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re: Anyone else think it's total BS that it cost the same to buy
Posted on 3/15/13 at 12:56 pm to TogaParty
Posted on 3/15/13 at 12:56 pm to TogaParty
quote:
simply because the production cost is lower on a downloaded game vs. the hard copy.
again, what does production cost have to do with the market value of a good? that is only a tiny component of the total cost of this particular good. do digital music albums sell for considerably less than that same hard copy album?
the true costs of these types of goods are in the production/development not the distribution
2
Posted on 3/15/13 at 1:00 pm to jcole4lsu
quote:
again, what does production cost have to do with the market value of a good? that is only a tiny component of the total cost of this particular good. do digital music albums sell for considerably less than that same hard copy album?
the true costs of these types of goods are in the production/development not the distribution
Like I said, I would really like to see the breakdown and what cost they pass down to the consumer for the physical portion.
ETA:
And again, digital download is more valuable to the developers because it eliminates used game sales. At the end of it all, they make more money from a digitally downloaded game because it is not available to be resold.
This post was edited on 3/15/13 at 1:03 pm
Posted on 3/15/13 at 1:04 pm to taylork37
quote:
I would really like to see the breakdown and what cost they pass down to the consumer for the physical portion.
with the advent of digital download, one might look at physical media as a cost the supplier has to eat, not pass on to the consumer.
quote:
digital download is more valuable to the developers because it eliminates used game sales. At the end of it all, they make more money from a digitally downloaded game because it is not available to be resold.
this still does not effect the market price of the good, merely increases potential profitability to the supplier.
Posted on 3/15/13 at 1:08 pm to jcole4lsu
It's a lot more than just production cocts. The logistics that go into it are costly as well. You think they deliver to the stores for free? That those truckers don't get paid?
I guess I wouldn't expect people on here to know about supply chains.
eta: stores also mark up to make a profit, so by eliminating the middle man (store), it would only be natural to assume the cost would be lower.
I guess I wouldn't expect people on here to know about supply chains.
eta: stores also mark up to make a profit, so by eliminating the middle man (store), it would only be natural to assume the cost would be lower.
This post was edited on 3/15/13 at 1:09 pm
Posted on 3/15/13 at 1:10 pm to TogaParty
quote:
It's a lot more than just production cocts. The logistics that go into it are costly as well. You think they deliver to the stores for free? That those truckers don't get paid?
ive got a degree in economics and worked for a major logistics provider for 5 years - but yeah thanks for the supply chain management lesson.
Posted on 3/15/13 at 1:12 pm to jcole4lsu
If that is the case, then why are you asking why consumers should expect a lower cost when downloading vs. in-store purchase?
so you're a UPS trucker? that explains why you asked the question then.
quote:
worked for a major logistics provider for 5 years
so you're a UPS trucker? that explains why you asked the question then.
Posted on 3/15/13 at 1:16 pm to jcole4lsu
quote:
with the advent of digital download, one might look at physical media as a cost the supplier has to eat, not pass on to the consumer.
That doesn't equate...they are already passing the cost to the consumer and more than likely plus some. The advent of the new medium simply takes away those costs that again, were already passing along.
quote:
this still does not effect the market price of the good, merely increases potential profitability to the supplier.
Of course its an increase in potential profitability....that's the whole point in asking why can't they reduce the price. Not to mention, if they decrease the price of digitally downloaded games, that might entice more gamers to buy...further increasing their potential profitability.
Its not surprising that they don't....its a business and they are there to make a profit...at the same time consumers can ask.
This post was edited on 3/15/13 at 1:18 pm
Posted on 3/15/13 at 1:22 pm to TogaParty
quote:
then why are you asking why consumers should expect a lower cost when downloading vs. in-store purchase?
because the price of the good is not set by the costs of production, price is set by the market.
if the market will not bear a profitable price the supplier will either have to find a cheaper means of production or cease production altogether.
furthermore, the major (the vast major) component of production cost in this case is design - not delivery. you dont even know what the terms of contract are between supplier and retailer, and those may be different depending on party. the cost of deliver in ExWorks would be much different to the supplier as opposed to CIP or DDP.
on top of that, some of the cost of traditional delivery vs digital is offset via increased server and technical resources used. i suppose you think bandwidth is free?
quote:
so you're a UPS trucker? that explains why you asked the question then.
you are out of your league kiddo
Posted on 3/15/13 at 1:24 pm to jcole4lsu
Damn it I love it when new guys come in and try to throw their weight around 
Posted on 3/15/13 at 1:26 pm to taylork37
quote:
That doesn't equate..
yes it does.
first, read my above post re: terms of contract.
second, as one standard is passed by for a new, more efficient standard, the costs of continuing to support the antiquated model becomes a cost the supplier either has to a) eat or b) pass on to the consumer via price increase.
there is absolutely no reason a supplier has to drop the price of a good below current market value just because their production costs have become slightlyreduced. thats just not the way the free market works in a capitalistic society.
