Well...
Actually manufacturing a CD costs pennies. Lets say 20 cents for arguments sake. If you buy the CD for $20.00 that is 100 times the price of what the disk actually costs to make. A good rule of thumb in high end audio is that the 'ACTUAL cost of the parts to make a component is around 10% of the retail price'. Maybe a little less or more depending on manufacturer. This does NOT INCLUDE the labor that goes into making the product.
Basically audio products are marked up 10 times parts costs
CDs are marked up 100 times parts costs
Now there are also OTHER costs involved in making a CD, you have to pay the artist their cut (which is less than $1 per CD sold under most contracts, for a singer to get more than $1 they have to be REALLY big, like say Madonna or U2, many artists get around 30 to 50 CENTS a CD sold.) You have to pay Sony/Phillips a cut ($1 or so) because they have the patent on the CD. And finally the record company has to pay the production and promotion/distribution costs involved in the production of a CD. I do not know what this figure is, but it sure as heck CANNOT be $17 per CD. I could believe $5 or maybe $10, but $17 sounds like price gougeing.
Audio manufacturers have Labor and R&D/production overhead they have to factor into the selling of any product. These percentages vary from company to company.
HOWEVER, when you break it all down, a record production company is marking CDs up way higher than Audio manufacturers are. The sad thing is that CD prices have risen through the years. When CDs first came on the scene they were $15 or so per disc. Now most are at least $15 if not $20. Through the past 20 years it has become ALOT cheaper to make CDs. Heck many people can now make their own CDs at home with their coomputers.
Annyway, I must get back to work.
KF
Actually manufacturing a CD costs pennies. Lets say 20 cents for arguments sake. If you buy the CD for $20.00 that is 100 times the price of what the disk actually costs to make. A good rule of thumb in high end audio is that the 'ACTUAL cost of the parts to make a component is around 10% of the retail price'. Maybe a little less or more depending on manufacturer. This does NOT INCLUDE the labor that goes into making the product.
Basically audio products are marked up 10 times parts costs
CDs are marked up 100 times parts costs
Now there are also OTHER costs involved in making a CD, you have to pay the artist their cut (which is less than $1 per CD sold under most contracts, for a singer to get more than $1 they have to be REALLY big, like say Madonna or U2, many artists get around 30 to 50 CENTS a CD sold.) You have to pay Sony/Phillips a cut ($1 or so) because they have the patent on the CD. And finally the record company has to pay the production and promotion/distribution costs involved in the production of a CD. I do not know what this figure is, but it sure as heck CANNOT be $17 per CD. I could believe $5 or maybe $10, but $17 sounds like price gougeing.
Audio manufacturers have Labor and R&D/production overhead they have to factor into the selling of any product. These percentages vary from company to company.
HOWEVER, when you break it all down, a record production company is marking CDs up way higher than Audio manufacturers are. The sad thing is that CD prices have risen through the years. When CDs first came on the scene they were $15 or so per disc. Now most are at least $15 if not $20. Through the past 20 years it has become ALOT cheaper to make CDs. Heck many people can now make their own CDs at home with their coomputers.
Annyway, I must get back to work.
KF