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Secondly, would be interesting to do the same analysis on UK/European RRPs as I suspect some of the reduction in pricing may be specific to the US. ie its not so much LEGO is getting cheaper over time, rather LEGO is getting cheaper in the US, perhaps from being relatively expensive compared to the rest of the world to unquestionably cheap.
It seems much harder to get early non US RRPs so its hard to tell but its a feeling I have.
As far as piece count goes with a set these days, LEGO is using more MOC style building in a lot of cases, so a couple dozen 1x1 plates here and there really does inflate the piece count in some sets.
However, I don't believe this is very accurate, because the source data is the weight listed here at Brickset. Someone please correct me if I'm wrong, but I believe that weight comprises the entire product, including the box, instructions, etc. Modern sets have significantly larger instructions, which skews the cost per gram in their favor. To do this accurately, one would need to use the weights of individual pieces in combination with set inventories.
http://www.bricksetforum.com/discussion/comment/125032/#Comment_125032
http://www.bricksetforum.com/discussion/comment/125247/#Comment_125247
http://www.bricksetforum.com/discussion/comment/125361/#Comment_125361
Another thing: It's funny how a lot of people think sets used to come without directions. I try to educate them that Lego sets have almost always had directions. It's just that older sets emphasized creativity a bit more with the alternate builds shown on the back of the boxes. I will say that there was a lot less hand holding in the older sets. You might have twenty pieces on one page whereas many sets today will utilize only a couple of pieces per page of instruction.
Price of the raw material, in this case plastic, is very very low. Comparing the cost of sets over the years using price per piece is just one data point, and not one with much basis to it. How about comparing the price of the plastic contained in each set? I betcha there is more automation in manufacturing today reducing the cost even further.
Real cost of a set must be having variables like the salaries of designers, marketing, the packaging and oh dont forget "management". These too would not make a plastic moulded set of bricks sell for hundreds of dollars.
I wonder if we can compare Lego pricing with those of smart phones? There are a lot more complicated stuff going into a smartphone!
Like a can of coke whose real cost is in the pennies, but sells for a price closer to a dollar -- we the customers are what determine the cost of a Lego set. The brand name and quality we *perceive* is reflected in the sticker price.
Trying to justify that it is expensive because it is difficult to maintain clutch power with bricks made eons ago is another argument that I dont buy. There are people manufacturing minifig accessories from their garage with perfectly acceptable quality.
Sometime it is easier to go with popular opinion... :-(
@sram Yes, you're right about the customers determining the price of LEGO products. However, you seem to be mixing up ideas a bit. Like price and cost. First of all, generally speaking products are priced to market and are not priced to cost. This means that companies will not set the price of a product based on how much it cost to make it, but rather will price it at a level that the market will bear. This does not mean, however, that you can ignore production costs. LEGO bricks are expensive to make. If the market would not support prices that would cover the cost of making LEGO bricks along with a bit of profit, then LEGO bricks as we know them would no longer be made.
You speak about comparing real costs. You mention real costs include overhead. Then you mention that the real cost of a can of soda is pennies. Well that's clearly not true. It think you mean the real cost of the liquid ignoring other costs. Also you compare the costs to retail prices. I'm sure you realize that when you buy a can of cola in a store for a dollar, the manufacturer does not get a dollar.
And you express doubt that good clutch power is expensive to manufacture. I'd recommend you ask an engineer what happens to cost when you increase the level of precision in making a part by an order of magnitude. Or how much of an effect a tight tolerance has on manufacturing costs. The difference between using 0.1 mm screws in your project versus using 0.100 mm screws in your project might amaze you.
@cheshirecat Yeah, I'm actually curious how the data would stack up in this regard. Although it would be hard to get direct measurements of weight, it might be possible to do some indirect calculations that shed some light on this.
I also think there is a certain charm in the older sets that is somewhat lacking today. That's me though.
Everyone is entitled to a different opinion, but personally when people speak of the charm of older sets or evaluate a higher quality with older bricks I can't help but suspect a large portion of that opinion is not very objective.
Let's take the softness of bricks. ABS ages and becomes more brittle over time. So if you're comparing an old brick today to a new brick, it isn't the right comparison. You would need to compare an old brick decades ago to a new brick today, which of course is not possible. So instead you can rely on memory, but that can be really deceiving. I think most people forget some of the quality issues of the past.
