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Posted by suioir 6 days ago

Autodesk's John Walker Explained HP and IBM in 1991 (2015)(www.cringely.com)
136 points | 67 commentspage 2
jaynate 2 days ago|
Had me hooked right up to this point: “When we get the check, we pay a commission to this representative. Assume the commission is $500.”

I’ve never seen a software company pay 50% commissions on a software sale. I know it’s and example but the percentages are wrong even for the perpetually licensed days. Should be closer to 8-15%.

Totally sales and marketing spend could indeed be higher in this model because autodesk moved to direct positioning with end buyers rather than distributors.

jdswain 2 days ago||
Commissions were different back then. I worked part time selling computers around 1990 and a little earlier, margin on computers was moving down, but was as high as 50%, I recall it moving down to 30% and stabilising there for a while. I don't remember software margins, but it could have been about the same. I used to get 50% of the margin as commission.
xoxxala 2 days ago||
When I sold Windows 2.1 at Egghead Software, my spiff was an extra 30% for the first month as a promo. I always assumed that was a loss leader by Microsoft to push extra copies on release.
kragen 2 days ago|||
I'm pretty sure this is a roughly accurate breakdown of AutoCAD's cost structure 34 years ago. How long have you been in the business, and what was the highest-sticker-price software you were selling?
WillAdams 2 days ago||
A further consideration here is that this wasn't just commission, but also a payment towards providing support to the customer.
zkmon 2 days ago|
The way businesses or empires had success was by dancing to the tune of the time. The tune changes with time. The wind changes, tides change direction, the overall context changes. So it doesn't help to much to study what business have done or what empires have done or what leaders have done. They were a minuscule part of the overall climate and context, which was overlooked by historians.

Foreground is a product of the background.