[fedora-arm] 1ghz ARM Laptop (12in 1280x800 LCD)

[Matt Sealey]

On Wed, Feb 2, 2011 at 10:32 AM, Luke Kenneth Casson Leighton
<luke.leighton at gmail.com> wrote:
> On Wed, Feb 2, 2011 at 4:02 PM, Gordan Bobic <gordan at bobich.net> wrote:
>> Luke Kenneth Casson Leighton wrote:
>>
>
>  it's very interesting that it's been the U.S. companies whose
> attitude has been "your product will fail, therefore we do not wish to
> be involved".  i find this fascinating.

It is far more subtle than that. Note the job title: I do product
development for a living. Your product won't fail - I am sure if you
find the money to advance development beyond pre-production prototype,
and that is a rather significant amount of money, you might sell a few
units. Getting industrial design done, EMI testing, FCC/CE/NOM
certification, and then ramping it up to a reasonable production
economy will double your budget, minimum. Don't forget shipping them
from Taiwan, freight, and delays in part ordering, and price
fluctuations making your hair fall out.

Designing an ARM Netbook is going to cost you about a million bucks
out of pocket for the first 1,000 units. You'd better be willing to
sell them for $1000 each to recoup the costs involved if you want it
back immediately. Can you guarantee you'll sell 1,000 units on a
consumer level? Can you guarantee 10,000? In that case you can offset
the cost and give your system an ultimate BOM cost of $100 and sell it
for about $250.

Without those guarantees and without up front funding and investment,
your product will fail. No company would take on the project if it
meant expending significant resources on something that at best case
end up as a doorstop. I can point you at several "community efforts"
which do mean well but have ended up basically either being chucked in
the trash or not being anything close to viable. Remeber the Crunchpad
that became the JooJoo? Without the nitty gritty details I can't say
what actually went on between Arlington and Fusion Garage but I
suspect the reason is Fusion Garage put in significant funding through
investors and could not find volume in the market the TechCrunch guys
though it would attract, at the price they wanted (which amounts to
selling at a loss).

It is not possible to create a loss leader without having something
next to it that is not slightly overpriced to compensate. Apple do
this with the iPod - the device is sold above manufacturing cost, but
well below development cost. They make money on the iTunes store. For
every 99 cent tune they sell, they get paid. When they get sold in
batches of 12, they get paid 12 times. When 50 million people do it
once a week, who cares if they recoup the money on hardware and OS
development? Take Android's App Store: the vendors don't get anything,
but the App Store drives them to the product. The phones are
subsidized by the telecoms companies so that the demand for a fart app
can be met with a $99 phone that cost $300 to build. The vendor is
happy because they are protected by the subsidization model.and is
being paid back in full (+profit) for the cost of the phone, and the
telecoms company can do it because it makes a huge profit on the
mandatory 2-year subscription ($60 a month for a
worth-$10-in-infrastructure data plan pays for your phone in such a
way that every phone is written off in 3-4 months and the rest is
gravy).

It is all about recouping investment, and no amount of investment in
this product being discussed will ever be recouped. You need to find
yourselves a wealthy guy who will back your cause. I am surprised Mark
Shuttleworth hasn't done something like it already - you'd think the
largest most successful consumer-oriented open source distribution in
the last 5 years would do well to have development hardware available.

-- 
Matt Sealey <matt at genesi-usa.com>
Product Development Analyst, Genesi USA, Inc.