Posts Tagged ‘ACCC’

Where there’s smoke…

Posted: April 25, 2010 in Uncategorized
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The Australian government has just announced the intention to introduce new legislation that will require oil companies to no longer share price information.

This raises an important issue. It is hard to imagine government introducing something like that unless it had evidence that the oil companies were indeed sharing price information. So it is a pretty fair assumption that the oil companies have indeed been sharing price information.

Why would oil companies, all competitors with each other, be sharing price information? The is only one plausible explanation – that they are sharing price information in order to collectively set prices? No other possible explanation would make the slightest sense.

Now if the oil companies are sharing information to collectively set prices, that is considered anti-competitive behaviour.

There is a little organisation called the Australian Competition and Consumer Commission. Their entire reason for being is to enforce matters such as the Trade Practices Act. Their remit involves taking action against anti-competitive behaviour. Yet the ACCC has for years allegedly been unable to find any evidence of such behaviour by the oil companies. But it now appears to have been something of an open ‘secret’ with enough evidence existing to warrant passing of legislation to stamp out the practice.

Just exactly why was the ACCC unable to find the same evidence? Former head of the ACCC, Prof Alan Fels, the man behind the push to remove Parallel Import Restrictions on books, who declared those who opposed the move to be ill-informed and ignorant, was apparently unable to find evidence that was clear enough for others to find.

I have said it before in this blog – just exactly who was the ignorant one, Prof?

The oil companies have been blatantly manipulating prices to suit themselves and engage in price gouging at the expense of the consumer for who knows how long. And the regulator was proven to be completely and utterly useless in combating that situation.

Pathetic. Simply pathetic.

Telstra? ‘3’? It appears I spoke too soon!

Posted: April 14, 2010 in Uncategorized
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First, the latest Telstra developments.

After all of my problems trying to get assistance, now that I have finally been refunded for the dud product, all of a sudden Telstra staff are falling over themselves trying to do things for me. First there was an email, suddenly expressing concern that I have had complaints about their service. Then a whole new Customer Service person is calling me, having assigned an entirely new Complaint Resolution case. Naturally when I called back they were not available and I did not receive a return call in response to my message. Situation normal. But they wait until after I have been refunded for their dud product and after I had confirmed receipt of the refund before suddenly wanting to assist? WTF??

I also heard from 3 today by email. First there was a blurb apologising for the distress I experienced. Then, in response to my quite specific complaint about 3 continuing to sell a product while assuring customers that they will receive service on their network when in fact the network is not broadcasting in that location at all and they have known this for weeks but kept on making bullshit promises to the contrary, 3 have entirely ducked the matter. Instead, I am told that due to privacy restrictions, they may not discuss any aspect of the matter.

What a load of absolute, prime-grade bullshit. The Information Privacy Principles that form the core of the Australian Privacy Act, 1988, specify what personal information about individuals may not be revealed. For 3 to hide this entire matter under a veil of secrecy, claiming ‘privacy’ restrictions, is absolutely pathetic. Just as well that I have already reported them to the Australian Competition and Consumer Commission. I have now reported this latest stunt to them as well.

How can anybody ever trust organisations who are quite prepared to pull stunts like that?

Last Wednesday, Prof Alan Fels stated in the wake of the government refusing to enact the recommendations by Fels to lift Parallel Import Restrictions, that the public had the government to blame for more expensive books. Now he has changed his story.

In a very public display of what can only be described as pique, Fels has claimed that the government has bowed to the opinions of a small number of ignorant and uneducated authors.

Who the hell does Fels think he is? I am a published author in my own small way. I joined the campaign against lifting PIRs. I am an accountant and economic statistician by qualification and experience as well as holding post-graduate professional writing studies. I take considerable offence at this clown calling me either ignorant or uneducated. This coming Thursday I shall be interviewing a highly successful author who holds three separate degrees as well as a Doctorate in Human Letters. My, we authors really are an uneducated lot, aren’t we!

This is the same Prof Fels who for years while heading the ACCC, continually claimed that there was no evidence of any wrong-doing by oil companies. Meanwhile, we ignorant, uneducated slobs, did the practical thing of watching the pump prices. Whereas any reduction in the price of crude (ah – the joys of petrol pricing parity, gifted to the nation by then-Treasurer John Howard in the late 1970s – whatever happened to him by the way?) took a week or so to ‘filter’ through to the pump price, yet the moment there was an increase in the price of crude, it immediately hit the pumps. That happened across the board, regardless of company or location. But that was apparently too bleedin‘ obvious for the good Prof to notice.

