Case Study: Fighting to Stop Cheaper Books and Software

By Steve Lewis and Brendan Pearson
The Howard Government was last night facing a strong challenge from business and operation parties to its plan to lift import restriction on software and books.

Already under pressure from a range of industries over its GST reforms, the Government mus now weather another expected lobbing campaign by Australia’s $1.5 billion campaign by Australia.
Hailing the copyright reform yesterday as great news for consumers, the Attorney-General, Mr Daryl Williams, predicted ‘potential price falls of around 30 per cent in the cost of books, computer games and various software applications.

Under the Government’s plan to allow ‘parallel important’, Australian retailers and wholesalers will be able to source their products from anywhere in the world – rather than waiting for local companies to release them.

While the Australian Consumers Association said the reforms were ‘good news’, the publishing and software industry-and the Opposition-raised concerns the Government’s plan could wind back protection for intellectual property laws.

The executing director of the Australian Publisher Association, Ms Suan Blackwell, said the industry would mount a ‘vigorous campaign against this ridiculous decision’.

‘If anyone thinks that prices will fall, they are sadly deluded,’ Ms Blackwell said.

It is uncertain what the major publishing houses such a Penguin Random House and HarperCollins, will do to protect their present stranglehold on book imports.

A spokesman for the Business Software Alliance of Australia, Mr Maurice Gonzales, expressed concern at the announcement. He predicted that relaxing import restrictions would increase software piracy levels, which were already very high at 32 per cent of total sales, at a cost of $264 millions a year.

Labor’s industry spokesman, Mr Bob McMullan, said the Opposition would respond in detail when the Government introduced legislation.

‘But the Government has never got the balance right between the legitimate interests of owner of intellectual property and consumers,’ Mr McMullan said.

Labor and the Democrats opposed Government reforms in 1998 to lift import restrictions on CDs.


Australian Financial Review
28 June 2000

Questions

1. What type of market structure best characterizes the Australian publishing industry and the market for software before the copyright reforms become law? How will this structure change with the introduction of reforms?
2. What are parallel imports? Who gains from the ban on parallel imports and who loses?
3. The publishing and software industries are concerned that the government’s plan will reduce protection for intellectual property. Do you support this argument?
4. The Australian Publishers Association and the Business Software Alliance intend to mount a ‘vigorous campaign’ against the removal of restriction on ‘parallel import’. Why are such campaign by small lobby groups often successful even though they may be against the interests of a much larger group-the general book-reading and software-using public?

Case Study: Fighting to Stop Cheaper Books and Software