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March 31st, 2007, 18:01
Originally Posted by Kharn View Post
Yes it does. Your basic understanding of the concept of full price selling is correct, but you are reading it wrong. These games are still turning a profit, through edition and re-edition. There is nothing about this market that differentiates it from the DVD market. Sure, for the DVD market, initial sales matter. But do you honestly think Warner Bros. doesn't care anymore how many Matrix editions and re-editions they can sell? Why wouldn't this apply to games?
It might not apply to games in some cases because the company that originally invested the money (and we were talking return on investment here) might not benefit directly from the long term sales. Which might be especially true if a company like Interplay is involved that has (factually) gone out of business. One would have to know what exactly Interplay did with the distribution rights for the Fallouts but it could very well be that they sold them off for a flat fee and that they no longer participate in the earnings on a per copy basis.

But that doesn't even really matter in regards to the original investor because you have to consider that a game that does not turn in a profit gets written off as a loss by the company at some point. Then, after the write-off and a big, fat quarterly/annual loss, the calculation starts from scratch and -yes- it might be that a budget game becomes profitable then because all the previous negative factors (developing/publishing/distribution/marketing costs etc) have been written off. But that's after a lot of cash has gone up in smoke due to the write-off so you're only making a very theoretical profit on paper .
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