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Text 5115, 224 rader
Skriven 2005-06-17 22:20:46 av Rich (1:379/45)
   Kommentar till text 5114 av Geo (1:379/45)
Ärende: Re: Everyone should take a pay cut
==========================================
From: "Rich" <@>

This is a multi-part message in MIME format.

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   New software is not less expensive.  Let's say you simply wanted to =
create a product that was competitive with what existed 10 years ago = instead
of competitive with today's software.  It will cost more than it = did to
produce 10 years ago because for as many man years as it takes to = produce
those man years cost more today.  It won't take you fewer man = years to
produce.

   Your attempt at math is way off.  You have several fatal flaws =
including your continued attempt to pretend that fixed costs have not =
increased dramatically, pretending that variable costs have not = increased,
pretending that the revenue to support the increased costs = and investment is
also unchanging, and that there is no inflation = either.  This is above and
beyond your implication that a more = successful product should not actually be
expected to be more profitable = particularly since this is what provides the
motivation for investment = and innovation.  In regard to competition, the
success of such products = and the dramatic growth of the market that you made
such a big deal of = create openings for competition that keep prices at the
right level.

   Now, George, for your own businesses you are free to drop prices to =
progressively become less profitable, if you ever were.  You are also = free to
enter any market where you believe that prices are too high and = sell a
competitive product for less.  This is what Microsoft has a = reputation for
with Office being a prime example of a product that sold = for less than the
products with which it competed and as we have = discussed has continued to
drop in price while increasing in value.

Rich

  "Geo" <georger@nls.net> wrote in message news:42b3a893@w3.nls.net...
  "Rich" <@> wrote in message news:42b3988f@w3.nls.net...

  >> much more labor is required for today's software because you get so =
much
  more of it.

  I don't agree, it's not "today's" software that requires more labor, =
it's
  mature software that requires more because it suffers from the =
featuritis
  problem of trying to add every feature anyone could ever ask for. New
  software is inexpensive to make compared to the past.

  >>   When Microsoft Office for Windows was released in 1990 containing =
Word,
  Excel, and PowerPoint it was $995.  In 1991 Mail was added and the =
price
  dropped to $750.  Today, the current much more functional versions of =
those
  applications are included in Microsoft Office Standard Edition 2003 =
for $399
  SRP for full packaged retail non-upgrade with a street price 30% lower
  =
(http://www.atomicpark.com/xq/aspx/microsoft-office-2003-standard/prodid.=
189
  44/buy.software/qx/productdetail.html).  Volume licenced copies are
  obviously less expensive.<<


  Ok, now lets try to figure out how many copies of office were sold in =
1990
  compared to 2003. From 1988 to 1990 (figure a 3 year life time for a =
PC)
  there were 44 million pc's sold, so lets assume a copy of office sold =
for
  each one (zero piracy), that's 44 million copies of office times $995 =
equals
  43 billion dollars maximum market size.

  In 2001 thru 2003 there were 405 million pc's sold, times $399 equals =
a
  maximum market size of 161 billion dollars or a 360% increase in sales =
if
  you didn't gain any market share. So just based on market growth the =
price
  should have come down to $276 SRP not $400, and that doesn't take into
  account the fact that office gained a hell of a lot of market share =
during
  that time period. If it's market share went from 40% to 80% (not =
unlikely)
  then you can take that $276 down to $138.

  PC figures from http://www.pegasus3d.com/total_share.html

  Geo.



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<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN">
<HTML><HEAD>
<META http-equiv=3DContent-Type content=3D"text/html; =
charset=3Diso-8859-1">
<META content=3D"MSHTML 6.00.2900.2668" name=3DGENERATOR>
<STYLE></STYLE>
</HEAD>
<BODY bgColor=3D#ffffff>
<DIV><FONT face=3DArial size=3D2>&nbsp;&nbsp; New software is not less=20
expensive.&nbsp; Let's say you simply wanted to create a product that = was=20
competitive with what existed 10 years ago instead of competitive with =
today's=20
software.&nbsp; It will cost more than it did to produce 10 years ago =
because=20
for as many man years as it takes to produce those man years cost more=20
today.&nbsp; It won't take you fewer man years to produce.</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT>&nbsp;</DIV>
<DIV><FONT face=3DArial size=3D2>&nbsp;&nbsp; Your attempt at math is =
way off.&nbsp;=20
You have several fatal flaws including your continued attempt to pretend =
that=20
fixed costs have not increased dramatically, pretending that variable = costs
have=20
not increased, pretending that the revenue to support the increased = costs
and=20
investment is also unchanging, and that there is no inflation = either.&nbsp;
This=20
is above and beyond your implication that a more successful product = should
not=20
actually be expected to be more profitable particularly since this is = what=20
provides the motivation for investment and innovation.&nbsp; In regard = to=20
competition, the success of such products and the dramatic growth of the =
market=20
that you made such a big deal of create openings for competition that = keep=20
prices at the right level.</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT>&nbsp;</DIV>
<DIV><FONT face=3DArial size=3D2>&nbsp;&nbsp; Now, George, for your own =
businesses=20
you are free to drop prices to progressively become less profitable, if = you
ever=20
were.&nbsp; You are also free to enter any market where you believe that =
prices=20
are too high and sell a competitive product for less.&nbsp; This is what =

