Author: John Merlino
Date: 10:29:20 03/29/99
Go up one level in this thread
On March 29, 1999 at 08:51:11, Steve Lopez wrote: >On March 29, 1999 at 00:41:20, Lin Harper wrote: > >>While we're on the subject, why don't the "professional"(did I spell that >>right?) programs appear on the shelves of computer game warehouses, alongside >>CM6K and the 'crappy' ones? Are they too snooty? Or is it that their prices will >>appear a little out of line in comparison to the other games. Mindscape has the >>better business approach to marketing a chess program, and will make a killing >>now with these SSDF results! > >Speaking from personal experience, it's because you have to practically *give >away* your software to get it into mass-market. Why do you think Babbages, >Software Etc., and the rest debut a program at $50 and eventually knock the >price down to $15 or less and *still* make money? Is it because they love you >and want you to own the sofware for a mere pittance? No, it's because they pay >about $7.50-$10.00 per unit for a program that retails for $50.00, so after a >few months they can knock the price down to $15.00 and still turn a profit. >Software manufacturers make more money per unit on direct sales (therefore >increasing their ability to stay in business and produce new product) than they >can by selling through third-party vendors, and this is particularly crucial for >producers of specialty software (such as chess programs). Chessmaster isn't the >only program sold by Mindscape, just as Power Chess isn't the only Sierra >product (besides, Sierra went outside the company for Power Chess' engine >anyway). > >Believe me, *nobody* is becoming wealthy in the chess software business. In >fact, I took a pay *cut* to return to ChessBase compared to what I'd been making >in non-software-related businesses (there were compensatory factors -- I work at >home, I have fewer hours per week, less stress, more time with my kids, etc). >But I won't be purchasing a yacht anytime in the near future. > >By the way, I'm not disagreeing that lowering prices can increase sales. We've >been selling Fritz/Junior/Nimzo like there's no tomorrow since the price went >down to $49.50. > >-- Steve Lopez The main reason that you won't find Fritz/Junior/etc. on your local software store's shelf has nothing to do with the price. It's all about "shelf space" and "brand name/company name knowledge". Mindscape has a HUGE ability to put their software on the shelves; Fritz has zero. Even though the people who frequent THIS board know both Chessmaster and Fritz equally well, the retailers do not. All they know is that Chessmaster has been the #1 selling retail product for many years, and that's all they need to know. Fritz could lower their price to $10 and you wouldn't see it at your local store. As for "nobody is becoming wealthy in the chess software business", it is currently estimated that the entire Chessmaster line could make as much as $8 million REVENUE this year (my own personal estimation from PC Data's numbers). As for PROFIT, I'm not sure, but I AM sure that Mindscape wouldn't spend all of their development/advertising/etc. dollars on a product that was losing money. jm
This page took 0 seconds to execute
Last modified: Thu, 15 Apr 21 08:11:13 -0700
Current Computer Chess Club Forums at Talkchess. This site by Sean Mintz.