State Media Call Starbucks Too Pricey The Chinese state news media have begun an attack on Starbucks, calling the coffee chain wildly expensive. Chinese consumers so far have responded with a yawn, and perhaps another latte. The criticism from the state-run broadcaster CCTV and other outlets centers on the fact that Starbucks is disproportionately pricier in China. In a report on Sunday, CCTV compared the price of a tall latte in Beijing (27 renminbi, or $4.42) with the price in Chicago (19.98 renminbi, or $3.26), London (24.25 renminbi, or $3.97) and Mumbai (just 14.6 renminbi, or $2.39). The report said the cost of the ingredients of such a drink should run less than 5 renminbi, or $0.82, in China. "What in Western countries is an average cup of coffee has in China become a coffee "luxury product,"" CCTV said. The broadcaster noted that Starbucks's profit margin for China and the Asia-Pacific region in the second quarter of this year was 32 percent, versus 21.1 percent for the Americas and 1.9 percent for Europe, the Middle East and Africa. Starbucks responded that it was wrong to draw conclusions based on prices in China compared with those in other markets. "Our pricing strategy is based on local market costs, including infrastructure investment, labor, commodity costs, currency valuation, real estate and other costs of doing business," the company said in a statement. The profit margin figure for Asia-Pacific was for 14 markets, not just China, it added. So far, the response among consumers has been a shrug. The fact that Starbucks is expensive for what it provides is hardly news to people in China. In many places where the Seattle-based chain has an outlet in China, one can walk around the corner and find a local or foreign competitor offering similar products, sometimes at vastly lower prices. But Starbucks has managed to cultivate an image as a default place for a meeting or a date. And in a country where urban professionals are aggressively embracing luxury products, a reputation for priciness isn't necessarily a disadvantage. The Beijing-based author Ma Boyong said that he sought out Starbucks for its atmosphere. "When I write I don't like quiet, I want a little noise, not too much, and the best is when there are people around, each busy with his or her own thing," he wrote on his Sina Weibo microblog. So I often go to the Starbucks nearby, order a 20-plus-renminbi coffee, sit for as long as I want to sit. The price, he said, wasn't much of an issue. If somebody came over and indignantly said how much coffee beans and hot water cost, I would politely tell them to get out. That attitude was reflected even in some other quarters of the Chinese media. In a piece titled "Is Starbucks Discriminating Against Chinese Consumers?," The Chengdu Commercial News came down on the side of the company. If Starbucks wants to set their prices high, they can set them high. If they can sell coffee for 1,000 renminbi a cup, that's their own business," the newspaper wrote. Of course, Starbucks isn't that stupid, because in this amply competitive marketplace, potential competitors are eyeing it watchfully. This is not the first time Starbucks has come under close media scrutiny in China. In 2007, it closed an outlet in the Forbidden City in Beijing after complaints that a coffee shop was inappropriate in such a famous center of Chinese culture.