Microsoft has a reputation for with Office being a prime example of a =
product=20
that sold for less than the products with which it competed and as we = have=20
discussed has continued to drop in price while increasing in =
value.</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT>&nbsp;</DIV>
<DIV><FONT face=3DArial size=3D2>Rich</FONT></DIV>
<DIV><FONT face=3DArial size=3D2></FONT>&nbsp;</DIV>
<BLOCKQUOTE=20
style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; =
BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
  <DIV>"Geo" &lt;<A =
href=3D"mailto:georger@nls.net">georger@nls.net</A>&gt; wrote=20
  in message <A=20
  =
href=3D"news:42b3a893@w3.nls.net">news:42b3a893@w3.nls.net</A>...</DIV>"R=
ich"=20
  &lt;@&gt; wrote in message <A=20
  =
href=3D"news:42b3988f@w3.nls.net">news:42b3988f@w3.nls.net</A>...<BR><BR>=
&gt;&gt;=20
  much more labor is required for today's software because you get so=20
  much<BR>more of it.<BR><BR>I don't agree, it's not "today's" software =
that=20
  requires more labor, it's<BR>mature software that requires more =
because it=20
  suffers from the featuritis<BR>problem of trying to add every feature =
anyone=20
  could ever ask for. New<BR>software is inexpensive to make compared to =
the=20
  past.<BR><BR>&gt;&gt;&nbsp;&nbsp; When Microsoft Office for Windows =
was=20
  released in 1990 containing Word,<BR>Excel, and PowerPoint it was =
$995.&nbsp;=20
  In 1991 Mail was added and the price<BR>dropped to $750.&nbsp; Today, =
the=20
  current much more functional versions of those<BR>applications are =
included in=20
  Microsoft Office Standard Edition 2003 for $399<BR>SRP for full =
packaged=20
  retail non-upgrade with a street price 30% lower<BR>(<A=20
  =
href=3D"http://www.atomicpark.com/xq/aspx/microsoft-office-2003-standard/=
prodid.189">http://www.atomicpark.com/xq/aspx/microsoft-office-2003-stand=
ard/prodid.189</A><BR>44/buy.software/qx/productdetail.html).&nbsp;=20
  Volume licenced copies are<BR>obviously less =
expensive.&lt;&lt;<BR><BR><BR>Ok,=20
  now lets try to figure out how many copies of office were sold in=20
  1990<BR>compared to 2003. From 1988 to 1990 (figure a 3 year life time =
for a=20
  PC)<BR>there were 44 million pc's sold, so lets assume a copy of =
office sold=20
  for<BR>each one (zero piracy), that's 44 million copies of office =
times $995=20
  equals<BR>43 billion dollars maximum market size.<BR><BR>In 2001 thru =
2003=20
  there were 405 million pc's sold, times $399 equals a<BR>maximum =
market size=20
  of 161 billion dollars or a 360% increase in sales if<BR>you didn't =
gain any=20
  market share. So just based on market growth the price<BR>should have =
come=20
  down to $276 SRP not $400, and that doesn't take into<BR>account the =
fact that=20
  office gained a hell of a lot of market share during<BR>that time =
period. If=20
  it's market share went from 40% to 80% (not unlikely)<BR>then you can =
take=20
  that $276 down to $138.<BR><BR>PC figures from <A=20
  =
href=3D"http://www.pegasus3d.com/total_share.html">http://www.pegasus3d.c=
om/total_share.html</A><BR><BR>Geo.<BR><BR><BR></BLOCKQUOTE></BODY></HTML=
>

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