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Re:Sennheiser HD 555 to HD 595 Mod by ip26 on Sunday June 18, 2023 @05:39PM (#36384788)
The cross-subsidy means that while they have gross margin on the 555, it would not be enough to cover R&D & make net profit without the additional sales of the higher margin 595. In other words, they could not afford to develop & bring the 555 to retail by itself, even if the sale price is higher than the simple cost of manufacturing.
Re:Sennheiser HD 555 to HD 595 Mod by activitypea on Monday June 19, 2023 @06:23AM (#36389394)
That wouldn't be cross subsidy, that would be selling at a loss, right? I don't think any item has ever been sold for the sum of its bill of materials. The price is always bill of materials + labor + some profit, and here "labor" includes R&D.