Not all games are $9.99. Some are still $19.95. I'll be interested to see if this increases my revenue or not. This is indeed a bold move. If I was Reflexive I would focus on making their purchase page more streamlined - remember the customer's details between purchases, make it more friendly, etc.
Sooo.... amazon bought reflexive. So how does this work? Say dev gets 40% of the reflexive sale price. Say amazon pay a 1% share of the sale price as commission to reflexive, and keep 99%. Does that mean the dev now gets 0.4% of the sale price? I'm not saying these are the rates, just asking a question as to how subsidiaries work in legal and business terms. I presume people have contracts with reflexive, not with amazon, and now they are owned by the same people, the incentive is to maximise Amazons profits, which remain 100% with amazon. Does that make sense?
Considering almost all of us have tried the reduced pricing experiment only to find that it made no difference (or outright hurt business) it will be interesting to see how this goes. Publishers have the least exposure to risk so they have more wiggle room to play with pricing than a developer does. Unfortunately, I think developer's cuts are already as low as they can go and still be feasible to make a profit. Even a hit portal game is looking less impressive when you consider the amount a developer actually earns. Assuming (not confirmed) that royalty rates are now based on the $9.95 price tag and that you're still able to get 30% of each sale...that's $2.98 net! So let's say you have a moderately successful game that sells 20,000 copies in the first year. That's only $59,000 to cover the 12 - 18 months development time you likely spent (and indeed would have to spend to produce a portal worthy game that sells that many copies). (cue "old man" voice) Back in the day you used to hope for a hit but could scrape by on a "near-miss" or "moderately popular". Unless my math is wrong, you need to crack the top 5 or else you're in Taco Bell Night-Manager income territory.
Here is some marketing analysis from "E-Myth Mastery" All products are divided into 3 categories: True Products, Commodity Products, and Brand Products. True Products: "When a new product is introduced to the market, or when there is a one-of-a-kind product, it is considered a "True Product" The marketing issue is product acceptance. Teaching the functionality and benefits of the new product. (think Wii) True Products often appeal to experimental buyers. Once competition moves in, the picture changes. Commodity: As more competing products enter the market, and customers begin to accept the product, customers begin to see it as a commodity. People see all the products as the same. Marketing issue is differentiation, getting customers to prefer your product. (360 vs PS3) If you are unable to differentiate your product, the strategy is to compete on price or convenience. This is where you attract "Performance" customers. Brand: As the market matures, it's harder and harder for new competitors to enter the field. Growth potential for the product begins to level off. If you are unable to differentiate your product with features, you have to get them to prefer your brand. This is where you attract "Value" customers." Commentary: The casual games industry is mostly in the Brand phase. Both Portals and series of games are trying to establish "Brand".(Mystery Case Files) I can see the strategy of Amazon's move into the casual space. They have a strong existing brand and they are leveraging into a new market, and the price point shows that we are mostly talking about "Value" buyers. The other problem is how innovation is effected by this. Innovating in game can create a new product, if the behavior is different enough, but you have to teach it to people. Most innovation is iterative, adding a new twist. This is how commodities differentiate themselves. But the outlets (portals) are mostly only care about brand and price. This is why the market looks like it does for game devs.
Come on. That would be ridiculous. Developers get a cut of the purchase price not a percent of some tiny amount that Reflexive gets from Amazon. I understand that the price change is a big deal that everyone wants to talk about and speculate on. That I expected. But these other issues are just paranoia based on zero facts.
Yes, this is the end. I don't think it will be wise to bring a game to the protal nowadays unless it is 6 months old. I feel so bad we released Totem Tribe at the wrong time. ________ Gm 122 Engine Specifications
Some of the games are also now on Amazon.com: like this one I don't know if that's related to Reflexive though, because not all Reflexive games appear to be on Amazon -- mine isn't.
Really? is this how portal contracts work? I didn't think was the case. Say for example that someone else is selling reflexive games on affiliate schemes and taking 40% (no idea the rates) Surely that 40% is deducted BEFORE the dev gets their share? Or are you saying that if (hypothetically) I had a 40% deal with reflexive, that I get $4 when someone buys kudos through amazon's download service at $9.99? I'm not being paranoid, I just want to clarify how these relationships work.
Cliffski is right: according to the contract I believe the dev gets a percent of what reflexive gets, not a percent of the sale price. Also, the Amazon store: http://www.amazon.com/b/?node=979455011 Appears to be composed of a subset of Reflexive games. Perhaps more will be added eventually. Perhaps not, since it launched with 600, which is about half of Reflexive's library. The announcement: http://www.amazon.com/gp/blog/post/PLNK1H6EB4HF79DEG/
Amazon can work with Reflexive as an affiliate, so don't worry about your cuts, worry about low end price...
Stop believing and check out contracts.... I don't have the time to do that, but don't forget that no matter if you got a sale through inhouse or affiliate traffic you still earned 40% of $19.99 less e-commerce and not 40% of $19.99 less affiliate commision (40%) less other costs.
Well, I just read it like a month ago, so it's still fairly fresh in my mind. But you're right that I should have checked to be absolutely sure. Actually from what Russell told me, you can affiliate your own game through Reflexive and get 90% or something along those lines, since your royalties plus the affiliate royalties add up, so you may be right.
In the Reflexive / GameCenterSolution system a developer's cut is never affected by the cut an affiliate gets. Reflexive never pay develoeprs "after" the affiliate take their share out. It doesn't work that way. Everyone's cut is based on purchase prices minus COGs. If your $9.99 game sales on Reflexive.com or Amazon.com or Retro64.com you will get the same developer share on all three places. In every case it will be a little less than $4.
Just thought I'd highlight that bit above as I've just barely gotten to this point of the thread, and think it seems very valuable to the conversation. Also, as noted there are $6.99 and $9.99 games. I also think Cliffski has a point about doing something different. There are multiple ways to compete. I think comparing pricing on Amazon to the other two major portals - Real and BFG is enlightening. Especially if you have reports of your own that you can look at. Without them, it's really hard to talk about everything. Additionally, I think looking at pricing on Steam is rather interesting. Actually, when considering the pricing on the major portals and also the new download channels such as XBLA, WiiWare and iPhone, I'm kind of surprised at the reaction to the pricing change, as the change is similar to what is already available pretty much everywhere. Overall, I think Amazon will be a very powerful player in the casual space and is likely to greatly increase awareness of the games. Honestly, I think most people still aren't aware that these types of games exist. Reaching out to Amazon's customer base is a great thing for the developers .
Something along those lines, I don't know the exact algorithm EDIT: Wait, I was thinking you'd said how did they decide which ones to price higher or lower...Pricing had something to do with newness and sales. On which ones were migrated and why, I actually don't know the particulars at all. Don't think it was sales based, but I don't really know.