Apple criticised for download costs

Apple computer is facing an inquiry by the Office of Fair Trading after it was criticised for selling music downloads to UK customers at higher prices than in other European countries.

Apple computer is facing an inquiry by the Office of Fair Trading after it was criticised for selling music downloads to UK customers at higher prices than in other European countries.

The investigation follows a letter of complaint from the Consumers' Association pointing out that Apple's iTunes online store sells a digital song for €0.99 (67p) in France and Germany, but 79p in the UK.

The iTunes Music Store, which opened in the UK, France and Germany in June, offers purely digital downloads of almost a million tracks. The content is identical in each country, but people can only buy songs in the online store for the country they are in. In the 10 weeks after the three European online stores launched, users have downloaded five million tracks.

Continental VAT and song licensing fees are actually equal to or higher than UK prices.

Phil Evans, principal quality adviser for the Consumers' Association, said: "We're continually told about the benefits of the internet, about it breaking down borders. That should mean that there's benefit to consumers as well as companies. If you have a product like this that's digital, the argument for having price discrimination melts away."

A spokeswoman for Apple said: "The underlying economic model in each country has an impact on how we price our downloads. That's not unusual - look at the price of CDs in the US against those in the UK. We believe the real comparison should be with the price of other music download sites in the UK."

The European iTunes Music Store is believed to operate from a centre in Luxembourg, serving all three countries.

An OFT spokesman said: "We have been aware of this issue and are closely monitoring it."