Still flying with the 195 on my yolk and that was $ well spent years
ago but would like to upgrade. Anyone hear anything about what's coming
down the pike next? Seems about 2 year intervals for these portables.

Thanks for any info.

Dale
PA-24

make that yoke.

wrote:
> make that yoke.

Oh darn, I was looking forward to thinking of something clever to say about your
yolk. :)

About your original question... I don't know what's next, of course, but the 396
is available now and is a nice addition to your yoke.

I have the yoke mounted 396 that supplements the panel-mounted GNS480. Next week
the avionics shop will upgrade the connector so that the 396 will be able to
automatically display the flight plan from the 480. Connecting to ship's power
means the 396's battery is continually kept topped off, ready to work as a
standby if needed.

I have a Stormscope, too. The combination of 396 plus Stormscope gives me a lot
of confidence for summer flying.

I configure the 396 with the map-plus-HSI display and it's easier to follow than
the HSI display on the 480. It's closer to my scan and easier to see. Only as a
supplement to my approved navigation equipment, of course. :)

DGB

I've not heard of anything new coming out, the 396 is pretty new. To
me, the biggest jump happens in the 296 because you get terrain. Flying
singles over mountains makes the terrain feature almost a requirement.
Those on the East coast my disagree. The 396 is only better if you
maintain the $50/month subscription, otherwise it turns into a 296.

-Robert


wrote:
> Still flying with the 195 on my yolk and that was $ well spent years
> ago but would like to upgrade. Anyone hear anything about what's coming
> down the pike next? Seems about 2 year intervals for these portables.
>
> Thanks for any info.
>
> Dale
> PA-24

Robert M. Gary wrote:
The 396 is only better if you
> maintain the $50/month subscription, otherwise it turns into a 296.

There are two levels of subscription, $30/mo and $50/mo. I use the less
expensive one and it has all the important stuff.

If you like, you can jump back and forth between the two levels of subscription
on a month-to-month basis.

http://www.xmradio.com/weather/0726_xmwx_realease.pdf

Thanks gentlemen. Very helpful. The 396 is obviously a marvelous tool

Don't know if I'll wait for the 496 or not-wonder what the changes will
be. Sort of fun to predict where the Garmin gang will try to make
improvements. They have competion to worry about.

Dale

Robert M. Gary wrote:

> I've not heard of anything new coming out, the 396 is pretty new. To
> me, the biggest jump happens in the 296 because you get terrain. Flying
> singles over mountains makes the terrain feature almost a requirement.


Only if you're IFR. I have NavGPS software on my PDA that has terrain
and was really looking forward to it when it came out. Now with all
these hours terrain serves no useful purpose when VFR.

> I've not heard of anything new coming out, the 396 is pretty new. To
> me, the biggest jump happens in the 296 because you get terrain. Flying
> singles over mountains makes the terrain feature almost a requirement.
> Those on the East coast my disagree. The 396 is only better if you
> maintain the $50/month subscription, otherwise it turns into a 296.

Does the 296 really have the capabilities of the 396 minus the XM?
Does an XM receiver really cost $1100? (list price difference between a
296 and 396)

> wrote:

> Thanks gentlemen. Very helpful. The 396 is obviously a marvelous tool
>
> Don't know if I'll wait for the 496 or not-wonder what the changes will
> be.

Why wait? The 396 is fairly new. Every time Garmin's come out with a new
model, I've traded up. Never had a bit of trouble selling the old one.

I love the 396. The wx capabilities make it an awesome cross country tool.

--
Dan
C-172RG at BFM

I was looking at 2,000 foot T.V. towers the other day. The 296 alarmed
them before I saw them.

Newps wrote:
> Robert M. Gary wrote:
> Only if you're IFR. I have NavGPS software on my PDA that has terrain
> and was really looking forward to it when it came out. Now with all
> these hours terrain serves no useful purpose when VFR.

"john smith" wrote:

>> I've not heard of anything new coming out, the 396 is pretty new. To
>> me, the biggest jump happens in the 296 because you get terrain. Flying
>> singles over mountains makes the terrain feature almost a requirement.
>> Those on the East coast my disagree. The 396 is only better if you
>> maintain the $50/month subscription, otherwise it turns into a 296.
>
> Does the 296 really have the capabilities of the 396 minus the XM?
> Does an XM receiver really cost $1100? (list price difference between a
> 296 and 396)

I don't know, but I suspect not. There are also software and hardware
development costs to be covered.

