NEW PRICES! but im very conflicted

[Jason DeSimone]

Things are getting very interesting around here. We keep talking about cameras and camera skills as being key to success. One thing I think we sometimes forget about is one of the most valuable assets of all, the thing that can separate us from the pack - people skills!

I understand some will feel frustrated with this announcement. I'm sure this will affect some people's bottom line. But seems like things are getting a bit personal in quite a few threads. People questioning other people's business practices, questioning their decision making, etc. Not sure it's very productive. The prices are what they are, it's a decision RED has made and now current and future owners have some decisions to make. I encourage everyone to be respectful and engage in healthy discourse. You never know when that person you are engaging with might be a future client or colleague. People skills is something that can carry a career a long way.

THANK YOU STEVE

Most of us are on this forum because our livelihood revolves around motion cameras and we have chosen to invest in Red systems, or they are our preference etc. Although the camera is the most important tool in what we do, our businesses our built on much more. I worked on 3 shoots last month alone that shot on other systems (one of them on a c300 I suggested over my own Scarlet just based of the details of that shoot in particular). There are a lot of cameras that we rent, but only one professional camera system that most of us own.

I completely understand the frustration that comes with an announcements like this. People feel like they have lost a lot of money overnight, this just is not the case. At the end of the day I strongly believe the Epic will be a viable tool for creating professional content for at least another 4 to 5 years (just as the R1 has proven to stand the test of time). As we all know a camera brain is where the investment begins, but far from where the investment ends.

I think there are a lot of reasons this move was made now by Red, I also imagine the future of the Epic system will provide it's owners that have built businesses around it with value beyond anything they felt they have lost with this announcement.

 

[Mark Toia]

Mark, you're arrogance over the years on this forum has been really annoying. There's something to be said about being humble.

For all you "awesome" DP's who are pissed about the price drop, why would you buy a camera if everyone is hiring you for your skills? Buy high quality accessories and lenses for supplemental income, not camera bodies.

I can count the number of good DP's on one hand who own a camera body here in LA, and it's usually an Alexa.

This thread wreaks of insecurity, possibly worse than Red fanboyism. At least fanboys are entertaining to read.

Settle pettle....

I put creative in front of cameras... cameras don't really mean crap to me when I'm pitching on jobs, I just bring what I want to the job, clients don't care what I use... so long as they get the images and creative they paid for.

and I'm sorry if I have sounded Arrogant... over confident yes, maybe you are getting the two mixed up.

At the end of the day, who really cares what things are shot on, so long as the pictures are good and your bank balance reflects your talent.

Alex... your arrogant as well. Sorry to say.

 

[Steve Sherrick]

Settle pettle....

I put creative in front of cameras... cameras don't really mean crap to me when I'm pitching on jobs, I just bring what I want to the job, clients don't care what I use... so long as they get the images and creative they paid for.

and I'm sorry if I have sounded Arrogant... over confident yes, maybe you are getting the two mixed up.

At the end of the day, who really cares what things are shot on, so long as the pictures are good and your bank balance reflects your talent.

Alex... your arrogant as well. Sorry to say.

Let's all have a beer and call it a day.

 

[Chuck Z]

If RED had came out with a Dragon EPIC for 15k and I sold my EPIC-X for 9K... I would still be in the same boat. The way to adapt to what RED is doing is to drop rental prices and to go after volume just like what they are doing OR to get a camera (ARRI) that holds its rental value more and as a higher "perceived" brand value.... OR to get out of the camera body race and get a more stable investment with still high returns.

RED's not running a mutual fund. They're not selling you long investments. They're selling you a depreciating asset. THAT IS A FACT.

 

[Andy White]

RED's not running a mutual fund. They're not selling you long investments. They're selling you a depreciating asset. THAT IS A FACT.

I think everyone is aware and knows their camera is going to depreciate in value. We all expect that, it's business.

The seed change here is that the Epic was halved in value by RED themselves, rendering a number of users (in the stage4 and after) out of pocket.

On the one hand we have people applauding the price drop - and others being unhappy.

What it has also done is make some consider both their business models and attitude to kit. That's why some are quiet and others are selling up or re-thinking.

