Overpriced Stuff........

[nightfire]

Any hardware containing the words 'enterprise', 'pro' or 'Apple'.

Actually it is not the stupid pricing that's the problem, it's the STUPID PAYING. People, just stop.

To be fair, when lots of that stuff is used by people that actually need some of the specs, it lives up to pricing/expectations. Also Apple phones in corporate environments are not bad, easily to integrate into MDM systems, good supply chain for pre-configured models to cause minimal workload on local sysadmins, decent software update period (=usable for years).
Of course, on lots of stuff that gets the "enterprise" stamp the quality is sometimes questionable.
And, for a non-enterprise user that does not use the features that make the premium, they pay more that they probably would have to for a competitors model.

[Miyuki]

HDMI cables from these guys

Featuring 72V bias technology for... er... ummm... better something or other?

Wow they have 1000$ USB A-B Cable, I can have a use for it, it will work perfectly with my 90$ Behringer microphone interface
And the great 5000$ C13 cable, I wonder if it makes my computer faster or if it works just for sound 
Heck I shall start to sell those magic cables 

yes and 5000 $/m XLR cable + 5500$ for connectors, what a great deal 

[Miyuki]

Any hardware containing the words 'enterprise', 'pro' or 'Apple'.

Actually it is not the stupid pricing that's the problem, it's the STUPID PAYING. People, just stop.

To be fair, when lots of that stuff is used by people that actually need some of the specs, it lives up to pricing/expectations. Also Apple phones in corporate environments are not bad, easily to integrate into MDM systems, good supply chain for pre-configured models to cause minimal workload on local sysadmins, decent software update period (=usable for years).
Of course, on lots of stuff that gets the "enterprise" stamp the quality is sometimes questionable.
And, for a non-enterprise user that does not use the features that make the premium, they pay more that they probably would have to for a competitors model.

I must agree, iPhones just work out of the box and have very long support. I still have 7 plus, released in 2016, and my piece manufactured 2018. Working just fine. All software updates still regularly available. You don't have many phones with this long support.
Lenovo laptop also running and running, for years (just got a second SSD and RAM), and it is now turned on 24/7 and connected to dock 

[Psi]

I kind of feel we need laws that limit the profitability of products.
But it would be a crazy hard thing to regulate and almost everyone would be against it.
Would also be difficult to do as some low volume things do need to be high profit. Sales volume would have to play into the calculation.

Not going to happen but interesting to think about.

Simply making the BOM cost of all products require public knowledge would help somewhat to shame companies into not overpricing things.

[tautech]

I kind of feel we need laws that limit the profitability of products.
But it would be a crazy hard thing to regulate and almost everyone would be against it.
Would also be difficult to do as some low volume things do need to be high profit. Sales volume would have to play into the calculation.

Not going to happen but interesting to think about.

Simply making the BOM cost of all products require public knowledge would help somewhat to shame companies into not overpricing things.

A lot also depends on ROI to subsidise your distribution network.
I've heard Uni figures of 10% of retail for BOM cost but add in a pile of SW development and that seems too little.

You know, you build stuff and sell it.

[Psi]

Yeah, I'm more thinking of situations where the company could cut retail prices by 50% and they'd still be raking in billions in profit and have no problem paying back ROI over a reasonable time.

[tautech]

Yeah, I'm more thinking of situations where the company could cut retail prices by 50% and they'd still be raking in billions in profit and have no problem paying back ROI over a reasonable time.

Seriously, what that might be ?
Whom might determine that ?

We have some products that haven't changed in 10 years except for SW and others just a few years old like your DSO that were discounted USD400 for the last 2 months of 2022. Really  you didn't benefit.
Would either be sold at a loss, that I very much doubt however there was some tightrope walking done with price setting I won't go into. 

We see new products released for what seems considerably more than imagined and it's only when we examine competing products pricing we see why it's been priced that way, in short we see competition sets the price of what the marketplace can withstand.

[Psi]

in short we see competition sets the price of what the marketplace can withstand.

yep, it always boils down to maximizing profits.


In any case, test equipment is a specialized industry. Not really what I'm talking about.

[tautech]

In any case, test equipment is a specialized industry. Not really what I'm talking about.

Why would the TE industry unlike be any other needing to maximise profits ? 

Should we be distinguishing between a ROI and a ROC ?
Should any one items cost represent a little of both ?
I believe it should as shareholders expect a return on their investment.

