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Valve faces a £656 million lawsuit in the UK for 'overcharging 14 million PC gamers'
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this post was submitted on 13 Jun 2024
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Bullshit. Games on steam that hit sales thresholds pay less to steam and the prices remain the same. Games on EGS only pay 12% and prices haven't dropped.
Reality does not comport with your argument at all.
I've been in product development and management for 10+ years. I know how pricing decisions are made. You're very naive.
Well no shit they'll look at the highest price on the market and use the same price everywhere, but the highest price is based on the fact that the distributor takes a 30% cut!
Again, you are very naive. What you're describe is cost-up pricing which hasn't been a generally used method of pricing goods and services for decades at this point. The reason is that doing cost-up pricing is a really good way to go out of business.
The way pricing works today is that sellers set pricing based on what they believe the customer is willing to pay. From there you work backwards accounting for retailer margin, cost of goods, transport, discounts, etc... To find your maximum cost per unit. If you can't produce the product for less than the maximum cost, you either need to scale back your features, add a feature that would justify a higher sell price, or abandon the project.
Your notion that companies would lower prices if they had to give retailers a small cut is not borne out by theory or by observed real world outcomes.
You're wrong. Doubling down won't make you less wrong.