7 ms·

Even for cloud-based services like dropbox, the cost of doing business in all countries is not the same. There are different laws/regulations to deal with, cos

by brk 12y ago

Even for cloud-based services like dropbox, the cost of doing business in all countries is not the same. There are different laws/regulations to deal with, costs for having foreign-language support people, costs for internationalizing parts of the UI/etc. Personally, I think it's kind of odd to expect that something will cost the exact same amount anywhere in the world. It might be that the added cost for dropbox to do business in Europe just happens to be very close to the exchange rate, so they just change the currency symbol and call it "close enough". There are plenty of things that are more expensive in the US than they are in Europe.

chton 12y ago
The problem isn't just paying more. I'm aware of how tax-heavy europe is, and how much harder it is to support the wide variety of languages and laws. In most cases, I would be fine paying a bit more for a service. The problem is the way the mark-up happens. They're not calculating the difference and marking that up, they're literally just equating US dollars with euros. $99 and €99 might sound similar, but the difference is over 30%. There is no way the additional support costs run that high, so it comes across as just an attempt to pull a fast one on europeans. I'm sure if they did a proper calculation and gave a realistic number, nobody would complain about the increased cost.
- lucaspiller 12y ago
  Netflix and Spotify are the same. Spotify is £9.99 here in the UK, €9.99 in most of Western Europe and $9.99 in the US. Admittedly they have to deal with record labels so it's a bit different, but it's not really an excuse. Strangely Dropbox here is showing the price as $9.99.
  - mciancia 12y ago
    In Poland Spotify costs ~20zł which is just a little bit under 7$. So not always it's so bad
- sugerman 12y ago
  Who is to say they didn't do a "proper calculation" and result in something close enough to €99 that they just rounded up/down to keep things consistent?
  - nraynaud 12y ago
    India as 37 languages and a mess of a country, I guess they are selling their product for 150% of the American price there?
    - arjunnarayan 12y ago
      But many products are sold in India in English only. This is manifestly not the case in Europe.
      - nraynaud 12y ago
        I'm perfectly ok to have an English only product with a 30% discount, but I can't find the option. (That said, looking at the streets in Seattle, I'm not trading my 20% VAT for potholes, crumbling sidewalks and aerial electric wires in a storm prone region, thanks)
  - chton 12y ago
    That's ofcourse possible, but there are many many services that pull this trick, and I would be surprised if dropbox was the only one that did the honorable thing here. And even if that's what they're doing, they should realize it gives a very bad impression and maybe round up/down to a different price. Literally anything else would be better.
- wodenokoto 12y ago
  No way? Sales tax in Denmark alone is 25% and then we haven't even begun talking about additional cost of running your business here.
  - chton 12y ago
    those are valid points, but then why don't they calculate the price they should be asking and ask that? As it stands, they don't give the impression that they do that, they seem to try to screw us over. Hell, if they had gone for €97 instead of €99, a lot less people would be complaining, because it wouldn't look like an arbitrary price hike but a calculated price.
nraynaud 12y ago
Products are not priced by cost. They are priced at the highest point the market will tolerate. Moreover, a European employee is generally way cheaper than an American one, the corporate tax is often cheaper, if they were really driven by costs, they would simply have relocated (at least outside of Silicon Valley). The simple fact of operating from California means they don't care about operating costs.
- acdha 12y ago
  > Products are not priced by cost. They are priced at the highest point the market will tolerate. This is a very simplistic view: product pricing also takes into account things like psychological thresholds (e.g. why it's 9.99/month rather than 10) and the likelihood of a competitor entering the space if your profit margins are too high. Amazon is famous for keeping low margins because they're willing to trade the short-term profits in exchange for making it harder for someone else to enter the space which would hurt their profits long term. > The simple fact of operating from California means they don't care about operating costs. Again, simplistic analysis: a business like Dropbox doesn't need to scale their employment at the same rate as they add customers so individual costs matter less than, say, a fast-food restaurant because each employee's work benefits as many customers as you can convince to signup. If you're making a profit on someone's labor their salary isn't as significant as, say, the opportunity-cost of not being able to hire someone at all or hiring the wrong person because most of the top people have been lured elsewhere. Being in business means weighing all of those factors not just looking at a single number and trying to lower it.
  - nraynaud 12y ago
    Adding 30% to the price and selling the thing to 27 countries all having a different tax policy in the name of "languages" (wait, I thought salaries were not at issue) or "taxes" (wait, vat is different in every country, and nowhere it is 30%), do you think it's worth anything more than simplistic analysis? Do you think anything more than simplistic thinking leads to changing the dollar sign to the euro sign?
    - 12y ago

