Misunderstanding The Global Economy

It's a story dating back over a year but it's worth shining a light on. In February 2008, Eveready-Energizer protected its profits by putting a small importer out of business:

The Federal Court has ordered the forfeiture and consequential destruction of approximately 150,000 parallel-imported Energizer batteries seized by the Australian Customs Service.

The importers, Contrade Pty Ltd, its director George Condos, and four other companies were found to have infringed on the trademark registrations owned by Energizer Australia.

According to Energizer, the companies traded on the mistaken belief that parallel imports were legal.

Energizer's legal gun hoped bankrupting the 2000-founded importer of toiletries, personal care and battery products would warn off the other corner stores and wholesalers they're breathing down the necks of:

John Carroll, a lawyer who manages Energizer Australia’s monitoring and compliance program, said the court order should give concern to all parallel importers.

“The actions of these companies not only jeopardizes Energizer’s reputation as a supplier of quality and safe batteries in Australia, but also threatens consumer safety and faith in the brand...

Since the batteries involved were parallel imports - not counterfeits - what is Mr Carroll saying? Is he suggesting that Energizer's products as sold overseas are unsafe and unreliable?

Well, his words hint at it to add a little scare for anyone thinking of paying half the price of Australian batteries for parallel imported genuine Japanese-made Energizer batteries. But they're really only unsafe for the corporation's profits and they'll nail you for it, as his following statement makes clear:

“The unauthorised importation and resale of Eveready and Energizer branded batteries for which Energizer Australia Pty Ltd owns the trademarks is an illegal practice and importers face civil and criminal proceedings.”

It's not really about protecting trademarks or intellectual property, it's about protecting the extortionate extra profits companies can make in particular territories. For instance, software maker Adobe:

In Australia, CS5 Master Collection will cost AU$4344 for the full edition, and AU$1503 for the upgrade edition. In the US, the same software will cost US$2599 (AU$2816.45) for the full edition — more than AU$1500 less. The upgrade edition will cost US$899 (AU$974.22) — more than AU$500 less.

Adobe doesn't just apply the 'Australia Tax', it has a European one too, as applied to the 2088 edition of this software:

IF YOU WERE THINKING about popping along to your local computer superstore to pick up a copy of Adobe's Creative Suite 4 Master Collection on its release date of November 14th, you might just want to reconsider. Because Adobe's insane pricing policy means that it would be cheaper to fly from London to New York, grab a copy of the software, spend the night in a hotel, and fly back to London the next day!

Yes you read that right. At today's exchange rate, the full suite of design programmes is a full £1,358 more expensive to purchase in the UK than it is for our colonial cousins in the USA. And we found flights from Gatwick to JFK in New York for £318 each way, so you could skip the hotel and save yourself a small fortune.

And they wonder why people buy grey imports or seek out illegal copies of software...

As one commenter put it:

The way Adobe extract money from customers makes Apple look well behaved. No wonder Apple won't play nice with Adobe. There's only enough room for one bully.

-- Nick