Into The Unknown

I know that whenever something comes over from the US (or Japan), the price conversion is more often than not a straight $ -> £ conversion (so $20 would equal £20, even though at present $20 is only worth £10). This has really hacked me off, and the iPhone is no exception - the 8Gb model going on sale in the UK for £269, equivalent to $542 (given that £1 = ~$2). In the US, the 8Gb model is on sale for $369. What really spurred me on was reading the SiliconValley.com article about O2 being announced as the exclusive UK carrier (Dear god, they must have been desperate for the custom, O2 is one of the worst networks in the UK - I should know, I was dicked about for 12 months by them before moving to T-Mobile!) The article wrote off the higher UK price to "value added tax." Well, it's not all VAT, and here's my quick maths to prove it:

(All sums done with Google btw because I'm lazy and it has currency conversion built in, and decimals rounded up to nearest £ or $ because that's what they all do anyway.)

# globals
let VAT = 17.5%, or 1.175
let $1 = $2.015 (thanks Google)

VAT-inclusive UK price in USD: $536 = £266 according to the article, but £269 from Google = $542. For the sake of simplicity, let's go with the article's figure.

£269 (UK sale price for 8gb model) x.85 = £228.65 before VAT = $462.

$536 (UK sale price VAT incl.) - $397 (US sale price) = $139 difference = £69 difference.

$397 (US sale price) = £197 in GBP (plus VAT).

Now, if the world was fair, we should be being charged £200 (well, £197, 'but what's £3 between friends,' quipped Steve Jobs).

Therefore,
£200 x 1.175 = £235 with VAT, which is what we *should* be being charged for the 8Gb iPhone. Ha.

So, somewhere, somebody's making £34 to £35 on each sale ($70, by the current exchange rate). Maybe it's for Ives' pension fund? And, even though I don't think the iPhone is a particularly great device save for two things - its multi-touch interface and its form factor - I still get really annoyed when companies bring their products to the UK and rip us off. The iPhone's not the most spectacular example of this, consoles and PCs being much worse for this problem, but it still hacks me off. If you're planning on becoming a beta tester for a new product (i.e., early adopter), you really have to have a fat wallet to survive this kind of hobby.


And yeah, if you're wondering, I have posted this elsewhere, I am active in more than one place on the Internet. ;)