Some input on the discussion on revenue per game unit sold for developers: 

A friend of mine got MK:Wii. Not from the store but rather through his company from their wholesale provider. Cost of game (before tax): 30 Euro.

Now since he only ordered one unit, he did not have plenty of buying power. Meaning large retail chains probably get a better wholesale price. My assumtion is that they have to pay about 25 Euros per copy of MK:Wii. Which gives them a margin of 50% (obviously, before all the other cost is added....).

Since Publisher, Logistics company (and Middle-Men?) will want their share, I would estimate that each copy brings the developer less than 10 Euros....

Thoughts?

funny how on a web site dedicated to game sales, no one seems to care about game sales related topics.

That would actually mean a 100% margin, since they're getting double of what they paid.

I would have expected more like 40 €... Why would the retailer be the one who makes the most money? Downloadable games can't get here soon enough...

NJ5 said: That would actually mean a 100% margin, since they're getting double of what they paid. I would have expected more like 40 €... Why would the retailer be the one who makes the most money? Downloadable games can't get here soon enough...

 You are right. 100%.

The retailer is the one with the buying power. Everything goes through him, he offers shelf space, he has access to customers AND he takes the risk. He buys the games and its his risk if they sell or not. So why shouldnt he get a big margin? 

Faxanadu said: NJ5 said: That would actually mean a 100% margin, since they're getting double of what they paid. I would have expected more like 40 €... Why would the retailer be the one who makes the most money? Downloadable games can't get here soon enough... You are right. 100%. The retailer is the one with the buying power. Everything goes through him, he offers shelf space, he has access to customers AND he takes the risk. He buys the games and its his risk if they sell or not. So why shouldnt he get a big margin?

I don't think retailers take a bigger risk than publishers... Publishers invest millions into making a game, how much do retailers spend on a given game? If they're not sure a game will sell well, they'll just order a small amount of copies, and reorder later if it sells out.

With the current business model, I don't see retailers taking much risk from selling games.

 

they certainly do take a risk though. Just imagine: they buy 10 copies at 25 Euros, sell it in the beginning for 50 Euros (so they get 40 Euros since about 10 Euros are tax). but then they only sell 5 copies that way. 2 they sell at reduced price of 40 Euros, 2 at 30 and one they dont sell....

Cost: 250
Revenue: 5*50+2*40+2*30 = 390 MINUS the tax of 20% (too lazy to calculate)

so it is not that high a margin.

I don't know if I'm seeing the situation correctly, but this is how I see it:

Publishers - they pay a team of dozens (or sometimes hundreds) of highly-skilled people to work for a few years, besides the fixed costs such as rental space, hardware, software licenses, logistics and advertising.

Retailers - they rent a few square meters of space, pay minimum wage to a bunch of (mostly) clueless college students, and spend some money on logistics and advertising.

Of those two, who do you think should have the higher profit? Maybe I'm being naive in my mental picture of each one's costs, but I think it's unfair to have retailers profiting as much or more than publishers do.

NJ5 said: I don't know if I'm seeing the situation correctly, but this is how I see it: Publishers - they pay a team of dozens (or sometimes hundreds) of highly-skilled people to work for a few years, besides the fixed costs such as rental space, hardware, software licenses, logistics and advertising. Retailers - they rent a few square meters of space, pay minimum wage to a bunch of (mostly) clueless college students, and spend some money on logistics and advertising. Of those two, who do you think should have the higher profit? Maybe I'm being naive in my mental picture of each one's costs, but I think it's unfair to have retailers profiting as much or more than publishers do.

Ok, so quick question: who will sell the game to customers? the publisher? Nop. Its the Retail company. they have access to the consumer. If they have a specific market share in a specific market (electronics, germany) like for example Media Markt/ Saturn group, then they have the buying power in the market. Simple as that.

 Also, the 30 Euros I quoted are REAL ACTUAL WHAT MY FRIEND PAID; NOT ONE CENT LESS. so i dont understand the arguing. ITS A REAL LIFE REAL COST.

I know it's the publisher who sells the game to the customer, but that doesn't change my view much. As I said, I don't have any real numbers to back my opinion, maybe I'm totally wrong.

Regarding your second paragraph, I don't get it. Did I suggest in any way that you were lying? If next time people don't reply to you, don't be surprised. People usually don't like to be yelled at for no apparent reason.

 

Exactly I really doubt it. Many brick and mortar stores here in Germany do not even have the 59.99E price but go higher to 65 or 70 for some games. I really do not think that Sony and the publishers would give them such a high margin.
What I think is far more likely is that different publishers have different prices so that mighty publishers like EA or Activision can get higher prices and small devs need to make it cheaper so stores buy it.