Hey Guys, update here
Working on something I think you guys will like.
I know some of you have been frustrated about our lack of clarity on the what the "buy back" or "price protection" meant. To cut to the chase, we announced those things to early. We had the deals in place, but the manufactures backed out. In our defense, one of the reasons I never announced the details of how it would work, was because we still were trying to figure out the best way of doing it.
And to those of you that have claimed we "never did this". Let me remind you that not only have we bought back old customer hardware so they could upgrade, we also have provided some price protection by stepping up and covered some of the losses our customers took with our own cash flow.
Whether you agree or not, the bottom line is we need our manufactures to participate in a program like this for it to work for everyone. Some of our manufactures agreed, then later backed out of the deal. This left us holding the bag. While this was out of our control, I think we stepped up by offering free hardware to compensate those that bought at a bad time. We paid for this ourselves, essentially giving up our profits for two weeks.
For some you that was not enough, and I am sorry you feel that way. But for many of you, thanks for the support, we are doing the best we can. This is a crazy space, and we are constantly getting curve balls.
The reason I am writing is because after much thought. I have realized that the only way (besides "Project Prime" in development) we can stop this from happening this way, and offering a level of protection, is to track our hardware cost to the market.
What does this mean?
Simply put, we are building a way to regularly update our hardware pricing at fixed intervals. This way you can decide when your going to buy and what the price will be. In other words, instead of this:
Week 1- 100% Original Price
Week 2- 100% Original Price
Week 3- 100% Original Price
Week 4- 100% Original Price
Week 5- 50% Original Price
I want it to work more like this:
Week 1- 100% Original Price
Week 2- 80% Original Price
Week 3- 70% Original Price
Week 4- 60% Original Price
Week 5- 50% Original Price
Dont quote me on the numbers here, its just an example to illustrate the concept. The key to making this work, is to get the manufactures to sell to us the same way. I believe we can do this if we work together.
This is bigger then us. If we want this industry to stay around, this is how it needs to work. Hardware needs to drop in price at set intervals at set times. So miners can actually start making some money (we should come of with a name for this concept). My goal is this:
If we can lead the way here, then we can get other resellers to do the same. Imagine a world where the hardware cost is always coming down. So there are no surprises, no drops, and you can actually get an ROI? I think we can pull this off.
The other thing that needs to happen is we (resellers) need to start thinking about things on a cost per MH/s basis. I think we should publish our price per MH/s on our front page (and have it continue to drop). AND sell all systems at the same ratio. This way no matter what you buy and when you buy it, your always paying a fixed amount. On top of that, if you know the schedule, you can start understanding how pricing will work in the future, so you can time you buy.
So I propose:
1. Drop the prices at a regular scheduled interval, so you can plan your buying
2. We need to get the manufactures to sell to us this way
3. Publish our price per MH/s on our site, so you always know what it is
4. Price all the systems at the same ratio, so you can make easy choices on what you want
5. Show a schedule on when the price changes will take place and by how much in the future
This is a concept, I am voicing it here to see what your input is. Whether we can make this a reality or not (I think we can), I hope you guys can see we are trying to make this work for everyone. And I am genuine in that effort.
Josh
Josh, First I must say that I very much appreciate everything you have done and are still trying to do for the mining industry. There will always be pushback and skeptics.
I must say, I saw this coming. I could tell you were pushing towards this when you priced your own GAW miners with structured (tiered) pricing depending on delivery date (weeks one, two and three). While I think it is a great idea to have predictable depreciation, I don't think it will work. You are trying to change the mining industry as a whole. So far, and I could be wrong, all the scrypt ASIC manufacturers are in China. It's essentially you against China here. You might get Zeus to agree to structured depreciation for their chips. But you won't get all ASIC manufacturers to jump on board.
This industry is too cutthroat, as you already found out with Gridseed. Gridseed is not the only manufacturer who will drop prices with no warning. Many, many others will. Everyone is out to make as many bucks as they can, including miners. Even if you can get many manufacturers to agree to these terms, someone will break them (or some new manufacturer will come out of nowhere). Once that happens, it'll be a domino effect. This is exactly what happened with Gridseed.
Threatened by loss of sales because of Zeus and Innosilicon, Gridseed paniced and lowered prices to liquidate hardware before it became irrelevant. Those Chinese guys are ruthless, I'm sorry to say it. I have nothing against China, like I said, everyone is trying make a buck where they can.
The published MH/s is a good idea. Frankly however, it's easy to calculate. I do this almost on a daily basis for each ASIC (and as prices change). I believe others should be doing this too before purchasing equipment.
I could be completely wrong, and I hope that I am. Keep calm and mine on.