You can't blame Garmin for charging what the market will bear when they have
a product that everyone wants and there is no competition; that's capitalism.
396s were selling so fast last year, I bet Garmin was wishing they'd priced
them a little higher.

--
Dan
C-172RG at BFM

On 06/01/06 14:15, Robert M. Gary wrote:
> I was looking at 2,000 foot T.V. towers the other day. The 296 alarmed
> them before I saw them.

It's really a strange feeling flying near those towers even if more than
1000' above them. The thing is they "appear" to be in your airspace while
the rest of the planet "appears" so much further below.

It looks like you're going to trip over them - really makes you want to
keep a safe distance ;-)

>
> Newps wrote:
>> Robert M. Gary wrote:
>> Only if you're IFR. I have NavGPS software on my PDA that has terrain
>> and was really looking forward to it when it came out. Now with all
>> these hours terrain serves no useful purpose when VFR.
>



--
Mark Hansen, PP-ASEL, Instrument Airplane
Cal Aggie Flying Farmers
Sacramento, CA

john smith wrote:

> Does the 296 really have the capabilities of the 396 minus the XM?
> Does an XM receiver really cost $1100? (list price difference between a
> 296 and 396)

It's not just the receiver, of course, it also has to decode and display all the
weather information and provide the user interface to access it.

The 396 can display TIS from your Garmin mode-S transponder.
The 396 can interface with your panel-mount GPS 430/530/480.
The 396 can be an XM music receiver.
The 396 can tune your SL30 or SL40 NAV/COMM.

The 296 has a 200 MHz processor, the 396 has ???

Looks like the GPS engine is the same, the display is the same, the battery is
the same, the case is the same, the database is the same. The 396 weighs a tiny
bit more.

296: 10,000 point automatic track log; 15 saved tracks; 700 points per saved
track; lets you retrace your path in both directions

396: 10,000-point automatic track log; 15 saved tracks; 1,000 points per saved
track; lets you retrace your path in both directions

I'm no Garmin expert, just put together this list from Garmin's web page. I
probably missed some stuff.

> Why wait? The 396 is fairly new. Every time Garmin's come out with a new
> model, I've traded up. Never had a bit of trouble selling the old one.

The 396 will likely wind up in my plane and maybe eventually on ebay to
make room for the upgrade if the next iteration is worth the trade.

thanks.

Dale

"Mark Hansen" > wrote in message
...
> It's really a strange feeling flying near those towers even if more than
> 1000' above them. The thing is they "appear" to be in your airspace while
> the rest of the planet "appears" so much further below.
>
> It looks like you're going to trip over them - really makes you want to
> keep a safe distance ;-)

> --
> Mark Hansen, PP-ASEL, Instrument Airplane
> Cal Aggie Flying Farmers
> Sacramento, CA

Thank God we only have little bitty TV towers that measure in the low 100s
of feet here in the Phoenix area.

Of course, the fact that these little bitty towers sit on 1500'+ foot
mountains which themselves, are poking up out of a 1500' valley floor, are
another matter entirely.

(Tongue ---> Cheek)

Jay Beckman
PP-ASEL
Chandler, AZ

> Looks like the GPS engine is the same, the display is the same,

The 396 has a brighter and better display

Karl
"Curator"

The 396 has audible alerts if interfaced. I think that is pretty nice when
you could hear an alert when you are otherwise overloaded. I assume it
would help if you were overloaded or you wouldn't need the warning would
you? It also has audible driving directions. I don't have one but maybe
someday I will upgrade my 196.

I can tell you that I for one, that I miss not having the full approaches in
them so I can follow along and the few times I go into a big airport it
would sure be nice to have the SIDs and STARS in them instead of flying only
on a KLN90B.

The other capability I would really like is the ability to upload/download
flight plans to it from a PC. That stinking MapSource only works good for
roads.




"Dave Butler" > wrote in message
news:1149197657.288989@sj-nntpcache-3...
> john smith wrote:
>
>> Does the 296 really have the capabilities of the 396 minus the XM?
>> Does an XM receiver really cost $1100? (list price difference between a
>> 296 and 396)
>
> It's not just the receiver, of course, it also has to decode and display
> all the weather information and provide the user interface to access it.
>
> The 396 can display TIS from your Garmin mode-S transponder.
> The 396 can interface with your panel-mount GPS 430/530/480.
> The 396 can be an XM music receiver.
> The 396 can tune your SL30 or SL40 NAV/COMM.
>
> The 296 has a 200 MHz processor, the 396 has ???
>
> Looks like the GPS engine is the same, the display is the same, the
> battery is the same, the case is the same, the database is the same. The
> 396 weighs a tiny bit more.
>
> 296: 10,000 point automatic track log; 15 saved tracks; 700 points per
> saved track; lets you retrace your path in both directions
>
> 396: 10,000-point automatic track log; 15 saved tracks; 1,000 points per
> saved track; lets you retrace your path in both directions
>
> I'm no Garmin expert, just put together this list from Garmin's web page.
> I probably missed some stuff.

