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Forums - Sales Discussion - Pachter's explanation on where your 60 dollars goes

Mr Puggsly on 10 April 2010
steverhcp02 said:
Damn, no wonder the 360 was able to turn its profits around for MSFT so quickly. With those publishing numbers for the big guns and then $12 bucks for all software on the software monster that is the 360.

If it really $12 per copy, MS could probably just wave their fees to appeal to developers.



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jdt532 on 10 April 2010

I had an account with a wholesale distributor about 7 years ago and I can tell you that retailers don't make anywhere near $12 on video games... This was when games retailed for $50 but the wholesale price for the games were around $47 so that was about $3 profit for retailers. Now big retailers might be able make deals with distributors because they buy in huge numbers so Wal-Mart might make $5 or more on games.



geddesmond2 on 10 April 2010

So basicly 20% to retailer, 20% to consol manufactor and 60% to publishers. Wow I didn't realise consol manufactors get that much money. So the next time Sony say there loosing money on each consol sold we know its a load of bullshit because they make that back on licensing



jarrod on 10 April 2010
kitler53 said:
277,778 full price sales for every 10 million in investment to break even. So a big budget game like GT ($60M) would need 1.67M sales to break even.

wii games would need a few more (per 10 million in investment) since full price wii games are only $50. probably like 300-320k.

That's only for R&D.  There's also advertising/promotion (for which budgets regularly equal or exceed R&D even) and cost of goods/logistics (production, distribution, loss/theft, returns, etc).

 



leo-j on 10 April 2010

A first party PS3 game would mean $48 to sony o-O



 

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makingmusic476 on 10 April 2010
kitler53 said:
277,778 full price sales for every 10 million in investment to break even. So a big budget game like GT ($60M) would need 1.67M sales to break even.

wii games would need a few more (per 10 million in investment) since full price wii games are only $50. probably like 300-320k.

Sony doesn't have to pay itself licensing fees, so they get $48 a game, thus requiring 1.25 million to break even with a $60 million budget.

The sales of Prologue are paying for that nicely.



Shanobi on 10 April 2010
geddesmond2 said:
So basicly 20% to retailer, 20% to consol manufactor and 60% to publishers. Wow I didn't realise consol manufactors get that much money. So the next time Sony say there loosing money on each consol sold we know its a load of bullshit because they make that back on licensing

I'm not so sure I wouldn't believe them. How many games actually sell numbers high enough to even begin to erode their insane r&d costs? I wonder if they'll even pay off the creation of the cell chip within the next 10 years?



 

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hunter_alien on 10 April 2010

OMG... I was thinking more like



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Tuganuno on 10 April 2010

If Patcher says so, I believe :D



outlawauron on 10 April 2010
makingmusic476 said:
kitler53 said:
277,778 full price sales for every 10 million in investment to break even. So a big budget game like GT ($60M) would need 1.67M sales to break even.

wii games would need a few more (per 10 million in investment) since full price wii games are only $50. probably like 300-320k.

Sony doesn't have to pay itself licensing fees, so they get $48 a game, thus requiring 1.25 million to break even with a $60 million budget.

The sales of Prologue are paying for that nicely.

Well, you can't really convert that exactly as Prologue started out at $40.



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