Michael Reichmann explains the SD1 price...

Started Jul 23, 2011 | Discussions
DMillier
Forum ProPosts: 16,969
Like?
Michael Reichmann explains the SD1 price...
Jul 23, 2011

From post on the Lula forum:

"It was not chip yield, manufacturing or supply issues, the earthquake, or any other seemingly plausible reason. It was just a misguided decision by one executive that flabbergasted the rest of the company. It was a really bad decision and I predict will one day become something of a business school case study. Call in the King Lear syndrome."

-- hide signature --
desinteresadamente
Regular MemberPosts: 264
Like?
Re: Michael Reichmann explains the SD1 price...
In reply to DMillier, Jul 23, 2011

Thank-you David, somebody said it some time ago, therefore this only confirms the blatant mistake by this executive....

Reply   Reply with quote   Complain
tammons
Veteran MemberPosts: 4,878
Like?
Re: Michael Reichmann explains the SD1 price...
In reply to DMillier, Jul 24, 2011

Interesting.

So they built the camera for $1000 and are selling it for $7000.
Nice profit margin.

Reply   Reply with quote   Complain
leonard callow
Contributing MemberPosts: 827Gear list
Like?
and he would know this how?
In reply to desinteresadamente, Jul 24, 2011

oh yeah , he would not - to even post such dribble (drivel if you prefer) is juvenile on his part.

and that this was posted by some other fool and now again by this one proves it must be true - how, exactly?

hard to believe adults post/ behave in this fashion
--
Leonard

Reply   Reply with quote   Complain
worldcup1982
Contributing MemberPosts: 967
Like?
Re: Michael Reichmann explains the SD1 price...
In reply to DMillier, Jul 24, 2011

I fail to understand how amateur a company can be...one guy? this shows how much Sigma is behind the competition...not just product wise, even executives are worse than others...the guy didn't know sigma doesnt even have lenses to support the new camera? is this guy still working for Sigma?....

DMillier wrote:

From post on the Lula forum:

"It was not chip yield, manufacturing or supply issues, the earthquake, or any other seemingly plausible reason. It was just a misguided decision by one executive that flabbergasted the rest of the company. It was a really bad decision and I predict will one day become something of a business school case study. Call in the King Lear syndrome."

-- hide signature --
Reply   Reply with quote   Complain
FritsThomsen
Senior MemberPosts: 2,759
Like?
...is this guy still working for Sigma ?...
In reply to worldcup1982, Jul 24, 2011

worldcup1982 wrote:

I fail to understand how amateur a company can be...one guy? this shows how much Sigma is behind the competition...not just product wise, even executives are worse than others...the guy didn't know sigma doesnt even have lenses to support the new camera? is this guy still working for Sigma?....

He he .. Yes !! He owns it

No doubt Mr.Reichmann is refering to none other than the owner and founder Mr.Yamaki Michihiro.....

DMillier wrote:

From post on the Lula forum:

"It was not chip yield, manufacturing or supply issues, the earthquake, or any other seemingly plausible reason. It was just a misguided decision by one executive that flabbergasted the rest of the company. It was a really bad decision and I predict will one day become something of a business school case study. Call in the King Lear syndrome."

-- hide signature --
Reply   Reply with quote   Complain
SandyF
Forum ProPosts: 14,744Gear list
Like?
Re: Michael Reichmann explains the SD1 price...
In reply to DMillier, Jul 24, 2011

DMillier wrote:

From post on the Lula forum:

"It was not chip yield, manufacturing or supply issues, the earthquake, or any other seemingly plausible reason. It was just a misguided decision by one executive that flabbergasted the rest of the company. It was a really bad decision and I predict will one day become something of a business school case study. Call in the King Lear syndrome."

IF true, and we really have no way of knowing whether or not this is true, I actually think it's GOOD news. Decisions can be changed (assuming, at some time in the future); chip yield or manufacturing or component costs cannot be modified as easily.