>>>>> "DB" == Dave Butler > writes:

DB> If you like, you can jump back and forth between the two
DB> levels of subscription on a month-to-month basis.

Can you turn the subscription on and off?

For instance, most of the year I fly locally in Northern California,
within a few hundred miles of home base, and the weather is very
predictable: sun inland, fog on the coast in the morning. But once a
year I like to fly an overnight cross-country and then the WX would be
very handy.

Has anyone tried the vistanav software (www.vistanav.com)? Reading
their website and reading through the operating manual, it appears that
it does everything the 396 does, and then much much much more. With
the wx package i believe its just shy of 5 amu but certainly adds a lot
more features such as Highway in the Sky, Chart view type software, 2D
and 3D views, and also very handy (for someone like me who needs to get
at their email) the LS800 computer can be taken from the cockpit and
used in the hotel or wherever you're staying as a real full functioning
computer with builting 802.11. The GPS and WX units connect to this
wirelessly (bluetooth) so you can stick those devices under your seat
or in the back. The screen measures 8x5 (roughly) on this computer too
compared to the small Garmin screen.

I have a Garmin now, however once the vistanav contains Canadian
information (they told me 6 - 9 month) i'm getting in line.

-dr

Bob Fry wrote:
>>>>>>"DB" == Dave Butler > writes:
>
>
> DB> If you like, you can jump back and forth between the two
> DB> levels of subscription on a month-to-month basis.
>
> Can you turn the subscription on and off?
>
> For instance, most of the year I fly locally in Northern California,
> within a few hundred miles of home base, and the weather is very
> predictable: sun inland, fog on the coast in the morning. But once a
> year I like to fly an overnight cross-country and then the WX would be
> very handy.

Sorry, it's been too long since I've had that discussion with them. I don't
remember all the restrictions. Seems like there was some kind of n-month
contract to start up. Give them a call or scan their web site.

Mark Hansen wrote:
> On 06/01/06 14:15, Robert M. Gary wrote:
> > I was looking at 2,000 foot T.V. towers the other day. The 296 alarmed
> > them before I saw them.
>
> It's really a strange feeling flying near those towers even if more than
> 1000' above them. The thing is they "appear" to be in your airspace while
> the rest of the planet "appears" so much further below.
>
> It looks like you're going to trip over them - really makes you want to
> keep a safe distance ;-)

Before the days of GPS I'm sure I would never have been able to find
Franklin Field if it weren't for those towers.

-Robert

Dan Luke wrote:
> I don't know, but I suspect not. There are also software and hardware
> development costs to be covered.

I doubt that has much, if anything, to do with the cost of the 396. In
a free market economy a smart producer will charge what the market will
bear. The cost to "cover" the product only comes into play when
deciding whether or not to produce it, not in determining price.


> You can't blame Garmin for charging what the market will bear when they have
> a product that everyone wants and there is no competition; that's capitalism.
> 396s were selling so fast last year, I bet Garmin was wishing they'd priced
> them a little higher.

Exactly Garmin knows that everyone has a price they are willing to pay
for the product. By starting prices higher and then lowering them they
are able to charge those that are willing to pay more, more, and those
willing to pay less, less. The concept is referred to as "perfect price
discrimination" in academic circles (the term "discrimination" in this
context not having a negative connotation). Some people mistakenly
believe that new products hit the market with a higher price because
companies are recoving costs, that is not so.

-Robert

On 06/02/06 09:56, Robert M. Gary wrote:
> Mark Hansen wrote:
>> On 06/01/06 14:15, Robert M. Gary wrote:
>> > I was looking at 2,000 foot T.V. towers the other day. The 296 alarmed
>> > them before I saw them.
>>
>> It's really a strange feeling flying near those towers even if more than
>> 1000' above them. The thing is they "appear" to be in your airspace while
>> the rest of the planet "appears" so much further below.
>>
>> It looks like you're going to trip over them - really makes you want to
>> keep a safe distance ;-)
>
> Before the days of GPS I'm sure I would never have been able to find
> Franklin Field if it weren't for those towers.

