Of dollars and cents and M&Ms
I had an interesting encounter a little while ago. A 10 year old asked me how much does Distant Suns cost in the App Store. I said “10 bucks.” “Why so much?” he responded….
One of the many paradigms that shifted when the App Store first opened up was the pricing model. It was obvious that the apps would cost less then their CD-ROM/store shelf variants. But how much was underestimated. Apple expected games that might retail for $30 to drop down to $10 or $15. That’s a nice savings from both the standpoint of the customer while still giving the publisher as much or maybe more he would’ve received after all of the costs if packaging and distribution were factored in. But it was obvious that early on, the app authors in particular those who had little or no knowledge of how to price software dove for the bottom. After all, if they spent 3 months working on a game on their own, any revenue was a treat. In fact, when Distant Suns 1.0 went live in October of 2008, my modest sales goal was just $20/day (first day’s sales was about twice that, second day’s sales were over $410).
When Distant Suns was published for the very first time in 1987 for the Commodore Amiga, originally known as Galileo, the shelf price was $99.95. Wholesale was just $40, yet my royalty of 15% was a scant $6. Six bucks off a $100 sale. Why so little? My publisher at the time, Infinity Software, paid for the boxes, floppies, duplication and manual. Not to mention tech support and marketing. It was a very expensive process, and in fact my royalty was on the high end of the industry, where 10% to 12% was the norm.
Currently the most expensive version of Distant Suns is priced at $9.99. After Apple takes their cut, I end up with $7/sale. No boxes needed, no hardcopy manual, no disks or duplication. I handle my own tech support and end up making more than the original $100 product. Not bad.
So back to my young inquisitor. To him my response was “I’ve been working on this since 1985, 27 years, currently putting in 65 to 70 hour weeks, buying thousands of dollars of equipment, and spending thousands of hours of research in both astronomy and the mobile markets, and you get all of that for just 10 bucks.” He said, “okay,” turned and walked away.
So, next time you complain about some “expensive” app that costs nearly 3 bucks. Think of what it might have cost pre-iOS days, and think about all of the expense and time that went in on it. And you get all of that for the cost of an 8 oz. standup pouch of raspberry dark chocolate M&Ms.