When all is said and done, it's simple to see that some people have maxed out their resources to get an Epic at the old price. Now they are faced with something that's worth 50% less than they paid - and that's even people that purchased 6 weeks ago. So, they have loans or debts that can't be serviced if they need to sell up and get some money back.

What's done is done. I have been somewhat caught in the storm, but life's a roll of the dice and I've been around long enough to know how to twist and turn.

Had I known a purchase of something that's less than 8 months old would now be worth 50% less new (and probably only be able to get 35% of it's original value at resale), would I have purchased? Probably not... I'd have rented and then waited for the price drop...

Jim's new army of happy campers will get the 19K Epic and that's great. Even if it reduces by 50% again, the drop isn't as significant as this one.

This isn't about smelling the wind of change or seeing the tide turn, or expecting a free ride... it's simply that RED's slash of price was more than a curveball for some & the end of the line for others.

I'm hoping for 10K Epics in January so I can get a B-cam

 

[Arnold F.]

You're absolutely right. This was proven by the instant, unexpected, factory-imposed "depreciation" of 40% the other day. Depreciation in quotes since what happened the other day obviously has nothing to do with that concept.

RED's not running a mutual fund. They're not selling you long investments. They're selling you a depreciating asset. THAT IS A FACT.

 

[Arnold F.]

Some say it's absolutely wrong to consider resale value when buying a RED camera. I used to disagree but after the Epic splat the other day and after reading that both the Scarlet I paid $12K for less than a year ago, as well as the Scarlet I just paid $7100 for (and haven't even received yet) are now worth $5K in resale, I'm forced to agree. The camera advertised by the manufacturer as the "Deal Of A Lifetime" lost a third of it's value before many of us will get delivery.

I think everyone is aware and knows their camera is going to depreciate in value. We all expect that, it's business.

The seed change here is that the Epic was halved in value by RED themselves, rendering a number of users (in the stage4 and after) out of pocket.

On the one hand we have people applauding the price drop - and others being unhappy.

What it has also done is make some consider both their business models and attitude to kit. That's why some are quiet and others are selling up or re-thinking.

When all is said and done, it's simple to see that some people have maxed out their resources to get an Epic at the old price. Now they are faced with something that's worth 50% less than they paid - and that's even people that purchased 6 weeks ago. So, they have loans or debts that can't be serviced if they need to sell up and get some money back.

What's done is done. I have been somewhat caught in the storm, but life's a roll of the dice and I've been around long enough to know how to twist and turn.

Had I known a purchase of something that's less than 8 months old would now be worth 50% less new (and probably only be able to get 35% of it's original value at resale), would I have purchased? Probably not... I'd have rented and then waited for the price drop...

Jim's new army of happy campers will get the 19K Epic and that's great. Even if it reduces by 50% again, the drop isn't as significant as this one.

This isn't about smelling the wind of change or seeing the tide turn, or expecting a free ride... it's simply that RED's slash of price was more than a curveball for some & the end of the line for others.

I'm hoping for 10K Epics in January so I can get a B-cam

 

[Chuck Z]

You're absolutely right. This was proven by the instant, unexpected, factory-imposed depreciation of 40% the other day. Is someone denying they did that?

I'm completely sympathetic to your plight and everyone affected by this. But you simply can't count on RED to hold prices stable over the life of the product. If anything we've learned over the years, it's that "everything changes" mantra (which is a complete cop-out to me). This includes price, much to your detriment. Really, the only thing you can BANK on is that if you buy into the RED ecosystem at the beginning of the product launch, you'll be in a much better position down the road. Think about the stage upgrades/trade-ins, higher position in line for sensor upgrades, etc.

It's actually a bad idea to wait a long time. I know not everyone can buy in right away and need to save over time. But even then I'd seriously re-consider why you want to get into the owner-operator business in the first place. I think Mitch Gross spelled it out pretty clearly. If your business model will blow up from a price drop like this, you're in the wrong business.

EDIT: I would also just add the following. We knew Dragon was on its way. Maybe if not the end of this year, it would be right around the corner in 2013. If I were you, I'd have waited to buy a new Epic with the Dragon sensor pre-installed. This way you can jump the line on all of the trade-ins.

 

[Arnold F.]

I'm converted. I'll never count on a RED product to hold value. Lesson absolutely learned.

