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View Full Version : Portable Media Center, Pricing, and First Generation Products


Jason Dunn
07-07-2004, 03:00 PM
We were having an interesting discussion about the new iRiver PMP-100 a few weeks ago, and I thought I'd get into rant mode a little. ;-) The big complaint so far is the price point that the forthcoming Portable Media Center (PMC) is speculated to be $500+ USD, and that's seen as quite expensive. But I'd ask you to ponder these questions:<br /><br />How much were the first DVD players?<br />How much were the first MP3 players?<br />How much were the first Pocket PCs?<br /><br />First generation products will always be more expensive than they "should be". Early adopters who care more about getting the product that the price are the people that buy them. No one launches a category-defining device and expects mass-market success with the first version. Judging portable media devices solely on the basis of price is short-sighted. One could argue that the PMC is simply an evolution of other genres, a PDA with a hard drive, but I believe it's a relatively new category with only a few vendors blazing the trail before the PMC.<br /><br />Let's just wait and see, shall we? I have no doubt in my mind that the first generation products will not sell terribly well due to price and other limitations, but like most things that Microsoft does, it's a long term play that's ahead of where the market is now. Right now digital audio is hot. Carrying digital photos with you is still a fringe scenario for most people, and digital video is even more so. Apple is playing the waiting game by not releasing an iPod that does photos or videos - they're letting other vendors establish the market, and then they'll enter it.

Felix Torres
07-07-2004, 03:12 PM
Yes, lets wait and see what the real (street) prices turn out to be once the distribution channel gets filled and competition sets in. The RCA Lyra PMC-equivalent lists for $500 or so yet is readily available for around $350.

Consumer electronics devices tend to have a lot of built-in discount-margin in the official list prices to allow the retailers to offer sales and deals once competition sets in.

My best guess is that until Christmas most of the PMCs will go for around $450 plus or minus 50. ;-)

Afterwards, they'll start to slowly move towards the natural price point of $299.

(Remember, in the CE business $299 is the magic number at which impulse buying kicks in. For a new product category, this is important.)

Mojo Jojo
07-07-2004, 03:42 PM
First generation devices and early adopters have long been the whipping boys (and girls) of the almighty dollar, that is a point I don't think anyone one can argue against these days. :)

However I wonder about price in a slightly different effect in todays consumer culture. While everyone still knows about and actively seeks things with a price value... are we subconciously being swayed by price status/appearance? If so, do companies push past value in pricing to raise their products image?

(I know I am about to lessen my argument by throwing in a car analogy but I am really, really, trying to shorten the length of my posts and this seems the most effective way to do so)

Take cars for instance, why do people buy BMWs or Mercedes? Certainly it isn't value for the dollar in preforming a car's main purpose. In recent studies those two car companies don't fall into the top reliability ratings but people still strive to buy them. Does this same factor apply to electronic devices in some way?

Do people who have less information preceive devices with a higher price tag to be of better quality? Do companies push the prices of their product up in hopes of appealing to this factor when they are first to market? Anyways some thoughts on price that have been stirring around.

As for the PMC portion of this...

I curse :wink: one of the other readers on these forums for planting this seed in my head but lately I have been looking at my day and doing some thinking.

At first I was all gung-ho about the idea of a PMC device. However I also suffer from the 'shiney new technology disease' or SNTD. I have a feeling some of you already know what that is.

With the slow launch of these devices I have had some time to think about how I would use these things. This available time to think and to ponder the readers question of why is this technology so big is starting to corrode my initial thoughts.

I enjoy my digital music player... listening to it right now, in the car, at my desk at work and it struck me. I like my digital music player because it blends with what I am doing. Driving, working, surfing the web. Could I do that with a PMC?

The answer I am coming to is this... no. I can't drive saftely and watch a video or tv show, would get fired if I was at work watching videos, and I only have two eyes to read the web page let alone try to focus on both writing posts and watching a mini tv.

In addition the times I do have for watch videos I am usually at home where I already have a large tv.

I am starting to think that protable videos are not for me. Now my SNTD is telling me that perhaps if I could replace a device I already carry (PDA) then it might not be so bad. :)

The short... while I don't presume that my activites and needs are the same as an entire market, I also don't presume that my routines are so out of whack that I am abnormal... with that said I am having doubts about the PMC market becoming mainstream by itself. Is cool technology creating the illusion of a market that isn't there?

Lee Yuan Sheng
07-07-2004, 03:49 PM
Is cool technology creating a market that isn't there?

That's what I've been saying all this time.. who really needs one? All those I've talked to who are receptive of MP3 players think video players fall into the category of Very Silly Devices.

Now, if they made it do more things, it might be more useful, but that'd make it into either a Pocket PC or notebook.

Mojo Jojo
07-07-2004, 03:58 PM
That's what I've been saying all this time...

Actually... you are the reader I curse. :D Joking of course on the whole ill wishes part but your post and some time changed my view on PMCs.

Gary Sheynkman
07-07-2004, 04:46 PM
at 500+...You might as well get the PSP :lol:

Lee Yuan Sheng
07-08-2004, 10:31 AM
Heh, I didn't know I had such powers of persuasion. :wink: