Yen also pointed out how such a court decision could help cut inflation in the US, too, “by dropping the price of a significant chunk of digital purchases by 30% overnight”.
I bet most companies will just take that extra 30% as profit rather than giving it back to their users like proton has.
Interesting that Andy Yen does not have a Wiki page. But Proton says “Previously, Andy was a research scientist at CERN and has a PhD in particle physics from Harvard University.” so, I think he’s very smart, he’s just outside of his lane here.
Or he’s just shitting on other companies who he knows are too greedy to do the same. Proton is getting positive press for this and he’s leaning into it with a bit of hyperbole
Not saying he’s a genius or anything, he’s just a spokesperson doing spokesperson things
Companies that were app-first like mobile games probably won’t cut prices much if any. Companies that were web-first like Proton and Patreon probably will.
With enough competition, someone is going to compete on price to attract customers. They obviously can’t sell for less than their costs (again, sufficiently competitive so you don’t get monopolies starving their competition), so that’s the floor for what they can sustainably charge.
It doesn’t matter what the service is, if there are enough viable alternatives, at least one of them will go for the value play. Customers aren’t willing to pay more than they have to, so they’ll be attracted to lower cost options.
Sure. But if people aren’t willing to pay more than the cost of production, games wouldn’t be made. The cost of production is the floor, and the cost people are willing to pay is the ceiling, and competition finds a line somewhere in the middle. The more competition, the closer it is to the cost of production.
if people aren’t willing to pay more than the cost of production, games wouldn’t be made.
Then that unmade game wouldn’t be relevant to this discussion.
The cost of production is the floor, and the cost people are willing to pay is the ceiling, and competition finds a line somewhere in the middle
Again, no it doesn’t. “What people are willing to pay” includes the competition. If one company undercuts another with a comparable product, consumers won’t pay for the more expensive one.
People would be willing to pay more if there wasn’t as much competition. People obviously want to pay less, and companies obviously want to charge more, so the real variable here is how competitive the market is. And the more competitive the market, the closer to production costs companies are able to pay.
The variable here isn’t how much people are willing to pay, that’s elastic and depends on competition. The real variable is competitiveness in the market, since that is what drives prices closer to production costs.
That is a very broad generalization. First of all inflation is not just some co-product of economic activity. It has specific reasons. An economy is not stagnant because the oil price sinks after geopolitical tensions ease. An economy is not stagnant because businesses are kept from price gouging in cartels or monopoly situations.
Also “stagnant” is not inherently bad. The reason why we need economic growth is because the super rich are siphoning off more and more wealth, so economic growth is the only thing keeping poor people from revolting. A zero growth or even degrowth economy could serve the people very well, if wealth wouldn’t be hoarded away by select few.
I bet most companies will just take that extra 30% as profit rather than giving it back to their users like proton has.
Yeah, even of the companies don’t pocket the difference, he’s an idiot to suggest that this will cut inflation.
This guy is just not very smart, I think.
Interesting that Andy Yen does not have a Wiki page. But Proton says “Previously, Andy was a research scientist at CERN and has a PhD in particle physics from Harvard University.” so, I think he’s very smart, he’s just outside of his lane here.
I think he’s a salesperson trying to sell the idea that getting rid of the apple tax is good for consumers.
Or he’s just shitting on other companies who he knows are too greedy to do the same. Proton is getting positive press for this and he’s leaning into it with a bit of hyperbole
Not saying he’s a genius or anything, he’s just a spokesperson doing spokesperson things
How many years until prices go up? I bet they marked down 1-2 years where they realize they can’t up the prices. But after, it will creep up.
In a decade it’ll probably be the same price it was last year.
Yeah, Proton is bucking the obvious trend, with this one. Most companies will totally take the profits rather than lowering prices.
Companies that were app-first like mobile games probably won’t cut prices much if any. Companies that were web-first like Proton and Patreon probably will.
I highly doubt Apple App Store revenues are a significant portion of the CPI.
I mean, let’s not kid ourselves that it has no effect, but it’s not even in the basket
Yep, product prices are not based on costs but rather just the absolute maximum of what consumers are willing to pay.
Proton just seems to be an exception.
In a sufficiently competitive market, the maximum is related to costs.
Proton is trying to get cheap marketing.
It’s not. It’s just related to the competition AKA what people are willing to pay.
With enough competition, someone is going to compete on price to attract customers. They obviously can’t sell for less than their costs (again, sufficiently competitive so you don’t get monopolies starving their competition), so that’s the floor for what they can sustainably charge.
It doesn’t matter what the service is, if there are enough viable alternatives, at least one of them will go for the value play. Customers aren’t willing to pay more than they have to, so they’ll be attracted to lower cost options.
What I’m saying is that competition is included in “what people are willing to pay”. Cost of production is not.
Sure. But if people aren’t willing to pay more than the cost of production, games wouldn’t be made. The cost of production is the floor, and the cost people are willing to pay is the ceiling, and competition finds a line somewhere in the middle. The more competition, the closer it is to the cost of production.
Then that unmade game wouldn’t be relevant to this discussion.
Again, no it doesn’t. “What people are willing to pay” includes the competition. If one company undercuts another with a comparable product, consumers won’t pay for the more expensive one.
People would be willing to pay more if there wasn’t as much competition. People obviously want to pay less, and companies obviously want to charge more, so the real variable here is how competitive the market is. And the more competitive the market, the closer to production costs companies are able to pay.
The variable here isn’t how much people are willing to pay, that’s elastic and depends on competition. The real variable is competitiveness in the market, since that is what drives prices closer to production costs.
i’m scared how many ceos don’t understand that rapid fall of inflation or zero inflation is bad because it means your economy is stagnant.
That is a very broad generalization. First of all inflation is not just some co-product of economic activity. It has specific reasons. An economy is not stagnant because the oil price sinks after geopolitical tensions ease. An economy is not stagnant because businesses are kept from price gouging in cartels or monopoly situations.
Also “stagnant” is not inherently bad. The reason why we need economic growth is because the super rich are siphoning off more and more wealth, so economic growth is the only thing keeping poor people from revolting. A zero growth or even degrowth economy could serve the people very well, if wealth wouldn’t be hoarded away by select few.