In hardware and software markets, the hardware is usually priced high, and the software is relatively cheaper. However, in some tied markets like razor and blades, printer and ink cartridges, hardware like the razor is priced low while software like the blade cartridge is priced high? One reason is that consumers buy cheap razors and are locked in by the incompatibility. Then they have to buy the same brand blades. However, due to the cheap price of the razor, consumers could easily buy a new razor in order to use a new blade. Then the question arise: why are the razor priced low and the blade priced high?
I think it's mostly about marketing, and also some amount of production cost.
In the razor example, the razor handle itself is most likely easier to manufacture than the blades. You are talking about modern razors, where the blades assembly is the more precise component. There is not a lot to the handle part.
But I think you already made the more important point. The "hardware" you mention is the more durable component, which locks the consumer into the system. The more important element for the manufacturer is the consumable component, the blades, the ink, the software, the film (for companies like Kodak in the past), some people even make this point for cars and car dealers. For the dealer, the important aspect is the continuing service, more so than the one-time sale. Even if that "durable" element is quite cheap, the consumer is still locked in. For example, printers might be pretty cheap, but installing a new printer is still more of a hassle than just changing the ink cartridge. Similarly with the razor, the consumer is likely to have several new blades available. Is he going to throw them out, to start on a new system? Or just continue as before, and keep a few spare on hand? So in practice, the consumer remains "loyal."
Hey, take a look at the Harry razor. They have taken this model one step further. Not only do they lock the consumer into their system, but they also lock him into a predetermined replacement schedule. Like a wine club, where the consumer is sent several new bottles on a regular schedule. The most egregious example: look at cable or satellite TV, or even those new limited-use little streaming boxes like Roku and AppleTV. Take a look at the web sites they even allow people to use, and see what the goal is. Only pay TV sites, with perhaps YouTube as the only exception. These TV distribution systems are all about revenue streams.
So I think it's all marketing strategy. In ancient times, people bought what they needed. Next step, marketing told people what they "needed." So marketing created demand. These days, marketing very deliberately builds systems that create "infinite revenue streams," and by that I mean, infinite revenue streams from each customer. That's the goal. The one-time sale is almost incidental.
Regards and salutations to JHU!
The prices of the blades during the life time of the razor are considered to be part of the deal (so are replacement parts in cars, etc.). Computing HW is typically a one shot and then you replace it all together so amortization of needed complementary parts are not part of the of the cost. Software on the other hand is easy to bring to mass market and the price has to be attractive enough to reduce the incentive of piracy (which is much easier than replicating HW). It is simple economics and rational pricing given these characteristics (and competition, and reputation etc. factored in as well via right marketing etc.).
I agree with the answers so far - the manufacturer wants you to buy the foundational elements (razor handle, printer, etc.) and make money on consumables. pH meters are similar: the instrument is lower cost, and the vendor makes the profit on electrodes.
Software is a little different. At first, software was almost free, then vendors recognized both the value of software and the cost of support so they charged more for one-time licenses. Now major vendors have shifted to a subscription model as they see the new sales leveling off with a growing cost structure. The key in the examples discussed is to lock you into a vendor (through handles, hardware, file structures, etc.) and then create a revenue stream through replacement parts and the ability to access your data.
May third party markets thrive.
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