[decadentcactus]

This seems to disagree with what I've heard of Valve and Steam sales. That the bigger the discount, the more (total) revenue is made, almost across the board.

$50 game -> 50% off, 100 sales $50 game -> 75% off, 500 sales etc

[codelion]

Where did you hear that from ? On the contrary. http://www.geekwire.com/2011/experiments-video-game-economic... "What we saw was that pricing was perfectly elastic. In other words, our gross revenue would remain constant."

[taejo]

In that interview, Gabe distinguishes between silent price changes and sales: silently changing the price had no effect on revenue, a promotion discount increased revenue.

[codelion]

Only in certain cases, and he mentions that they do not understand it well enough so they are still experimenting.

[stonemetal]

Yeah, but those are sales(aka short duration discounts). He noted a spike that eventually fell off. I bet the longer steam discounts see sales fall off in a similar manner.