At 10:26 AM 7/24/96 -0800, jim bell wrote:
Isn't it odd that when music is sold, CD's are MORE expensive than cassette tapes, even though you _know_ that the manufacturing cost of CD's is less?
CDs sell for more because buyers decided that they wanted a wider range of titles with shallower sales (hence higher unit costs) rather than a narrower range of titles with lower sales prices. The number of CD titles available is far greater (in general distribution) than the number of vinyl titles that were available during vinyl's peak year. This greater availability of short run pressings raises average unit sales costs justifying the higher prices. Had the market decided (when physical production costs fell) that it was satisfied with a Top-40 CD stock, average CD prices would have fallen to vinyl levels.
Another oddity: The price for a blank, standard-quality videocassette is about the same as that of a blank, standard-quality audio cassette tape, despite the fact that the volume of tape included in the former is probably about a factor of 10 higher.
Materials cost is a minor part of total cost. In both cases, the cost of production is a small part of the cost of goods sold. Almost all of that cost is the cost of marketing (as with all mass-market products in a modern capitalist economy. DCF "The only adequate description of the Universe is the Universe itself. The only fair price of an item is the market price. Neither the Universe nor the Market can be adequately duplicated in the head of a Congresscritter."