Well, I was flying out of Executive. From there, you just point the
nose to 150 and wait about 8 minutes ;-)

>
> -Robert
>



--
Mark Hansen, PP-ASEL, Instrument Airplane
Cal Aggie Flying Farmers
Sacramento, CA

That's not terrain, that's in your obstruction database, which is
separate. And not very reliable.



Robert M. Gary wrote:
> I was looking at 2,000 foot T.V. towers the other day. The 296 alarmed
> them before I saw them.
>
> Newps wrote:
>
>>Robert M. Gary wrote:
>>Only if you're IFR. I have NavGPS software on my PDA that has terrain
>>and was really looking forward to it when it came out. Now with all
>>these hours terrain serves no useful purpose when VFR.
>
>

I guess living at the base of the Sierras just gives me a different
priority of features.

-Robert

Newps wrote:
> That's not terrain, that's in your obstruction database, which is
> separate. And not very reliable.

"Robert M. Gary" wrote:

>> I don't know, but I suspect not. There are also software and hardware
>> development costs to be covered.
>
> I doubt that has much, if anything, to do with the cost of the 396.

Sorry, but I guess I don't understand you: the cost to develop and mfr. a
product has little or nothing to do with its selling price?


> In
> a free market economy a smart producer will charge what the market will
> bear. The cost to "cover" the product only comes into play when
> deciding whether or not to produce it, not in determining price.

Where's the starting point for pricing?

--
Dan

"Relax; we're cops."
--a cop on "Cops"

"Dan Luke" > wrote in message
...
>
> "Robert M. Gary" wrote:
>
>>> I don't know, but I suspect not. There are also software and hardware
>>> development costs to be covered.
>>
>> I doubt that has much, if anything, to do with the cost of the 396.
>
> Sorry, but I guess I don't understand you: the cost to develop and mfr. a
> product has little or nothing to do with its selling price?
>
>
>> In
>> a free market economy a smart producer will charge what the market will
>> bear. The cost to "cover" the product only comes into play when
>> deciding whether or not to produce it, not in determining price.
>
> Where's the starting point for pricing?
>
> --
> Dan
>
> "Relax; we're cops."
> --a cop on "Cops"
Real simple.
The start point in pricing for most products is "How much will the market
pay ?"
Then determine what profit can be made relative to manufacture costs.
The more profit the better. If it cost $1 to make, and the market will pay
$100 so be it.
Good companies use high profits wisely, ensuring that some % of the profit
is used to develop the next generation of that product and stay ahead of the
competition.
It is product appeal and competition that ultimately determines the % of
profit not the cost.






>

> -----Original Message-----
> From: Roy N5804F ]
> Posted At: Friday, June 02, 2006 6:25 PM
> Posted To: rec.aviation.owning
> Conversation: Garmin 195...295...296...396....
> Subject: Re: Garmin 195...295...296...396....
>
>
> "Dan Luke" > wrote in message
> ...
> >
> > "Robert M. Gary" wrote:
> >
> >>> I don't know, but I suspect not. There are also software and
hardware
> >>> development costs to be covered.
> >>
> >> I doubt that has much, if anything, to do with the cost of the 396.
> >
> > Sorry, but I guess I don't understand you: the cost to develop and
mfr.
> a
> > product has little or nothing to do with its selling price?
> >
> >
> >> In
> >> a free market economy a smart producer will charge what the market
will
> >> bear. The cost to "cover" the product only comes into play when
> >> deciding whether or not to produce it, not in determining price.
> >
> > Where's the starting point for pricing?
> >
> > --
> > Dan
> >
> > "Relax; we're cops."
> > --a cop on "Cops"
> Real simple.
> The start point in pricing for most products is "How much will the
market
> pay ?"
> Then determine what profit can be made relative to manufacture costs.
> The more profit the better. If it cost $1 to make, and the market will
pay
> $100 so be it.
> Good companies use high profits wisely, ensuring that some % of the
profit
> is used to develop the next generation of that product and stay ahead
of
> the
> competition.
> It is product appeal and competition that ultimately determines the %
of
> profit not the cost.
>
> >
[Jim Carter] Also know as "value pricing"
[Jim Carter]

>Anyone hear anything about what's coming
> down the pike next? Seems about 2 year intervals for these portables.
>

Check out http://www.aviationsafety.com/products.htm They have the Flight
Cheetah and it has some features that the Garmin 396 does not and I think is
very useful. Like IFR Low Alt. overlay, MEA's, the FULL IFR approach, puts
your airplane on the airport taxiways for ground navigation. I don't know
about all of you but I get more lost on the ground they I ever do in the
air., fastest flight level, cheapest AV fuel search, touch screen, etc.