I'm completely sympathetic to your plight and everyone affected by this. But you simply can't count on RED to hold prices stable over the life of the product. If anything we've learned over the years, it's that "everything changes" mantra (which is a complete cop-out to me). This includes price, much to your detriment. Really, the only thing you can BANK on is that if you buy into the RED ecosystem at the beginning of the product launch, you'll be in a much better position down the road. Think about the stage upgrades/trade-ins, higher position in line for sensor upgrades, etc.

It's actually a bad idea to wait a long time. I know not everyone can buy in right away and need to save over time. But even then I'd seriously re-consider why you want to get into the owner-operator business in the first place. I think Mitch Gross spelled it out pretty clearly. If your business model will blow up from a price drop like this, you're in the wrong business.

EDIT: I would also just add the following. We knew Dragon was on its way. Maybe if not the end of this year, it would be right around the corner in 2013. If I were you, I'd have waited to buy a new Epic with the Dragon sensor pre-installed. This way you can jump the line on all of the trade-ins.

 

[Lee Dashiell]

I think it's irresponsible on RED's part to make a cut like this. It's unfortunate that these cameras had value one day and half their value the next, all imposed by the manufacturer. If you bought an new Corvette you realize that there will be some depreciation of the car over the course of a year, what you would never expect is for GM to sell the same Corvette for 1/2 the price you paid. I call BS. Make me not want to buy into RED in the future. I'd rather have something that holds it's value better than this.

 

[Jeff Kilgroe]

I'm converted. I'll never count on a RED product to hold value. Lesson absolutely learned.

So what products do you count on to hold value? What made you think that an advanced piece of technology, built on components supplied by a highly volatile market, would hold value? The price had already gone up after the product started shipping... People complained. Now the price has gone down, people still complain.

RED has two options here:

1> Do what they're doing and provide the best piece of technology they can to their customers at the best price they think they can reasonably provide it for. Prices go up, shit happens and prices go up. Prices go down, same thing... Either way the pricing structure translates through to the customer.

2> Do what the "other guys" are doing -- set prices high to cover volatility and to artificially protect and uphold tiered cost structures. Prices go up, prices go down, it doesn't make a difference to the end user because the customer's price is the price, is the price, is the price, until the day they EOL the system and the value instantly tanks in favor of the new model.


It's obvious that some people want RED to go with the second option. However, they're not. They have chose option #1 and they have said that all along from the start. It's going to force the other guys int he industry to make changes too. Going to be very interesting to see how the others react in the coming months and next couple years.

FWIW, anyone thinking about buying into an Alexa right now had better make sure they can ROI that system within the next 6 months. ...just sayin'

 

[jake blackstone]

Has anyone noticed, that R1 now cost less than RR?:yesnod:

 

[Bob Gundu]

I think those BT ones are new. Just my own crazy theory of course.

Has anyone noticed, that R1 now cost less than RR?:yesnod:

 

[jake blackstone]

I think those BT ones are new. Just my own crazy theory of course.

I bet you, that those BT RRs are repaired cards by DVS. Well, if you would have bought Atomix card directly from DVS, which is the actual RR card, DVS would repair that card, if it failed. For a price, of coarse, but I would venture to guess, for less than a $3k a pop.
Regardless, one 3-4 years old design PCI card now worth more than revolutionary camera.

 

[Arnold F.]

Great points. A buyer of a RED camera should fully expect dramatic and possibly even overnight losses of resale value. Moreover, where I used to think that a business plan should take equipment resale into consideration, I now believe that a RED owner needs to consider both resale and depreciation (which generally means gradual in the accounting context) as outmoded concepts. It's a different ballgame.

I didn't buy an Epic at the old price and I'm thrilled that I might now afford one. I admit I fought the idea at first, but recent events and the advice of many here (including yours which, as a moderator I'll consider semi-official) have convinced me not to count on resale value at all. Heck, according to someone in another thread used Scarlets go for $5K, meaning the $7100 Scarlet I just bought has suffered a pre-delivery loss in resale value of about a third, and the one I bought 8 months ago has plummeted over 50%.

I tend to agree you; I doubt either Arri nor any other camera manufacturer could match such a consistent record. With RED we know exactly what to expect. This type of predictability helps us all.

