Prices set to increase ?

[concon]

but there's also no cost to manufacture or distribute software.

Oh, there really is a cost! Lots, actually.

Really? Besides uploading and downloading on servers? How much does that cost?

LOL, there's a little more to running a business that sells digital products than "uploading and downloading on servers". When prices go up, they go up for everything from the domain name, to the electricity bill. Digital products do not manufacture themselves, there is a load of cost involved in the making, marketing, selling, and supporting them. At every stage someone takes money, the web hosting, the payment processor, the bank, the government, the electricity company, re-seller fees, the staff, online subscriptions for file storage, video hosting, the accountants fees!

That's not a comprehensive list. You could say "these are just overheads", but to make (manufacture) digital products you still have to pay for everything, or you will not get a product to market.

Most of your list is overhead. Do you not know what overhead is? And that it applies to all businesses? What business doesn't have to pay for web hosting, electricity, staff, taxes, loan payments, etc.? Direct costs of physical manufacturing and distribution are a whole extra matter, even more compounded by inflation than is online software distribution.

[Biome_Digital]

but there's also no cost to manufacture or distribute software.

Oh, there really is a cost! Lots, actually.

Really? Besides uploading and downloading on servers? How much does that cost?

LOL, there's a little more to running a business that sells digital products than "uploading and downloading on servers". When prices go up, they go up for everything from the domain name, to the electricity bill. Digital products do not manufacture themselves, there is a load of cost involved in the making, marketing, selling, and supporting them. At every stage someone takes money, the web hosting, the payment processor, the bank, the government, the electricity company, re-seller fees, the staff, online subscriptions for file storage, video hosting, the accountants fees!

That's not a comprehensive list. You could say "these are just overheads", but to make (manufacture) digital products you still have to pay for everything, or you will not get a product to market.

Most of your list is overhead. Do you not know what overhead is? And that it applies to all businesses? What business doesn't have to pay for web hosting, electricity, staff, taxes, loan payments, etc.?

Did you read the last line?
"That's not a comprehensive list. You could say "these are just overheads", but to make (manufacture) digital products you still have to pay for everything, or you will not get a product to market."

[donkey tugger]

but there's also no cost to manufacture or distribute software.

Oh, there really is a cost! Lots, actually.

Really? Besides uploading and downloading on servers? How much does that cost?

LOL, there's a little more to running a business that sells digital products than "uploading and downloading on servers". When prices go up, they go up for everything from the domain name, to the electricity bill. Digital products do not manufacture themselves, there is a load of cost involved in the making, marketing, selling, and supporting them. At every stage someone takes money, the web hosting, the payment processor, the bank, the government, the electricity company, re-seller fees, the staff, online subscriptions for file storage, video hosting, the accountants fees!

That's not a comprehensive list. You could say "these are just overheads", but to make (manufacture) digital products you still have to pay for everything, or you will not get a product to market.

Most of your list is overhead. Do you not know what overhead is? And that it applies to all businesses? What business doesn't have to pay for web hosting, electricity, staff, taxes, loan payments, etc.?

Did you read the last line?
"That's not a comprehensive list. You could say "these are just overheads", but to make (manufacture) digital products you still have to pay for everything, or you will not get a product to market."

Do 'overheads' somehow not increase nor feature in accounts now?

[concon]

but there's also no cost to manufacture or distribute software.

Oh, there really is a cost! Lots, actually.

Really? Besides uploading and downloading on servers? How much does that cost?

LOL, there's a little more to running a business that sells digital products than "uploading and downloading on servers". When prices go up, they go up for everything from the domain name, to the electricity bill. Digital products do not manufacture themselves, there is a load of cost involved in the making, marketing, selling, and supporting them. At every stage someone takes money, the web hosting, the payment processor, the bank, the government, the electricity company, re-seller fees, the staff, online subscriptions for file storage, video hosting, the accountants fees!

That's not a comprehensive list. You could say "these are just overheads", but to make (manufacture) digital products you still have to pay for everything, or you will not get a product to market.

Most of your list is overhead. Do you not know what overhead is? And that it applies to all businesses? What business doesn't have to pay for web hosting, electricity, staff, taxes, loan payments, etc.?

Did you read the last line?
"That's not a comprehensive list. You could say "these are just overheads", but to make (manufacture) digital products you still have to pay for everything, or you will not get a product to market."

I'm just pointing out the difference between overhead costs faced by all businesses, as opposed to physical manufacturing and distribution costs, which are per unit and extra. This is economics 101.

[Biome_Digital]

but there's also no cost to manufacture or distribute software.

Oh, there really is a cost! Lots, actually.

Really? Besides uploading and downloading on servers? How much does that cost?

Wages, pensions, training, HR costs (for larger companies), promotion and advertising, equipment and software, office space, compliance with tax, data, company registration, and other regulations, heating and lighting, insurance, banking charges, accountancy and audit, etc etc.

Some seem to strangely think that software companies are exempt from all the requirements any other company has to meet. Their costs may not rise as disproportionately as say a manufacturing industry where the raw material price has increased, but rise they will, given the interconnected nature of businesses.

Exactly, you can't "manufacture" a digital product without buying, running, and maintaining a computer, and not all businesses have to have a computer. Not all businesses have a website, either.