[coppercone2]

I feel like test equipment is incredibly proportional to scientific progress. In the long term its better if the margins are lower for society IMO, I feel like some people have the idea that its a luxury good... but it leads to game changing scientific breakthroughs.Some things are priced so its like big corporations only, which don't necessarily have the smartest people, or the best intentions.

Kinda like the prices of that stuff decide how cool the future will be in like.. 10-20 years. And literal testing (wide scale) is how you decide if a technology is ready for wide spread adoption. Is it reliable? Does it always perform? Can we decide to make a million of the thing? If you have data from good test equipment (with good people), and alto of it, the answer might be yes.

And research always goes better when people are using the same equipment families IMO. Easier to transition between companies, spread information, easier to hire people since their pre trained (exactly so), etc. And its more trusted because it can be replicated exactly, no researchers are saying "well we need super expensive box #23 to really be sure we can start this project....."

[wilfred]

Price always meets a willingness to pay. Set it too high and either no-one will pay or a competitor will see an opportunity.

[Smokey]

I feel like test equipment is incredibly proportional to scientific progress. In the long term its better if the margins are lower for society IMO, I feel like some people have the idea that its a luxury good... but it leads to game changing scientific breakthroughs.Some things are priced so its like big corporations only, which don't necessarily have the smartest people, or the best intentions.
...

Cutting edge science needs cutting edge test equipment... which itself sometimes needs cutting edge science to make.

[coppercone2]

I feel like test equipment is incredibly proportional to scientific progress. In the long term its better if the margins are lower for society IMO, I feel like some people have the idea that its a luxury good... but it leads to game changing scientific breakthroughs.Some things are priced so its like big corporations only, which don't necessarily have the smartest people, or the best intentions.
...

Cutting edge science needs cutting edge test equipment... which itself sometimes needs cutting edge science to make.

'well its for the ____ industry, they have deep pockets' i.e. mega overpriced accessories. I think there is some times competition over a unrealistic price region that takes WAY too long to fall down.

[Berni]

It is hard to prove exactly how much profit is being made on a product

For large volume mass produced consumer goods, yes the BOM cost is the main driving factor (like TVs, washing machines..etc). These things heavily recycle R&D between products and whatever R&D cost is spread over massive volumes. The production process is heavily optimized and automated, minimizing the cost of that. So it is really about buying parts, putting them together and getting it out the door as fast and cheaply as possible. This market has a lot of competition so this drives a race to the bottom of making the cheapest product. (This sometimes results in products that are actually too cost cut down even)

But when it comes to more specialized products this is completely different. The niche products don't have the market demand for you to be able to sell them in the millions quantities like TVs can. Things like specialized scientific equipment require a lot of expensive R&D to develop and don't sell many units, so the huge cost has to be spread over a small number of products. On top of that the money for the R&D might have come from investors that want to see a return on there investment. The parts might also be very specialized so they might have to keep a sizable stock of them on hand. There are other costs unrelated to production, like having to have a sales team that works directly with costumers, perhaps a servicing team that installs and calibrates the equipment. You also have some critical employees that are experts in that niche field, you need to pay those well to retain them because if they leave you are not finding a replacement anytime soon. Even as the product is sold there is often more R&D going in in terms of software development to improve the product and help it keep up with modern requirements. All these costs coming in from different directions at different times make it very difficult to even calculate the true cost of making a product, let alone formally prove it on paperwork. But safe to say the BOM cost is only a small part of the total price. But yeah sometimes they have a monopoly and can charge whatever they want.

Id say retail is taking too much of a profit. They just buy up products from brands and sell them to costumers, yet they have 50 to 100% markups on them. They are taking a really big cut of the pie for how much work they are putting into it. This goes up a lot for specialized stuff that is sold to industry.

[tooki]

Id say retail is taking too much of a profit. They just buy up products from brands and sell them to costumers, yet they have 50 to 100% markups on them. They are taking a really big cut of the pie for how much work they are putting into it. This goes up a lot for specialized stuff that is sold to industry.

(retail veteran here)Well, the margin varies wildly: in groceries it’s typically around 10%.
On a computer, typically under 5% markup, which doesn’t even cover costs, so the stores often sell them at a loss, especially on low-end machines. Printers, especially low end models consumers typically buy, are similarly low-margin. On the other hand, the name-brand USB cable they sell you to go with it for $25 cost less than $2 from the distributor. That’s why accessories get pushed so hard with computer sales.

