profit margin
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Is Google selling the Nexus 7 at a loss?
Andy Rubin has already made it known that Google isn't planning to profit from the Nexus 7's hardware -- according to him, it's being sold at cost. However, a teardown conducted by TechInsights (and reported by Fudzilla) suggests that the true extent of our 'discount' may have been underplayed, because the Nexus 7's parts alone reportedly add up to around $184. That's just $15 below the current asking price for an 8GB model, before you even get to all the added costs like packaging, distribution, support, marketing and the tidy $25 Google Play voucher that comes as part of the bundle. Now, these figures may not be reliable, because who knows what deals Google and ASUS managed to negotiate, but still, it's further evidence (in case you needed it) that this tablet makes for a smart purchase.
Tiny Speck and Trion Worlds make gaming headlines in 2011
Trion Worlds and Tiny Speck are two MMO studios that have made waves in 2011 with their ambitious plans and potential profit margins, according to the Wall Street Journal. The publication's article examines how these companies are running contrary to Zynga's model by producing top-tier content without trying to nickle-and-dime customers. Trion's story is seen as one of high risk and higher rewards, especially considering that it was bringing in no revenue before last March while developing three titles. "RIFT has had tremendous success -- the commercial results are just astounding -- but we've got two more big games coming... There is no joy in Mudville," said Trion's David Reid. The article notes that once a MMO breaks even, the profit margin can be as high as 70%. Trion is reportedly adding 100 new people to the team in the first part of 2012, which will put this studio in giant-sized territory: 520 employees in total. Tiny Speck may not be as large, with just 41 employees, but the team is growing due to Glitch's success. Even though the potential to make money is there, co-founder Eric Costello says that the team puts in long hours as primarily a labor of love: "The game industry is famous for running their employees into the ground, and we definitely don't want to do that, but we've also found that building a game is a lot harder than we thought it would be."
Forum post of the day: Using the Auction House properly
The economy in WoW has some interesting nuances. Players spend oodles of WoW gold on their crafting professions, and sometimes manage to turn a tidy profit. I'm often surprised to see some items that are strongly in-demand, like Light Feathers. Shrewd players use the auction house to build their bankrolls. Lomentari of EU-Draenor is exasperated with people who fail to use the auction house "properly." She is angry that other crafters are selling the same product she creates for several gold lower than her preferred price. The items are placed on the auction house en masse at the low low rate, which the original poster blames on Leather Workers skilling up. She feels powerless to do anything about her "massive money loss." The original poster is willing to accept small cuts in pricing, but has a hard time deal with steep declines in prices.
