mmmm, interresting thread.
Surprisingly, the dsp R&D part of the plugin is not necessarely the most costly part of the production process. To give you an idea, it took something like one year/man to develop the core libraries of our plugins, which include the GUI part, the multiplatform and the multiformat support, and some basic dsp elements.
It seems hard to me to compare two very different markets, with different costs, number of potential customers, and product types (when you buy a plugin, you also buy a service).
It is already hard to compare hardware and software... so comparing software and record industry...
I think the interresting question would be : how one can price a plugin?
At the opposite to hardware, when a plugin is designed and built, that's it : no more real production cost. Duplicating a plugin is nothing, not like building a second piece of hardware.
At the end, there is no difference between a cheap and a hi end plugin. It IS programmed. So the more you sell, the more money you earn, what ever is the price you choose. A hardware has a minimum cost, which is the time to test individual units, if this happen to be the case, the time to built it (especially if it is hand made), the price of the components...
In this focus, a plugin is closer to a record, as most costs in the making of a record occur before the duplication process.
I agree with the general idea that good plugins are usually too expensive. And it's with this idea in mind that we created Ohm Force.
I think we have some brilliant dsp and gui designers in our crew, and create hi quality products (try to find a better software filter - not equalizer, filter, ala sherman - than the quad frohmage, or a better delay unit - not a simple tap delay, a creative delay unit - than the ohmboyz), that do not imitate old hardware stuff.
But our aim was to let everybody use hi quality effects at low prices. That's the reason why we had one version of our plugins that costed $10. We also thought that we might sell more plugins at this price (as Messiah thinks), and finally earn enough money to survive. (at this time we were only selling via internet)
The first thing we realized, is that we sold roughly 4 times more $10 plugins than $80 plugins (which is still a fair price IMHO), so we had more clients (and so more support to do).
Then came the retail distribution time. Distributors usually don't want to have such a competitive priced internet product compete with the retail version. So we had to remove the $10 version, and create a free version (which is not a plugin, but a stand alone application).
At this time, the retail distribution is in progress, but still not achieved, and our price policy has changed. What do we see? That we are selling more and more plugins, even if they are higher priced, and that we are earning more money now that at the $10 version time. (but still not enough to get paid decently)
And the quality of our plugins has not changed!!
A good example : i was at the winter NAMM show this year to demonstrate our products. One guy came to see me, and asked for a OhmBoyz demo. I did my duty, and at the end the guy told me : "well, the delay sounds even better than before. Congratulation for the work!!".
Of course he was wrong (but i did not tell him :o) . The same products, 8 time more expensive, that's all.
That's why i think it is very difficult to price a product like this, because the price is SUPPOSED TO BE RELATED TO THE SOUND QUALITY!!!
I don't want to give names, but there are highly priced vintage synth emulators, from very well known companies, that have aliased oscillators(which is indeed a huge problem when you want to emulate analog oscillators

) !!
And i don't even try to analyse WHY people are buying that, it would be depressing for everybody.
cheers all,
Jerome