I hope the day when decoder manufacturers get down their prices. The hardware value of a sound decoder is under $ 15.-: including research, employees, packaging and so, why to pay more than $40.- ???
I am think you live in a different reality than most of us. Cost for software, recording of real sounds, the machines that do the actual parts assembly and testing of the decoder as an example. Development cost are there also as research is always being done to improve the decoders as WE, yes you and I want more and better features.
Many rivet counters want as prototypical as possible. Non rivet counters want low price and then rant when they find out some of the sounds are PC generated or real sounds modified by PC.
You will never see a good sound decoder at the price you fantasize about.
Rich
Not being a mathematical wizard or electronics desighn expert, I figured somethings were missing in your calculations. And I dido what Rich said.
Truck.
It’s a case of you get what you pay for.
At some point, the prices will come down, just like they did for non-sound decoders. Competition will drive them down once the manufactuers have recovered their development and start up costs. We’re just not at that point yet.
SRN,
I also want add on that the more that are produced, the cheaper that they become. Simple Economics.
I think you’re a bit off on the hardware value of a sound decoder. Realtively small quantities of custom chips are NOT cheap, and they all use custom chips for the most part.
–Randy
I’d like to see the calculations as well. There’s a lot involved other than the chip. The people who do the work expect to get paid and the people owning the company expect a profit. Then the retailer will also expect to earn a profit after paying his employees.
I doubt any of us are going to see the calculations unless one decides to prepare a business case for getting money to enter the business. Most places aren’t going to give you wholesale prices on components unless you appear to have some credibility as a business buyer. Knowing your cost structure is critical to staying in business for the long term.
I find guessing what it costs a manufacturer to make something a rather fruitless exercise unless I am preparing said business case. Only the federal government gets to see the books on stuff they buy - and even then they pay to have time-consuming independent estimates generated as well. Many of those so-called estimates are hardly worth the paper they are written on. Don’t ask how I know this.
Bottom line - either the item is worth what is being charged to you, or it isn’t.
my thoughts, your choices
Fred W
If you really think a sound decoder can be made that cheaply, why don’t you invest the $10,000 - $15,000 required for a computer-controlled, surface mount technology assembly station, computer, field sound research, etc. and make one for us.
Here’s an example of what can be involved in surface mount assembly technology:
DCC sound decoder manufacturers seem to have found a workable price range between $100 and $140 that apparently covers their overhead and still makes them a profit. Instead of lowering their prices for existing technology, they seem to be taking a page from computer manufacturers who keep prices from falling by adding more features, speed, memory and the like. First came generic sound, then came more prototypical sounds, then came sound file downloads. QSI now offers stereo sound in their top line decoders, although you’d have to install one speaker in the loco and the other in the caboose to be able to hear true stereo separation. I expect that someday we’ll see Surround Sound 7.1 offered for Z Scale and still priced between $100 and $140. Digitrax offers a couple of sound decoders with generic sounds and a street price of around $40. I wouldn’t expect to see prices any lower so if $40 is your break point, you’d better buy them now.
Let’s assume you business model for a moment and follow the price trail.
Decoder manufacturer “X” can produce the sound decoder including all operational overhead for
$15, unlikely, but OK.
“X” is not in the business to break even, but to make a profit, and that profit margin is added to the price that the decoder is sold to the Distributor “Y”, and for maths sake, that markup is 66% of the total cost, in this case $10, for a total sale price of $25.
Distributor “Y” also has operational overhead costs that are added to the $25, and to remain profitable, the cost of goods needs to be in the 30% range of the wholesale selling price, but for argument sake “Y” can be profitable with a 50% COG, so “Y” sells the decoder to the dealers for $50 with a MSRP of $100.
Dealer “Z” buys decoder X from Distributor Y for $50, once again the Dealer has business overhead, a family to feed, a sick dog…, and is also in business to hopefully make a profit, and these days it’s a little one. Internet only retailers can get by with about a 40 - 50% markup, and discount local shops around 60%, unless they’re in a high profile location.
Following this model, the decoder that X made for $15, will cost you, the end consumer $70-75 from INTERNET only retailers, and $80 -100 from the LHS, and to me the value added by the local shop is worth the $5-10 difference, but we.re a LONG way from your under $40 number.
I remember motor only decoders were over $30. Now you can find them for around $15 with more features and lighting. I too would love to see sound decoders for under $100. Some are!. I also remember when a sound decoder was just that. I still have a loco with a sound, motor and lighting decoder inside it. The sound decoder is about the size of the motor not including speaker. I am glad they come all together now and a heck of a lot smaller. My mom used to tell me, Be happy with what you got, Cause you can have nothing.
Pete
$30? Motor decoders used to be over $50 and didn’t do half what an NCE D13SRJ can do, at $12. Those decoders that used to be $50 are now included ‘free’ in many Bachmann locos.
Using common parts instead of a custom chip is what allows Digitrax to sell sound decoders for lower cost. However the tradoff is limits int he sound and the extreme complexity of makign your own sound projects. Some of that difficulty is eased by the efforts of Fred Miller with his front end program, but I doubt you will ever get the smaller PIC proocessors like that to do 16 bit sound AND motor control in one - in fact some of the ones that are sound and motor seem to have a few issues playing sound at the same time the loco is moving. Custom chips specifically designed for sound and motor control, like the ones used by Soundtraxx and QSI (take a look at their boards - that big chip on there - that’s not some repurposed cell phone part - THAT’S where the cost is) can handle higher quality sound and still have enough CPU horsepower to run the loco.
I waiting to hear the new QSI - the stereo feature will come in quite handy for things liek EMD E units with two prime movers and maybe non-compound articulateds - if it happens to have dual cam inputs you could have each engine of the articulated be completely independent, if it also had dual motors. The stereo channels can also be used for reverb effects without the speakers having to be many feet apart.
–Randy
Like I mentioned earlier. The more something is produced, the less expensive it becomes. Add in that when newer and updated technologies come about, the prices also come down.
Does anyone remember what the prices for electronic calculators was in the early 1970’s? About $100 and without features such as memory and square root buttons.
An XT desktop computer went for $1500 twenty years ago. Now I can get a laptop with 100 times the software and 10 times the processor power for 500$. In fact, the web book that I’m typing this post on cost me $100 brand new from Verizon.
Eek! Price increases with Walthers…price increases with pre-orders…prices about decoders…prices about gas…[sigh]
Maybe it’s time we all got outside and breathed in a little fresh air. [%-)]
Tom
And despite there being 10’s of thousands of model railroaders, the number using DCC, and the number using SOUND, pales in comparison to the number of people using calculators or cell phones. So our stuff costs more. Bottom line.
–Randy
If 25% of modelers are running DCC Sound, I’ll be amazed.
For Mike and anybody: can you compare a laptop ($500) or a web book ($100) with a tiny sound decoder, as an ESU, $ 137.- deco and speaker???. That´s for V3.5, wait the price for the new 4.0…And don´t say me that model railroading market is small. Today just 4 or 5 manufacturers sells millions of decoders around the world, specially here in USA, in Europa and Australia, and add the rest of the world, and each day more and more people turn to DCC. Maybe the profit is for intermediaries, who knows,… but I think that the amortization of the decoder is sooner than what you think. Regards H-D.
Dear Randy, 10.000 model railroaders where, in Tombuctu?? not here, indeed. Why do you think that so many model manufacturers sells new models month over month here, in Europe, UK, Japan, etc? just for 10.000 modelers? I think this number shoul´d the floor just to make a new model, not less. Bye.