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Gadgeteer Module Market


#1

As I and others are getting used to Gadgeteer and finding shortcomings in the module market and as GHI is ramping up to become a board factory, I wonder if GHI has considered opening something similar to an “App Market” except for modules? I know a few others in the community have created their own modules and I have some ideas for several I want to build in 2012. However, I don’t currently see any good way for people to sell/distribute their modules.

What I propose is something similar to the Apple or Android markets where someone could submit a design and a fully created module & software to GHI and upon GHI’s testing/approval they would manufacture and distribute the module and the creator would get a buck or two for every one sold. It would be good for geek cred to put the name of the developer on the module in addition to GHI.

Personally, I’m going to create my modules regardless. However, I have no desire to be in the business of manufacturing & distributing them to the world and would love to be able to hand that over to someone like GHI and have us all benefit from it rather than me owning the only copies ever made of those modules.

Thoughts? Especially from GHI…


#2

As someone who’d like to be able to design a module or two, this sounds very cool.

OTOH, my guess would be that a lot depends on how much start-up and/or switching cost there is for changing what parts GHI is manufacturing at any given point in time. If you have to do a run of 100+ modules to make the economics work, that may be a very high bar, in terms of sales to recover the costs.

App stores work because while there is an initial incremental cost in vetting and testing an app, each subsequent sale costs close to nothing. That doesn’t hold true for manufacturing, of course, so the applicability of the app store as a model may be limited.

All that said, if anyone can make something like this work I’d expect it’s GHI. :slight_smile:


#3

You guys really need to come by our office so i can show you some of our plans.

Manufacturing hardware is very expensive. If you make 100 pcs than your cost is higher than our retail price. Try www.screamingcircuits.com for a quote on assembly. Then add $1000 for board and tooling then add the component cost from digikey. Oh! You have to buy reels of parts, prices of strips won’t work so. I say your 100 modules will cost about $3000 minimum plus now you need testing and packaging. Let us assume $4000 for all. Your module is $40 and this is your cost. How much will you sell it for? :slight_smile:

With that said, we have something for 2012 for sure.


#4

I’m still interested in a 1st annual FEZ World at your office in (summer) 2012 :slight_smile:

I know that some modules that require parts you might not need for other boards may be unreasonable to try and do. However, there are lots of modules that perhaps could be created using parts that you would already stock. For example, I plan to create Mongoose module that would basically be identical to the XBee module but with a different pin layout. Perhaps if someone comes up with something that’s really complex and requires lots of parts then they pitch into the components cost and recover their expenses as the parts are sold?

Or another totally different route… Maybe an additional market where all GHI really does is host a page of modules that are built totally by their designers and distributed & marketed by GHI. This could be useful for people who do want to do the assembly (and support) themselves. Perhaps something could be worked out where GHI uses it’s connections to get the PCBs printed at discount prices.

I know hardware is totally different than software but there should be some way to make this work. Since it seems that most Gadgeteer users are coming from the software world they are used to working in a app/module type market place and something like this could really help Gadgeteer popularity.


#5

$40 + $20 profit = $60 / module, hell ya for the right module that could work, so yes a Module Market could work , but I think there are a bunch of no brainier basic modules that need to happen first, but then using something like KickStarter which worked for BootStrapSolar (I was order #1080 for that) and we could have a module market. We will need to continue growing the Gadgeteer market space of course as the more people using Gadgeteer, the more likely a Module Market would be viable.

Sometimes I cast an envious eye to some of the modules for other platforms and while I know I could wire them up myself, I really see Gadgeteer as the Lego of embedded devices so I’d rather buy a suitable module then wire it up myself.

Of course where this gets really fun is taking a prototype device to the next level and I hope and trust that GHI has a plan for that too.


#6

Its not quite that simple. In the product cost example above, $40 was the production cost of the module itself. What about the time/money spent on R&D? What about the cost of all the employees required to handle the distribution?

It is not uncommon for the direct cost (the material + labor to produce the object) and indirect cost (engineering, office folks, etc) to be about equal. So if you were in the business of producing modules and set your price by only considering your direct cost you would be loosing money with every module you sold.


#7

If we use a number of App Stores as model, then distribution cost is a 30% split, but that covers the web site for the catalog (ie they handle marketing), payment processing and QA (ie ensure the app is up to some level of standards), now there is a small stocking and shipping issue (customers typically pay shipping costs anyways) as unlike software you have a physical object. R&D is the developer’s sweat equity, in that you build it first then if its any good, then you make your money, and if the devices goes golden, then you could really score.

Now given there isn’t a app needed for the ‘phone’ or something like Zune or iTunes, ie its just a web store, I would think that 30% would be a tad heavy, as payment processing companies like ShareIT take less then 10% of the product costs, but that is too lite as I mentioned there is inventory to deal with here.

If we adapt the model to be include something like KickStarter where modules can be pre-sold as an indication of market interest and initial production run cost coverage, then this could work. A number of Gadgeteer users are software guys and some of us have been doing shareware/app stores for years and know this model can work and you can make a living doing this, but it will need some tweaking for Gadgeteer modules and of course a bigger Gadgeteer market.