October 22, 2007 // 12:08 pm
- So you thought the iPod was expensive in Brazil? It was no secret even before the popular game console was released that its retail price in Brazil would be, well, prohibitive.
Though the high cost can be attributed to many factors, the real explanation lies in the burocracia alfandegária or customs bureaucracy. Getting goods into Brazil inexpensively is no joke; according to the US Department of the Treasury, "Brazil applies a. 60 percent flat import tax on most manufactured retail goods". 60%!!!!
So naturally this means that the same phenomenon inflates the prices of other competing game consoles. The Playstation 3 in Brazil costs a whopping $3,299 reais, or $1,818.82 USD as of this writing. And games are no cheaper either; $200-$300 reais is a lot to drop on a video game when the minimum wage is about $380 per month. So what does this tech-hungry market do? Where do frustrated, Halo-loving teenagers turn?
Pirated software. In Brazil, software piracy has become a socially accepted epidemic, largely as a result of the huge discrepancy between buying power and prices. Vendors of illegally-manufactured PS2/3, XBox and Wii games, HD-DVDs, Blu-Ray discs and movies discourage the use of the word pirata, preferring the generous euphemism paralelo. This 2005 article states that 64% percent of software in Brazil was pirated at that time. Here's the kicker: this was the second-lowest piracy rate in Latin America (Colombia weighed in with 55%). There have been some advances and there is now even some optimism about software and intellectual property security in Brazil, but eliminating piracy is clearly going to be an uphill battle.
Personal anecdote: When I was in Brazil, I wanted some CDs I had recorded with a band in college. A friend sent them down in the mail, about 20 of them. In order to receive the package, I had to pay 60% of the full retail value of the CDs, the US retail value no less! So just to be able to give away 20 CDs that I had made myself, it cost me almost $300 reais.