken and that our own CD industry adopted last year. The intention of the move is to allow the consumer to purchase from the cheapest source, rather than having to deal through a locally authorised representative of software developers, explains the ACA.

According to ACA's policy and public affairs manager, Mara Bun, this strategy will considerably free up the market. Bun explains that the present system restricts the options a consumer has and the abolition of the compulsory dealerships will "lift the restrictions on who you can buy software from, be it the local dealer or through the Internet. This will increase competition significantly."

As with the removal of CD restrictions this proposition has had negative reactions from some of the people involved in selling software. Ken Hoskings, survey sales manager at Brisbane-based reseller Dural International, believes that the channel model is based entirely around the premise of alliances and partnerships. "A reseller needs to protect and support a particular market area," asserts Hoskings. The absence of such a structure could undermine partner programs that introduce training and support measures into the industry. "Without localised support, customers would suffer," continued Hoskings.

ACA's internal magazine, Consuming Interest, indicates that this structure will soon be obsolete as "at a time when anyone can purchase software from a host of nations, the role of the local distributor and the bind of its private contractual restrictions are increasingly irrelevant to the consumer".

Bun reiterates this point but reassures channel players that increased competition is beneficial, not detrimental to their businesses. It will not encourage vendors to go direct as the proposed system allows them equal leniency in this regard as the present system does.

A parallel pricing system would eliminate the power that software vendors have in determining prices, empowering the reseller with the responsibility. With this comes the assumption that the savings will be passed on to the consumer, an assumption that is, however, open to corruption.

Dianne Semmens, managing director of ACACIA, is anticipating that the potential for lower prices will also deter the piracy market in Australia which, according to BSAA statistics, is up to 32 per cent of the total software market.

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