by brk 12y ago

chton 12y ago

The problem isn't just paying more. I'm aware of how tax-heavy europe is, and how much harder it is to support the wide variety of languages and laws. In most cases, I would be fine paying a bit more for a service. The problem is the way the mark-up happens. They're not calculating the difference and marking that up, they're literally just equating US dollars with euros. $99 and €99 might sound similar, but the difference is over 30%. There is no way the additional support costs run that high, so it comes across as just an attempt to pull a fast one on europeans. I'm sure if they did a proper calculation and gave a realistic number, nobody would complain about the increased cost.

lucaspiller 12y ago
Netflix and Spotify are the same. Spotify is £9.99 here in the UK, €9.99 in most of Western Europe and $9.99 in the US. Admittedly they have to deal with record labels so it's a bit different, but it's not really an excuse. Strangely Dropbox here is showing the price as $9.99.
- mciancia 12y ago
  In Poland Spotify costs ~20zł which is just a little bit under 7$. So not always it's so bad
sugerman 12y ago
Who is to say they didn't do a "proper calculation" and result in something close enough to €99 that they just rounded up/down to keep things consistent?
- nraynaud 12y ago
  India as 37 languages and a mess of a country, I guess they are selling their product for 150% of the American price there?
  - arjunnarayan 12y ago
    But many products are sold in India in English only. This is manifestly not the case in Europe.
    - nraynaud 12y ago
      I'm perfectly ok to have an English only product with a 30% discount, but I can't find the option. (That said, looking at the streets in Seattle, I'm not trading my 20% VAT for potholes, crumbling sidewalks and aerial electric wires in a storm prone region, thanks)
- chton 12y ago
  That's ofcourse possible, but there are many many services that pull this trick, and I would be surprised if dropbox was the only one that did the honorable thing here. And even if that's what they're doing, they should realize it gives a very bad impression and maybe round up/down to a different price. Literally anything else would be better.
wodenokoto 12y ago
No way? Sales tax in Denmark alone is 25% and then we haven't even begun talking about additional cost of running your business here.
- chton 12y ago
  those are valid points, but then why don't they calculate the price they should be asking and ask that? As it stands, they don't give the impression that they do that, they seem to try to screw us over. Hell, if they had gone for €97 instead of €99, a lot less people would be complaining, because it wouldn't look like an arbitrary price hike but a calculated price.

nraynaud 12y ago

Products are not priced by cost. They are priced at the highest point the market will tolerate. Moreover, a European employee is generally way cheaper than an American one, the corporate tax is often cheaper, if they were really driven by costs, they would simply have relocated (at least outside of Silicon Valley). The simple fact of operating from California means they don't care about operating costs.

acdha 12y ago
> Products are not priced by cost. They are priced at the highest point the market will tolerate. This is a very simplistic view: product pricing also takes into account things like psychological thresholds (e.g. why it's 9.99/month rather than 10) and the likelihood of a competitor entering the space if your profit margins are too high. Amazon is famous for keeping low margins because they're willing to trade the short-term profits in exchange for making it harder for someone else to enter the space which would hurt their profits long term. > The simple fact of operating from California means they don't care about operating costs. Again, simplistic analysis: a business like Dropbox doesn't need to scale their employment at the same rate as they add customers so individual costs matter less than, say, a fast-food restaurant because each employee's work benefits as many customers as you can convince to signup. If you're making a profit on someone's labor their salary isn't as significant as, say, the opportunity-cost of not being able to hire someone at all or hiring the wrong person because most of the top people have been lured elsewhere. Being in business means weighing all of those factors not just looking at a single number and trying to lower it.
- nraynaud 12y ago
  Adding 30% to the price and selling the thing to 27 countries all having a different tax policy in the name of "languages" (wait, I thought salaries were not at issue) or "taxes" (wait, vat is different in every country, and nowhere it is 30%), do you think it's worth anything more than simplistic analysis? Do you think anything more than simplistic thinking leads to changing the dollar sign to the euro sign?
  - 12y ago