So what products do you count on to hold value? What made you think that an advanced piece of technology, built on components supplied by a highly volatile market, would hold value? The price had already gone up after the product started shipping... People complained. Now the price has gone down, people still complain.

RED has two options here:

1> Do what they're doing and provide the best piece of technology they can to their customers at the best price they think they can reasonably provide it for. Prices go up, shit happens and prices go up. Prices go down, same thing... Either way the pricing structure translates through to the customer.

2> Do what the "other guys" are doing -- set prices high to cover volatility and to artificially protect and uphold tiered cost structures. Prices go up, prices go down, it doesn't make a difference to the end user because the customer's price is the price, is the price, is the price, until the day they EOL the system and the value instantly tanks in favor of the new model.


It's obvious that some people want RED to go with the second option. However, they're not. They have chose option #1 and they have said that all along from the start. It's going to force the other guys int he industry to make changes too. Going to be very interesting to see how the others react in the coming months and next couple years.

FWIW, anyone thinking about buying into an Alexa right now had better make sure they can ROI that system within the next 6 months. ...just sayin'

 

[Nikhil Kamkolkar]

So what products do you count on to hold value? What made you think that an advanced piece of technology, built on components supplied by a highly volatile market, would hold value? The price had already gone up after the product started shipping... People complained. Now the price has gone down, people still complain.

RED has two options here:

1> Do what they're doing and provide the best piece of technology they can to their customers at the best price they think they can reasonably provide it for. Prices go up, shit happens and prices go up. Prices go down, same thing... Either way the pricing structure translates through to the customer.

2> Do what the "other guys" are doing -- set prices high to cover volatility and to artificially protect and uphold tiered cost structures. Prices go up, prices go down, it doesn't make a difference to the end user because the customer's price is the price, is the price, is the price, until the day they EOL the system and the value instantly tanks in favor of the new model.


It's obvious that some people want RED to go with the second option. However, they're not. They have chose option #1 and they have said that all along from the start. It's going to force the other guys int he industry to make changes too. Going to be very interesting to see how the others react in the coming months and next couple years.

FWIW, anyone thinking about buying into an Alexa right now had better make sure they can ROI that system within the next 6 months. ...just sayin'

There was a third option here, Jeff, that RED seems to have ignored for whatever reason.

Take some of the cost reduction and allocate it to reducing costs of modules that'd help the EPIC compete with ALEXA today. For some reason, this was not considered, or if it was considered, it was rejected.

Jarred did say those modules did not in themselves have cost reductions. Cool, I get that. But why not drop the price on the brain by half of what they did, and use the rest to drop the price on the Meizler module for eg? Even if its for a limited time?

I believe the fact this was not considered is a clue to their business strategy/goal, but I don't want to speculate anymore. When we know, we'll know, I suppose. I'm disappointed though that this option did not come to be.

 

[Mark Pedersen]

+1

M

 

[Alexey Datsenko]

Everything is changing!
Only marketing is eternal!

 

[Mark Toia]

I'm converted. I'll never count on a RED product to hold value. Lesson absolutely learned.

Wow...

Did you forget about the $230K SONY F23 ---- Gathering dust.. worth what ever you can get for it.
The $220k Sony F35... Know body uses that anymore... the f65 made quick work of that... so worth what ever you can get for it.
The $250k Arri D21 - worth nothing, literally ! I know a guy with 2 of them sitting dead now for 2 years. Not a single hire.
Panovisons priceless Geneis ... I doubt this thing ever sees light of day anymore..
And the Arri Alexa about to get super seeded any day now... so who knows how low that will go once a cheaper better 4k version hits the stands... I was offered one for 35k only a week ago.

And your worried about the drop on price on a EPIC X... ? Shesshhh... Don't be getting into other brand names Arnold, you would be loosing a sight more than that over the next year or 2.

i personally would have dribbled the price down over 12 months or more, instead of one great whack. Just to save face... but hey, I don't own RED.

 

[Thomas Pohl]

i personally would have dribbled the price down over 12 months or more, instead of one great whack. Just to save face... but hey, I don't own RED.

That's the point! Evolution instead of Revolution. But I guess RED loves to do the first big step...

Cheers
Thomas.