Canadians Wonder Why They Have To Pay More For AppleCare

We all know that Canadians have to pay more for books, but why do they have to pay more for AppleCare?

Zachariah, a Canadian, asks:

My Apple iMac is nearing its 1 year anniversary and I am considering getting the Apple Care Protection plan which will give me another 2 years of warranty coverage.

I just got off the phone to someone in Agreement Administration who could not tell me why the price of the Plan here in Canada is $199 but in the US it is $169. The Canadian and US dollars are basically on par with each other. The protection plan is not a product but a service. The rep I talked to told me that he too wondered why there was such a huge price differential as well but said that reps don’t get explanations.

I did some spot checking on pricing differences between different Apple products here and in the US. The prices seem to differ between 8 and 10% but the service agreement is 15%.

I was wondering if you guys could find a rationale for this? Something about this just rubs me the wrong way.

Thanks,
Zachariah

Zachariah notes that the terms & conditions of the warranty are exactly the same. Since we’re not Canadian, we don’t actually know why Apple charges more. Perhaps it’s because Canada is an entirely different country with completely different laws than the United States and that subtle distinction affects the price of goods and services.

If there are any Canadians out there who know why they are charged more for AppleCare, or the best way to avoid being charged extra for AppleCare, please do let us know.

(Photo:bribriTO)

Comments

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  1. mupethifi says:

    because apple rips everyone off.

  2. Anonymous says:

    Maybe it’s an ‘importing/exporting’ kind of law. I don’t actually know. i just wanted to say ‘importing/exporting’.
    I do reside in Canada though… and wish I had never seen this story and was able to remain in an ignorant world, since I’ve already purchased all my apple products.

  3. Anonymous says:

    saw*

  4. canerican says:

    Because Canada is not driven by market prices and there is too much government regulation.

    I am Canadian, lived in Montreal until two years ago.

    If you hate high prices, and government regulation try to get a Green Card in America. What else can you do?

  5. tawker says:

    Its because the prices were factored when the American dollar was actually worth something and now that it’s dropped faster than Bush’s approval rating (if thats possible) the prices have not been adjusted and companies don’t want to fix it for fear of the dollar rising and their profit margins getting shot.

    I’d love the company that says, “you pay the US price at current exchange” and leave it at that. So much easier.

  6. cflury says:

    Apple does not ship your laptop to a local repair station in Canada, it ships it to the USA and apple care does this free of charge. It is more expensive to ship between the US and Canada than the US and the US. Mystery solved.

    BTW: Apple Care = Smart Move

  7. loudguitars says:

    Because Apple set up the pricing scheme a few years ago, when the Canadian dollar was much weaker and the American dollar was much stronger, and the difference actually made sense given the exchange rate. Same thing is happening with a lot of books, where the list price is 24.99 US and 29.99 CDN, despite the fact that the Canadian dollar is now worth more.

    Canadians are getting a bit hosed on this one, eh? (Sorry, couldn’t resist.)

  8. dix99 says:

    Ha! Ripping people off, that’s funny..

    I thought paying $499 for a Dell (already overpriced, S/B &10), with Spyware, Spamware, Virusware, Trojanware, causing me hours of my productive time to fix & reinstall & reboot & poor resale value was ripping people off. There’s more, but my time is more valuble, than to list them all. From a Mac user, forced to use a PC at work 8hrs a day, so I know what I’m talking about.

  9. 92BuickLeSabre says:

    Oh. Come on now. It’s a simple service charge for having to listen to people speaking “Canadian.”

    You don’t have to hear them speak when selling products online, but when you have to sit on the phone and listen to them complaining “about” their computer’s “processes, eh?”?!?!?

    Otherwise think of the Worker’s Comp. premium-increases Apple would be facing due to grimace-induced neck injuries.

    /hee hee hee

  10. kc2idf says:

    Where is service performed? If it is in Canada, then it is possible that the problem stems from the former disparity between Canadian and US dollars, and the fact that salaries/wages are going to be disparate in a manner that reflects the way the value of a buck versus a loon used to be disparate. In short, American wages haven’t come up to reflect the amount that the value of the US dollar has gone down, and so the Canadian techs are getting paid better.

    That’s my hypothesis, anyway.

  11. Buran says:

    Uh, because things have been like this for a long time. Look at the back of just about any book. Sheesh. There’s cost differentials of numerous types too that have already been largely covered by other commenters.

  12. tedyc03 says:

    Apple’s pricing is due to the old pattern of charging more in Canadian dollars than in U.S. dollars. That scheme no longer is valid because of the decline in the dollar, but it was five years ago. This plan price has probably not been reexamined in some time.

    I’m at the Apple Store Canada right now, and the price of the MacBook is $150CA higher than the U.S. model. The MacBook Pro is $200CA more, the iMac $100CA more, and the Mac Pro $300CA more. The iPod shuffle is $10CA more, and the iPod Nano is $20CA more.

    I don’t think tarriffs are to blame since NAFTA covers most things, but that could be too (since most Macs are made overseas). Still, the exchange rate seems the most plausable answer, since exchange rates have only been at parity for a little while.

