You can get screwed on the gross as well. All the company has to do i=
s=20
drop the price of the product (gross) and make it up with another=
=20
attached "service".

I have a good friend who got bit with this scam. He designed a multi-
user OS for an OEM, for royalties based on gross sales $. After the=
=20
systems began to sell well, the OEM gave away the OS and just charged=
=20
more for the hardware and software maintenance. If you go the gross %
route, I'd make sure you have some sort of minimum value (per
unit) clause so they can't get you this way.

I think in 25 years I've seen every way an engineer can get screwed b=
y=20
royalties.

Matt Pobursky
Maximum Performance Systems=20

On Sat, 31 May 2003 13:58:02 -0700, Bob Barr wrote:
>=A0
>=A0The gross is the gross; the net is whatever the accountant wants =
it=20
>=A0to be. :=3D)=20
>=A0
>=A0I'd recommend basing royalty negotiations on the gross. It's much=
=20
>=A0more straightforward. Do you really want the VP's new Porsche com=
ing=20
>=A0out of your royalties? If it's bought as a company car, it comes =
off=20
>=A0the net (and thus your royalties). Every company employee can get=
 one=20
>=A0and it won't affect the gross (nor your royalties) at all.
>=A0
>=A0Exact royalty percentages probably vary quite a bit. A few things=
 to=20
>=A0consider: the effort you'll be expending, =A0the contribution you=
r=20
>=A0software makes to the product's success, and any =A0ongoing suppo=
rt=20
>=A0requirements.
>=A0
>=A0I'd also recommend having a contract provision to be able to=20
>=A0independently verify the company's sales figures in case of a=
=20
>=A0disagreement.

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