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That's pretty big, especially if you're selling an external hard drive with two FireWire ports (for daisy chaining). I don't recall what FireWire drive prices w

That's pretty big, especially if you're selling an external hard drive with two FireWire ports (for daisy chaining). I don't recall what FireWire drive prices were ~15 years ago, but that could easily be several percent of the final retail price.

scarface74 3y ago
The first link I could find for contemporary prices was this one from 2012 - in pounds. https://www.theregister.com/Print/2012/03/14/ten_firewire_hard_drives/ https://www.theregister.com/Print/2012/03/14/ten_firewire_ha...
reaperducer 3y ago
I don't recall what FireWire drive prices were ~15 years ago, but that could easily be several percent of the final retail price. $2 for two ports would have been a tiny percent of the final retail price 15 years ago. Today we're used to portable 4GB drives for $99. But back then, drives were more expensive. According to the Wayback Machine†, a 1TB FireWire drive was almost $400. So those two ports would have been ½% of the retail price. † https://web.archive.org/web/20080128203022/http://www.lacie.com/us/products/range.htm?id=10033 https://web.archive.org/web/20080128203022/http://www.lacie....
- vlovich123 3y ago
  How familiar are you with how manufacturing works? A BOM (bill of materials)/COG (cost of goods) cost !== the retail price. You have things like NRE costs (i.e. what it costs to pay people to design and bring the thing to mass production, machines you have to buy/manufacture to support your assembly lines, marketing, legal, etc etc) and profit margins to factor in. Apple's 20-30% is rare and PC margins are closer to 2-5% (often even negative for Android phone manufacturers as they try to recoup that through revenue sharing on the software side with Google). Basically, BOM/COG is things you pay for that you pass on directly to the consumer. However, the retail price has to cover a bunch more than that so you can't compare the two directly. A good rule of thumb is ~2-20x markup depending on the profit margin you are targeting. A $2 licensing fee in the BOM is thus probably closer to ~$14-40 retail. Considering how thin profit margins are, 3% of retail going to nothing but marketing is not nothing especially considering that Apple doesn't have to pay this fee and also getting a cut of every product you sell to boot. Think about it this way - frequently towards the end of the development cycle as you're heading towards mass manufacturing, companies will look to shave tens of dollars and be trying to find 10-20c here & there to add up to that. $3 is massive. You see similar dynamics with MFI. It requires a special chip (space within the product, battery costs) and licensing fees (Apple gets a cut of every sale you make making your competitor product more expensive or less profitable). It's why none of the major tech companies have MFI in their products AFAIK. It cripples any competitor product you try to make (not to mention that you're further at Apple's whims around licensing agreements changing if you build your product around MFI).
  - scarface74 3y ago
    And why should people who choose to be in an ecosystem that doesn’t suffer from those market conditions be forced to use a substandard component? I’m not saying that USB C is inferior. But if Apple did want to come up with a better port it couldn’t. This goes back to when Apple was moving to Lightning, the EU wanted to mandate micro USB.

scarface74 3y ago

The first link I could find for contemporary prices was this one from 2012 - in pounds. https://www.theregister.com/Print/2012/03/14/ten_firewire_hard_drives/ https://www.theregister.com/Print/2012/03/14/ten_firewire_ha...

reaperducer 3y ago

I don't recall what FireWire drive prices were ~15 years ago, but that could easily be several percent of the final retail price. $2 for two ports would have been a tiny percent of the final retail price 15 years ago. Today we're used to portable 4GB drives for $99. But back then, drives were more expensive. According to the Wayback Machine†, a 1TB FireWire drive was almost $400. So those two ports would have been ½% of the retail price. † https://web.archive.org/web/20080128203022/http://www.lacie.com/us/products/range.htm?id=10033 https://web.archive.org/web/20080128203022/http://www.lacie....

vlovich123 3y ago
How familiar are you with how manufacturing works? A BOM (bill of materials)/COG (cost of goods) cost !== the retail price. You have things like NRE costs (i.e. what it costs to pay people to design and bring the thing to mass production, machines you have to buy/manufacture to support your assembly lines, marketing, legal, etc etc) and profit margins to factor in. Apple's 20-30% is rare and PC margins are closer to 2-5% (often even negative for Android phone manufacturers as they try to recoup that through revenue sharing on the software side with Google). Basically, BOM/COG is things you pay for that you pass on directly to the consumer. However, the retail price has to cover a bunch more than that so you can't compare the two directly. A good rule of thumb is ~2-20x markup depending on the profit margin you are targeting. A $2 licensing fee in the BOM is thus probably closer to ~$14-40 retail. Considering how thin profit margins are, 3% of retail going to nothing but marketing is not nothing especially considering that Apple doesn't have to pay this fee and also getting a cut of every product you sell to boot. Think about it this way - frequently towards the end of the development cycle as you're heading towards mass manufacturing, companies will look to shave tens of dollars and be trying to find 10-20c here & there to add up to that. $3 is massive. You see similar dynamics with MFI. It requires a special chip (space within the product, battery costs) and licensing fees (Apple gets a cut of every sale you make making your competitor product more expensive or less profitable). It's why none of the major tech companies have MFI in their products AFAIK. It cripples any competitor product you try to make (not to mention that you're further at Apple's whims around licensing agreements changing if you build your product around MFI).
- scarface74 3y ago
  And why should people who choose to be in an ecosystem that doesn’t suffer from those market conditions be forced to use a substandard component? I’m not saying that USB C is inferior. But if Apple did want to come up with a better port it couldn’t. This goes back to when Apple was moving to Lightning, the EU wanted to mandate micro USB.