Activity › Forums › Apple Final Cut Pro Legacy › Milking the FCP cash cow
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Milking the FCP cash cow
Posted by Eric Jurgenson on July 24, 2009 at 3:56 pmLets see – 1 million users; maybe 25% buy the upgrade. 250K x $300. = $75.5 million revenue. Actual development cost: Let’s say it took twenty programmers two years: 20 x $100K x 2 = $4 million. Add executive and corporate board compensation – maybe $20 million. Thats over $50 million clear profit!
Helmut Kobler replied 16 years, 9 months ago 19 Members · 26 Replies -
26 Replies
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Victor Perez
July 24, 2009 at 4:07 pmNot to mention upgrading 2 of our 6 suites to MacPros from G5s just to keep all systems running on the same Final Cut Studio 3 software. I am sure backwards compatibility of projects will not be available as before.
Wonder what percentage of users will need to upgrade their machines and Kona Cards as well. You could look at it as a boost to the economy. Well Hopefully.
Victor
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Chris Gormlie
July 24, 2009 at 4:21 pmWith or without whatever folks wanted, for the price of a dozen or so tapes the update IS a no-brainer, certainly for intel users.
I know i’ve made WAY more than a 200% ‘profit’ from my FCS investment. Can’t really fault Apple for making theirs.
I’ve changed my mind from my initial knee-jerk reaction to the release… I reckon a few more will do the same once the dust settles.
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David Roth weiss
July 24, 2009 at 4:23 pmYou forgot about all the charges for pizzas and mocha frappucinos.
The profit probably goes down to under $20 million after those expenses…
And so, your point is?
Eric,
Apple has 1.4 million FCP users, some of whom actually make a living using their $1000 software suite, and no one I’ve heard voice their complaints has so far said that FCP prevents them from accomplishing their work or from making their living in video production.
So, Apple has not reinvented the wheel yet and that obviously makes you and many others unhappy, if you want to punish them for that, then vote with your dollars by refusing to give them your $299 upgrade fee. But deriding them for making (or trying to make) a small profit seems rather pointless.
David Roth Weiss
Director/Editor
David Weiss Productions, Inc.
Los AngelesPOST-PRODUCTION WITHOUT THE USUAL INSANITY ™
A forum host of Creative COW’s Apple Final Cut Pro, Business & Marketing, and Indie Film & Documentary forums.
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Victor Perez
July 24, 2009 at 5:02 pmAdditional profit and ease IS worth the minimal 300 upgrade.
Victor
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Chris Poisson
July 24, 2009 at 5:07 pmAn even more basic critique of Eric’s post, do that math against ANY successful product, and you would see margins even greater than what Apple is making on FCP. BTW I think his estimate is low.
But when I think back on it, over the years and upgrades, I have probably paid more than $5,000 for my FCP, to think I could get the latest version for $999 is just ludicrous. And yes, it does make me feel a little ripped off.
Have a wonderful day.
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Stephen Smith
July 24, 2009 at 5:59 pmIf a plug-in was created for Motion to add 3D shadows and reflections I imagine people would pay 300 just for the plug-in. Getting that and a whole lot more for the small price of $299 for a upgrade is cheap. I can’t wait to play with the new version when it arrives.
Check out the TV Show Open I did.
Check out my DVD Money Making Graphics & Effects for Final Cut Studio 2
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Mark Maness
July 24, 2009 at 6:24 pmSo…. When was the last time you bought any gas for your car?
Be it, $999 or $299, the price is more than fair. Compare this to Adobe’s Creative Suite. Can you buy that for $999? I don’t think so…. Can you upgrade from CS3 to CS4 for $299? Nope.
So tell me, where’s the complaint now?
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Wayne Carey
Schazam Productions
https://web.mac.com/schazamproductions
schazamproductions@mac.com -
Eric Jurgenson
July 24, 2009 at 7:23 pmI guess my point is that this should have been a free “point” upgrade. I think there is about as much here as in the PPro 4.1 upgrade (which was free). There is no comparison to the number of features added in the CS3 to CS4 upgrade. Everyone is waiting for the 64-bit “Snow Leopard” release. That would certainly qualify as a full upgrade, but now that looks even further out in the future (another two years maybe). I bet we see 64-bit CS5 on the Mac before 64-bit FCS4.
Apple can make enough money from its user base to afford to put more money into development, but they choose not to. It reminds me of Avid ten years ago, who decided they owned the market, and could get away force feeding users with overpriced software and hardware. It almost put them out of business. Of course Apple won’t go out of business (as long as the iPhone stays hot – maybe a few more years), but they won’t sell the pro apps (which would undoubtably accelerate development), as long as they can get away with charging $300. for what amounts to a point upgrade.
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Andrew Kimery
July 24, 2009 at 7:36 pm‘Cash cow’ wouldn’t be the first words that come to my mind for apps that have always sold well below fair market value, IMO. I mean, since about version 5 FCP has really gone toe-to-toe w/Avid (an obviously much more expensive solution), Color cost $25k before Apple purchased it and included it in FCS2 at no extra charge, Shake received big price cuts under apple as well. Taking a look at the FCS suite I can’t think of comparable apps I could get for anywhere near the price.
Apple’s ProApps are high profile, and they can sell hardware, but I don’t think they are big money makers all by themselves. I kind of liken it to car companies and auto racing. Ford and Toyota don’t get into racing to get rich they get into racing to show off, get headlines and as a developmental proving ground.
-Andrew
3.2GHz 8-core, FCP 6.0.4, 10.5.5
Blackmagic Multibridge Eclipse (6.8.1) -
Michael Sacci
July 24, 2009 at 7:46 pm[Chris Poisson] “But when I think back on it, over the years and upgrades, I have probably paid more than $5,000 for my FCP, to think I could get the latest version for $999 is just ludicrous. And yes, it does make me feel a little ripped off. “
Would you be willing to give back all your billable $ that you made in the X amount of years if someone was willing to give you the $4000 that you payed in upgrades along the way?
This line of thinking doesn’t make sense. I have purchased 3 seats of FCP/FCS since FCP3 come out, as well as DVDSP1.5, So I’m sure there is changes my total cost per seat is up there but I have made more than $4000/seat/year off the software. It sounds like to make you happy Apple would need to keep adding to the full retail price of the software to cover all past upgrades. That is just soar grapes.
Eric, hope your clients don’t use that math on your services, You buy a system for $10K and you charge how much? Color was free, how can you charge me $150-250/hr to use it?
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