fritzz@lamont.ldgo.columbia.edu (fritz zaucker) (08/28/89)
There are a few things I don't understand in this discussion: 1) Why do all the INTERACTIVE people say that they don't know the AT&T license fees. Who else then them could get this information easier (I suppose there should be somebody in their company how pays these). 2) It makes no sense to me how the difference in AT&T fees are compared to the INTERACTIVE margins. The fees are fixed costs (as the ISC people say themselves) and because of that the difference in price for the 1-2 and unlimited user version should be the difference between the AT&T fees for these two versions. If the other statements are correct this should be 100 (one hundred) dollars or the ISC people should tell us what the real difference is (the price difference is a lot more than 100 $). 3) I believe that the work ISC is doing in implementing UNIX for the 386 should be payed reasonable. But nevertheless this pricing policy should be explained suffiently. Fritz
darryl@ism780c.isc.com (Darryl Richman) (08/29/89)
In article <1638@lamont.ldgo.columbia.edu> fritzz@lamont.ldgo.columbia.edu (fritz zaucker) writes:
"1) Why do all the INTERACTIVE people say that they don't know
" the AT&T license fees. Who else then them
" could get this information easier (I suppose there should
" be somebody in their company how pays these).
I'm a tech type, not a marketeer. I have no access to this kind of
information.
"2) It makes no sense to me how the difference in AT&T fees
" are compared to the INTERACTIVE margins. The fees
" are fixed costs (as the ISC people say themselves) and
" because of that the difference in price for the
" 1-2 and unlimited user version should be the difference
" between the AT&T fees for these two versions. If
" the other statements are correct this should be 100
" (one hundred) dollars or the ISC people should tell
" us what the real difference is (the price difference
" is a lot more than 100 $).
You haven't got a good grip on the way distribution and retail sales
work. Each in line boosts their cost of product by a percentage,
often 100% or more. They don't much care why their cost is at a
certain point. So, by the time you buy anything, it costs 4 times
(or more) what the manufacturer got for it originally. Three fourths
of your cost was profit and overhead of the distributor and retailer.
And that original $50-150 (or whatever) for licensing is now $200-600
of the cost. Which is why it is critical to have a 1-2 user system
as well as an unlimited. I know that as a consumer I don't much appreciate
this, since I hardly find retailers to be value added (and in some cases,
like autos, they are often value subtracted), but you're gonna have
to reform a the whole marketplace before you get around to us.
One way to avoid the retail level is to direct market. But this is
a difficult way to go for what is supposed to be a mass market
product. Usually developer companies choose this route on low
volume items that they don't have to store.
"3) I believe that the work ISC is doing in implementing
" UNIX for the 386 should be payed reasonable. But
" nevertheless this pricing policy should be explained suffiently.
I can only offer you my own naivette' here, but this is my understanding
of why prices get set the way they do. I'm not in marketing or sales,
and (as my .signature claims below) these are only my opinions. I
know that a couple grand is a whole lot of money for a personal
system, and even for a small company. But everyone seems to be
desparately clinging to the idea that Unix is going to be a business
OS. (I'd like to see some proof of concept, myself. IBM seems to
be having a difficult time convincing people that they want to pay
a few hundred dollars for multitasking.)
--Darryl Richman
--
Copyright (c) 1989 Darryl Richman The views expressed are the author's alone
darryl@ism780c.isc.com INTERACTIVE Systems Corp.-A Kodak Company
"For every problem, there is a solution that is simple, elegant, and wrong."
-- H. L. Menckenpalowoda@fiver.UUCP (Bob Palowoda) (08/31/89)
From article <32411@ism780c.isc.com>, by darryl@ism780c.isc.com (Darryl Richman): [bit bucket] > And that original $50-150 (or whatever) for licensing is now $200-600 > of the cost. This is interesting, you mean to say ISC sign a contract for the $50-$150 range and ATT changed the contract mid-stream. > Which is why it is critical to have a 1-2 user system > as well as an unlimited. I know that as a consumer I don't much appreciate > this, since I hardly find retailers to be value added (and in some cases, > like autos, they are often value subtracted), ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ How in the world can a retailer "value subtract" from your product. Sure they can offer different packages but I don't think they go around removeing programs or recompile some program with less functions. If what you mean by *value subtract* is reduceing the price, the consumer views this as *value added*. > but you're gonna have > to reform a the whole marketplace before you get around to us. > I wouldn't worry about this until *your* company seeks more revenue. > I can only offer you my own naivette' here, but this is my understanding > of why prices get set the way they do. I'm not in marketing or sales, > and (as my .signature claims below) these are only my opinions. I > know that a couple grand is a whole lot of money for a personal > system, and even for a small company. But everyone seems to be > desparately clinging to the idea that Unix is going to be a business > OS. (I'd like to see some proof of concept, myself. IBM seems to ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Proof, go down to the bookstore and pick up a couple of UNIX releated magazines. Read the articles than forget everything you read. Now look at the little boxes and you will notice that alot of them advertisements for spreadsheets, wordprocessors desktop publishing programs. Surely they are not selling these to programmers. Look at ATT's ads. Every one of them explain how they soulved a *business* problem with a UNIX OS. The only reason IBM cannot sell a multi-tasking system is they cannot get it to work without crashing every five minutes. Wake up Darryl, UNIX is a business OS already. To give credit where it is due I think that you and INTERACTIVE have done an outstanding job on your product. But as the market matures and becomes more of a consumer demand the prices will have to drop to sustain the market. These are pressures that INTERACTIVE will have to deal with very soon. As for the 1-2 user license I still hope it will not develop into a multi-tiered marketing game to inflate the price of UNIX. By the way does INTERACTIVE have a upgrade from the 1-2 user to the unlimited? If so how much is it? > be having a difficult time convincing people that they want to pay > a few hundred dollars for multitasking.) -- Bob Palowoda *Home of Fiver BBS* login: bbs Home {sun,dasiy}!ys2!fiver!palowoda (415)-623-8809 1200/2400 Work {sun,pyramid,decwrl}!megatest!palowoda (415)-623-8806 1200/2400/9600/19200 Voice: (415)-623-7495 Public access UNIX system