Starting from July 1, Pocketgear will change the distribution agreement.
Below is the new formula for calculating royalties which goes into
effect on July 1, 2004:
Actual Sales Price minus Transaction Costs equals Net Sales minus
Royalty Rate equals Net to Developer.
An example for an application with a sales price of $19.99:
$19.99 sales price
-$1.12 (minus transaction cost*)
$18.87 net base for royalty
-$5.66 minus 30% royalty rate (40% for Premier Partners)
$13.21 net to developer
This is 66% of the price. The highest commission for a Premier Account that I have ever seen (The highest was Handango's with 70% for a premier account and 60% for a Premium Account).
What this means for users? This means that authors will have to pass this cost to users, so if we continue with the above example, the author will have to increase the price to $22.53 dollars to keep getting the same $14.99 that he was getting in every sale before July 1st.