[NTLK] Re - Strength in numbers

From: Frank Gruendel (Frank_Gruendel_at_t-online.de)
Date: Sat Jan 12 2002 - 09:35:07 EST


> Not trying to start a long thread response, but it would seem we have
> strength in our number and unity that might be applied to some avenues
> that may have the potential to make a difference....

Well, let's try some basic mathematics:

In the company I work at, a good hardware or software engineer costs about
$130 per hour. This includes salary (which unfortunately is the minor
part) plus 1/1500th of the remaining cost to run a 1500 people company.
Assuming that every engineer works 8 hours a day and 200 days per year,
this would mean $1.040 per day or $208.000 per year. Lets say $200.000 to
make calculation easier.
Assuming that 20 qualified engineers would manage to develop both hardware
and software for the new PDA within a year (which I strongly doubt),
developing this beast would set the company back
around 4 million bucks. Everyone who has done this kind of planning before
will now say it will probably cost way more and he'll be right, but this
is just a theoretical example.
Now let us assume for a second (again, this is theory) that
a) Every single of the 1500 members of this list is going to buy
a unit as soon as they hit the market
b) Apple will be able to manufacture this thing for no cost at all
c) No cost for transportation, test and whatever is required before the
device lies on the Apple store shelf will apply
d) The list price is $1000 (which I think is already way above
what people would be willing to shell out for a device like that)

This would mean that Apple will sell 1500 units to us which will put 1.5
million bucks back into their cash register. With that, they wouldn't even
have their cost of development back. Leaving the theory trail
and rightly assuming that it will cost them at least 200 bucks to
manufacture a thing like that (which I consider realistic if it was
manufactured in large quantities), the situation would look even worse.
Let alone the fact that marketing, factory tests, putting up service
networks worldwide and stuff like that aren't exactly free these
days, either. And the fact that four millions in your purse are a good
start to make a significant profit by the end of the year by just
leaving it at your bank which must be added to the total loss.

So, in a nutshell, for Apple it doesn't matter whatsoever
whether this list wants a new PDA or not, even if
we each *would* buy one once it was available. The only way to make this
project a success would be to develop a device a sufficient number of
people would spend their money on. Considering the situation
Palm Inc. currently is in, you can replace "sufficient" by
"even more than the current number of Palm users".

Frank

Newton software and hardware stuff at www.pda-soft.de

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