As for charm, you're being very vague. You're saying there is a quality found in the older sets that you find pleasing or delighting, but you're not really able to describe it. I think I know what it is though. I think it's nostalgia. In which case, the only reason today's sets are lacking in this charming quality is because they haven't been around long enough. It isn't anything inherent in the design.
This highlights what is so great about the article by Andrew Sielen. It is data driven. It's not just his impression, it's supported by facts. And it's not just anecdotal data, it's statistical analysis of a collection of data. I think it's wonderful that he took a hunch and examined the data to see what really was going on.
I'm going off on tangents, but part of the charm with the older sets I think is that since they were simpler designs they pushed you more to build something else, even better. Todays sets almost encourage you to just build the set and then play with it as if it's only a model. That and the emphasis on overly specific themes I believe take away some from the original intent of Lego.
So you like simple designs that encourage you to build other things. I take it you're a huge fan of Creator? I don't find the emphasis has changed much. When I was a kid, I just built the set and then played with it as if it was only a model. I don't think the set encourages this, I think your own preferences do.
Regarding #7208, it does nothing for me. It looks like any other play toy version of a fire station.
What I find a little strange is the pricing in places like South East Asia, you have a country like Malaysia which has an average income close to 1/3 of that in Australia (Yes I know cost of living is lower) yet they pay a little more then we do for Lego. This does not really prove much, but I just find it interesting.
@Basta When a company develops a new product they will at some point need to decide how much they will sell it for. The way they approach that question is called their pricing strategy. There are many different strategies. The most basic simple one is called cost-plus pricing. You figure out how much it cost to make your new product and you sell for that and a little bit of profit. This is not a good strategy because it ignores demand. A smarter thing to do is to figure out your market and use that information to set prices that meet your goals. Just keep in mind goals are key. You're looking at what people are willing to pay, what the demand distribution in the population is, and what your competitors are doing to determine the best price for your goods. It doesn't matter what the incomes are, but who wants your stuff and how much they are willing to spend.
Nobody ever proposed that Lego should sell their stuff in India or Malaysia at a much lower price than in the USA. All I've heard as complaints is that it's a lot more expensive there even compared to Europe (and even to Australia). I think reasonable fans there are hoping for a price change towards those prices. (Still quite a lot higher than US prices.)
Don't know how feasible even that is though. Lego is a niche luxury product in these countries aimed at the upper class.
A basic desktop computer was $3,000 back in the 80's, today $400 will buy you a very nice computer, either desktop or laptop.
Try the same with a TV, a Mr. Coffee machine, a dishwasher, or anything else sold in the 80's that is still sold today.
So yes, things are cheaper today, but you pay for it in crappier quality.
I disagree about it things being built better in the past. Nearly every cordless phone had static even if you were 5 feet from the base. I wasted cointless hours winding audio and vhs tapes eaten by players. Most cars in my location began rusting within 5 years. And my dad had to repair our stereo on more than one occasion.
The difference was back then the expectation of quality was lower so we were more content with malfunctioning products. The one benefit was that technology was simpler so you could generally fix it yourself, now you throw it away. Also people were willing to spend a large portion of money on a tv or stereo and get one that would last because they could keep it for decades. Now devices become obsolete much quicker so we spend less on them because we are going to have to get a new one in a few years anyway. But in most cases the cheap device you just purchased still blows away the more expensive device that it just replaced.
Lego bricks may be lower quality than in the past, but the set designs are significantly better than they ever were.
Sure, some items today aren't built to last, but not everything is that bad. I have no doubt my iPad will last a very long time, it is clearly well built.
The original "iPad" was the Apple Newton:
http://oldcomputers.net/apple-newton.html
$699 in 1993 which is worth $1,094 in 2012 - Yet the new iPad is only $499 and far, far more powerful and just as well built, if not better.
So long as I don't throw my iPad on the floor, I have no doubt it will still be working in 20 years time.
As for the general idea that "things were made better back in the day," it tends to be a rosy-hued misconception There are as many quality things today, Lego inclusive, as there were back then. Better manufacturing techniques, better materials, better distribution, etc. allow for more people to have access to quality things. While I will admit that my microwave from back in the 80's could probably withstand a sledgehammer, my microwave right now is quite acceptable for what it does, especially considering the price.
