Update:

Please note that since this article was originally written it has been revealed that the developers involved recieved a fixed sum for their participation, not a percentage of the overall sales which was my original theory. There has been an awful lot of coverage of this subject subsequently. I want to make it clear I don't 'hate' MacHeist or its organisers and I don't think the developers involved were 'stupid' for taking the deal. I do still believe in the end that MacHeist themselves were rewarded disproportionately for their efforts, but the developers involved presumably realised this would be the outcome and decided the marketting exposure and potential upgrade revenue was worth it. Case closed.

Unless you've been living under a rock you probably know that MacHeist ended today and the big bundle of apps was announced. All the apps are big names like Delicious Library, RapidWeaver, NewsFire and so on. You kind of wonder why already popular and successful apps need the extra publicity to shift a few extra copies before Christmas. Lets take a look at the actual economics involved here:

MacHeist Bundle:
Selling price: $49.00
Total given to charity per sale: $12.25
Profit per sale: $36.75
Profit taken by MacHeist: Unknown
Typical profit per sale, per developer: < $3.68

Given most of these apps are $30 or more that's a huge give away on the parts of the developers. I guess the draw is that they're probably expecting many thousands of sales. Ok lets make some guesses and see what the potential income might be from participating in MacHeist:

Total sales:	5000	10,000	20,000	50,000
MacHeist profit:	$18,400	$36,800	$73,600	$184,000

Nice those are big numbers!

What would they have made if they sold their apps at regular price and still shifted that number of copies?

Total sales:	5000	10,000	20,000	50,000
Profit at normal price*:	$200,140	$400,000	$800,000	$2,000,000

*Based on $40 app value, around the average of what's in the bundle.

Whoa those are really big numbers! Still they're probably more like annual sales figures for a big developer rather than 'one off' promotions. Still you're making a huge loss per sale. Roughly how many regular sales are the MacHeist numbers equivalent to?

Total sales:	5000	10,000	20,000	50,000
MacHeist profit	$18,400	$36,800	$73,600	$184,000
Eqv. regular sales*	460	920	1840	4600

*Based on $40 app value, around the average of what's in the bundle.

Right so based on the lowest estimate a mere 460 sales would have earned you as much as participating in MacHeist. Remember the above numbers don't reflect the assumed cut that MacHeist will be taking from each sale. Still 5000 is pretty low, how about 50,000? That's a much larger 4600 sales, that's probably beyond what most developers are capable of pulling off in a promotion on their own. Still if you could pull if off you'd have made yourself a sweet $2 million instead of a measly $184K.

Is this a great way to make a quick one off profit? Well the answer is yes and no - depending where the sales figures ultimately land you could probably come up with your own promotion - say giving 50% of profits to charity and come out ahead of what you'd made participating in MacHeist by a factor of 5 with any of the big name apps divulged so far. You might think that perhaps the marketing exposure is 'priceless' or at least worth the massive loss per sale - but then think about the kinds of people who participate in MacHeist. It's people that read Digg, TUAW, MacMinute, MacRumors etc. these are people who already know about your products if you've already got a successful app. So really the marketting exposure is at best negligible for you. Then what about the ongoing costs of supporting these thousands of new users? You could probably slice another $1 off each sale to take that into account.

So in conclusion, like most of these other free/heavily discounted app promotions that have been non-stop for awhile now, the only real value you get is in marketing exposure - unless your app really is only worth $4 per sale. If you have an already successful app with a name as big as RapidWeaver or Delicious Monster, you're probably throwing money down the drain participating in events like this. Maybe the PR value is worth it, I don't know, I just hope it doesn't come back and bite these developers in the ass.

Update

Gus Mueller of Flying Meat Software (Voodoo Pad!) reveals the offer MacHeist made him and the numbers aren't terribly generous for the developers but they sure line the pockets of those behind the Heist. Go see for yourself (in the comments).