
Apple’s UK App Store prices will rise 25% following Brexit currency fluctuations - rloc
http://www.theverge.com/2017/1/17/14293940/uk-app-store-price-increase-brexit
======
csours
Globalization generally makes things cheaper and easier for consumers, but
will also reduce employment in certain areas.

Restoring that employment is a separate track than reducing globalization -
that is to say: you can de-globalize and exit whatever trade treaties you
like, but those jobs you lost to globalization will not magically come back.

Citizens have been sold a bill of goods in both directions when experts and
politicians under-report the side effects and exaggerate the benefits.

~~~
HeavenBanned
So then how do you stop the bleeding in the form of lost jobs to near slave-
wage labor?

~~~
csours
That is a very good question, and one that I wish more people would ask and
consider the implications.

I don't know the answer to that question; I think most economists would tell
you that you cannot and you should not try.

Many people talk about "job creation", but a lot of what we hear about job
creation is political mumbo jumbo tax reduction bullshit.

Here are a few things that may help job creation from a political or
government point of view:

1\. Municipalities, State, and the Federal government should rationalize their
requirements for starting and running a business. The US is already much
better about this than other countries, but reducing bureaucratic friction is
always good. This doesn't mean less government, it means smarter government.

2\. One quick hit job creator is government infrastructure spending. The US
did this after 2008, and so far it's turned out pretty well!

3\. In the future there may be fewer jobs. Society needs to start seriously
considering localized post-scarcity economies.

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tveita
"While critics might note that Apple’s price increase is greater than the
pound’s loss in value, financial analysts predict that the market still hasn’t
fully priced in the cost of Brexit — that is to say the pound still has
further to fall."

So what mechanisms keep the price from instantly dropping if "everyone" agrees
it should be lower? Market inefficiencies? Or lots of money betting on an
upswing?

~~~
easytiger
> "While critics might note that Apple’s price increase is greater than the
> pound’s loss in value, financial analysts predict that the market still
> hasn’t fully priced in the cost of Brexit — that is to say the pound still
> has further to fall."

Someone should probably tell the worlds biggest futures exchange that their
forward rate for GBPUSD is wrong then:

[http://www.cmegroup.com/trading/fx/g10/british-
pound.html](http://www.cmegroup.com/trading/fx/g10/british-pound.html)

Methinks someone is talking nonsense

> o what mechanisms keep the price from instantly dropping if "everyone"
> agrees it should be lower?

It would drop. It hasn't, because that is not what the "experts" consensus is

~~~
tomarr
Not necessarily - the market has priced in multiple future outcomes according
to their probability, each which see a massively different valuation of pound
sterling. Article 50/hard Brexit/etc. is now very likely (lower pound sterling
value), but there’s still the potential of a late change to this approach or a
parliament refusal of the bill (higher pound sterling value).

~~~
notahacker
And of course it suits Apple to focus on the highest probability event,
particularly since (unlike FX traders) they don't stand to very quickly lose
large amounts of money if low probability but cannot be ruled out _yet_
positive news for the pound happens. The worst case scenario for Apple if the
pound rebounds involves people thinking their UK App Store is a bit overpriced
until they revise prices again.

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dazc
"This latest round of price changes doesn’t just affect the UK (customers in
India and Turkey are also going to see increases).."

OK, '25 percent due to Brexit' is going to get more clicks.

~~~
misnome
Different countries change over time for different reasons, and Apple tends to
change them in bulk.

Are you arguing that the massive drop in the pound _isn 't_ due to Brexit? As
far as I'm aware even the most rabid Farage-fanciers don't argue that, but
argue it's a good thing (Cheaper exports! As though we don't import most of
the raw materials, but that's not as snappy).

~~~
dazc
I was stating the headline was somewhat sensationalist given the statement
from Apple was pretty vague.

Where you get me arguing about the massive drop in the pound I don't know?

~~~
misnome
> Where you get me arguing about the massive drop in the pound I don't know?

Because, Apple has changed it's prices _because_ of the drop in the pound?

The pound dropped _because_ of Brexit.

You said that Brexit _wasn 't_ the cause of the price change.

~~~
dazc
You seem determined to draw me into an argument?

~~~
misnome
No, but any Brexit discussion is always rife with huge denials and lies.

So when one of the first comments on a report of an actual, verifiable
consequence is implying that "This has nothing to do with Brexit and is just
lying about it to get clicks", then I think that shouldn't be allowed to just
stand on it's own?

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ianamartin
This is a great example of when to not use percentages in a headline. Or, you
know, go for it! If you're trying to get clicks.

~~~
hellogoodbyeeee
Could you elaborate? I don't understand what is wrong with the headline being
a fact.

