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Are you claiming that books, software, and other pieces of intellectual property become cheaper over the years because the creator has finally recouped his or h
by jeff18 17y ago
Are you claiming that books, software, and other pieces of intellectual property become cheaper over the years because the creator has finally recouped his or her costs of the initial creation and benevolently decides to give consumers a break on pricing?
Before I start explaining how I believe the economy actually works, I'd like to make sure I understood you properly and you're not being sarcastic.
- count 17y ago'New' information is more valuable than 'old' information, so I don't think that's how it works, exactly.
- pchristensen 17y agoRight effect, wrong explanation. IP products don't become cheaper because creators magnanimously lower the prices, it's because they become less valuable because they've used up the market and are replaced by new products from competitors and creators. For instance, when people stop seeing movies for full price, they go to second run or dollar theaters. Paperback books come out when hardback sales lag (note - this is on a predicted schedule based on experience, not on real time signals). Windows Vista costs a lot less than Windows 7 does right now, and everyone has seen the disgusting bargain bins of DVDs for $5. IP creators would happily charge high prices until the end of time but competition prevents them from doing so. In circumstances where competition is limited or markets have failed, they can do so for a long time. Windows + Office is a good example - they're so embedded in people's and companies' experience that they can't be commoditized, so they have maintained high prices and profit margins for a generation.