Sure, maybe they have a lower markup if you don't buy the license up front, but you still paid for it. These types of gimmicks are free money for the company pulling them.

Edit: Hell, to make it sound even more stupid, you're being asked to fork over $1k or whatever the additional charge is in order to change a bit from 0 to 1.

Obviously, I don't like up-paying for features I don't get to use. The price of the product must be the same, having benefited from mass production. With that being the case, I'm actually glad I have the option to save money now and upgrade later.

The concept isn't a problem, it's companies taking advantage of it (and us).

To borrow a phrase you used earlier, I truly don't believe that we need to come to terms with companies blurring this line and taking advantage of us.

Which is a real thing that has actually happened.

The functionality exists, the code already has been written, but it's disabled so as to extract more money.

The arguments about cheaper manufacturing is pretty well pointless. If the cost of adding seat heaters is negligible, what justification is there for charging extra? You pay for the hardware either way. This is rent seeking and nothing more.

This is a topic that's been beaten to death in the electronics industry for years. Oscilloscope manufacturers design and sell a 500MHz scope, but cripple it to 200MHz unless you pay 50% more. Or they put 16MSample of memory in and restrict you to 8 unless you pay $400 for an "upgrade". The cost of buying the lower model and upgrading it later is usually much higher than just buying the high end model.

In any case, it's not like manufacturers are selling the lower tier model at a loss. They're taking lower margins on the crippled hardware, yes, but then they charge you ridiculous prices that are orders of magnitude above the real cost of the additional hardware.

Not true. The price you have decided you are willing to pay assumes it is not there. Your payment allocates no portion to the hardware. If you have decided a car is worth $30,000, that is what you are willing to pay, regardless of whether or not they include the hardware.

And, in actuality, you might even consider a car with said hardware to be worth less as it adds weight which will require more fuel and wear and tear expenses over the operating lifetime of the vehicle. The car worth $30,000 without heated seats is, perhaps, only worth $29,000 if the hardware is included.

The cost to manufacturer is their problem. Your value determination is entirely independent of that. Should it cost them $1 or $100,000 to build that $30,000 car – it doesn't matter. You are paying for the value you think you will derive from owing the car, not what it cost them to make it.

Indeed, in the long run the value has to exceed the cost of manufacture, else the business will soon find itself filing for bankruptcy. But in the short term, it is not uncommon to see input costs exceed the value of the product, resulting in a net loss for the business. The buyer doesn't care. Input costs mean absolutely nothing to them.

In the former case, I didn't pay you money, so you didn't give me a good / service / whatever. That feels fair, because you need money to provide those things.

In the latter case, I didn't pay you money, so you didn't flip a switch. That seems like a dick move.

So I guess the difference is that in only one of these cases does it feel like the manufacturer is an asshole.

This is the case for all software. There is no physical exchange of goods, and nearly zero effort to distribute the bits.

a car is hardware, not software, even if it interacts with software

the fact that the switch is implemented via software is irrelevant to the fact that hardware is more analagous, e.g. a printer you want to use off-brand cartridges in, or a cell phone you want to root

I bought a kindle fire at a discount because it was ad-supported, then rooted it and removed all the adware+bloatware, and don't feel even a little bit bad, because all I was doing was using my hardware as I saw fit

sorry not sorry that this breaks amazon's business model (in reality it's so rare it doesn't), but my hardware, my property, my rules

If it's that cheap then it should just always be included, period. Otherwise it's just transparent greed. Why charge your customers extra for something that costs you literally nothing extra? Why not do the same for everything? The radio volume knob is software-locked and it's either at 100% or off, unless you pay extra to unlock it. The entertainment system will play ads continuously while the car is running unless you pay extra for the no-ads version. When you unlock the doors they will stay locked for five more minutes unless you pay extra for the Instant Unlock feature.

So they make a cheaper version, with lower margins, but they deliberately cheapen the experience so that those who can afford the "luxury" version don't buy the "cheap" version instead.

In any case, it shouldn't change anything for the end user, hardware or software, you pay a premium for premium features. And even if it involves actual hardware, it will cost you a lot more than what the part is worth. That's how manufacturers target both the premium and budget market with the same product. I think it benefits most people in the end, especially on the "cheap" side since people can get something they wouldn't be able to afford at all otherwise, at the cost of a bit of luxury.

Now, you can get smart, buy the cheap version and hack the software, or install much cheaper third party hardware. Same idea as ink refills for printers, or ad-blocking ad-supported websites. Often, that's you right, but don't expect the manufacturer to play along, you are on your own.

Because that's not how business works, whether cars, computers, or any other widget. The cost of manufacturing is only tangentially related to the retail value.

Your examples, while contrived, could easily work the same way. As long as the customer knows what they're buying, and there are other choices on the market, then we will find out pretty quickly how valuable a non-binary volume knob is.

You may not want to know the answer to that one, if you pay much attention to airline ticket pricing and consumer behavior.

Welcome to capitalism, it seems you are new here.

> Why charge your customers extra for something that costs you literally nothing extra?

Because (1) you can, and (2) it maximizes profit.

> Why not do the same for everything?

Because of estimates about what people will accept not having in the base model and what some will be willing yo pay extra for. Why do you think there would be some other principal at work here?

  Some people don't want to pay for a 4th bedroom. Turns out the builder found it cheaper to just include the extra bedroom rather than differentiate on blueprints. What's the big deal? The ability to change your mind and increase your mortgage without having to deal with construction in the future seems like a nice bonus. Everyone wins.

If the customer only paid for 1 bedroom, they're going to save a lot of money. It's the extra maintenance costs of that roof and the associated space taken up by the structure that would make it a harder sell, otherwise dynamically growing living space would be very interesting.

Also, how will you keep me out of the room in my house that I didn't buy? You can't effectively.