As far as I can tell, Lego seems about the same today as about 30 years ago. My wife's parents had some Lego from the early 1980s, and it seemed on par with the Lego of today (at least to me).
I'll opt out of the Apple debate, as many people seem to have strong feelings about Apple :)
http://www.directfix.com/product/REP-0056.html
And of course you can do it yourself if you're handy:
http://www.ifixit.com/Guide/iPad+Wi-Fi+Battery+Replacement/2198/1
To answer the question of, "will my iPad be useful in 20 years", no it probably won't be, but then neither is the Apple Newton either.
So Mathew's comment that things were better built 20 years ago is not accurate or even reasonable.
First, I was able to provide an example that made the broadly brushed statement untrue.
Second, it hardly matters since no one is using Mr. Coffee machines or handheld computers 20 years later anyway.
You'll be able to use it for many years to come if you like.
Also, you probably wouldn't want to put iOS 6 on it, the CPU is quite a bit slower than the iPad 2. The iPad 1 has a single core chip with 256MB of RAM. It was a great start and far superior to anything else on the market at the time, but technology has run far and fast since.
The new iPad 4 is MUCH faster than the iPad 1, sooner or later new OS releases aren't going to work on old computers.
This is NOT unique to Apple, or does everyone expect Windows 8 to run on the same computers that ran Windows XP? Vista had much this problem, created largely by Microsoft who wanted everyone to upgrade. But most of the WinXP computers didn't have what Vista needed, thus half of the bad rap (the other half was drivers that weren't ready, a year after release Vista was much better)
But the units in the 80's were hundreds of dollars (thousands in today's money), while a new microwave today is less than $100, and frankly works better.
New small inexpensive magnetrons went a long way to making that happen, the development of better energy cages and fewer materials really brought the price down.
Comparing the quality of older good versus those made now depends entirely on what their function is and if that function has changed over time.
A hammer is a hammer, its for hammering a new hammer is unlike to hammer faster or require a "firmware" upgrade.
Its likely a hammer made 20-30 years ago is likely made using better materials and when upconverted to current inflation is likely more costly than you would ever even think about paying for a hammer.
It has a lot to do with the consumer culture that improved infrastructure and and manufacturing techniques have helped nurture. We buy a lot more and discard a lot more because we can afford to do both.
Lego has to maintain a price point that is follows this trend. They done a good job without sacrificing everything so I think we can all agree it could be much worse ;D
However, Lego can only benefit marginally from this aspect with improved mfg machines and logistics. Where they can drastically improve production costs is to scale-up total batch sizes and decrease raw material consumption. Hence the move towards lower labor cost markets like China and compromising on the quality and/or amount of ABS used as raw material. If someone were to weigh 1,000 bricks from the 90's versus 1,000 of the same bricks from today, then I have a feeling this aspect of it can be proven.
My grandfather's hammer will always have a revered place in my tool chest, but it's not what I'm going to reach for when I'm building a deck.
LEGO doesn't build a range of sets and then price them based on the material value of their contents (i.e. cost per piece). They design sets to fill a given range of price points. It's not coincidence that Galaxy Explorer would have been priced at ~$100 today. Just like the flagship set of any modern theme is priced at ~$100, Galaxy Explorer was the flagship set of the original Space theme and was priced accordingly. That it had fewer pieces is mostly irrelevant.
A car from 1983, not so much. Those cars rusted out after 3-5 years (depending on company), and were falling apart by 7-10 years, regardless of company.
My father kept his 1984 Cadillac Eldorado until just a year ago, but in that time it required 2 complete paint jobs, some body and rust repairs, a new interior, a complete rewire of the electrical system, new radio, etc.
In fairness, it did last about 7 years before it needed major work, so that isn't bad, but for the price of the car, it darn well should last! :) It needed minor work before then.
More recently I drove my 2001 Tahoe for 9 years, and the only thing it ever needed was the display in the radio fixed for a few hundred dollars, otherwise it was completely trouble free. The only reason I traded it in was to get a Yukon XL, needed the space, otherwise the Tahoe was just fine.
Anyway, back on topic; sorry for the derail. :)