One of the most interesting seldom mentioned concepts in business is the barrier to exit. You decide to buy a truck and start a trucking company. Oh shit, it's harder to make money than you anticipated. If you don't make it work, you're losing your house.
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So you "make it work" and eek out small profits, ruining the profitability of the entire industry. You launch some product and it fails. So you discount it, hurting not only your bottom line but those who compete with you indirectly. Barriers to exit. Few in software!
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Replying to @Molson_Hart
You create a game, launch it, develop another, fail. What do you do with the original piece of software? Maybe sell to a publisher who then runs 90% off sales all the time. Maybe do the same thing yourself. Heavily discounted content hurts the market in games in the same way.
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That’s a good point. Even more interesting: Isn’t gaming famous for being the worst way to make money in software?
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