Serious Questions about a "new deal"

[Michael Hastings]

I posted this on the other thread but seems like it may deserve its own. Moderator please feel free to delete if you think it is unnecessary.

http://reduser.net/forum/showthread....137#post682137

We have finished the EPIC development. Now we have to fab the boards, tooling and set up a line. While we are waiting, we can build one by one machined cameras and hand assemble with titanium mounts if there is anyone interested to pay more for something like this. We are going through now to see what we would have to charge to sell these because they will cost us a ton more than production run bodies.

There is no price increase on production EPICs. But this seemed like a way to get a few out sooner for those that can't wait.

When we have a number, we'll put it out there. There is no requirement for anyone to buy these, just kills a bit of time. If there was interest, they would go to customers by number 1st. There would be no trade in allowance. Numbers would be limited to what we can make until the line is fully operational.

It is important to note that these cameras would not delay or hold up production from the line. They are not Tattoo cameras... they would be special production cameras.

I think this option is very fair for the customer ....

...snip
I dunno Jim.. The more I think about this... The more red flags it brings up.

This is such a complicated release, and there's so much I/we do not know. I think the better track right now is to stay with your origional plan.

Jay

I have been stewing about this for a few minutes. On the one hand I'm interested because I'd like a camera sooner rather than later.

But I have to disagree with Haskell - I think there are some serious fairness issues here.

And I have to agree with Jay. Lotta red flags.

Jim:

I don't want to get branded with the "bad attitude" stamp but a few weeks ago you said Epic was finalized in its major respects and "released for production". Well, honestly I thought that's where you would have been when you asked us for $5000 deposits on stage 2. I understand how getting the exact board and electronics design finalized can be hard to predict and have delays, but I'm having a harder time understanding how the manufacturing and assembly line stuff wasn't virtually completed quite a while ago.

But that's all water under the bridge. No, I don't want my deposit back, and no I don't want another camera - I want the camera I ordered, from the company I have been on board with and promoted since day one.

But before you start asking about altering the program, after you've taken those 25% deposits, it's time to lay out what's really going on:

A realistic `description of what you are doing in terms of mfg. facility and how long that is going to take; what's going on with these circuit boards - AFAIK board manufacturing is pretty straightforward from lots of suppliers with pretty short turnaround and usually the time it takes is more about lead time scheduling - if they can make a few dozen boards they can make hundreds in another day or two. Special lemo connectors can take awhile but you've known what those were for months. I thought you would be CNC machining body parts for all of the epics but even if the long range plan is casting, the additional cost to CNC is not that great in strict dollar terms or as a percentage of the price. Seems like you should have your own CNC capability, but if not there are dozens in your area. And how many man hours does it really take to handbuild one of these?

Maybe I'm mistaken because I've underestimated the complexity, if so then educate us a bit. I can't see how some better disclosure at this late date, so close to delivery and given the announcements the other players have already made, will really give away any big secrets to competitors.

As far as a new program, I think anything that dramatically changes the cost of entry or delivery order is unfair.

In particular a higher priced/no trade in/jump the line version just reeks of unfairness.

Here's my scenario for what might be reasonable and fair (no consulting fee, this one time :-) )

1) you lay out that it is going to be say 4-10 weeks (whatever you think it is) to get real production setup.
2) you estimate that you can make 10 to 20 (whatever it is) per week in the mean time. The prepro number will be limited to that max times the max estimate of weeks e.g. 15 units x 10 weeks = 150. Beyond that it is unfair to string the other people out, and you should just wait for full production.
3) You offer the stage 2 people to take their camera early (in order of original SN/delivery date) as one of these "handbuilts" for a $1000-$1500 (and $1500 is pushing it) premium on top of their $19500.

I'm not saying that $1000 will or won't cover the difference. I'm saying that it should either 1) cover it or 2) you should eat the difference as part of development and learning costs, goodwill and the PR value of getting it out or:

3) DON'T DO IT if 1 or 2 isn't acceptable. I'm sure many would buy outright at a high price, but regardless of whether some will go for it, it is abusive to the rest.


PS I had serious concerns about saying this at all/possible repercussions, but I think it needed to be said. Please take it in the spirit it is given. And Happy Thanksgiving to all the RED team.

[KETCH ROSSi]

I hear you Michael,

however I'll paste here my 2 Cents form the other thread..