I always wondered how the chip yield theory could be correct. I assume the chips are fabricated long before the cameras are assembled. So that IF there were a significant yield problem, the statements would not have been made relatively recently about a (lower) anticipated price point, ie the 7D statements by several Sigma executives.
Best regards, Sandy
http://www.pbase.com/sandyfleischman (archival)
http://www.flickr.com/photos/sandyfleischmann (current)

 SandyF's gear list:SandyF's gear list
Sigma DP2 Sigma DP1 Sigma DP2 Merrill Canon EOS 5D Mark II Sigma SD9 +5 more
Reply   Reply with quote   Complain
mike earussi
Veteran MemberPosts: 4,430
Like?
Re: Michael Reichmann explains the SD1 price...
In reply to DMillier, Jul 24, 2011

I still like my theory that the SD1 is just meant as a prototype and Sigma was looking for beta testers willing to pay 7 thou for the privilege.

Reply   Reply with quote   Complain
ToasterFlyer
Veteran MemberPosts: 3,122
Like?
Re: Michael Reichmann explains the SD1 price...
In reply to DMillier, Jul 24, 2011

DMillier wrote:

From post on the Lula forum:

"It was not chip yield, manufacturing or supply issues, the earthquake, or any other seemingly plausible reason. It was just a misguided decision by one executive that flabbergasted the rest of the company. It was a really bad decision and I predict will one day become something of a business school case study. Call in the King Lear syndrome."

-- hide signature --

My exact thoughts from the very get go ..when Sigma announced the price!! Has absolutely NOTHING to do with sensor production!!

Rich
ny

Reply   Reply with quote   Complain
Paul Petersen
Senior MemberPosts: 1,147Gear list
Like?
Re: Michael Reichmann explains the SD1 price...
In reply to DMillier, Jul 24, 2011

At this point the question is more how will Sigma recover from this fiasco?

Repricing the SD1 ASAP would be easy except for the fact that a few people have put their own money down. From a CS standpoint the only answer would be to issue refunds for the difference.

Introducing a new model with the same sensor at the expected price would be an option but would shatter their desire to place the SD1 as their flagship product.

The biggest roadblock is the companies Japaneese culture. Death is often preferred to admiting you screwed up. Many lies can be told to "save face" which is permissible under their sense of allowing others to keep their honor. That concept is DOA in western culture so I guess we get to watch and wait to see what happens. This fiasco will not kill the company since this is not their prime business, however it is a major setback for their aspirations to be a player in the DSLR business.
Pete
--
A bad day of train chasing is better than a good day at work.
http://peterzpicts.smugmug.com/

 Paul Petersen's gear list:Paul Petersen's gear list
Nikon D70 Nikon D90 Sigma SD14 Nikon AF-S DX Nikkor 35mm f/1.8G Nikon AF-S DX Nikkor 18-70mm f/3.5-4.5G ED-IF +2 more
Reply   Reply with quote   Complain
jrdigitalart
Senior MemberPosts: 2,921
Like?
Ha, ha, ha...
In reply to DMillier, Jul 24, 2011

DMillier wrote:

From post on the Lula forum:

"It was not chip yield, manufacturing or supply issues, the earthquake, or any other seemingly plausible reason. It was just a misguided decision by one executive that flabbergasted the rest of the company. It was a really bad decision and I predict will one day become something of a business school case study. Call in the King Lear syndrome."

Talk about falling for a sucker punch.

-- hide signature --

Sincere regards, Jim Roelofs

Cherish your privacy? Avoid (sp)iPhones.

Please visit my gallery at http://www.pbase.com/jrdigitalart/

Reply   Reply with quote   Complain
RWilliam
Junior MemberPosts: 31
Like?
Re: Ha, ha, ha...
In reply to jrdigitalart, Jul 24, 2011

The current price point for the Sigma SD1 is based upon its footprint cost. It has everything to do with the Sigma purchase of Foveon. The corporate capitalization and cost cut in the ownership groups profits. Capital outlays while financed with stock options none-the-less still have an initial rate of investment born by the owner of Sigma. He simply needed to capture his investment, so why not at the pricing of the newest camera. While the additional sales of lenses will provide more income it will take more time and another investment/R&D and fabrication costs so it will take several years to recapture. Due to the Foveon investment, earthquake and increased production expenses/costs in Japan the new pro-lens line is still a distant future plan. The $6899 price of the SD1 lets him take more profit to the bank much sooner. After the Sigma ownership group reaches their capital out-lay the price will drop on the SD1, however, not significantly as it will be needed to off set the new pro-lense process investment. New products and product lines are initially cost prohibitive at first. So new purchases of the SD1 are paying for the acquisition of Foveon. It will pay-off in time with reduced price points on future cameras.