And how about this feature: it has a Satellite overlay of the ground below.
So at night with a forced landing, you may be able to put it down in an open
field without needing to see it. Could be a life saver.

It also has an Electronic Attitude Indicator which automatically monitors
your pitch and roll. If you exceed certain parameters that would not be
expected in IFR flight you automatically receive an alert on your display
with the EAI in the corner of your screen. This instant notification
provides you with plenty of time to recover, before it develops into a
serious situation.

I have the 396, but I've been thinking about switching. Further, I bet you
the next Garmin (486 or 387) will have a touch screen...please god...a touch
screen!!!!

Kobra

> Can you turn the subscription on and off?
>

Yes, but there is a 75.00 startup/setup fee. You might have to pay that
plus the one month each time you turn it on. That said, they told me that I
could get the 29.99 one and if I needed to I could upgrade to the 49.99 one
"once in a while", but if I did it too much they might stop allowing that
courtesy.

Kobra

> Does an XM receiver really cost $1100? (list price difference between a
> 296 and 396)

No, but it does traffic too and can automatically change the COM and NAV
frequencies if you are using certain NAV/COM's. I heard the screen is
different too...brighter as I recall. Also, if one was smart enough to buy
the 396 early, you got the free auto kit. (~$250 dollars savings right
there).

Kobra

I'd like to see the 396 with traffic that does not require a
transponder interface. Perhaps that will be the next model.

--Dan



Kobra wrote:
> >Anyone hear anything about what's coming
> > down the pike next? Seems about 2 year intervals for these portables.
> >
>
> Check out http://www.aviationsafety.com/products.htm They have the Flight
> Cheetah and it has some features that the Garmin 396 does not and I think is
> very useful. Like IFR Low Alt. overlay, MEA's, the FULL IFR approach, puts
> your airplane on the airport taxiways for ground navigation. I don't know
> about all of you but I get more lost on the ground they I ever do in the
> air., fastest flight level, cheapest AV fuel search, touch screen, etc.
>
> And how about this feature: it has a Satellite overlay of the ground below.
> So at night with a forced landing, you may be able to put it down in an open
> field without needing to see it. Could be a life saver.
>
> It also has an Electronic Attitude Indicator which automatically monitors
> your pitch and roll. If you exceed certain parameters that would not be
> expected in IFR flight you automatically receive an alert on your display
> with the EAI in the corner of your screen. This instant notification
> provides you with plenty of time to recover, before it develops into a
> serious situation.
>
> I have the 396, but I've been thinking about switching. Further, I bet you
> the next Garmin (486 or 387) will have a touch screen...please god...a touch
> screen!!!!
>
> Kobra

Dan Luke wrote:
> "Robert M. Gary" wrote:
>
> >> I don't know, but I suspect not. There are also software and hardware
> >> development costs to be covered.
> >
> > I doubt that has much, if anything, to do with the cost of the 396.
>
> Sorry, but I guess I don't understand you: the cost to develop and mfr. a
> product has little or nothing to do with its selling price?


Exactely, the selling price is based on what people are willing to pay
for it. If that does not cover the cost to make it, you don't make it.
Selling the product for more than people are willing to spend (because
it cost so much to make) will put you out of business. Selling it for
less than people are willing to spend (because the cost to make it is
cheap) just makes you foolish.


>
> > In
> > a free market economy a smart producer will charge what the market will
> > bear. The cost to "cover" the product only comes into play when
> > deciding whether or not to produce it, not in determining price.
>
> Where's the starting point for pricing?

Usually focus groups, comparison with existing products, etc. That's
why Garmin has an entire Marketing department. Pricing is determined by
the marketing department,. not the RND or production departments.

-Robert

"Robert M. Gary" wrote:

>> >> I don't know, but I suspect not. There are also software and hardware
>> >> development costs to be covered.
>> >
>> > I doubt that has much, if anything, to do with the cost of the 396.
>>
>> Sorry, but I guess I don't understand you: the cost to develop and mfr. a
>> product has little or nothing to do with its selling price?
>
>
> Exactely, the selling price is based on what people are willing to pay
> for it. If that does not cover the cost to make it, you don't make it.