In overall retail, wholesale prices are around 40% of the retail price. But it’s hard to claim that retail takes too big of a profit: in retail, you’re paying for convenience, because the store is in a convenient location (=very expensive rent), has staff, and performs money-losing services like customer support, handling returns, etc at that expensive retail location. (Online vendors can do those things at cheap facilities far away from the customer). Also, in malls, stores have to pay the mall a % of sales as a commission (which is why malls love high-revenue stores like Apple) in addition to rent. There’s also loss due to theft and damage (or insurance premiums for insurance against such losses).

With that said, since you talk about “sold to industry”, maybe you’re not actually talking about retail, but about distributors. And yeah, they take a cut. But whether that’s bad is debatable, it depends on what value they add. I mean, buying parts in small quantities on Digi-Key, etc. is way more expensive than buying a reel from the manufacturer. But you’re paying for the convenience of being able to buy small amounts of each part, of parts from multiple manufacturers, all in stock at one place, as a consumer or small business that the manufacturers don’t actually want to deal with. And that’s why manufacturers like TI or Analog Devices outsource their own logistics to Digi-Key, mouser, etc.

[coppercone2]

but you can see I think also that high price leads to innovation. I think its amazing what people have done with the SDR platform. RF test equipment is generally expensive, and I think alot of people put their effort into SDR.. and that became a powerful tool that IMO lead to a kind of 'rf revolution', enabled tons of people to work with RF that would normally not mess with it. It is a different direction to head in, but it seems that the utility of those kinds of inventions are huge. Cheap hobby of the RTL-SDR lead to extreme proliferation, massive surge in polarity and a super increase in education and practical capabilities.

Maybe one can say the same thing about minicomputers and super computers. A much easier avenue for advancement of certain sciences came about because of the development of less capable and cheap microprocessors. I am not sure that distributed computing a substitute for traditional supercomputers (i.e. very sequential), I am sure that... new applications of those Cray type devices will eventually come up for specific problems that maybe distributed computing won't be able to adequately solve.. eventually... but we got a incredibly interesting and useful realm of science from intel's 4004.

[Smokey]

...
Things like specialized scientific equipment require a lot of expensive R&D to develop and don't sell many units, so the huge cost has to be spread over a small number of products. On top of that the money for the R&D might have come from investors that want to see a return on there investment.
...

For sure.  It's way easier make the case for something coming out of R&D having a higher cost.  That profit needs to both pay back the R&D expense for that product but it also needs to fund the future R&D for the next thing. 

...
With that said, since you talk about “sold to industry”, maybe you’re not actually talking about retail, but about distributors. And yeah, they take a cut. But whether that’s bad is debatable, it depends on what value they add. I mean, buying parts in small quantities on Digi-Key, etc. is way more expensive than buying a reel from the manufacturer. But you’re paying for the convenience of being able to buy small amounts of each part, of parts from multiple manufacturers, all in stock at one place, as a consumer or small business that the manufacturers don’t actually want to deal with. And that’s why manufacturers like TI or Analog Devices outsource their own logistics to Digi-Key, mouser, etc.
...

Our products used to go through distribution.  And I'm not talking about Digikey, I'm talking about small specialized automation distributors.  In order to carry your stuff, they want exclusivity contracts over some region in addition to adding a big markup to the final price.  Since I also worked applications support, I heard from a number of customers that they loved our stuff and it worked great but the final price the distributors marked the thing up to was out of their price range so they went with something less expensive.  That gets pretty frustrating. 

but you can see I think also that high price leads to innovation. I think its amazing what people have done with the SDR platform. RF test equipment is generally expensive, and I think alot of people put their effort into SDR.. and that became a powerful tool that IMO lead to a kind of 'rf revolution', enabled tons of people to work with RF that would normally not mess with it. It is a different direction to head in, but it seems that the utility of those kinds of inventions are huge. Cheap hobby of the RTL-SDR lead to extreme proliferation, massive surge in polarity and a super increase in education and practical capabilities.
...

