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I just had a thought. Perhaps the reason why they have concerns about the royalties now is due to the recession. When game prices drop the retail, royalty and production costs remain stagnant so the publishers take 100% of the hit when the game price falls. So say for example the royalties are $10 and the Retailer, market developmet and production costs are $20 which leaves $30 for them. If they cut the price of the game to $40 their cut may only be $15 (assuming lower marketing costs) so a reduction of even $2 in royalties may be significant for them because the average sale price of the titles have been falling recently because the recession has made people more price concious and relative to their take on the cut price titles $2 is significant in that context.



Tease.