[concon]

but there's also no cost to manufacture or distribute software.

Oh, there really is a cost! Lots, actually.

Really? Besides uploading and downloading on servers? How much does that cost?

Wages, pensions, training, HR costs (for larger companies), promotion and advertising, equipment and software, office space, compliance with tax, data, company registration, and other regulations, heating and lighting, insurance, banking charges, accountancy and audit, etc etc.

Some seem to strangely think that software companies are exempt from all the requirements any other company has to meet. Their costs may not rise as disproportionately as say a manufacturing industry where the raw material price has increased, but rise they will, given the interconnected nature of businesses.

Exactly, you can't "manufacture" a digital product without buying, running, and maintaining a computer, and not all businesses have to have a computer. Not all businesses have a website, either.

Most businesses require computers. And most have a web presence. C'mon.

[concon]

Do 'overheads' somehow not increase nor feature in accounts now?

I'm just saying every business has to pay overhead costs, no different than software developers. And yeah, those costs are going up for all businesses. But producers of physical products have extra costs more directly impacted by supply chain difficulties and fuel expenses, which impact product price inflation more. Software developers don't have these extra costs.

[donkey tugger]

I'm just saying every business has to pay overhead costs, no different than software developers. And yeah, those costs are going up for all businesses. But producers of physical products have extra costs more directly impacted by supply chain difficulties and fuel expenses, which impact product price inflation more. Software developers don't have these extra costs.

Indeed, and that was a point I made;

Their costs may not rise as disproportionately as say a manufacturing industry where the raw material price has increased, but rise they will, given the interconnected nature of businesses.

The question therefore is how are those increased costs to be addressed?

[LFO8]

seriously, around 25 quid a week i used to spend, now its 47 wtf

25 quid per week on what?

[concon]

I'm just saying every business has to pay overhead costs, no different than software developers. And yeah, those costs are going up for all businesses. But producers of physical products have extra costs more directly impacted by supply chain difficulties and fuel expenses, which impact product price inflation more. Software developers don't have these extra costs.

Indeed, and that was a point I made;

Their costs may not rise as disproportionately as say a manufacturing industry where the raw material price has increased, but rise they will, given the interconnected nature of businesses.

The question therefore is how are those increased costs to be addressed?

Right. And I was agreeing with you and supporting your statement. How the cost increases affecting all businesses, including software developers, affect software prices remains to be seen. I'm hoping they'll be more resilient than prices for most other kinds of products, especially those that are physical in nature.

[LeVzi]

Ahum...cough, cough.
Not that anyone cares but...
I can't get over the fact that the title of the post is a statement and the post itself is a question.

Prices goes up when sellers can find a good motivation for it but never comes down again. That's capitalism and that's unfortunately what we have to deal with. Keep smiling or they catch you.

Here's the missing question mark

?

I hope that calms your nerves.

[Urs]

One of the biggest single cost factors and workload at u-he is customer support. Another is product maintenance. That's something that happens *after* a license is sold. While indeed "manufacturing" (in terms of copying the final product) and distribution is small bucks, the post-sale costs of software are incredibly high, compared to a company which manufactures, say, cups, flower pots or letter boxes.

That said, it's no secret most music software developers have done very well during the pandemic, probably because people had more time to make music or maybe because live gigging has turned into production in the box. Such that I think at least some of us will be able to sit the current inflation out on current prices without having too much of a hard time.

[LeVzi]

One of the biggest single cost factors and workload at u-he is customer support. Another is product maintenance. That's something that happens *after* a license is sold. While indeed "manufacturing" (in terms of copying the final product) and distribution is small bucks, the post-sale costs of software are incredibly high, compared to a company which manufactures, say, cups, flower pots or letter boxes.

That said, it's no secret most music software developers have done very well during the pandemic, probably because people had more time to make music or maybe because live gigging has turned into production in the box. Such that I think at least some of us will be able to sit the current inflation out on current prices without having too much of a hard time.

That's good to know. I hope most of the devs will be able to keep current prices , although some are seemingly jumping the gun.

[concon]

One of the biggest single cost factors and workload at u-he is customer support. Another is product maintenance. That's something that happens *after* a license is sold. While indeed "manufacturing" (in terms of copying the final product) and distribution is small bucks, the post-sale costs of software are incredibly high, compared to a company which manufactures, say, cups, flower pots or letter boxes.

That's interesting that much of a software developer's costs are post-sale in customer support. You do realize, of course, that most businesses also must provide customer support, and physical manufacturers typically have to allow for the costs of product returns, say of defective or poorly shipped cups, flower pots, and letter boxes. I'm glad to hear your admission that distribution costs for software products don't add up to much, and your prediction that product prices shouldn't be so much impacted by inflation costs.

[Urs]

your prediction that product prices shouldn't be so much impacted by inflation costs.

I have only spoken for my company and my products. I can not predict how other companies are going to be affected and act upon it.

The costs of running a business are real, and if inflation means that employees need higher salaries, ad prices going up, servers, rent, insurances, all those factors, then that money must come from somewhere*, regardless of the manufacturing and distribution process.

I just currently don't see the need to react to inflation myself, even if we have raised salaries recently to meet current inflation rates.

*in our case, we had a few good years and we've spent conservatively, so we're pretty comfortable.