Background

It's pretty well known that computer hardware is very much more expensive in Europe than it is in the USA. For example, the cheapest 1GiB PC6400 DIMM from inet.se is 271 SEK. From eWiz.com, it's $21.63.

Let's compare like with like. At today's exchange rate, $21.63 is 138 SEK. Add MOMS (VAT) @25%, that's 172.50. Add 5% forex fee, that's 181 SEK. 271 SEK is still 50% more.

This is not limited to Sweden, nor to memory. I recently priced a basket of hardware (including memory, CPUs, and graphics cards) in Ireland, the UK, Sweden, and the US, and found it to be over 30% cheaper in the US (40% cheaper before VAT), all of the adjustments being made, and it included stuff that simply couldn't be obtained in Europe.

Buying Online

So, it seems simple— just buy online from an online hardware retailer in the US!

Good luck. Most of them don't ship outside the US. Those who do usually only accept payment by wire transfer or, heaven forfend, Western Union who charge you handsomely for the service and then gleefully ass-rape you on the exchange rate. Those who claim to accept international credit-cards often use Verified by VISA (VbV). Is your bank part of the VbV scheme? The bank I've used for 23 years, Ulster Bank doesn't seem to be. Can I do a wire transfer via their online banking service? Nope. So, I have to change bank to buy online from the US.

I recently tried to buy online from geeks.com. Not the cheapest, not the best selection, but better than here. I buy my stuff, pay with my VISA card, sit back and wait for it to arrive.

Next day I get an email that they can't “manually verify my card details”. Why would they want to? My card and delivery address already passed verification, unless they're using a stone-age clearinghouse, or the charge wouldn't have succeeded. Now, my choices: wire-transfer or nothing and, to add insult to injury, they want me to pay them an extra $20 for the privilege of wiring $450 of my hard-earned lolly to them. Thanks but no thanks.

It amazes me that the only US online hardware retailers who seem to have enough brains to accept payment from this customer base of disgruntled Europeans are the ones who charge $200 for a $90 CPU, so the bottomless pit of money from European hardware pricing refugees goes completely untapped by American “entrepreneurs”.

And The Point Is

The point is this. Any way you cut it, I have to go through all this hassle because hardware retails at 30-50% more in Europe than in the US even when typical VAT (17.5 to 25%) is added on to the US price. I don't mind paying the VAT, it's part of what pays for decent education and healthcare, but I do mind being screwed.

And someone in the supply-chain is screwing us. I've heard the arguments: economies of scale, higher labour and insurance costs, etc. Yes, hardware should cost a little more because of these factors, but 50%?

I think not!

Meanwhile...

Meanwhile, the people who should be worried about how this obstructs consumer adoption of technology and competitiveness in Europe sit on their shiny asses doing nothing. It's a legitimate question for the European Commission to ask, so why don't they?

Probably because they're technologically ignorant dinosaurs who might get around to setting up a committee to investigate it in 2012 that will report in 2017, by which time it'll be too late: we'll be left wondering why we went from the Americans eating our lunches to the Chinese eating our lunches without ever having been the lunch eaters ourselves.