The AppStore is bringing math back again to game developers. Lately there we had Jeff Atwood thinking out loud, why setting the price to the lowest possible, 0.99 cent, is the best way to go for iPhone-developers. Adam Saltsman now takes the turn and doing math the other way round: If you sell a certain amount of games, a higher price might be better, just because revenues grow as sales grow. He writes the whole turn at Gamasutra:

The best case scenario here is that we’re all working from home and have cheap mortgages, and only need maybe $5,000 per month for living expenses (before taxes). We’re going to ignore health insurance and stuff like that for now too – very rosey best-case scenario! So, quick mental math, we need to recoup about $30,000 in net revenue just to break even, much less earn a little extra to put toward the next project.

So, let’s check out the bottom three pricing tiers (in USD only for sake of simplicity):

50,000 copies x $0.99 = $49,999 – 30% = $35,000

50,000 copies x $1.99 = $99,500 – 30% = $70,000

50,000 copies x $2.99 = $149,500 – 30% = $105,000

Which brings me somewhat circuitously to my main point: selling your game for $0.99 means you have to get in the top 10 to make it worth your while. Selling your game for $1.99 or more means you can get by and maybe even fund your next project even if you’re only in the top 100.

Simple math, isn’t it? What do you think?


Blog, Research and Theory - Date published: December 9, 2009 | 0 Comments

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