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If MS charges 30% for doing almost nothing but putting an XBox game in the store, that's also a scam. I don't know enough about it to know if they provide othe
by donmcronald 6y ago
If MS charges 30% for doing almost nothing but putting an XBox game in the store, that's also a scam. I don't know enough about it to know if they provide other services like matchmaking, etc. for that.
The rest of those seem reasonable to me.
The publisher is basically your marketing budget, right?
Retailers' shelf space has a cost and is limited physically. They could be using the same space to sell literally anything, so I think whatever the price of that ends up being it's probably a result of competition across a ton of industries.
The licensing fee is ok too IMO since the console makers take a huge risk producing and selling the consoles as cheaply as possible. It also sounds like a well known, flat fee, not a cut of ongoing revenue.
The problem for me is when digital stores with a tiny marginal cost of distribution think it's reasonable for them to capture a huge portion of lifetime revenue. They're not doing that much. It's bad value and the only reason they can make it work is because they're in a position that lets them act like an extortionist.
It's the cut of every single transaction for the lifetime of a customer that people think is unfair. Ex: $27 to a publisher is fine if it's a one time fee and they're providing $27 of value by advertising etc.. They could never ask for 40% of revenue for all future transactions like DLC and microtransactions because there's enough competition that no one would use them and they'd go out of business.
- scarface74 6y agoDo you feel SASS companies are also unethical because the marginal cost of a customer is 0? And then the publishers also have to pay MS for DLC. I think MS still charges for delivering patches through MS Live. They might have dropped it.
- nrmitchi 6y agoI'm not going to touch the space about MS, Xbox, or the like because I have 0 insight into that space, but I will point out that the marginal cost of a customer in many SaaS companies is most definitely not 0.
- tonyarkles 6y agoFor anyone who is doubting that assertion, it’s all about the costs that scale with the number of customers you have. Beyond the hosting and server costs, there’s support costs. There’s customer acquisition costs (eg click-throughs on ads scale with the number of people click the ads). For more expensive/enterprise SaaS, there’s the account managers and sales team. You can grow your customer base dramatically with a smallish team of engineers/recurring engineering costs, but many of the costs surrounding them still grow in a linear way.
- scarface74 6y agoAnd Apple also has to host your app and your assets, provide storage through things like CloudKit, provide services through GameCenter, customer support and refunds, centralized notification system etc.