Well, hell, Robert; the cost to make the product then determines the minimum
go/no go selling price for production. I'd hardly call that "little or
nothing to do" with the selling price.

--
Dan
C172RG at BFM

In article om>,
"Robert M. Gary" > wrote:
> Exactely, the selling price is based on what people are willing to pay
> for it. If that does not cover the cost to make it, you don't make it.
> Selling the product for more than people are willing to spend (because
> it cost so much to make) will put you out of business. Selling it for
> less than people are willing to spend (because the cost to make it is
> cheap) just makes you foolish.

Actually, if the selling price doesn't generate a profit (not just cover
costs), most businesses won't make it. Businesses are in business to
make the maximum profit possible, and any restriction (such as a
"windfall profit" tax) will simply discourage development and marketing
of a product.

Garmin's ability to make a profit on their aviation equipment will
ensure that development and innovation will continue well into the
future.



JKG

"Robert M. Gary" > wrote in message
ups.com...
>
> Dan Luke wrote:
> > "Robert M. Gary" wrote:
> >
> Selling it for less than people are willing to spend (because the cost to
make it is
> cheap) just makes you foolish.
>
> -Robert
>
Well, there is a comprimise there. If they sold a 396 for $3500, would they
sell any? Probably. If they sold them for $1995, would they make any money?
Probably.

Dan wrote:
> I'd like to see the 396 with traffic that does not require a
> transponder interface. Perhaps that will be the next model.

If ADS-B is ever going to be more than a curiosity, the cost of admission is
going to need to come down. The future of ADS-B is a box in the 396 price range,
or else it has no future.

"Robert M. Gary" > wrote in message
ups.com...
>
> Exactely, the selling price is based on what people are willing to pay
> for it. If that does not cover the cost to make it, you don't make it.
> Selling the product for more than people are willing to spend (because
> it cost so much to make) will put you out of business. Selling it for
> less than people are willing to spend (because the cost to make it is
> cheap) just makes you foolish.
>
>

Unless you are MicroSoft selling the Xbox 360.

"Michael Ware" > wrote in message
.. .
>
> "Robert M. Gary" > wrote in message
> ups.com...
>>
>> Dan Luke wrote:
>> > "Robert M. Gary" wrote:
>> >
>> Selling it for less than people are willing to spend (because the cost to
> make it is
>> cheap) just makes you foolish.
>>
>> -Robert
>>
> Well, there is a comprimise there. If they sold a 396 for $3500, would
> they
> sell any? Probably. If they sold them for $1995, would they make any
> money?
> Probably.
>
>

And at some point the will sell them for ~$1995. Probably shortly after the
496 comes out. When the 596 releases you can snag one for $995.

Jonathan Goodish wrote:
> In article om>,
> "Robert M. Gary" > wrote:
> > Exactely, the selling price is based on what people are willing to pay
> > for it. If that does not cover the cost to make it, you don't make it.
> > Selling the product for more than people are willing to spend (because
> > it cost so much to make) will put you out of business. Selling it for
> > less than people are willing to spend (because the cost to make it is
> > cheap) just makes you foolish.
>
> Actually, if the selling price doesn't generate a profit (not just cover
> costs), most businesses won't make it. Businesses are in business to
> make the maximum profit possible, and any restriction (such as a
> "windfall profit" tax) will simply discourage development and marketing
> of a product.

>From an accounting point of view you are right, you must make a profit.
>From a business point of view you have a concept called "The Cost of
Capitol". That cost includes the profit you need to make based on where
you get your money (investors expect more money than debtors etc).
Cover costs **MUST** include all Cost of Capitol including returns
(i.e. profit it layman's terms) for investors.
-Robert

Michael Ware wrote:
> "Robert M. Gary" > wrote in message
> ups.com...
> >
> > Dan Luke wrote:
> > > "Robert M. Gary" wrote:
> > >
> > Selling it for less than people are willing to spend (because the cost to
> make it is
> > cheap) just makes you foolish.
> >
> > -Robert
> >
> Well, there is a comprimise there. If they sold a 396 for $3500, would they
> sell any? Probably. If they sold them for $1995, would they make any money?
> Probably.

If they sold the first 100 for $3500, then dropped the price to $1995
they would get both prices.

-Robert

Jonathan Goodish wrote:
> In article om>,
> Actually, if the selling price doesn't generate a profit (not just cover
> costs), most businesses won't make it.