  13. jdotto02 says:

    You guys keep using the example of book prices as showing price differences between the Canadian and American dollars but what you fail to mention is that Wal-mart is selling all their books, magazines, and greeting cards at the US listed price instead of the Canadian one. So if Wal-Mart has found a decent solution the book price difference then I don’t see why apple can’t also lower their Canadian prices.

  14. guspaz says:

    Canada (or at least Quebec) has much stricter/stronger consumer protection laws than the states. So the company may have obligations to consumers that they don’t in the US. This may influence their prices.

  15. zcrow says:

    A follow-up to this issue: I took a look at the terms and conditions for the Apple Care Plan for both Canada and the US and they are identical. They both say:

    7. General Terms
    d. This Plan is offered and valid only in the fifty states of the United States of America, the
    District of Columbia and Canada. This Plan is not offered to persons who have not reached the
    age of majority. This Plan is not available where prohibited by law.

    The part numbers for the Plan are the same on both the Canadian and US sites.

    I ended up ordering a Plan from the US for $119 – I just saved $80. Of course the proof will come when I try and register it.

  16. North of 49 says:

    The answer is simple:
    1: they haven’t caught up with the Canadian backlash of higher prices in Canada for the same things even though our dollar is at par or better.
    2: Smaller population therefore less of an incentive to offer deals (or keep up with the dollar’s parity)
    3: Apple’s greedy and wants huge profits in Canada.

  17. m4nea says:

    @92BuickLeSabre: if you’re being serious i’m going to punch your first born child…
    :)

  18. 92BuickLeSabre says:

    @m4nea:…like I’d ever let a child visit Canada.

  19. 13743an says:

    Definitely get Applecare. If you know someone with a student ID, you can get a student discount at the store with the ID.

  20. Cathoo says:

    I was always told it’s because there are fewer people in Canada. Here’s the hypothetical situation I was given: if a company pays the same amount on both countries for advertising, they will reach less people in Canada, so they need to charge more in Canada to make the same profit.

    Also, all the financial know-it-alls are still saying that the Canadian dollar will drop in comparison to the US “soon”, so no one wants to readjust everything, then readjust it again when it happens.

    @JDOTTO02: Wal-mart is offering books and magazines at that price to get you into the store and rip you off on other stuff, like those tempting impulse items at the cash register. MMmmmmm… chocolate….

  21. EtherealStrife says:

    Translators don’t work for free.

    If you’re Canadian and want to take advantage of the shit dollar then just exchange your funny money (CAD) for tp (USD) before making purchases. Too lazy to do that? Too bad.

  22. Atlantys says:

    @92BuickLeSabre: Because then they’d never want to leave, eh?

  23. clevershark says:

    The reason Canadians pay more is that the merchants know they can get away with it. We’re not going to start driving to the US every time we need to buy something.

  24. Buran says:

    @jdotto02: because Apple is not Walmart. Why should company B have to do something just because company A does?

    If they want to charge that price, that’s their right. Take it or leave it.

  25. Parting says:

    @Cathoo: Soon? Market is going to hell in USA, as well as mortgage industry and USA debt is going up exponentially. Is US doesn’t do anything to prevent dollar drop, it will end down with pesos.

    It’s not Canadian dollar that went up, it’s USA’s who dropped in value. Canadian dollar compared to Euro/Pounds is pretty much the same.

  26. Parting says:

    @Buran: And Apple pretends to be ”cool” product. But the truth it’s a nice mp3, no better than other brands.

    And Apple charges more just because it can. Greed… If a product ”need” an extended warranty, then it’s a piece of Chinese-made crap.

    (p.s. I don’t think everything Chinese-made is crap.)

  27. CapitalC says:

    It’s totally bullsh!t. I just checked for my Macbook Pro (which is at 1 year in March) – the prices are $349 on the US site, $399 on the CA site.

    If anything, it should be cheaper here since we have smaller and fewer service departments.

  28. Topcat says:

    @ Commenters saying this has something to do with providing services across borders: Apple has a Canadian office based in Markham, Ontario, and will service your Mac within the country. Postage costs more in Canada than in the US due to long distances between major cities, but aside from that, I can’t fathom any reason why there should be a 15% difference in price for US vs Canadian Applecare.

    I have to say though, I love this kind of stuff: Buy a Mac! They just work, though you’ll DEFINITELY want Applecare.

  29. attackgypsy says:

    Hello?

    What do you expect?

    I would charge someone more if they called their dollar “the loony”…

  30. Katchoo says:

    @jDOTTO02: Wal-Mart is selling their books and magazines at cost, something bookstores cannot afford to do. Magazine & book sales in Wal-Mart might account for, at most, %3 of their weekly sales, so they can sell them at (or even below) cost with a negligible hit to their bottom line. And, as CATHOO said, if they can lure you in with their “we’re selling at the US price” ads, and can get you to buy something else that they do make a healthy profit on (like their no-name food or household goods) then they’ve made back any money they’ve lost. Anyways, who goes to Wal-Mart to buy one book or one magazine? Very few people do, since few people want to wait in line for 20 minutes behind a mother with a full cart and 2 crying kids.

    @CFLURY: There are plenty of local authorized Apple resellers who can service Apple products, so it’s not simply a case of everything having to be shipped/serviced in the US. When my MacMini suffered a memory failure a month after I bought it, I was able to bring it in to a shop in walking distance to my home. They had to order in the appropriate RAM, but I had my Mini back within a week. In my city alone, there are at least a half dozen Apple resellers. Now the situation most certainly is different for someone living outside of a major city, so maybe the AppleCare price difference stems from covering all location/repair scenarios.

  31. Bruce Bayliss says:

    It’s called PRICING THEORY, people.

    Leopard costs $129 in the US and Euro129 in Germany. Which is $87. Including 19% tax.
    Price has nothing to do with cost (apart from the fact that the difference between the two is generally defined as “profit”
    You take what the market will tolerate…

  32. parabola101 says:

    Currency fluctuation’s are not updated on any type of timetable. Apple in Europe is 2x the cost here in the state.

  33. FLConsumer says:

    What about VAT? How much does that add to the price?

  34. sventurata says:

    @EtherealStrife: Um, yeah, it doesn’t work like that. Unless you set up a US dollar credit card (with a fee, screw that), they bill your CDN credit card with CDN funds… or pull the “sorry, your address is Canadian, so we’re charging you the Canadian price” line.

    I was excited about Wal-Mart’s US parity on magazines until I noticed a minor detail: many magazines have stopped printing their US price on issues distributed in Canada (*not* Canadian editions, there is a difference). So we’re still paying $5.99. Bah. Subscription rates, etc., have yet to be adjusted too.

    My one experience with Apple warranties (same as AppleCare?) required me to courier an iPod to the US, and pay for Apple to ship me a box so I could send it back to them with a fried iPod… long story short, the shipping wasn’t included in the plan, so I can’t imagine that would influence the warranty cost one bit.

    So, rather than buying flimsy American crap, I’ve decided to invest my valuable dollars. They say housing prices are at an all-time low in your land of debt and freedom…

  35. Cowboys_fan says:

    I would say it is partly that though the dollar in canada has increased dramatically as compared to the us, the prices have not been adjusted accordingly, virtually anywhere. The reason is the us dollar has sunk and the canadian dollar has only risen slightly in the world market.
    The second part is likely that canadians will simply pay more. I work for a dsl company and our 12 Mb/s plan costs $30 less in some areas than others. It doesn’t cost more, need different equipment, etc. People in area “A” are concerned with speed and people in area “B” are concerned with price. We charge more in area “A” only because we know we can.

  36. RvLeshrac says:

    @canerican:

    Then you can spend all of your newly-acquired money on $200/mo health insurance plans.

  37. RvLeshrac says:

    @Mrs. Basil E. Frankweiler:

    Magazine prices differ because *gasp* they’re produced locally.

    Much like copies of the New York Times sold in Los Angeles are printed in LA, copies of MaximumPC sold in Toronto are printed in Toronto. This is because the difference in printing costs are minimal compared to the shipping fees for heavy paper.

    Since the people at the printing facility in Canada are likely getting paid a lot more than the people at the printing facility in the US, you pay ever-so-slightly more. There really isn’t a massive difference for magazines, but I don’t understand some of the $5-$10 book pricing differences.

    Then again, copies of the Sunday Times are printed locally, but we pay nearly $10 for them. WTF is that?

  38. sibertater says:

    @mupethifi: shoosh. It’s a secret.

  39. EtherealStrife says:

    @Mrs. Basil E. Frankweiler: Do you understand the meaning of EXCHANGE as it applies to currency? It seems you do not, so I’ll clarify: here’s a wad of CAD, now you (the bank teller) give me a wad of USD.

  40. Tonguetied says:

    @FLConsumer: “What about VAT? How much does that add to the price?”

    That was the first thought that crossed my mind. Those lovely Value Added Taxes imposed before the product even reaches the store for which you then have to pay sales tax as well. I don’t know that is the case here but it is something to look into. (Now how you go about looking into it I haven’t the slightest idea…)

  41. zcrow says:

    I am a Canadian and just ordered an Apple Care Protection plan for my iMac. The place I got it from has a promo on and the Protection Plan is only $119, rather than the $199 it is here in Canada or the regular $169 that it is in the US.

    To top it off, the person I was dealing with agreed that when he received my payment (money order or wire transfer) he would just email me the invoice along with the certificate number and that way there would be no shipping, brokerage or duty. As promised, the email arrived today and I successfully registered it.

    As mentioned before, the Apple Care Protection Plan seems to only come in one flavour for North America and states that the agreement is valid in both the USA and Canada. The part numbers for the agreement is the same in both the Canadian and US Apple stores. I haven’t received my certificate yet so perhaps I will be burned at that point but so far so good.

    So if you Canadians want to save some money bypass the Apple Canada store and find some deals somewhere else.

  42. zcrow says:

    I should have mentioned in the post above that I ordered my Apple Care Protection Plan from a store in the US.