"Wii Third-Party Struggles Highlighted by May NPD" - GameDaily

[Bodhesatva]

Viper1 said:

Bodhesatva said:

Viper1 said:
Hey Bod, you're calculating retail cost, not wholesale.

Right? As I said, 4-5 of the extra 10 retail dollars go to the producers. Can you explain what's wrong with that?

Because retailers don't buy the game at $60.00, they pay approximately $48.00 from the distributor (Jack of all Games, D&H Distributing, Ingram Entertainment, Mecca electronics, etc...) who pay even less from the publisher. ~$40.00 depending on their annual unit contract.

 

Now you want to redo your math?

That's exactly what I did, we're just looking at this from different angles. 

Of the 60 total dollars, retailers get a share, developers get a share, publishers get a share, console manufacturer gets a share.

Both the Wii and Ps3/360 suffer from this problem, the difference is that with Ps3/360 games, retailers get an additional 2-3 dollars, the console manufacturer gets an additional 2-3 dollars, which leaves an additional 4-5 dollars for the publisher/developer, totaling 10 extra dollars.

Let me put it more generally: there are 10 dollars more to go around with each game sold on the PS3/360. Some of that 10 dollars go to retail, some to the console manufacturer, and whatever is "extra money" for the developer/publisher. That extra money adds up when you're talking about large amounts of sales.