What exactly is the reason for plug-in's requiring license transfer fees?

[antic604]

By that logic you could charge transfer fees for literally anything

Not everything. Most things bought 2nd hand have already lost some of their value because of age, wear & tear, obsolescence, etc. For example 2nd hand car, hardware, clothes, house, etc. and that's a natural barrier that keeps many people from buying, as they prefer to have something ganuinely new.

With software 2nd hand license is as new as ever, so transfer fee is a stand-in mechanism to create such a artificial barrier.

[Biome_Digital]

Isn't the most obvious reason "lost sales", though? If I bought a plugin and sold it to someone else, the developer only saw one sale instead of two. Obviously I can't use the plugin anymore and the other person now can, so - in practice - only one license is in active use, but still two people have used it, created music with it, maybe even profited from using it, etc.

Exactly, we need to support companies that make decent products. Sure I've bought some second hand licences before, but now I just buy from the people that make it, the people that spent all the time and money to make an excellent plugin I want/need to use.

[melomood]

Maybe they can work out a deal. You get the second hand software you feel shouldn't require a transfer fee and you get an as is piece of software with no future bug fixes or leveraging for a discount on upgrades

[foosnark]

Sounds like a good guess, but I find this archaic.

I.e. why isn't the license system entirely automated?

Someone has to write and maintain he software to automate it. That person also has to get paid.

piece of software with no future bug fixes or leveraging for a discount on upgrades

And now the developer needs a system to track who is and isn't eligible for bug fix updates, which also costs them money/time/effort.

[Urs]

My guess: An average of 5 to 10 emails back and forth, database operations, this and that taking an average of so and so many minutes at an average cost of 30€ an hour for the staffer who does it.

Sounds like a good guess, but I find this archaic.

I.e. why isn't the license system entirely automated?

Yes, it's archaic.

Mostly because when we came up with it, it was hardly necessary to put up an automated process. But as the number of customers has tripled or quadrupled in the past few years, now there are times when a single support person could do nothing but license transfers (usually in the weeks 9 months after a sale). Other weeks, it's one or two.

But yeah, as we move our license scheme from simple serial to even more simple keyfile (one file for all your u-he licenses, register everything with a single drag'n'drop), we're also working on an automated license transfer scheme. Which - if it works well enough - will be free entirely. This process is estimated to take two years though.

[AnX]

What exactly is the reason for plug-in's requiring license transfer fees?

Is it necessarily just about making money?

Or are there real costs to be covered?

Could also be, if its a very high fee, to put ppl off from selling plugins in the first place.

[whyterabbyt]

Some devs have automatic systems such as Voxengo, PA, iLok.
Voxengo is free, iLok charges, PA even more.

For the record, not all iLok transfers are fully automatic. Some involve manual intervention as well; its up to the developer.

[melomood]

Sounds like a good guess, but I find this archaic.

I.e. why isn't the license system entirely automated?

Someone has to write and maintain he software to automate it. That person also has to get paid.

piece of software with no future bug fixes or leveraging for a discount on upgrades

And now the developer needs a system to track who is and isn't eligible for bug fix updates, which also costs them money/time/effort.

Was being facetious

[Ploki]

Some devs have automatic systems such as Voxengo, PA, iLok.
Voxengo is free, iLok charges, PA even more.

For the record, not all iLok transfers are fully automatic. Some involve manual intervention as well; its up to the developer.

Oh right you're correct - i only had it happen once so i forgot about it.

[MirkoVanHauten]

I remember some dude buying a high number of licenses for a plugin when it was for sale. Afterwards sold them for less than the regular price, creating sort of a "business" and competition to the company. If such licenses can be transfered at all, I think transfer fees are at least some sort of small compensation for this misuse.

You could say that every transfered license is a "loss" in a new product being sold. And it's adding a "new customer" theoretically needing support. This should also be compensated for.

[Ploki]

That's called scalping, people have been doing it for ages. Not sure what's the legal status of it, but it should be illegal anyway lol

[bungle]

My guess: An average of 5 to 10 emails back and forth, database operations, this and that taking an average of so and so many minutes at an average cost of 30€ an hour for the staffer who does it.

To be fair, it seems that software developers are the only ones who run a business model that does not count admin as part of running costs, aren't these better factored in to basic support in the original sale price?
It is more understandable with an independent developer, and the paradox there is that the more independent the developer, the less chance they will charge.

Gratuitous vehicle analogy.
I once worked as a mechanic, if an owner of a newly purchased vehicle came in and needed a tyre pressure checking, it was done, no charge, gratis.
That is just running cost customer service, and transfers very much feel like they should fall in to this category.

(For the record I have no idea your transfer policy, just replying to your post, nothing more, no ill intent)

Aside.
Oh and lets not even get in to IK and their transfer fees for hardware, I don't want the ban that that will bring on this forum.

[ShawnG]

If you allow license transfers, you have to have some sort of copy protection (or else people will buy the plug-in, sell it and keep using it. aka “casual piracy”, also why sample packs usually can’t be transferred) if you have copy protection then you have to administer the copy protection in some way that costs money, either manually or automated (automated does not equal “free”) combine that fact with the developer not wanting to wholeheartedly promote doing it (there are benefits and drawbacks to the developer for doing license transfers). There’s your fee. Yes you can sell your car, but in that case, you don’t have to call Ford and make them process the paperwork, do you? If you did, Ford would charge you. You can bake that cost into the price, but then everybody is paying for a few to do license transfers. That might be how some do it.

Years ago people would complain about Cakewalk not allowing transfers, but cakewalk also didn’t employ anything more than a serial for copy protection. There was no way for them to verify the original user wasn’t still using it forever.

[Passing Bye]

I remember some dude buying a high number of licenses for a plugin when it was for sale. Afterwards sold them for less than the regular price, creating sort of a "business" and competition to the company. If such licenses can be transfered at all, I think transfer fees are at least some sort of small compensation for this misuse.

You could say that every transfered license is a "loss" in a new product being sold. And it's adding a "new customer" theoretically needing support. This should also be compensated for.

What is lost, if guy bought 50 licenses, developer sold 50 licenses and 50 new customers are waiting for those same licenses?

[DaveClark]

What is lost, if guy bought 50 licenses, developer sold 50 licenses and 50 new customers are waiting for those same licenses?

Revenue example:

Normal price, $50 x 50 = $2,500.
Sale price, $25 x 50 = $1,250.
Later discounted resale, $35 x 50 = $1,750.
Profit to reseller, $10 x 50 = $500.
Lost revenue for producer, $25 x 50 = $1,250.

This assumes that all of those who paid $35 would pay $50 which is not necessarily true, so is more like a limit.