Aspherical Boundaries

I know that the internet has some rules regarding using Nazi analogies but this one was too good to pass by.

Incidentally, the footage used is from the 2004 film “Der Untergang“.

Not surprisingly, Nikon revealed the D3x on 1 December 2008, ending the Coolpix P6000’s short reign as Nikon with highest pixel count. See here for the news on DPReview.

The specs are a bit disappointing, since the only change compared to the D3 is the 24MP sensor, trading a doubling in pixels for lower ISO range (100-1600 as compared to 200-6400) and shooting speed (5fps (even lower for 14-bit) for 8fps). The big shock, however, is the Canon 1Ds class price tag of 8000USD.

Lots of internet people are very… angry over this, stating that the newer model is not worth 3000USD over the D3. I think I would agree.

An interesting thing to note here is that this is a demand side reaction. Less people will buy this flagship model than if it was pegged at 5000USD. Let’s look at the supply side. Assume the marginal cost of producing the D3x is the same as the D3 (not unreasonable, since Sony sells the A900 with a very similar sensor for 3000USD), and that each model costs Nikon, say 3500USD to manufacture. That means at 5000USD, Nikon will make a marginal profit of 1500USD per unit. However, at 8000USD, that profit goes up to 4500USD. This means that Nikon has to shift only a third as many units as it would have had to other wise to make the same profit. (P.S. Note I’m dealing with marginal prices, not unit prices. For those who are unfamiliar, marginal prices don’t include fixed costs, such as R&D).

I suspect no matter how much the D3x was priced at, news agencies would not have been buying them in the thousands, simply due to the D3 being a more suitable price. So Nikon couldn’t have been expecting to shift many units to start with. If that is true, the pricing decision might have been a way to keep profits high in the face of low expected demands.

I’m also assuming here that despite being vocal, the internet people don’t actually buy that much equipment. 10% of the market, maybe?

Oh, as a footnote, I’ve finally upgraded Wordpress to 2.6.5. Yah. Also installed NextGEN Gallery.