In Box

Latin America’s Sour Apple

Argentina is one of the world’s worst places to buy an iPod. But you’d never guess it walking into MacStation, a store in Buenos Aires’s wealthy Recoleta neighborhood. The shop is not owned by Apple, but it mimics the company’s white-box feel, with Plexiglas tables and support staff clad in matching black T-shirts. Any similarity, ...

Argentina is one of the world’s worst places to buy an iPod. But you’d never guess it walking into MacStation, a store in Buenos Aires’s wealthy Recoleta neighborhood. The shop is not owned by Apple, but it mimics the company’s white-box feel, with Plexiglas tables and support staff clad in matching black T-shirts.

Any similarity, however, ends at the cash register. An 80-gigabyte video iPod that sells for $349 in the United States costs about $800 here. A 2-gigabyte iPod Nano fetches $320, not the $149 Apple charges back home. In January, Australia-based Commonwealth Securities released a comparison of the price of a 2-gigabyte iPod Nano in 26 countries. Brazil had the most expensive model, with a price tag of $327.71. "It’s [a] big irony," says Jay Gumbiner, Latin America director for IDC, a market research firm. "The poorest people have to pay more than wealthier people."

High technology prices in South America stem from the tandem effect of protectionist trade policies and corporations’ lack of enthusiasm for the region. A basket of import and value-added taxes alone, for instance, adds 50 percent or more to the cost of technologies imported to Argentina. The problem is exacerbated by Apple and other technology firms, which have shown little interest in the region. Apple, for instance, owns no stores in Latin America. Neither iTunes nor iTunes Latino is accessible on the continent. Apple spokeswoman Christina Caballero blames rights and clearance issues for the company’s low profile. "Apple has a suggested retail price for all of our products," she says. "However, due to issues that are beyond our control, such as import laws, duties, and transport, the local prices change in each country."

But that doesn’t mean Latin customers are out of luck. In a subway station five blocks from MacStation, billboards advertise a 2-gigabyte MP3 player from Philco, a Chinese manufacturer, for $139. And savvy sellers on the Argentine online auction site MercadoLibre.com.ar offer 80-gigabyte iPods — likely purchased in the United States — for $450, closer to the U.S. price. It’s proof that, if Apple won’t serve the Latin market, someone else will.

Trending Now Sponsored Links by Taboola

By Taboola

More from Foreign Policy

By Taboola