[Asterisk-Users] Cost of IP Phones, or Isn't It Just Software?

[Jay Milk]

You're correct -- I believe I pointed out in my original post that there
is a $200+ difference between a cordless Cisco with/without software.
And that's plain ridiculous.  Plus, the phone alone isn't worth $500 in
hardware -- so we're obviously dealing with GREED here.

My knee-jerk response to such business tactics always has been to do it
better and cheaper.  Six years ago, I was talking to IT personel in
industry "X".  There were two established mainframe solutions in that
industry serving 80% of the market, costing $50K-$75K start-up cost per
location, plus $1K+ per seat.  Never mind the $10K-$15K monthly
"maintenance" cost.  Never mind that everyone had to be able to work a
terminal with a lovely amber on black, text-based "GUI".

In response, we set out to write a better application, using a
relational DB, Windows GUI, etc.  We now have installed over 600
locations nationwide (capturing almost 16% market share), offering a
much better solution at a lower cost.  Our company employs some 20
programmers, 40 support and 20 training staff, and we're greatly
profitable.

Cisco would be smart to drop the prices of their phones to realistic
levels -- if their phones cost $200 instead of $400, they would probably
only make $100/phone, but they'd sell disproportionally more phones to
balance this out.  On the other hand, they'd really P.O. their current
customers who paid their inflated prices.  Sucks to be them.

So, reading all the great feedback on this, what if we took an
open-source SIP phone (Siphon, KPhone), figure out the least amount of
hardware to run it, configure a PC104 or other SBC prototype and then
show it to investors.  Heck, I think I may just try this out sometime...


$400 buys me a 5.25" sized miniboard with Dual-Lan, onboard Audio, usb,
serial, CF port (for disk-on-chip), etc.  Another $100 gets me a serial
LCD, and for $2.50 I can pick up parts to adapt a telephone handset to
the sound-card's impedance.  It would seem that this is the complete
deal.  Part cost for prototype: Less than $1K.  Software is GPL'd.  Then
I'd have an actual prototype to show the banks and pass off to product
engineering team.  Software can remain open source, and the hardware is
nothing more than a very specialized PC with built-in UA and handset.

BTW, where can you get the Grandstream for $50?  That's a decent
alternative to having Sipuras and analog phones everywhere in this
house.

-----Original Message-----
From: Lars Boegild Thomsen [mailto:lth at cow.dk] 
Sent: Wednesday, June 16, 2004 8:25 PM
To: asterisk-users at lists.digium.com
Subject: RE: [Asterisk-Users] Cost of IP Phones, or Isn't It Just
Software?


Hi

> Just to get an idea of hardware cost involved here:
> - I can buy a 4-port router with built-in firewall, web-server and 
> email-client for $20-$30 RETAIL.  That would indicate a hardware cost 
> of $10 max.
> - I can purchase a Sipura SPA-2000 for $100 -- actual hardware cost 
> should be $50-$75.
> - I can also purchase a fully featured ADSI speakerphone for $80 
> retail, with an expected hardware cost of $50-$60.

But you fail to discuss the most important fact.  Cisco charge USD 500
for a phone simply because they can do so :)  If you look at the general
pricing - go back 2 years and you could hardly find a VoIP phone for
less than USD 250.  Enter Grandstream and prices started dropping.  When
Grandstream first appeared they listed the price as USD 79.  Now they
are generally selling at around USD 50-60 or so (single pcs. end user
pricing.  It's now possible to get a lot of IP phones for less than USD
100 - which is about the price that I and most people find reasonable to
pay for them.

You see the same with the WiFi phones right now.  The first Cisco one
was what - 6-700 USD (I never even bothered to check the exact price).
The second one - the ZyXEL/Pulver thingy - well - they generally seem to
sell now at around USD 200 or so.  The Senao one is going to hit the
market in a few month and they claim to target around USD 120 for the
initial offering. I'll bet you anything that shortly after the ZyXEL's
will be around USD 100 and they'll both end up competing around that
level.

Anyway - I'm babbling now :)  My point was only that the price of these
gadgets have next to nothing to do with the actual hardware cost - but
is only controlled by what the market is prepared to pay.

Regards,

	Lars...

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