Reply   Reply with quote   Complain
Paul Petersen
Senior MemberPosts: 1,147Gear list
Like?
Re: Ha, ha, ha...
In reply to RWilliam, Jul 24, 2011

Yeah but at the price of limited sales. I am sorry but the 7k price bends the volume/revenue curve too far in wrong direction for recovering whatever the investment amount was.
Pete
--
A bad day of train chasing is better than a good day at work.
http://peterzpicts.smugmug.com/

 Paul Petersen's gear list:Paul Petersen's gear list
Nikon D70 Nikon D90 Sigma SD14 Nikon AF-S DX Nikkor 35mm f/1.8G Nikon AF-S DX Nikkor 18-70mm f/3.5-4.5G ED-IF +2 more
Reply   Reply with quote   Complain
mike earussi
Veteran MemberPosts: 4,430
Like?
Re: Ha, ha, ha...
In reply to RWilliam, Jul 24, 2011

RWilliam wrote:

The current price point for the Sigma SD1 is based upon its footprint cost. It has everything to do with the Sigma purchase of Foveon. The corporate capitalization and cost cut in the ownership groups profits. Capital outlays while financed with stock options none-the-less still have an initial rate of investment born by the owner of Sigma. He simply needed to capture his investment, so why not at the pricing of the newest camera. While the additional sales of lenses will provide more income it will take more time and another investment/R&D and fabrication costs so it will take several years to recapture. Due to the Foveon investment, earthquake and increased production expenses/costs in Japan the new pro-lens line is still a distant future plan. The $6899 price of the SD1 lets him take more profit to the bank much sooner. After the Sigma ownership group reaches their capital out-lay the price will drop on the SD1, however, not significantly as it will be needed to off set the new pro-lense process investment. New products and product lines are initially cost prohibitive at first. So new purchases of the SD1 are paying for the acquisition of Foveon. It will pay-off in time with reduced price points on future cameras.

By your logic then Sigma should price them at $1,000,000 each. That way they would get a very fast return on investment--provided thay sold any at all.

Reply   Reply with quote   Complain
exdeejjjaaaa
Veteran MemberPosts: 6,506Gear list
Like?
Re: Michael Reichmann explains the SD1 price...
In reply to Paul Petersen, Jul 24, 2011

Paul Petersen wrote:

The biggest roadblock is the companies Japaneese culture. Death is often preferred to admiting you screwed up.

thing of the past... nobody dies nowadays...

 exdeejjjaaaa's gear list:exdeejjjaaaa's gear list
Olympus E-M1 Sony Alpha 7 Panasonic Lumix G 20mm F1.7 ASPH Panasonic Leica DG Macro-Elmarit 45mm F2.8 ASPH OIS Panasonic Lumix G 14mm F2.5 ASPH +20 more
Reply   Reply with quote   Complain
Couscousdelight
Regular MemberPosts: 405Gear list
Like?
Re: Michael Reichmann explains the SD1 price...
In reply to Paul Petersen, Jul 24, 2011

Paul Petersen wrote:

Introducing a new model with the same sensor at the expected price would be an option but would shatter their desire to place the SD1 as their flagship product.

that's a very good idea indeed. The 15MPX foveon sensor, in a body without video & liveview, and a 98% viewfinder ; a budget body.
Oh, wait...
--
http://www.labellelumiere.fr
http://www.flickr.com/photos/lepimento
http://picasaweb.google.com/Couscousdelight/Misc

Reply   Reply with quote   Complain
Phil Loughran
Veteran MemberPosts: 3,407
Like?
Re: Michael Reichmann explains the SD1 price...
In reply to exdeejjjaaaa, Jul 24, 2011

exdeejjjaaaa wrote:

Paul Petersen wrote:

The biggest roadblock is the companies Japaneese culture. Death is often preferred to admiting you screwed up.

thing of the past... nobody dies nowadays...

