Tonight, I was fortunate enough to attend ‘Restrictions on parallel imports: to remove or not to remove?’, which was chaired by Dr Mark Davis at ACMI for MWF. Below is a summary of what was brought up during the debate surrounding the Productivity Commission’s report.
According to Professor Allan Fels, ex-chairman of the ACCC, the average price of books in Australia was substantially higher than overseas editions. The introduction of parallel importation in the music industry did reduce the price of CDs significantly, and similar reforms in the publishing industry should produce similar benefits for the consumer. He conceded that there would be some impact on Australian writers, but this would not be significant as there was currently a strong demand for good, Australian writing. To minimise impact on emerging Australian writers, he was in favour of direct assistance (i.e. grants), an idea that attracted grumblings from other panellists and the audience.
Industry blogger Peter Donoughue was also in favour of parallel importation. He was sceptical in regards to a guaranteed price drop, since price depended on currency volatility and freight costs, but he did believe that parallel importation would force major Australian publishers to become more responsive to the market. ‘The publishing industry should not fear change, but be wary of change.’ He then used the analogy of an apartment block (the Australian publishing market) and an untidy fence (current parallel import restrictions). Removal of the fence did not destroy one’s rights to the property.
Representatives from the publishing industry, however, spoke heatedly against parallel importation. Penguin’s Gabrielle Conye did not believe that prices of books would go down, citing Hong Kong as an example where booksellers were not passing on savings to consumers, while Hardie Grant’s Sandy Grant explained that parallel importation would disadvantage Australian publishers. The US and UK weren’t going to open their markets; Australian publishers could not export cheaper books to such countries; why should Australia open its market?
Grant also spoke of ‘cultural damage’. If Australian publishing became less profitable, then Australian publishers would be less likely to take risks with new Australian writers. In regards to Professor Fels’s suggestion of direct assistance, he wanted to know why subsidies were necessary when a robust industry already existed.
Dr Mark Davis then introduced music industry representative David Vodicka who explained how the Australian music industry had been affected by parallel importation. Though prices of CDs have dropped over the years, Vodicka believed that this was due to the internet and not industry reform. He warned that emerging artists and smaller labels had difficulty accessing the market, that stores cared little for ‘cultural diversity’, and that government subsidies were often unreliable.
Towards the end of the debate Professor Fels reassured everyone that parallel importation would have little direct impact on Australian writers. Very few Australian writers were printed overseas. It was unlikely that an imported, cheaper edition would compete with local editions.
Nevertheless, with profits shifting from the publishers to booksellers, I cannot help but worry. After all, it was the after-effects of the comet’s impact, and not the comet itself, that wiped out the dinosaurs.
For more on parallel importation, read the Productivity Commission’s report on the internet, the Australian Society of Authors’ response. Hate the PC already? Sign the petition against the PC’s recommendations at savingaussiebooks.wordpress.com.