Path: utzoo!attcan!uunet!lll-winken!lll-tis!ames!amdahl!pyramid!voder!kontron!optilink!cramer
From: cramer@optilink.UUCP (Clayton Cramer)
Newsgroups: comp.misc
Subject: Re: Piracy
Summary: "Negligible" Costs Per Unit
Keywords: copy protection piracy
Message-ID: <173@optilink.UUCP>
Date: 18 May 88 18:09:51 GMT
References: <9160@cisunx.UUCP> <1801@uhccux.UUCP> <807@netxcom.UUCP> <174@proxftl.UUCP>
Organization: Optilink Corporation, Petaluma, CA
Lines: 28

In article <174@proxftl.UUCP>, rafael@proxftl.UUCP (Rafael Mayer) writes:
> > If software authors charged 200% more than what their software was worth, they
> > would not sell one single copy.  Not one.  OK, perhaps a few copies to
> > complete imbiciles, but that's about it.  Lotus has managed to sell a few
> > million copies.
> 
> You are implying that Lotus's production costs are in excess of $150 dollars
> and I don't believe that.
> 
> Actually, software is over priced initially to cover the R&D margin. Once the
> R&D cost is covered, the rest of the costs per unit (production and
> advertising) are close to negligible compared to what the software costs.

"Negligible"?  I've been selling a couple of software packages for the last
year or two -- more of a profitable hobby than anything else, really -- and
I've been constantly surprised how hideously expensive production and
advertising really are.

I suggest that you take a look at what it costs to have a several hundred
page manual printed.  A thousand pages, all alike, is trivial.  A five
hundred page manual means printing thousands of copies of five hundred
different pages.

The disks are cheap -- but even five disks, at $.28/disk is over a dollar.
Copying isn't free, and the box, shipping charges, sending out product
announcements...  I don't know if I believe that Lotus spends $150/unit,
but I can well believe that it costs them $50/unit for production alone.

Clayton E. Cramer