jragosta said:Why would you reach that conclusion? The number sold has absolutely nothing to do with it.
If your total costs are equal to your total revenue, you don't make money. Simple.
Look at the airlines. How could they be flying millions of passengers billions of miles and not making money?
You're probably right in that just having the number doesn't give you enough information to determine profitability, but the number sold certainly does impact profitability.
There are some costs wich are the same over item sold, things like bandwidth, Apple probably pays Akamai some number / byte transfer. So each song might incure a $.02 cost for bandwidth and as you get bigger that stays the same. So for these costs # of songs sold really has no impact on profitability, though there might be some break for bulk buying your bandwidth.
There are other costs that are fixed and you need to pay that money no matter how many items you sold, like say the DB admin who keeps the database server humming. If his salary is 100k and you only sold 10 songs, that salary cost you 10k/song, very hard to be profitable. If you sell 3 million songs, his salary only cost you $0.0333/song which is a much smaller slice of your gross, thus you are more likely to be profitable.