~~~
ianamartin
I will elaborate.

Percentages are not good measures of small quantities. 25 percent of zero is
still zero.

It's not a meaningful number.

If you're dealing with small amounts, use small amounts. This is junk.

~~~
hellogoodbyeeee
The problem is that apps in the app store have a variety of price points from
$1 to $10 and they are all increasing 25%. Would you rather the title of the
article be a table that maps the quantity of increase for each price point?

~~~
ianamartin
Your range is off by 1. Quite a number of apps are actually cost zero dollars.

This is a great use case for a thing called averages.

The correct title for the article would be this:

"Apps to increase in price by almost nothing following . . ."

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weavie
I haven't checked (I don't make enough from it to get excited about it) but
presumably my income from the app store from the rest of the world should also
increase. Does Apple work out my revenue in Dollars and then convert to GBP at
the exchange rate at the time of payment?

~~~
graeme
I imagine they do, if they're like most other multi-currency platforms. If the
license terms are on a percent of revenue basis, they'd more or less have to.

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ronnier
It looks like the GBP has been in decline for years.

Here's the last 10 years:
[http://www.xe.com/currencycharts/?from=GBP&to=USD&view=10Y](http://www.xe.com/currencycharts/?from=GBP&to=USD&view=10Y)

~~~
pmontra
The GBP has been pretty stable against the dollar in normal times. The graph
shows two discontinuities: the 2008 crisis and Brexit.

There was a stable level at 1.95 in 2007-2008, then a drop and a sinusoid
around 1.55 for 8 years, then another drop to lower levels after Brexit. We'll
see where it goes from there.

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quotha
So the pound is soaring higher this morning.. they will have to cut prices!

~~~
TillE
So much higher:
[http://www.xe.com/currencycharts/?from=GBP&to=USD&view=2Y](http://www.xe.com/currencycharts/?from=GBP&to=USD&view=2Y)

~~~
quotha
a 2 year chart!? check the 1 day chart. or ok let's see where it is in another
2 years.

------
rrggrr
Eurozone debt-to-GDP: 92%. This is BEFORE one considers (a) member country
debt, (b) troubled bank liabilities which EU must backstop (eg. Deutchebank),
and (c) immense social, security and defense costs which EU nations must incur
due to recent global events.

By contrast UK debt-to-GDP: 90% and falling, and a US-UK trade deal is likely
very soon.

I'd rather own Sterling.

~~~
andyjohnson0
> and a US-UK trade deal is likely very soon

The earliest that this can happen is 2019, when the UK ceases to be a member
of the EU. And since EU rules prohibit members from negotiating their own
trade agreements, its probably going to be 2020 or later before a deal is
signed.

~~~
gaius
Not true. Article 50 stipulates the maximum negotiating period, not the
minimum. T-May could quite legally declare Article 50, negotiate for a day,
then join NAFTA the day after...

~~~
TillE
There are many many thorny issues to be untangled. It's not as simple as
saying "we're leaving"; Britain's membership in the EU is a complex thing
that's going to take a lot of work to dissolve. The Article 50 negotiations
are about those issues, not a future trade deal.

If you just walk away, you leave a mountain of chaos that would have to be
handled in courts.

~~~
gaius
Sure, but it takes two to tango. The EU can't force the UK to wait two years
because the UK can simply walk away. This is a loophole that the writers of
Art 50 didn't consider.

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EasyTiger_
Will this affect Apple Music subscription? If so then I'm out.

~~~
k-mcgrady
I don't think they can change that without big consequences. A 9.99 price
point is pretty important which is evident given that it costs $9.99 and £9.99
and €9.99.

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hacker_9
I don't like prices increasing as much as anyone, but if this gets people to
stop and think before buying Apple products then I'm all for it. They have
been overcharging for their products for the last 10 years.

~~~
simonh
So you think the way to stop Apple overcharging is for Apple to overcharge
even more? Look, if you just don't want anybody to buy Apple products at all,
irrespective of the price, just say so.

Bear in Mind Apple have been eating the post-Brexit drop in their UK revenues
with no price rises for the last 6 months.

~~~
freehunter
If you firmly believe that people are choosing to go against their best
interests, it's not a far stretch to think that going even further from their
best interests would snap them out of it, make them learn their lesson. It's
winter here right now and I'll admit to seeing my neighbor's sidewalk covered
in snow and ice and thinking "well when someone falls and sues them, they'll
finally learn to clean it".

So if the parent believes that Apple is overcharging but consumers just aren't
seeing it properly, maybe if they overcharge even more, consumers will finally
realize they've been bamboozled the whole time.

