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My company is interested in multimedia, but we're not sure if it's a worthwhile investment. What does it cost to develop a CD-ROM?

Like any media, CD-ROMs can be as much or as little as you make them.

The only fixed costs are the actual discs and the jewel box cases, at a combined price of under $2. What you do on top of that can cost anywhere from $20,000 to $1 million, or more.

On the low end are CD-ROMs produced for businesses to use in-house. On the high end are showy, consumer-oriented titles that feature lots of video or complex special effects.

To produce a quality consumer title using existing video takes a minimum of $400,000, says Bruce Ryon, multimedia analyst with Dataquest Corp., San Jose, Calif. Shooting new video will boost the price to $1 million. And that doesn't include licensing fees, reproduction costs, distribution or marketing.

CD-ROM games also can cost upwards of $500,000. Virgin Interactive Entertainment's "The Seventh Guest," one of last year's most popular CD-ROM titles, cost a reported $750,000 to make.

One caveat: As costs soar, sales won't necessarily keep pace. While many CD-ROM titles are bundled with computers, retail sales average only about 10,000 to 20,000 copies, Mr. Ryon said.

That means a CD-ROM with a retail price of $60 could result in sales of only about $600,000, conceivably less than it cost to produce.

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