It seems that so much gets taken out of context so I'll put in my 2cents..


A) This is likely to be a similar deal to what was originally to be the TATTOO program, just that now will
be expended to more STAGE II original reserves.

B) This is not BESIDES Stage II, as it seems obvious that once you have taken the possibility of buying
a Hand Build Epic-X it will be EXECUTING one of your ORIGINAL Stage II Reservations.

C) TATTOO or Stage I was to be paid in full @ 28k and not the discounted Stage II deal of 19.5K and
for this I say it could be very fair to pay this and possibly some more for an early Hand Build Epic-X.

D) All the Above stil off course will depend on time line of getting the early Hand Build Epic-X vs. the
rest of stage II production cameras.

E) As Jim stated that this early Hand Build cameras will not be effecting the Production line of the
other Stage II cameras, I trust there should be no concern at all to those not entering the early opportunity to an Hand Build Epic-X.

[JD Holloway]

Cut and paste from other discussion

as for 1-2-3

1) I kinda have the feeling that its going to be more like 4 -10 months before we see an assembly line Epic. That's why this is on the table.

2) I have a feeling they would be lucky to hand assemble 10 - 20 per month.

3) this makes some sense to me, price variable. (1000-1500 seems inexpensive though). Seems like a no-brainer.

It feels like the stage one option offered earlier doesn't it? What happened to those guys? This feels like their deal, not a stage 2 deal.

Tattoo Two? Ta-Too-Too?

I can sympathize with your need for more information regarding a timetable for delivery though. At least a best guess, Subject to Change
(trademark).

The Tattoo option never materialized as we expected it to.
The Tattoo program was an alpha-prototype program and became the alpha +13 series, not a beta production run program.
With that said, it must mean that all the original Stage one (formally known as Tattoo) people could be fulfilled before the assemble line can be finished.
Thus extending the hand-build cameras into the stage 2 rollout.

ergo- Ta2-2

[Michael Hastings]

I hear you Michael,

however I'll paste here my 2 Cents form the other thread..

It seems that so much gets taken out of context so I'll put in my 2cents..


A) This is likely to be a similar deal to what was originally to be the TATTOO program, just that now will
be expended to more STAGE II original reserves.

B) This is not BESIDES Stage II, as it seems obvious that once you have taken the possibility of buying
a Hand Build Epic-X it will be EXECUTING one of your ORIGINAL Stage II Reservations.

C) TATTOO or Stage I was to be paid in full @ 28k and not the discounted Stage II deal of 19.5K and
for this I say it could be very fair to pay this and possibly some more for an early Hand Build Epic-X.

D) All the Above stil off course will depend on time line of getting the early Hand Build Epic-X vs. the
rest of stage II production cameras.

E) As Jim stated that this early Hand Build cameras will not be effecting the Production line of the
other Stage II cameras, I trust there should be no concern at all to those not entering the early opportunity to an Hand Build Epic-X.

Ketch:

Couple comments:

Problem is we need a lot more context, which has not generally been given-it's been six months since stage 2 deposits and very little context over that time period and nothing now before sending up this trial balloon.

If there are paid tattoos obviously they should get a hand built one of these ASAP - don't think there were any.

Say what you will about it not affecting the production line cameras - ANY change to the order materially changes the deal.

If RED can't do something like my scenario, but they want to keep some cashflow, and the Elves busy, maybe they could consider a Stage3/keeper option where you upgrade your REDONE to M-X and then have the option to keep it for the $19500 (or whatever). No change in order, but buying an M-X upgrade just gets you a "coupon" for the option to keep your RED1. That would bring a lot of people off the fence that can't make sense out of an M-X upgrade now.

[Jay A. Kelley]

You make a lot of interesting points Michael. I will say this does sound like Stage 1 to me. The tattoo program that never was.

However, I am still unable to escape the very basic world that I live in outside of RED.

Companies, especially companies that have finished their testing and move into production, usually have release dates.

To be offered a hand-built camera, with no idea of when the production cameras are due out, simply does not, and will not work.

Furthermore, Epic is similar to the RED ONE in that it's just a brain. It's not going to work without a lot of other parts, modules, and drives to support it And we have little, if any idea what's going on with that.