True, but only in accounting terms. In business terms the cost to
produce the product "Cost of Capitol" includes a return to investors
(the required return is calcuated based on a number of factors, GE
doesn't need to return as much as Sun for example, debtors require the
lowest return).

-Robert

"Robert M. Gary" > wrote in message
ups.com...
>
> Michael Ware wrote:
> > "Robert M. Gary" > wrote in message
> > ups.com...
> > >
> > >
> > Well, there is a comprimise there. If they sold a 396 for $3500, would
they
> > sell any? Probably. If they sold them for $1995, would they make any
money?
> > Probably.
>
> If they sold the first 100 for $3500, then dropped the price to $1995
> they would get both prices.
>
> -Robert
>
True, they could. But the 396 has been out for about a year now, and I have
yet to see prices on new 296 come down any. They will sell them for that
price until demand drops off, then discontinue production.

Michael Ware wrote:
> "Robert M. Gary" > wrote in message
> ups.com...
> >
> > Michael Ware wrote:
> True, they could. But the 396 has been out for about a year now, and I have
> yet to see prices on new 296 come down any. They will sell them for that
> price until demand drops off, then discontinue production.

Its all just marketing (which is why we said the marketing department
sets prices, not the production or RND departments). My guess is that
they consider the 196 to be their "intro" model and do not see a need
to drop the price of the 296 to fill that section of the market. At
some point the 196 will seem obsolete and they will need to find
another product to fill that void (possibly the 296). The actual cost
to produce the 196 and 296 are probably about the same but dropping the
price of the 296 may eat into the 396 market (some people will perfer
to pay the lower price and forgo the extra features). The bottom line
may be that the 296 is too similar to the 396 right now to use it as
the low end product.


-Robert

wrote:
> Still flying with the 195 on my yolk and that was $ well spent years
> ago but would like to upgrade. Anyone hear anything about what's coming
> down the pike next? Seems about 2 year intervals for these portables.
>
> Thanks for any info.
>
> Dale
> PA-24

FYI, they just dropped the price on the 396. It now sells for $2195 at
Tropic Aero, JA Air, and most other places.

Brock Boss

Gig 601XL Builder wrote:
> "Robert M. Gary" > wrote in message
> ups.com...
> Unless you are MicroSoft selling the Xbox 360.

Microsoft isn't selling Xboxes, they are selling XBox games. ;)
Actually, from having done some consulting in this general area for
Microsoft I would say that they simply want to establish a better
position in the family room (i.e on the TV). XBox is only one piece of
their strategy. I'm not sure how much information is public but you can
find public information on Microsoft's CSF web site
http://www.microsoft.com/serviceproviders/solutions/connectedservicesframework.mspx


-Robert

In article om>,
"Robert M. Gary" > wrote:
> True, but only in accounting terms. In business terms the cost to
> produce the product "Cost of Capitol" includes a return to investors
> (the required return is calcuated based on a number of factors, GE
> doesn't need to return as much as Sun for example, debtors require the
> lowest return).


From a practical standpoint, that's really irrelevant if the business
never makes money. If the business is never profitable, it can't return
anything of substance to investors and sooner or later the "investment"
will cease. What is accomplished by operating (or investing in) a
business that only consistently breaks even or loses money, or otherwise
has an artificial "cap" on profitability?

Most businesses in the United States do not have debt traded on the
public market--they are small businesses. In this case, profitability
is even more important because the number of private debtors is usually
relatively small and the window of opportunity to turn loss to profit is
much narrower.

Business is all about profitability and if you don't have it--whether
you're a large or small business--you won't last very long.



JKG

In article . com>,
"Robert M. Gary" > wrote:
> >From an accounting point of view you are right, you must make a profit.
> >From a business point of view you have a concept called "The Cost of
> Capitol". That cost includes the profit you need to make based on where
> you get your money (investors expect more money than debtors etc).
> Cover costs **MUST** include all Cost of Capitol including returns
> (i.e. profit it layman's terms) for investors.
> -Robert


There really is no practical difference between the "accounting" point
of view and the "business" point of view when you get down to the brass
tacks--if the business isn't profitable (or expected to become
profitable), there's no reason to operate it. All of the accounting
minutia is rather irrelevant if the business can't cover debt payments
and provide appreciable uncapped returns to investors. While all
businesses have target margins and other objectives, I'm not aware of
any (good) businesses which decide to stop making money once those
targets are hit.

