[calico_pie]

Quote:

Originally Posted by Anika Hanson

Perhaps not the case with iPhones, but iPads, macs and iPods can be bought cheaper from other retailers like Argos, PC world etc if you wait a few months after release.

What does that have to do with Apple and price fixing?

[calico_pie]

Quote:

Originally Posted by jonmorris

I suspect you need to look up your definition of price fixing. I think you're talking about a cartel.

Resale price maintenance is where a manufacturer sets a price and can use various (illegal) means to stop someone selling below it. The most effective method, still used by companies today, is simply not supplying stock to those who discount - but with a range of reasons that you'll be hard pushed to disprove. As a small company, you either play the game or you have nothing to sell.

I experienced it when I sold mobile phones way below RRP/SRP, and a distributor being told it couldn't supply me. I even attended a training event for one company where they told us all the room quite brazenly that we were not to discount, or we'd suddenly find everything we wanted to sell became out of stock.

Unfortunately for them, I was recording the conversation and wrote a story in a trade paper soon after, whereby they changed their policy after threats of legal action. And action was taken against other firms, some of whom paid heavy fines and had to issue statements to the trade that they were free to sell below the SUGGESTED retail price.

There's price fixing all over the place. It's easy to tell when you can't go online and find stock cheap, bar a few pounds here and there, or when the manufacturer itself does a discount/promotion. Apple does do promotions, as well as the reconditioned kit, but try finding an iPhone half price even after it's been on sale for 10 months.

Isn't that the whole point of a cartel - to fix prices?

From your story, does that mean that any company producing a product is legally obligated to supply that product to anyone? That doesn't sound right. Surely a company is within its rights to supply its product to whoever it likes.

If I produce a great new hot dog, and agree to supply it exclusively to Odeon cinemas, could Cineworld take legal action?

[Tallywacker]

Quote:

Originally Posted by Anika Hanson

Most phones you can get subsidised on contract anyway so you don't have to pay the retail price.

Got any proof? If you look at a deal which includes the phone and a call package, then one for the call package only (i.e. Sim only), the difference between the two over the term (24 months) is more than the cost of the phone. Hence, just buy the phone outright at the start.

[Anika Hanson]

Quote:

Originally Posted by Tallywacker

Got any proof? If you look at a deal which includes the phone and a call package, then one for the call package only (i.e. Sim only), the difference between the two over the term (24 months) is more than the cost of the phone. Hence, just buy the phone outright at the start.

Of course you pay the full price over the cost of the contract but I meant that you didn't have to sump up for the full price at the start. I do agree that it's better to buy the phone sim free and not be tied to a contract.

[jonmorris]

Quote:

Originally Posted by calico_pie

From your story, does that mean that any company producing a product is legally obligated to supply that product to anyone? That doesn't sound right. Surely a company is within its rights to supply its product to whoever it likes.

If I produce a great new hot dog, and agree to supply it exclusively to Odeon cinemas, could Cineworld take legal action?

Exclusivity contracts are irrelevant here. If Apple only wanted to sell via certain people, that's fine. But what if one of those companies decided to discount? Would they be allowed, or find that suddenly they're cut off?

There are laws to protect businesses. Not quite the same as consumer law, but still aiming to stop this practice. But companies are usually one step ahead (just look at the recent press around the Panama Papers!).

[calico_pie]

Quote:

Originally Posted by jonmorris

Exclusivity contracts are irrelevant here. If Apple only wanted to sell via certain people, that's fine. But what if one of those companies decided to discount? Would they be allowed, or find that suddenly they're cut off?

There are laws to protect businesses. Not quite the same as consumer law, but still aiming to stop this practice. But companies are usually one step ahead (just look at the recent press around the Panama Papers!).

Before anyone jump down my throat, this isn't about Apple - its a genuine interest in how this stuff works.

For example, it seems a fine line to me. If, say, I make my hotdogs, and I value them at X.

I supply them to Cineworld and Odeon, on the understanding that they are valued at X.

But then Cineworld start selling them at Y, as a loss leader, and I feel that as this is an artificially low price for my excellent hot dogs, which undermines the value proposition of my brand, am I not within my rights to stop supplying them to Cineworld, and agreeing an exclusivity deal with Odeon?

Basically, if a company is free to sell via certain people, why can't the price those people wish to sell the product for be a valid factor in the decision?

[jonmorris]

https://en.wikipedia.org/wiki/Resale_price_maintenance might give some insight.

I believe books are one area where price fixing is actually legal, and there have been test cases from manufacturers that have been able to stop a company selling goods they sourced outside of that market (e.g. importing goods, genuine I should add, from Asia to sell in Europe).

As you can imagine, it's very hard to police. It's even harder when companies aren't going to risk being unable to sell a product by not 'playing the game' which is why most premium brands can control prices very effectively.

The upside is that it DOES protect resale prices, so not everyone is against it.

[calico_pie]

Quote:

Originally Posted by jonmorris

https://en.wikipedia.org/wiki/Resale_price_maintenance might give some insight.

I believe books are one area where price fixing is actually legal, and there have been test cases from manufacturers that have been able to stop a company selling goods they sourced outside of that market (e.g. importing goods, genuine I should add, from Asia to sell in Europe).

As you can imagine, it's very hard to police. It's even harder when companies aren't going to risk being unable to sell a product by not 'playing the game' which is why most premium brands can control prices very effectively.

The upside is that it DOES protect resale prices, so not everyone is against it.

That's what I was getting at I suppose - a company surely has the right to protect what it sees as a fair retail price for its product.

The section on price fixing sounded more like I mentioned earlier, Ie two or more companies agreeing to keep the same price. I don't really see a company not supplying a product to a retailer it feels won't protect its retail price in quite the same way.