Why are costs for ISBN less in Australia, until you order 1,000?

Question

As I was looking up the Bowker website for when I go to buy ISBNs I found it has separate URLs for The US and for Australia (which is good because I'm Australian). but the prices seem....strange

No. of ISBNs | US Cost | USD -> AUSD | Aus Cost
-------------------------------------------------
1            | $125    | $165.45     | $44
10           | $290    | $383.85     | $88
100          | $575    | $761.09     | $480
1000         | $1500   | $1985.44    | $3000

_{USD -> AUD calculated using xe.com 24/04/2017}

Up to 100 ISBNs it's cheaper for an Australian to buy from the.au site but when it's 1,000 it's actually more expensive to buy from the.au site than it is to buy from the US Site after currency conversion (this assumes the prices on the.au site are in AUD but if they aren't and are actually in USD then it's even more expensive).

But why is this? If it was in some odd way more expensive to deal with ISBNs brought by Australians then why aren't they more expensive across the broad? What stops an Australian buying 1000 ISBNs from the US Site and saving almost $1,000?

Also is the explanation for the price discrepancy between US and Aus prices for 1000 ISBNs the same for why in the US 10 -> 100 is less than 2x (~1.9827586206896551724137931034483) the price while in Australia it's almost 5.5x (~5.4545454545454545454545454545455) more?

Answer 1

(1) One word: monopoly.

(2) See above.

(3) Oh, all right, details:

The previous answer (involving math) is substantially correct, in a competitive environment. The producer factors in the costs of production, distribution, and service, along with a profit target. Competitors ensure that the values are reasonable. If a particular supplier cannot make a profit, then that supplier will exit the line of business.

The price to the customer can be broken down to a setup fee (possibly high) and a per-unit cost once setup is completed (in this case, very low). So, it could be possible to say, "$250 to sign up, then $0.10 per unit." Or, the same amount of money exchanges, with "$350 for the first 1000 units, then $100 for the next 1000 units."

The US supplier has chosen the second approach, by incorporating the setup fee into the cost of units sold. Apparently the AU supplier does not entirely incorporate the setup cost into the early units.

However, the linear equations approach is only valid in the case of competition. In the case of a monopoly, which is what we have here, the price is not necessarily calculated that way. Certainly it is calculated to cover costs and allow for profit. But unless there is some prevailing law or regulation against it, the supplier may choose a pricing strategy intended to reward some and penalize others. There is no market correction.

It seems that small do-it-yourself types assume that they are being penalized. That may be true, or not, since I don't know the cost factors.

Answer 2

In the modern era there no is formula by which corporations calculate a market price based on cost. Product prices are primarily based on "What is the maximum the market will stand?"

Gas prices will typically be more expensive at the 'last gas station for 50 miles' than where there are four gas stations on the same city block.

Capitalism fails with scale. The US has the most advanced capitalist system and it is there you can find the most evidence of its inherent corruption: (Why's US Healthcare amongst the world's most expensive?). Companies like Bowker are bullied by the big 4 publishers and Amazon. Bowker will set their prices according to Amazon and co's demands else (in an extreme scenario) Bowker will find themselves bought out . . . and there will be no more Bowker.

Globalism is a game of strategy. Companies like Bowker are permitted to make profit in certain markets at certain times. Import and Export levies prevent true global competition (Why can't you buy prescription drugs from Canada).

The ISBN system is particularly prone to corruption as the system is a national monopoly. Bowker are the authorised suppliers for the US and Australia but when those contracts are renewed those contracts could be awarded to Neilson if Bowker are not doing as they're told.

In summary: there are several factors as to why any particular pricing schedule is calculated that way at that time; politics, market forces, personal whims. It's not something you can work out on a spreadsheet.

Answer 3

You can't usually save money by shopping around for ISBNs from different countries, which is a shame because in some countries they're free. For example, both Canada and Sweden have free ISBNs, provided through Library and Archives Canada and National Library of Sweden respectively. In both cases you have to have a publication address in the respective country to qualify for an ISBN.

It would be interesting to know how much it costs the Swedish and Canadian governments to provide their publishers with ISBNs, and how much profit companies like Bowker in the US and Nielsen in the UK make from providing the same service.

Answer 4

I'm not sure about your second question, but I can answer your first.

This involves some linear equations. Many companies use it to determine the cost of their products, and this is no different for ISBNs. Think of the equation y=mx, where, in this instance -

-y = the cost

-m = the increase in cost compared with increase in no. of ISBNs

-x = the no. of ISBNs

(note for fans of linear graphs: c is not applied as it would equal 0)

m is known as the gradient - how steep or gradual the slope of the equation is. If m is different in the equations for Australian cost and American cost, then one will be cheaper than the other until you order a certain number of ISBNs, where the lines meet and the one that was cheaper will become more expensive. Currency conversion has little to do with it. If you still don't understand, search linear models on Google or your preferred search site.