If you've been watching Torchwood..true....except for Jack....but then this is fiction!

Reply   Reply with quote   Complain
Gary Dean Mercer Clark
Veteran MemberPosts: 5,160Gear list
Like?
Re: The price was already set at below $2000.00 prior to the release.
In reply to mike earussi, Jul 24, 2011

The price was already decided during the development phase of the SD1 project. That is why there are so many documented interviews where high ranking Sigma officials tease us with hints that the price would be competitive with the Canon 7D etc. Contracts for chips and production were fixed costs at that point. Companies know to the penny exactly how much each product will cost and how much they will charge when it comes to market a year before it is even built.

It is simple. The SD1 was designed to compete with the Pentax K5, Canon 7D in that price range and if you look at the build--it is comparable to those models and very nicely built from my experience shooting with it. It was never intended to be sold above $2000.00 in price. EVER. Now why would a company price a product at 500 percent higher than planned? Because the owner said so. End of controversy.
Its his company. He can do whatever he wants.

mike earussi wrote:

RWilliam wrote:

The current price point for the Sigma SD1 is based upon its footprint cost. It has everything to do with the Sigma purchase of Foveon. The corporate capitalization and cost cut in the ownership groups profits. Capital outlays while financed with stock options none-the-less still have an initial rate of investment born by the owner of Sigma. He simply needed to capture his investment, so why not at the pricing of the newest camera. While the additional sales of lenses will provide more income it will take more time and another investment/R&D and fabrication costs so it will take several years to recapture. Due to the Foveon investment, earthquake and increased production expenses/costs in Japan the new pro-lens line is still a distant future plan. The $6899 price of the SD1 lets him take more profit to the bank much sooner. After the Sigma ownership group reaches their capital out-lay the price will drop on the SD1, however, not significantly as it will be needed to off set the new pro-lense process investment. New products and product lines are initially cost prohibitive at first. So new purchases of the SD1 are paying for the acquisition of Foveon. It will pay-off in time with reduced price points on future cameras.

By your logic then Sigma should price them at $1,000,000 each. That way they would get a very fast return on investment--provided thay sold any at all.

-- hide signature --
Reply   Reply with quote   Complain
Roland Karlsson
Forum ProPosts: 19,559Gear list
Like?
Re: Do MR know this?
In reply to DMillier, Jul 24, 2011

DMillier wrote:

"It was not chip yield, manufacturing or supply issues, the earthquake, or any other seemingly plausible reason. It was just a misguided decision by one executive that flabbergasted the rest of the company. It was a really bad decision and I predict will one day become something of a business school case study. Call in the King Lear syndrome."

Yeah ... this seems to be the correct explanation, even though it seems odd. I wonder though if MR really knows this --- or if it is an educated guess. And if he knows it - how reliable is his source.

-- hide signature --

Roland

support http://www.openraw.org/
(Sleeping - so the need to support it is even higher)

X3F tools : http://www.proxel.se/x3f.html

 Roland Karlsson's gear list:Roland Karlsson's gear list
Canon PowerShot G10 Pentax K-5 Pentax smc DA 15mm F4 ED AL Limited Pentax smc FA 50mm F1.4 Pentax smc DA 21mm F3.2 AL Limited +6 more
Reply   Reply with quote   Complain
TomFla
Regular MemberPosts: 489
Like?
Re: The price was already set at below $2000.00 prior to the release.
In reply to Gary Dean Mercer Clark, Jul 24, 2011

I tend to agree with Gary that a company that has reached the level Sigma has would have had to have had a real handle on costs well before releasing a product. Not to mention the PR failure of bait and switch with blurbs about a price point in the 7d range and then releasing it with a silly MSRP.

Sure Sigma has the option to do this; but they also have the responsibility to take the heat.
--
Those who forget history are condemned to go to summer school.

Reply   Reply with quote   Complain
Keyboard shortcuts:
FForum MMy threads