Posted on 3/15/13 at 1:46 pm to TogaParty
quote:
stores also mark up to make a profit, so by eliminating the middle man (store), it would only be natural to assume the cost would be lower.
For someone claiming to know about logistics and supply chains, you don't understand simple economic principles quote:
Member since Feb 2013
GTFO
This post was edited on 3/15/13 at 1:47 pm
Posted on 3/15/13 at 1:49 pm to jcole4lsu
quote:
second, as one standard is passed by for a new, more efficient standard, the costs of continuing to support the antiquated model becomes a cost the supplier either has to a) eat or b) pass on to the consumer via price increase.
BluRay is hardly an antiquated model. Especiallly considering consoles and the fact that digital download use is severely in the minority.
quote:
there is absolutely no reason a supplier has to drop the price of a good below current market value just because their production costs have become slightly reduced. thats just not the way the free market works in a capitalistic society
Of course..but are we still allowed to ask why?
And again...used game sales or lack there of that comes with digital download should give the developers reason to reduce pricing just enough to encourage DD. You didn't respond to that comment.
This post was edited on 3/15/13 at 1:50 pm
Posted on 3/15/13 at 1:50 pm to TogaParty
quote:
TogaParty
You just got boom roasted son
Posted on 3/15/13 at 1:55 pm to taylork37
Exactly. I have $X to spend on video games. Seems to me that the video game makers wouldn't care how many games I bought as long as I spent $X either way. Now if given that they get to keep more of $X if I download rather than buy at WM or what have you, it only stands to reason that it should be in their best interest to sell the game cheaper online than WM has it, and thus sell me TWO games that they keep all the profits on rather than 1 game that they share the profits with a retailer.
And I win by getting two games rather than one for the same amount of money.
And I win by getting two games rather than one for the same amount of money.
Posted on 3/15/13 at 1:56 pm to taylork37
quote:
BluRay is hardly an antiquated model
am i missing something? what game is being printed on blueray? (thats a serious question btw, i do everything digital)
regardless, bluray/cd/fricking laserdisc - doesnt matter - the "antiquated" part of that statement is referring to any physical distribution.
look at new computers for example - they used to come with discs for backup, reload, even the full blow OS at times - now its a program on the unit and they expect you to create those discs yourself.
same for software like Office 2010. go to bestbuy and youll be buying a product key card, not the actual media.
quote:
but are we still allowed to ask why?
the answer is because the market (consumers - in this case gamers aka "us") are not willing to forgo games just because the price of digital is the same as physical. of course you can keep asking but the answer is always the same.
sort of like asking why the sun rises in the east
Posted on 3/15/13 at 1:56 pm to TulaneTigerFan
If that was a boom, then I'll take it. Being a new member and having it be the only thing to "boom" me with is not too shabby
Time for a meeting. have a good one
Time for a meeting. have a good one
Posted on 3/15/13 at 1:58 pm to BTHog
quote:
Seems to me that the video game makers wouldn't care how many games I bought as long as I spent $X either way.
they would rather you find a way to pony up the extra cash for another game.
quote:
And I win by getting two games rather than one for the same amount of money.
and they basically lose. because in many cases gamers will pony up the extra cash for the game
Posted on 3/15/13 at 2:00 pm to taylork37
quote:
used game sales or lack there of
used game sales proceeds goes to the retailer, not the developer, there by rendering this statement:
quote:
should give the developers reason to reduce pricing
incorrect.
Posted on 3/15/13 at 2:03 pm to jcole4lsu
quote:
they would rather you find a way to pony up the extra cash for another game.
I guess I'm just not a hardcore gamer than, because I limit myself to just a few new titles every year. Probably not even half as many as I'd like to buy. I pass on a lot of cool looking games simply because I don't feel like spending $60 on a game.
Posted on 3/15/13 at 2:04 pm to BTHog
They're cheaper on PSN for nearly all vita games. 10% off.
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