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When people say X should cost Y, what they really mean is that they only value X at Y. You can't get them to increase their valuation by arguing that X can't b

When people say X should cost Y, what they really mean is that they only value X at Y. You can't get them to increase their valuation by arguing that X can't be made profitably for price Y.

joezydeco 14y ago
Good point. So why is the perceived value dropped so low? Is it the plethora of teardown sites that show you "oh, SuperWidget Tab4 only has two chips and an LCD in it. How expensive can that be"? Or is it the deluge of cheap commodity stuff on Monoprice and NewEgg that has inoculated us as how this stuff needs multiple generations of devices to cost-reduce the toys down to a price that is finally acceptable?
- samstave 14y ago
  I think that pretty much everybody sees a single RGP LED as a super cheapr component. Even if they have no domain knowledge.
- astrodust 14y ago
  The amount of electronics required to connect a commodity LED to a commodity USB connector is so minimal. The very same sort of component goes into every single computer mouse sold today, many of these costing less than $1 to produce. $30 is extremely expensive for such a toy. Do they think I'm spending $3,000 to make a pretty blinky-light server rack? Anyone with a credit card can get a custom anything manufactured if they're resourceful enough and know how to communicate with their suppliers. I think the makers of this product should do more research in how to cut costs, find a part that does 95% of what they need and come up with a way to bridge that gap in software.
  - joezydeco 14y ago
    Okay, and I'm paraphrasing Louis CK here, you go make one if it's so sucky and imperfect. Seriously, how hard can it be? Get together a BOM for the $5 in parts, send it through DigiKey and have it in a couple of days. That's like what, an hour of time? Then layout a PCB in your favorite schematic capture and send it off to a board house, quantity one. Two hours, tops. Never mind you're wasting 75% of the minimum PCB size. While DigiKey and PCB Express are cooking, time to write some firmware. If you chose a nice chip like a Cypress part and have some experience, you could be done in another 2 hours. You do have a development kit on-hand, right? Then take all the parts, solder them up in your reflow, burn the code, test, and assemble. Another hour? Sure. (Hope those boards were right the first time and didn't come in upside-down) Whoops, don't forget the drivers. Let's do a quick linux one. So $20 in parts and board, and six to eight hours of your time. What's your time worth? $2 an hour? Cool, you're golden. I tend to charge a bit more for my time, so it puts me in the range where $30 is a great deal. But then again, I'm using the old ScrollLock LED trick as my message indicator. It's free.
    - astrodust 14y ago
      The same group is making a very similar product, minus housing, for a $15 unit cost. Clearly there's some serious slack in this Kickstarter price.
      - joezydeco 14y ago
        Probably not as much as you think. Remember that Kickstarter takes 5% and Amazon Payments takes 2%. Then the group has to pay federal taxes on that, which could be another 20%. Now we're close to $20 remaining for the device. Oh yeah, and I didn't even get into the costs of tooling and shooting a plastic housing. That's something a little more time-consuming and pricey than firing off an order to DigiKey and PCBExp on your credit card.
samstave 14y ago
That's exactly what I meant! I understand how hard it is though for the founders of efforts like this one - they are valuing all the work and effort it went to making this a reality. Thus they feel that a $30/unit cost covers all that effort. The problem is they can often forget that the outsider will value the end product alone and typically at far less than the creators. They have a mock up image of a bunch of servers in some racks. thats a hefty price for a bunch of servers with a fairly questionable value for the utility.

When people say X should cost Y, what they really mean is that they only value X at Y. You can't get them to increase their valuation by arguing that X can't be made profitably for price Y.

joezydeco 14y ago

Good point. So why is the perceived value dropped so low? Is it the plethora of teardown sites that show you "oh, SuperWidget Tab4 only has two chips and an LCD in it. How expensive can that be"? Or is it the deluge of cheap commodity stuff on Monoprice and NewEgg that has inoculated us as how this stuff needs multiple generations of devices to cost-reduce the toys down to a price that is finally acceptable?

samstave 14y ago
I think that pretty much everybody sees a single RGP LED as a super cheapr component. Even if they have no domain knowledge.
astrodust 14y ago
The amount of electronics required to connect a commodity LED to a commodity USB connector is so minimal. The very same sort of component goes into every single computer mouse sold today, many of these costing less than $1 to produce. $30 is extremely expensive for such a toy. Do they think I'm spending $3,000 to make a pretty blinky-light server rack? Anyone with a credit card can get a custom anything manufactured if they're resourceful enough and know how to communicate with their suppliers. I think the makers of this product should do more research in how to cut costs, find a part that does 95% of what they need and come up with a way to bridge that gap in software.
- joezydeco 14y ago
  Okay, and I'm paraphrasing Louis CK here, you go make one if it's so sucky and imperfect. Seriously, how hard can it be? Get together a BOM for the $5 in parts, send it through DigiKey and have it in a couple of days. That's like what, an hour of time? Then layout a PCB in your favorite schematic capture and send it off to a board house, quantity one. Two hours, tops. Never mind you're wasting 75% of the minimum PCB size. While DigiKey and PCB Express are cooking, time to write some firmware. If you chose a nice chip like a Cypress part and have some experience, you could be done in another 2 hours. You do have a development kit on-hand, right? Then take all the parts, solder them up in your reflow, burn the code, test, and assemble. Another hour? Sure. (Hope those boards were right the first time and didn't come in upside-down) Whoops, don't forget the drivers. Let's do a quick linux one. So $20 in parts and board, and six to eight hours of your time. What's your time worth? $2 an hour? Cool, you're golden. I tend to charge a bit more for my time, so it puts me in the range where $30 is a great deal. But then again, I'm using the old ScrollLock LED trick as my message indicator. It's free.
  - astrodust 14y ago
    The same group is making a very similar product, minus housing, for a $15 unit cost. Clearly there's some serious slack in this Kickstarter price.
    - joezydeco 14y ago
      Probably not as much as you think. Remember that Kickstarter takes 5% and Amazon Payments takes 2%. Then the group has to pay federal taxes on that, which could be another 20%. Now we're close to $20 remaining for the device. Oh yeah, and I didn't even get into the costs of tooling and shooting a plastic housing. That's something a little more time-consuming and pricey than firing off an order to DigiKey and PCBExp on your credit card.

samstave 14y ago

That's exactly what I meant! I understand how hard it is though for the founders of efforts like this one - they are valuing all the work and effort it went to making this a reality. Thus they feel that a $30/unit cost covers all that effort. The problem is they can often forget that the outsider will value the end product alone and typically at far less than the creators. They have a mock up image of a bunch of servers in some racks. thats a hefty price for a bunch of servers with a fairly questionable value for the utility.