Prof Fels has made quite a deal of noise about the price reductions he claims would have resulted from lifting PIRs, by comparing the price of a book available in say the USA with the same available here in Australia. The coalition of major book retailers, lead by Dymocks, who have been staunch supporters of Fels in this matter, have stated that the reduction that may have resulted could have been as much as 12%. However the price differentials that Fels likes to show off were far greater than a potential maximum of 12%. So even his supporters, who have publicly vowed to ‘continue the fight’, cannot agree with him on what the savings might be.

Incidentally, the good Prof with his apparently superior education, appears to have missed out entirely on the basic economic premise of ceterus paribus, loosely translated as ‘all things being equal.’ Simple comparison of market prices between significantly different economies breaches that economic fundamental. But perhaps he slept in that morning at uni.

I keep harping on the point of taxation in other posts. In all the hoopla, why is it that Fels and Dymocks et al, continue to ignore the simple fact that most of that potential 12% saving could be achieved in one fell swoop (pun intended) by removing taxation on books? I seem to remember the then-Labour Opposition joining with the Australian Democrats in opposing introduction of GST on books, prior to the Democrats leader, Meg Lees, blatantly rolling over for John Howard in the Senate.

We already have a taxation infrastructure for managing exemption of certain ‘supplies’. It would not be a big deal to extend those to cover exemption of books. But Fels, in his apparent wisdom as a product of his superior education, pushes instead for a scheme that would require creation of new, expensive infrastructure, not to mention the imposition on the tax-paying public of the proposed government grants to compensate authors for the loss of income that Fels admits would result.

On this subject of author income, please do realise that we aren’t all J. K. Rowling, getting mega-bucks. Studies have shown that writers as a whole are very poorly paid. We are not in general a pack of greedy oiks, complaining because we can’t upgrade the Rolls this year or have to put off installing that helipad.

Throughout this saga, Fels and Dymocks et al have continually claimed that the object of the exercise was to realise cheaper book prices, yet the simple measure of removing taxation is ignored in favour of a set-up that would have the long-term impact of a wrecking ball smashed into the Australian publishing industry, under the guise of having market forces driving price reductions.

Another significant point consistently overlooked by Fels and co is that the likes of the USA and the UK flatly refuse to have anything to do with lifting their own equivalents of PIRs. Yet those are the economies that stand to benefit by dumping onto the Australian market. That product would not necessarily even be the same as that published here. Take the example of the author Michael Robotham. He is a major seller in both the UK and the USA. However on at least one occasion, the US publisher made him rewrite part of a novel, removing part of the text, because it was too ‘sophisticated’ for the US market. Robotham has told me that the box of freebies of that US edition that he was given, remains unopened because as far as he is concerned, that is not the real novel that was published elsewhere, including Australia. Guess what edition would be dumped onto our markets in the wake of lifting of PIRs.

Significantly, the major publishing chains have not supported the Fels proposals. These are multi-nationals who could have benefited by dumping excess production that through sheer economies of scale (see Prof – we’re not all as ignorant as you claim and understand something of economics) can be produced cheaper there but they could see the long-term view. Driving margins down yet further, simply means there is less money available for publishers to bring on new authors. We aren’t all magically like Stephen King, Jack Higgins, Bryce Courtenay or Tim Winton. In fact, at the start of their publishing careers none of them were the accomplished authors that they now are. It is already becoming harder and harder for new novelists to get into the mainstream. The Fels proposals would have pretty much screwed an entire generation of new Australian authors.

Exactly who is demonstrating their ignorance here? Not to mention chronic short-sightedness. And who stood to really benefit? The multinationals and a small number of major book retailers trying to further tighten their control of the market while pretending to be in the pursuit of some altruistic ideal.

In all of this fuss, I am reminded of the late Nigel Hawthorne in his wonderful portrayal of the English civil servant, Sir Humphrey Appleby. Sir Humphrey described the behaviour of politicians thus: “we must do something; this is something therefore we must do it.”

Perhaps the good prof should consider a career in UK politics rather than acting like a petulant schoolboy, with voluble complaints when the ref has called him for a foul on the footy field. Of course he could always just take his ball and go home.