I am also EXTREMELY tired of speculating. So that leads me here:

I have no opinion about Jim's offer because I do not know enough about what's going on to have ANY IDEA WHATSOEVER if it's a good deal.

If I had money to throw around, I'd take it and not care one way or the other (There may be some people in this position). Since I am not throwing money, the answer is... I don't know... Tell me more.

At this point, I'd also like to make a personal request to everyone at RED. Please take a moment and consider shedding some real, useable, light on where things are right now. You have told us that cameras are out of testing, and moving into production. This tells us they are moving forward, but gives us no concept whatsoever as to when they will ship. You said this new, "idea" or "offer" will get a few to people sooner, but sooner than what? We have no basis of comparison.

I don't mind the waiting.. But all the unanswered questions are wearing me down a little.

I'll be fine.. I'm a big boy.. But more specific info would be nice.

Jay

PS Jim I know you guys are bad at dates, but I also believe that the closer you get to the end, the more accurate you will be at a deadline. Do me a favor, sit down and work it out, take your best guess, and the DOUBLE it.. Throw that date out there. Even if you miss it, I won't be mad. In fact, I will most likely DOUBLE it again!

[Bill Anderson]

I feel your pain, but I think Jim is bending over backwards to provide as many viable solutions to interested parties without compromising or effecting the original game plan. Is it "jumping the line" if they take Jim up on this offer, since jumping the line means impacting those that wait in the line? Hmmm:

"Any change to the order materially changes the deal".

I'm curious (since Jim has stated that the special assembly offer will in no way impact the regular production schedule): what is it that seems unfair "materially"? The thought of someone getting the jump on being the first to shoot X Y or Z ?
Or ???? Whatever it is, is it not worth making the concession, considering what Jim is offering in the first place?

[Johnny Friday]

It's one thing to take a chance and jump in with a $500 deposit with a proven "leader" but it's now another to have jumped in at $5000 deposit and some of us have multiple cameras so we're not talking chump change.

Yep...love the RED philosophy, strategy and all round way the keep us in the loop. AND the fact that the "leader" makes dramatic decisions to hault everything in order to give us more bang for our buck. That said, some of us have a lot of $$$ sitting out in RED land that could be used elsewhere or have been allocated differently. I'm all for getting a better product, but it's been a while that my ten grand has been out of my hands. I could have used it for a few other things right now. If it was $500 or $750....not as big a deal. BUT, i guess this all depends on economies of scale and each individuals monetary status. I'm sure for many $5k is nothing more than $500 for some of us.

Would be nice to have some more words of where we're at from the big cheese and some rough time tables. If we're looking at several more months, why not offer something different to those of us with thousands on deposit or a way to keep our place in stage 2 but i'd sure like to have had my ten grand working on a project i had to pass on recently.

....agreed, all in the spirit of open conversation. BRANDED! as a BAD ATTITUDE

[Meryem Ersoz]

I'm seriously stunned by the negativity of these responses.

RED should get its camera technology out into the world as soon as possible, make some money back on all the cash that they have no doubt been burning, and solidifying their reputation for staying ahead of the game by getting these out working in the field -

what a statement it would make to have shipping EPIC cameras out the door by Christmas!

I honestly don't see where anyone is harmed by this gesture. And RED will be able to drop a big new year's surprise on the imaging world - that would be huge for RED.

Damn the torpedoes, bring on the EPICs.

[Jannard]

1. We have bent over backwards for our customers. We aren't stopping that now.

2. I have said all along EPIC is a difficult trick. Do you see any other companies with such aggressive specs in a matchbox?

3. We have added features (like HDRx) along the way that no one signed up for... no charge on EPIC.

4. You can have your deposit back any time we let you down, you find a better solution... or you are just pissed off.

5. If we do NOT do this new program (of a handful of cameras) you will not get your camera any quicker. Might even be a week later since we won't have the assembly data.

6. We expect assembly of production cameras to begin in modest amounts by early February and full ramp up by early April... before NAB.

BTW... if we DO do this program, a handful would be shipped in Dec. and more in January.

Hope that helps... now go eat something and calm down. Happy Thanksgiving. :-)

Jim

[Jannard]

In particular a higher priced/no trade in/jump the line version just reeks of unfairness.

Why is it unfair if we give 1st access to our customers in order? I'm not sure what the real issue is here.

Jim