We all work to make as much money as we can, right?



JKG

Jonathan Goodish wrote:
> There really is no practical difference between the "accounting" point
> of view and the "business" point of view when you get down to the brass
> tacks--if the business isn't profitable (or expected to become
> profitable), there's no reason to operate it.

The point is that "profit" is not an absolute. There is a cost to using
your money that is very, very tightly related to how the company is
financed. If you are a publicly traded company you must earn a return
to make your investors happy (usually calculated as risk free rate
(T-bills) plus risk premium for your stock). If you are financed by
debtors the the cost of your capitol is just the interest rate you pay.
All investors expect to get returns, but at different rates. This is
why companies have finance departments that know their "cost of
capitol".
So it is wrong to say "you must make a profit". If a product would
produce a "profit" of 2% but your investors expect a 10% return, you
are losing money and should not produce the product. This is where
companies financed through debt have an advantage (their cost of
capitol is often lower).

-Robert

> Most businesses in the United States do not have debt traded on the
> public market--they are small businesses. In this case, profitability
> is even more important because the number of private debtors is usually
> relatively small and the window of opportunity to turn loss to profit is
> much narrower.

Again, you are using the term "profit" in an accounting way. If you are
a small company there is cost for you to use your money to produce the
product. If you are using your own money in the bank, then that cost is
the lost opportunity cost you could have had if you had left the money
in the bank, plus something for your risk. If you borrow money, the
cost is the cost to borrow the money. If you have investors (which is
what you are when you own a small company) the cost of capitol is the
return you require for it to be worth it to continue to invest in your
company.

If a product is going to return 0.5% then you'd be a fool to invest in
it, just buy T-bills. You need to return a "profit" that matches your
cost of capitol.

-Robert, MBA

In article . com>,
"Robert M. Gary" > wrote:
> The point is that "profit" is not an absolute. There is a cost to using
> your money that is very, very tightly related to how the company is
> financed. If you are a publicly traded company you must earn a return
> to make your investors happy (usually calculated as risk free rate
> (T-bills) plus risk premium for your stock). If you are financed by
> debtors the the cost of your capitol is just the interest rate you pay.
> All investors expect to get returns, but at different rates. This is
> why companies have finance departments that know their "cost of
> capitol".
> So it is wrong to say "you must make a profit". If a product would
> produce a "profit" of 2% but your investors expect a 10% return, you
> are losing money and should not produce the product. This is where
> companies financed through debt have an advantage (their cost of
> capitol is often lower).


I didn't say "you must make a profit." I said that you must be
profitable to stay in business--which is an absolute truth in a
capitalist economy. How the business is financed is irrelevant if it
isn't profitable, at least over the long term. The entire purpose of
any investment is to make money. I also said that the goal of every
business is maximum profitability. Any attempt to cap profitability
(such as with taxes or tariffs or direct price controls) will discourage
new investment and production.

Any business that operates at break-even won't last long against its
competitors who are profitable and able to make further investments in
the business to compete in the market economy.

And it's still my contention that "capitol" is a building.



JKG

In article . com>,
"Robert M. Gary" > wrote:

> > Most businesses in the United States do not have debt traded on the
> > public market--they are small businesses. In this case, profitability
> > is even more important because the number of private debtors is usually
> > relatively small and the window of opportunity to turn loss to profit is
> > much narrower.
>
> Again, you are using the term "profit" in an accounting way. If you are
> a small company there is cost for you to use your money to produce the
> product. If you are using your own money in the bank, then that cost is
> the lost opportunity cost you could have had if you had left the money
> in the bank, plus something for your risk. If you borrow money, the
> cost is the cost to borrow the money. If you have investors (which is
> what you are when you own a small company) the cost of capitol is the
> return you require for it to be worth it to continue to invest in your
> company.
>
> If a product is going to return 0.5% then you'd be a fool to invest in
> it, just buy T-bills. You need to return a "profit" that matches your
> cost of capitol.
>
> -Robert, MBA

Since you're an MBA, maybe this is all going over your head.

Explain to me, please, how a business can stay in business is a
competitive market economy without being profitable. What incentive
does the business have to produce anything if it can't be profitable?
How will the business compete if it can't invest in itself? How will it
attract investors to help finance growth if there isn't opportunity for
maximum profitability?

I would be interested in your answers, but will suggest that perhaps we
should take this off-line at this point, since it's evolved into
something not directly related to this group.



JKG