Originally Posted by SniperXX
Hard to get proof unless you work retail and are in a position to see cost price.
I was...he is incorrect about retail. I worked for CompUSA corporate in merchandising before we closed. Markup is extremely low. Your profits come from companies like Microsoft giving you X number of product A (or a discount on them) if you buy X number of product B. Sometimes they offer you manufacture credit if you buy X number of a product.
Cost of a Xbox game for example was $54.99 for a $59.99 retail game. PC games were similar priced.
Hardware retail fluctuates as well. An Ipod for example was $249.99 and retail was $299.99.
Laptop for $899.99 retail was $879.99 cost.
At one point the Xbox had a $5 mark up from cost to retail. Brick and morter stores make their money off accessories. Lets do a run down of them.
Xbox ($249.99 cost) $299.99 retail
Games ($54.99 cost) $59.99 retail
Here is the kicker...
HDMI cable ($0.88 cost) $39.99 retail (HAHA!)
Cat 5/6 cable ($0.03 cost) $1.99 retail
I can go on...My fav...
I bought a set of Sure e4c when they first launched. They were $299 retail. Cost...$53
I bought a set of Sennheizer (I cant spell for crap without spell check and its not installed) headphones that retail for $199 for $28
The accesories are were they make their money.
Steam can get away with doing the deals they do with the manufactures because there is no physical game, its just a digital copy. Thus, the developers allow steam to sell at a sale/lower price margin because its at no cost to them.Edited by M0E - 2/22/11 at 8:34pm