About DM32

[EdS2]

I do like these snippets of history. And there's something similar about the pricing of the original iBM PC: IBM forecast lowish volumes, so their procedure set a correspondingly higher price, so when the volumes became much greater, they made much more profit than they would normally have done.

There's certainly always a potential mismatch between business considerations and perceived value. And there will always be a spread of perceived value. And the business considerations are a mish-mash of imponderables too, because predicting the future is hard.

For me, any new product from SM is a Fabergé egg: there's only one place we can buy them, they have an attractiveness all of their own, and the price that was set, for whatever combination of reasons, is the price that I'd need to pay.

And if the price is higher than I would prefer, so be it.

What I don't feel, in this case, is any idea that there is an exploitation of a captive market. For some combination of reasons, I feel sure SM have made an honest set of guesses about demand and future costs, and come up with a number which makes sense to them.

If the DM42 had been priced at 299 and the DM32 came out at today's 249, it would be very much the same offering, but the reception might have been different. We tend to fixate on what has gone before, as if it sets some kind of benchmark of fair and reasonable. (There's even a term for it: "The anchoring bias is a cognitive bias well-known in pricing, negotiation and other contexts")

The other thing (while I'm here!) is that we've gone through an exceptionally long period of low inflation. Some of us will remember annual inflation of 15% or more, and others won't. Until rather recently, we haven't needed to update our ideas of what things will cost us.