Like so many things, the low cost SDR stuff is a direct result of the cellphone industry demanding cheaper more integrated RF solutions so they can make phones smaller and cheaper.  If the big name players hadn't spent a TON of R&D designing and manufacturing integrated single chip RF solutions we would all still be stuck piecing together discrete systems.  But we all get the trickle down... sometimes...
It is frustrating that the really good stuff like broadcom chips are just impossible to get unless you are a megacorp willing to commit to 1M pieces before starting engineering.

[Berni]

Our products used to go through distribution.  And I'm not talking about Digikey, I'm talking about small specialized automation distributors.  In order to carry your stuff, they want exclusivity contracts over some region in addition to adding a big markup to the final price.  Since I also worked applications support, I heard from a number of customers that they loved our stuff and it worked great but the final price the distributors marked the thing up to was out of their price range so they went with something less expensive.  That gets pretty frustrating.

Yeah that's the sort of distributors i was talking about.

But goes for things like hardware stores too. The tiny things like brackets cost way more than a L belt piece of metal with a few holes should cost to make. Sure they might not have huge margins on an expensive lawn mower, but the tiny hardware parts are way overpriced. Yet i still go there because it is easy to just buy all of it in one spot rather than looking for specialized stores.

Like so many things, the low cost SDR stuff is a direct result of the cellphone industry demanding cheaper more integrated RF solutions so they can make phones smaller and cheaper.  If the big name players hadn't spent a TON of R&D designing and manufacturing integrated single chip RF solutions we would all still be stuck piecing together discrete systems.  But we all get the trickle down... sometimes...
It is frustrating that the really good stuff like broadcom chips are just impossible to get unless you are a megacorp willing to commit to 1M pieces before starting engineering.

SDRs are mostly just a result of digital becoming so much cheaper than analog these days. It still makes sense to make a SDR without the integrated solution. The RF guts are still simplified when they are reduced down to a LNA feeding a mixer with a LDO that go right into a fast ADC. Then as the idea becomes popular chip vendors eventually create a chip that puts together all the building parts for the thing into one chip. At first it was about flexibility in things like cell basestations. Id say what really driven SDRs to be everywhere is the move to more complex modulation methods so that they could stuff more data into less spectrum. Those would be a pain to implement in analog and most of the time these modulations are carrying digital encoded signals anyway, so if you have the digital processing guts already, you might as well also do the demodulation in there.

What i would say cellphones pushed is higher integration of the analog RF black magic into single chips. It takes a whole lot of clever tricks to get good performance out of a RF chip that has things like LNAs PAs, mixers, filters..etc all on one piece of silicon. the actual consumer applications like cellphones, WiFi, DVB TV..etc then just piggybacked on that to make such chips cheep trough massive volumes.

[Halcyon]

Any hardware containing the words 'enterprise', 'pro' or 'Apple'.

Actually it is not the stupid pricing that's the problem, it's the STUPID PAYING. People, just stop.

Enterprise gear is usually priced based on specs, features etc... Enterprise networking gear comes to mind. Compare stuff like Cisco or Ubiquiti to consumer offerings and you'll soon realise that the extra cost is worth it.

Consumer networking equipment is all gimmick and no substance. Utter garbage (mostly).

I just bought a TP-Link VDSL2 modem/router/wireless AP for a mate to replace his failing one and it's pure junk. It actually forces you to download an app and sign up for an account just to configure it. No settings in the web GUI at all (although it actually has a HTTP server and web interface for stats). It literally took me an hour to set up because of that garbage. The app kept throwing me out and I'd have to factory reset and start all over again, for no reason at all. Shit like this seems to be a common theme, not just with TP-Link.

[Miyuki]

Any hardware containing the words 'enterprise', 'pro' or 'Apple'.

Actually it is not the stupid pricing that's the problem, it's the STUPID PAYING. People, just stop.

Enterprise gear is usually priced based on specs, features etc... Enterprise networking gear comes to mind. Compare stuff like Cisco or Ubiquiti to consumer offerings and you'll soon realise that the extra cost is worth it.

Consumer networking equipment is all gimmick and no substance. Utter garbage (mostly).

I just bought a TP-Link VDSL2 modem/router/wireless AP for a mate to replace his failing one and it's pure junk. It actually forces you to download an app and sign up for an account just to configure it. No settings in the web GUI at all (although it actually has a HTTP server and web interface for stats). It literally took me an hour to set up because of that garbage. The app kept throwing me out and I'd have to factory reset and start all over again, for no reason at all. Shit like this seems to be a common theme, not just with TP-Link.

