If the patents on their tech expire next year - the value of the company takes a huge hit.
TO simplify it - they treated the HO market like the O hi-rail market, one stop shopping. One supplier for everything you run (with maybe a LITTLE give for rolling stock, they never made much HO rolling stock). Problem is, that was never the HO scale model. We buy our locos from whover makes the nicest loco we are looking for, not just blindly buy one manufacturer’s offerings. We equip them with our choice of control system, be that DC, DCC, or something else. Not one single supplier - although there are some DCC users who will only buy decoders from the maker of their system, which unlike DCS, is not a requirement. They never made DCS available to add in to other locos, like you can buy DCC decoders. Their solution was to tell you to buy two systems, and they designed DCS to allow pass through. But who wants to deal with two different control systems on the same layout (not to mention the expense of buying two)? That would be like Sheldon running half his main with his MZL based system and the other half with the old fashioned toggle flipping method of cab control.
Someone may come forward and buy them. I don’t think this announcement comes because they are about to go bankrupt, Mike mostly is probably ready to retire at this point. If the patent expiration in 2021 is true, then ever-wily Mike is getting while the getting is good. Nothing more, nothing less.
And even if you like the HO locos, converting them to DCC is a nightmare, because they all use positive function outputs with a negative common, completely opposite DCC, so their LED light boards all have to be replaced or required just to swap a decoder. And many of them use a supercap instead of non-volatile memory to save settings (maybe that’s only in O - the older O locos used a battery, just to save a few cents a loco on a more expensive microcontroller). Makes me wonder if my FAs will even reme
Wow, there are pretty harsh comments here for someone who is retiring…
About duplication of suppliers, I’m not sure that is a bad thing for consumers. Competition is always good. I hope the owner gets a decent offer for his company, both for him and the staff.
Yes. If any patent runs out in 2021, then no buyer will be giving much value to the patentend products, IMO. Especially with ramp up expenses working into economic headwinds the next few months.
I suspect that the only thing that has real value is the tooling for the O scale products. Not even sure the HO scale stuff would be very desireable, outside of a few products. I think most of their HO scale is duplicative, a couple of times over.
I admit I don’t follow the highrail O gauge world, but from casual observations of comments, the market has been shrinking a lot in the last few years. So maybe it is a good time to get out of O, especially if the customer base is shrinking a lot.
Which comments?
I do know that many many have commented about being unhappy with the DCS digital stuff.
I am sorry to hear this although yes Mike was a figure who seemed to generate some controversy in his time. And his habit of being proprietary about so many factors including the assumed voltage on his HO line was an irritant to many.
I have only one MTH model, a very nice gondola in HO. I figured I’d give the line a try.
One reason I am sorry to learn of this is somewhat selfish. MTH has obviously been a big player in model trains scale and toy and they have large displays at Milwaukee’s Trainfest each year - and those displays are colorful, action filled, and attract crowds. The money he pays for his space and the crowds that his trains attract help keep shows like Trainfest running for the benefit of all, including those who are uninterested in the products themselves. Nobody benefits when a major player in model trains of any stripe calls it quits and shuts down.
My hunch is that there will be some cherry picking of the MTH tooling by various other entities, maybe even including the outfits he has sued from time to time!
I do by the way FULLY understand a desire to retire!
The loss of any company producing items for our hobby is indeed a loss. No matter good or bad, their products grew our hobby. I know Wolf as we are from the same town and I found him to be the real deal and cared greatly about his products. I am a brass guy, but I do have a few of his locos and found them to be excellent in all areas. My fleet of brass has allowed them acess to my mainline with no complaints. I only hope that Mike finds a buyer instead of just closing down. If not for my age bordering on relic, I’d be giving him a call.
Mike… good luck, on whatever you do next. Despite mixed critiques, you have my vote of excellence…and then some.
How does that work? Is he obligated to just hand someone the keys to his 123,000 sq ft building on 8 acres of land with all the contents, inventory and accounts receivable?
MTH made a couple of very unique engines for the Milwaukee Road, which I model. They made the Little Joe and the Bi-Polar, which are electrics that no one else has touched. I must thank them for making these uncommon engines.
I might have bought one, but I don’t have catenary so that would detract from the realism. Also, these again we’re DCS-only models, so they would have required surgery right out of the box. Maybe a new owner might be more DCC-friendly.
Well, what if the owner died and the company shut down? That ain’t right either but the dead man will be unable to respond to charges of unfairness. And btw, what about the owner of the Chinese factory AFFA that suddenly closed it’s doors at the end of July 2018 throwing a bunch of US model train companies out of ability to make trains? Unfair but it was his factory.
I’m sure many will be affected one way or another by MTH closing and Mike retiring, but for me it will be nary a ripple. He cut too wide a swath in the hobby, without reading it properly. What I mean is that, while he had been doing well in O as a competitor to Lionel and others, he hadn’t kept up with recent developments and the culture in HO sufficiently to anticipate that he was going to rub a LOT OF US the wrong way by being so rigid about DCS. I can’t say I know all the facts, but if his share of the HO market reached 5-8%, I’d be surprised. He’d have done much better if he’d simply inserted himself as Rapido did some years back, and maybe popped out a gee-whiz development every other year.
I don’t know if it was outright hubris, or maybe he felt flush with both cash and success in his O Gauge enterprises and simply felt that he would do well in HO. Maybe some of both. Personally, I think the hobby would have been happier and better served had he taken a different approach. And for his fans in the larger gauge, lo siento.
I’ve never owned an MTH locomotive but I did purchase their entire 10-car set of the '40 NYC 20th Century Limited passenger cars and they are terrific. I was hoping that MTH would release a few more with different car names so that I could acheive a 16-car consist w/o duplication. If another manufacturer purchased those dies and re-released them with the same quality and capacitor lighting module installed, I’d be all over that.
With all due respect to our poster, perhaps he has become convinced by the spirit of the age that responsible businesses do not just provide jobs and products or services, but are morally beholden as servants to the will and needs of both employees and customers. This is the apparent current view as is readily evident in growing corporate response to current events. The notion of an owner not requiring at least the tacit approval of either group prior to making a business decision is becoming passe. Fasten your seatbelts!
