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MisterMe

macrumors G4
Jul 17, 2002
10,709
69
USA
Mass production is cheap, relatively speaking.

For a basic example,
DVD blank: $0.25
DVD copy of "District 9": $20.00
Est. production budget for "District 9": $30 million
Obviously the bulk of the cost of a DVD copy of "District 9" is not in the cost of manufacturing of the DVD.

...
Wow! Talking about mixing things. First off, blank DVDs and commercial prerecorded DVDs are very different media. Your example of District 9 can take us on several different tangents. Let's deal with one. The movie was not direct-to-video. I don't know how much it made in theatrical release. However, I assume that the theatrical release was profitable. If this is the case, then the DVD is simply additional revenue. The additional revenue is used to enrich the distributers, producers, actors, and to subsidize other projects that may or may not be so successful.
 

LethalWolfe

macrumors G3
Jan 11, 2002
9,370
124
Los Angeles
Wow! Talking about mixing things. First off, blank DVDs and commercial prerecorded DVDs are very different media. Your example of District 9 can take us on several different tangents. Let's deal with one. The movie was not direct-to-video. I don't know how much it made in theatrical release. However, I assume that the theatrical release was profitable. If this is the case, then the DVD is simply additional revenue. The additional revenue is used to enrich the distributers, producers, actors, and to subsidize other projects that may or may not be so successful.
Like I said, it was designed to be a *basic* example illustrating the point that raw materials are typically on the low end of the cost totem pole compared to things like R&D and marketing.

Apple has loss leaders which are subsidized by higher margin items but traditionally the loss leaders have been software w/the hardware having healthy margins. With the success of the App store and the low cost of the entry level iPad I wouldn't be surprised if the $499 pad was being sold at or near cost and that is very unlike Apple (especially for a brand new product line). Whether or not this signals a new direction in Apple's business philosophy or is just an 'experiment' to try quickly establish dominance in a new computing niche is yet to be seen.


Lethal
 

Eidorian

macrumors Penryn
Mar 23, 2005
29,190
386
Indianapolis
Like I said, it was designed to be a *basic* example illustrating the point that raw materials are typically on the low end of the cost totem pole compared to things like R&D and marketing.

Apple has loss leaders which are subsidized by higher margin items but traditionally the loss leaders have been software w/the hardware having healthy margins. With the success of the App store and the low cost of the entry level iPad I wouldn't be surprised if the $499 pad was being sold at or near cost and that is very unlike Apple (especially for a brand new product line). Whether or not this signals a new direction in Apple's business philosophy or is just an 'experiment' to try quickly establish dominance in a new computing niche is yet to be seen.


Lethal
There's a strong sentiment in the Pro community here that the Mac Pro's price is subsidizing iMac sales and keeping it out of reach as well.

Lower margins on new products were mentioned last year. This is the second new product that falls in line with what they've told us.
 

rdowns

macrumors Penryn
Jul 11, 2003
27,397
12,521
There's a strong sentiment in the Pro community here that the Mac Pro's price is subsidizing iMac sales and keeping it out of reach as well.


That's crazy. Apple sold 1.2 million desktops last quarter. How many MPs in there? Tens of thousands, maybe 100,000.
 

zap2

macrumors 604
Mar 8, 2005
7,252
8
Washington D.C
There's a strong sentiment in the Pro community here that the Mac Pro's price is subsidizing iMac sales and keeping it out of reach as well.

That seem rather unlikely, admittedly the Mac Pro now might be a little old hardware wise, but I recall Jobs doing a price breakdown a while back,and it was very reasonably priced(when compared to PCs of the same specs).

Its a high end work station, so comparing it to PC towers for consumers isn't fair(not say you are, but some do)
 
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