The variable costs for reproducing digital content of movies

Solution

The variable costs for reproducing digital content of movies :

There are many costs involved in producing a digital movie.The content and type of story determines the cost range that is expected.The important characteristics involved in producing the digital content are fixed costs and variable costs. Making a digital movie involves very high fixed costs and low variable costs. The costs involved for producing a digitla movie, musical album, television programs, electronic books, the variable costs are very low.The key is how to sell at a low price level for those set of people who are very prices-sensitive.

The important aspect about movies, is its a one time thing.Its very important to try and to meed the expectations and market demand and create alot of hype for its release. In case of these kind of movies , producres charge more for movies for the first 3-4 weeks as itsintroduced at the theatres first time release.The later course of actions chargers comparitively less when is released on pay per view. The next step of releasing the film is through DVD and this costs very much less. Consumers who request the movie for repeat view, usally pays more proce than the cost of releasing in theaters for the first time.

For Reference :

http://catalog.flatworldknowledge.com/bookhub/reader/5574?e=sanders_1.0-ch05_s08

http://www.indiana.edu/~telecom/people/faculty/waterman/ProductionTechnology_DW_final.pdf