[asterisk-biz] PBX Functionality for Less than the Price of a KeySystem (3Com Asterisk IP Telephony Appliance)

[Alex Balashov]

Trixter aka Bret McDanel wrote:

> On Tue, 2008-06-03 at 15:26 -0400, Steve Totaro wrote:
>> On Tue, Jun 3, 2008 at 3:12 PM, Jay R. Ashworth <jra at baylink.com> wrote:
>>> You didn't read what *I wrote*.  I'm discussing telephony markups
>>> (40-50%, traditionally) vs PC markups (10%, on a good day, downhill,
>>> with a tailwind).
>> You obviously were off topic since this thread is about the 3com
>> Asterisk Appliance and you never addressed the question that Trixter
>> posed for this product's price....  Do you have an answer?
> 
> Yes, why is it 40-50% traditionally?  I am really curious, especially
> since you keep refusing to answer and are telling others that their
> answer is wrong.

I would venture that the answer has something to do with the 
relationship between cost structures and the externally perceived value, 
and the way in which those margins can dissipate when markets "correct" 
or "rationalise."

 From the very beginnings of the personal microcomputer industry, PC 
hardware has been based on largely interchangeable, commodity components 
  (the efforts of Compaq and Dell and such to make proprietary cases and 
memory and so on notwithstanding).  Open standards and architectures, 
even to the extent they exist in the PC hardware world, create 
aggressive competition and downward price pressure as the barriers to 
entry are lower.  In fact, the manufacturers of the first personal 
computers in the early 1980s deliberately structured things this way; 
commodity hardware is a complementary good that helps sell more PCs.

You can see how this plays out today, for instance, when a gamer decides 
to get a new computer because that would pretty much be required, from a 
technical perspective, to make effective use of their brand new 
top-of-the-line nVidia card so they can play a new, top-of-the-line 
video game that requires a 500 Terahertz GPU and so on.

This puts PC hardware _comparatively_ (and only comparatively so) closer 
to the idealised "perfect competition" of certain economic sectors where 
the product is fully commoditised and near-perfect market information 
exists.

Contrast this with the proprietary, black-box architecture of most 
traditional telephone systems and communications gear.  The standards 
are not open, the components are largely proprietary, and to the extent 
that specifications and interoperability exists, it is still 
circumscribed to a much more narrow pool of possible intra-industrial 
players.  In such a situation, what the market will bear can be much 
more loosely coupled to the cost structure of the underlying production.

That's why proprietary stuff in general (excluding really, really 
generic commodities and other things that are relatively trivial) pretty 
much always entails higher margins.  The price can float more freely, 
far less anchored to the underlying production costs;  (1) There is not 
a lot of competition to drive it down, and (2) the competition that does 
exist is rather an oligopoly, which usually has the consequence of some 
degree of collusion to support certain prices and margins, and (3) Even 
to the extent that interchangeability of products exists, they are all 
mathematically and technically incommensurable to a far greater degree 
than commodity goods, as far as the impact of that commensurability on 
causing margins to move toward a highly visible, open cost structure 
that has vivid external definition to other market participants.

-- Alex

-- 
Alex Balashov
Evariste Systems
Web    : http://www.evaristesys.com/
Tel    : (+1) (678) 954-0670
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