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Ignoring the huge cost of R&D (the sunk cost you refer to) is disingenuous. It isn't even free to produce the copy of the software. There is marketing, bandwidt
by chrismcb 9y ago
Ignoring the huge cost of R&D (the sunk cost you refer to) is disingenuous. It isn't even free to produce the copy of the software. There is marketing, bandwidth, upkeep. Maintaing backend servers and so on.
I agree, for the most part the price of the software doesn't have a lot to do with the cost to develope it, but you cant ignore the R&D costs.
- teddyh 9y agoI’m not ignoring the R&D costs. But a sunk cost is a sunk cost¹; wanting to charge more for software because you worked hard on it is a sweat-of-the-brow argument, and it doesn’t work. Nobody cares how much money was spent on the R&D which went into some software. People care about what they can use it for. 1. https://en.wikipedia.org/wiki/Sunk_cost https://en.wikipedia.org/wiki/Sunk_cost
- sokoloff 9y agoI mostly agree with you, but to the extent that your software competes with other, similar software built by companies with similar cost structures and addressable market, the cost of that sweat factors into their costs as well, so does have a (loose) connection to the viable costs for that software in the market.