This is a GREAT question and deserves a detailed answer, so happy reading.
First, you have companies out there like Tiger Direct, Buy.com and Amazon. These HUGE companies buy and ship their products from direct distribution channels. They have competitive prices for their cheap software when compared to the brick and mortar stores like Best Buy, Staples and Office Max. Occasionally, a manufacturer such as Microsoft will provide incentive money or kickbacks to these companies which allow them to lower their prices to move particular items. Unfortunately, this type of activity usually occurs when a manufacturer is trying to sell off old product to make way for a new one about to be released or they are trying to gain market share. Regardless, on occasion, you will find some very good deals from these large companies.
Next, you have companies like DirectDeals.com who buy products from the same direct distribution sources as the large internet retailers as well as secondary sources. These secondary sources are where the great deals come from. Occasionally, we run across limited amounts of specific products that are priced under the current distribution price. We agree to buy these items and bring them into our warehouse for inspection to ensure that they are 100% genuine. We then sell them at a discount over what our normal price would be buying directly out of distribution. So when you see a price on DirectDeals.com that is well below the price of a major online retailer like Buy.com or Amazon.com, you can rest assured that there are limited quantities available and once we sell out, the price will go back up to a competitive level with these large companies.
Lastly, you run into companies online who seem to be able to offer unlimited quantities of the most popular items at INCREDIBLE prices. You should do your homework on these companies to find out where they purchase their products and ask them out right if the product you are purchasing is 100% genuine. Many of these “start-up” companies out there are shipping directly out of china and carry no inventory. There is a 99.999% chance that any product you purchase online that arrives from china is counterfeit. These counterfeit products will load and install normally. You might even be able to use them for a while without any issues, but the moment you try to update any software on your computer, the manufacturer will disable the product. Another tactic they use is to take products that are licensed for students and sell them as the full commercial product. This is especially true of products from Microsoft and Adobe, but the issue is not limited to these manufacturers by any means. What is worse, use of these products on your computer is an infringement on the manufacturers copyright and can put you at risk of being sued by these companies for copyright infringement. So that $80.00 copy of Office 2007 Professional could easily cost you 100 times that amount in fines. The last time I looked, a manufacturer had the right to sue for up to $150,000.00 per infringement. That’s a lot to pay for a copy of Office Pro. Companies are especially vulnerable because a single disgruntled employee could unleash a firestorm of inspections and possible litigation by turning in companies who “skimp” on their software license requirements.
The moral of today’s blog is “The best price on software does not always constitute the best deal”. Ask questions when you purchase software. Understand what you are getting. Question companies who are offering “GREAT DEALS” on products that other company can’t even come close to the price. Ask them WHY their product is so cheap.
Now, I don’t normally do this, but I will give you a prime example of what today’s blog is all about. Go to the price comparison site http://www.nextag.com/ specifically this page.
http://www.nextag.com/Adobe-Systems-DESIGN-PREMIUM-624665352/prices-html
On this page, NexTag allows companies to post their product prices for the Adobe Systems Design Premium CS4 V4-WIN NEW Retail (65021566). If you sort the page by price, you will see that the lowest price on the page starts around $620.00 and the most expensive price on the page is about $1800.00. Now, scan the page and you will see a drastic jump in the price right at the $900.00 mark. Why do you think there is such a difference between the lowest priced company on this page and the highest?
Now let’s think about this. What is being advertised is the RETAIL BOX commercial version of this Adobe product. (Manufacturer Part Number: 65021566). The distribution cost on this will range from $1400.00 to $1600.00 depending on where you buy it and how much of a discount you get from the distributor. How is it possible that half the vendors on this page are selling this product BELOW DISTRIBUTION COST?
Want to know? Click here!!
http://www.nextag.com/Adobe-Design-Premium-CS4-632149223/prices-html
This is the ACADEMIC version of the same product. (Manufacturer Part Number: 65029326) The internal components of both software packages are identical except the serial number. There are no markings indicating the product is Academic, but if you call Adobe and ask them to verify the serial number, they will tell you the product is licensed for educational use. Remember the moral of this blog? “The best price on software does not always constitute the best deal”. Commercial use of Academic products could subject a company or individual to fines or litigation from the copyright holder. Be cautious. Ask questions. Buy Smart. If you qualify for Academic Products and use them according to the license agreement, you can save lots of money. Companies who get duped into buying something they are not authorized to use, can end up paying much more than they bargained for if the copyright holder audits your licenses.
