highdudgeon;148139 Wrote: > I'm just surprised that SD sold out so soon. Okay, twenty million is a > lot and I'm sure that Sean & Company are popping bottles of champagne. > Still, the Transporter is very new to market and the company is bound to > revolve over the year. In terms of branding, they might have trouble > with the audiophile crowd if the concentraton goes toward more toward, > well, Logitech-type products.
The Squeezebox is always gone to be the one that makes money - it's actually somewhat perverse that SD have gone from mass-market to upmarket. One would normally expect a high-end 'proof of concept' first, followed by a mass-market product (often better than the original), and then, maybe, a new upmarket product. I don't want to do SD down, but theirs is a new market, and there are several players who will enter it when it becomes more mainstream. They are probably making OK profits now, but they could easily collapse in the future to a large entrant with serious resources. Getting the resources (of Logitech) on board is the best way to ensure that they don't get pushed out of the market that they have created. I assume that they have also looked at the private equity route, and that they decided that their future was better with a product partner, not just a financial backer. Is $20m cheap? If Arcam bring out a branded audiophile Transporter-beater in a year, and Sony a mass-market SB-beater, SD's margins will be slim indeed. For $20m, with a risky future, I'd want them to be making $2-3m profit this year or I wouldn't even look at their business plan. I don't know how many SBs are being sold, but I doubt their profits are much above that. Even if they are making that, this strategic partnership is probably the best way to make sure of the future. It takes a lot to take a company from an edgy, techie product to real mainstream, and that is what is required for SD - it has the SB, which can do it, but you need real resource to take it there. So for me, it's hats off to Sean et al. I think that he has recognised that they would rather have a financially secure future, with a smaller part of something potentially huge, than to keep on with a real chance of being totally squashed by a large player. It's pragmatism over greed, and I respect it from a business perspective. Yes I share people's concerns over branding and continued product quality, but let's let time tell. I still feel very positive about SD's products' futures. Adam -- adamslim SB3 and Shanling CDT-100, Rotel RT-990BX, Esoteric Audio Research 859, Living Voice Auditorium IIs, Nordost cables ------------------------------------------------------------------------ adamslim's Profile: http://forums.slimdevices.com/member.php?userid=7355 View this thread: http://forums.slimdevices.com/showthread.php?t=28862 _______________________________________________ audiophiles mailing list [email protected] http://lists.slimdevices.com/lists/listinfo/audiophiles
