Originally Posted by Tyhan
...It's not as if there aren't costs involved in what steam does. Bandwidth isn't free after all.
Bandwidth cost is peanuts to the point where many hosting providers offer free unlimited bandwidth. And the ability of Steam (and GOG for that matter) to offer discounts of up to 80-90% during sales is another pointer - those prices are still profitable. Ditto with the pay-what-you-want HumbleBundle, IndieRoyale and other bundles.

Compared to physical DVDs where you have manufacturing, printing, assembling, storage, transport and inventory management (damaged returns, etc) costs, "fair price" for digital products shouldn't really exceed $5 per item.