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Message: RE: Will there be news this week? Emit / Daboss/ SGE

RE: Will there be news this week? Emit / Daboss/ SGE

posted on Dec 19, 2005 01:09PM
To my recollection the #`s we (not sure who we is... maybe it was just I)calculated for the digeplayer, at least the #`s used and seemed to work were, $600 - $625 / unit to Wencor. When APS sold them to Jetsgo they quoted $2000 / unit. Meaning APS yeilded around $1400 / unit. I remember this well because my eyes nearly boogered out of my head! There was an article about Ittean mentioning manufacturing costs being $400 for the IFE unit. This was quite a while ago but I believe I`m remembering correctly. Using the above #`s our margins per unit to APS/Wencor/Digecor were around $200 / unit. ($600 - $400 = $200) SGE has a pretty good grip on these #`s and might remember some of this....Hey SGE

The purpose of this exercise illustrates the difference between selling direct to the end user vs going thru a middle man like Wencor. Imagine the interest of the airlines if Digeplayer costs were slashed. It also illustrates how absurd Wencors decision is to hire Triad in an attempt to vertically integrate the entire process. They are basically paying a couple / few million up front to own the IP and save $200 / unit. They will still have to pay someone to oversee the manufacturing process to boot! Hey more power to them. If they manage to do it guess who will be negotiating with the competition with a totally redesigned, upgraded and next generation player.

Larry

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