Safety issues and backdoors were probably included, and no software patches will be ever released
It will probably freeze every few months (or worse weeks) and need to do a power cycle
This is not the kind of sh*t you want to deal with in any business
Yet many businesses fall into the trap of cheap equipment and then in the end need to pay for replacement with proper stuff
I see it commonly. Client outsources servers, storage, and networking to 3 different suppliers because it is cheaper than one integrated system from one vendor. And it never works reliably in the long term if they managed to bring it to life in the first place.
And after some time ends up tossing the "cheap" equipment, where they spend more on maintenance and outages and just buy a working system. 

[BravoV]

Mistress ... or even worst, mistresses. 

[tggzzz]

Mistress ... or even worst, mistresses. 

Standard aphorism: if it floats, flies or f***s, it is cheaper to rent than buy.

Every engineer should have a mistress. Then it is possible to tell the wife they are with the mistress, the mistress they are with the wife, while they go to the lab and have fun in peace.

[Berni]

Enterprise gear is usually priced based on specs, features etc... Enterprise networking gear comes to mind. Compare stuff like Cisco or Ubiquiti to consumer offerings and you'll soon realise that the extra cost is worth it.

Consumer networking equipment is all gimmick and no substance. Utter garbage (mostly).

I just bought a TP-Link VDSL2 modem/router/wireless AP for a mate to replace his failing one and it's pure junk. It actually forces you to download an app and sign up for an account just to configure it. No settings in the web GUI at all (although it actually has a HTTP server and web interface for stats). It literally took me an hour to set up because of that garbage. The app kept throwing me out and I'd have to factory reset and start all over again, for no reason at all. Shit like this seems to be a common theme, not just with TP-Link.

Sometimes enterprise solutions are just the same crap but with a higher price tag because it is an industry standard. While other times enterprise solutions are actually way superior to anything else out there.

When it comes to networking it is definitely the latter. Cheep consumer networking gear has cost me way too much grief, up until i decided to spend a bit more money on it with more enterprise-ish Mikrotik stuff. Suddenly there ware 0 issues, to the point when i forget it is even there, it simply never needs to be even looked at as it never breaks. Unfortunately they also tends to come with settings so vast and complicated that you need a doctorate in IT just to open a port, but once you set it up you know you won't have to dick with it ever again, so it is worth it. (Never having to reboot the thing just because you changed a damn setting is also a godsend when setting things up)

[AndyBeez]

[...]
I just bought a TP-Link VDSL2 modem/router/wireless AP for a mate to replace his failing one and it's pure junk. It actually forces you to download an app and sign up for an account just to configure it. No settings in the web GUI at all (although it actually has a HTTP server and web interface for stats). It literally took me an hour to set up because of that garbage. The app kept throwing me out and I'd have to factory reset and start all over again, for no reason at all. Shit like this seems to be a common theme, not just with TP-Link.

Blame the enterprise environment for the move to 'consumer cloud management'. I understand the necessity for cloud managed systems in pro-enterprise environments where networks are spread across the physical corporate landscape, but in a two bedroom house? I need Cisco Meraki etc to manage VLANs in another timezone, but why do I need an Omada controller with apps to configure three laptops and a rubbish printer on a single [router] default subnet? All this comes from the same script kiddie mindset that added WiFi connectivity to the toilet bowl > "Alexa, flush the toilet for me" Do I need that? If you have both hands full texting, you bet you do! Consent to the download...

I will add to the forum's list of overpriced stuff, the subscription model of software distribution. WTF? In olden days you bought the software [on a real disk], and if you were lucky, downloaded updates, patches and feature enhancements for free. Sadly the subscription model is becoming accepted practice. Let us not forget the in-app purchases also required on top of the annual user subscription. From open source software to open wallet software.

[tom66]

Test equipment may have high gross margins but if you have to run a competitive R&D department to fund it, then someone's got to pay for those salaries.

There's always an inflection point.  Keysight could sell an DSO4104X for $5k less and probably still make a profit on each unit, but if it only increases sales by 5% then they will struggle to pay the engineers to make the next generation of products.  The actual gross profits of these companies are usually not amazing because they have competition from many other manufacturers as well as competition for R&D budgets.

And engineers are expensive.  Especially the types of engineers who can make oscilloscopes.