1. Why is the iPod Touch so much more expensive in the UK (than in the US)? By James Martin An iPod touch First Generation owner

2. Manufacturing costs Reports and studies show that the likely cost of an 8gb iPod touch to apple is: $149.18, with an added cost of $5.86 for testing, manufacturing etc. (all statistics for an 8gb, first gen iPod touch at launch). This means that there is a total cost of $155.04. At retail, this device hit the market at $299, which is 92.9% higher. http://www.eetimes.com/showArticle.jhtml;jsessionid=F3BA Z4V1I23GMQSNDLPSKHSCJUNN2JVN?articleID=205100697 http://answers.yahoo.com/question/index?qid=2008081120 2838AAvgVGR

3. The UK pays more… So when the 8gb iPod touch launched in the US for the first time, it was priced at $299, which equates to roughly £171 (at the time of writing). However, when the device was launched in the UK, it was priced at £200 – which equates to around $348. That’s an increase of $49 for the same product, just because it’s being sold in the UK instead. Increase of 14.1% http://www.apple.com/ http://www.apple.com/uk

4. Europe and the Environment The European union is well known for putting lots of legislation on things. The original iPod shuffle was banned from sale in Europe, because it contained ‘hazardous materials’, which I believe from my research to have been the plastic. Apple now make sure that their products contain no hazardous materials, so that they may be sold anywhere.

5. What do they do? Apple make sure that they have no mercury in the iPods display – mercury, although once in the glass is not that harmful, during manufacture and disposal, it can be harmful to wildlife. They also have no arsenic in the glass, or PVC anywhere.

6. So how is this bad? You may be wondering why this is a bad thing – how, that a company that seems to care so much for the environment could be seen negatively. It’s not a bad thing, but it does have adverse problems. It costs more – an ambitious program like this means that manufacturing costs, R&D costs, and all sorts of other costs will have to go up. And remember, much of this stems from the legislation that EU puts in place, so that companies will not sell products that damage the environment.

7. More European Legislature Not only are the EU strict on what can be put into devices, they also quite strict on their power usage, which in their view can also damage the environment. The legislation named The European Union Code of Conduct on Efficiency for External Power Supplies (2000)± told companies that they have to make their power supplies be more efficient when they’re on stand-by (their precise words are ‘reduce no-load losses’), and as quoted on Apple’s website they’re dedicated to ‘meeting or exceeding’* this standard, which will increase the cost of manufacture, as well as testing. http://www.apple.com/uk/environment/energyefficiency/ http://images.apple.com/environment/resources/pdf/iPod -touch-Environmental-Report.pdf * http://www.apple.com/uk/environment/energyefficiency/ ± http://sunbird.jrc.it/energyefficiency/pdf/consumer_electronics_communication.pdf

8. Recycling Apple are committed to recycling. They offer recycling services (particularly for iPod’s) at most of their stores. Recycling can be a very expensive task, and with something complex such as an iPod, where the electrical components will have to be separated and melted down, the process can be much more expensive, adding onto the price in general. Whilst this should add evenly to the cost in America and Europe, I would postulate that shipments of recyclables are sent from here to America first, meaning that we effectively have to pay extra for transport. Product take-back and recycling In 2006, Apple recycled approximately 6,000 tons of e-waste, the equivalent of 9.5% of the weight of all products sold seven years earlier. We expect this percentage to grow to 13% in 2007 and to 20% in 2008. By 2010, we forecast recycling 8,600 tons of e-waste per year — nearly 30% of the product weight we sold seven years earlier. http://www.apple.com/uk/environment/recycling/ Percentage of products sold in 2000

9. Taxes Tax cannot be ignored when taking into consideration things such as prices across countries. In the UK, we include VAT (a standard, fixed rate of (currently) 17.5% of the products value added onto its price) onto the price of the product, which means that on paper it will appear more expensive, however in the US they add tax after the purchase, and therefore whilst there will still be a difference, it’s almost negligible.

10. Conclusion The iPod touch would likely cost less, were it not for legislation placed on Apple by the EU, to make sure that their products and their manufacture have as little effect on the environment as possible. They have to do things, such as constantly redevelop their power supplies, so that they use less power when they’re on standby, which costs more money in research and development. Also, as a company they will feel pressured into starting things such as recycling programmes, which in turn will add more to the cost of the end product.

11. Conclusion (2) The UK will have to pay more, since we’re taxed differently, however that’s not the chief reason, I believe. The products are made in China, and are shipped to America. Through various agreements, the cost of shipping here will be more or less negligible, however there is extra shipping involved in transporting the goods to the UK, which will add more onto our price (why should the Americans pay more for us to get things?). Also, the EU puts so much legislation on companies now, so that they have to spend more if they want to sell their products over here – that puts the cost of research and development up, and therefore our end price as consumers.

12. Sources http://www.ifoapplestore.com/stores/exchange_rates.html http://answers.yahoo.com/question/index?qid=200808112 02838AAvgVGR http://answers.yahoo.com/question/index?qid=200808112 02838AAvgVGR http://www.eetimes.com/showArticle.jhtml;jsessionid=F3B AZ4V1I23GMQSNDLPSKHSCJUNN2JVN?articleID=20510069 7 http://www.eetimes.com/showArticle.jhtml;jsessionid=F3B AZ4V1I23GMQSNDLPSKHSCJUNN2JVN?articleID=20510069 7 http://images.apple.com/environment/resources/pdf/iPod- touch-Environmental-Report.pdf http://images.apple.com/environment/resources/pdf/iPod- touch-Environmental-Report.pdf http://www.apple.com/uk/environment/recycling/ http://www.apple.com/uk/environment/energyefficiency/ http://sunbird.jrc.it/energyefficiency/pdf/consumer_electr onics_communication.pdf http://sunbird.jrc.it/energyefficiency/pdf/consumer_electr onics_communication.pdf