FTrevorGowen wrote:curious4872 wrote:
Basically, I'm asking: if we assume there's a demand for millions of units per month of the pi zero ...

Sorry, but that's a "false assumption" - sales of

**all** Pi's to date approximate ~180k Pi's per month (~9 million Pi's over 51 months).

Trev.

With all respect, my personal

**impression** - that requires validation - is different.

My own personal impression is that if it is legal to use a raspberry pi zero as part of another product (an embedded application) and if there are no showstopper latent bugs (it is what it seems to be) then despite the educational mission of the raspberry pi foundation, raspberry has created something there is a market of ten million of for $5.50 per pc with a 6-month lead time.

While I haven't investigated in detail, I can state with some certainty:

-> There are probably over 1,000 public and private high schools that have a budget of $5,000 to give a pi to each of 1,000 students, if that is their minimum order size and due by next September. (The same is not true of more expensive models.) That is 1M pcs.

-> There are over 100 verticals in IoT markets in which at least 10 small development manufacturers would place a minimum order of 1000. This is 1M pcs.

I don't want to keep running these numbers but the reference to the total sales of non-$5 devices is not directly relevant to demand for $5 devices - especially when the $5 device is the cheapest one in existence, and much cheaper than the next-cheapest one. If the cheapest taco you can buy in Beijing has been $35 until a couple of weeks ago, that tells you nothing about the demand for a $5 taco. Nothing. Especially if since opening, the $5 taco place has been sold out every few seconds, with people buying that taco and reselling it for $35, even before anybody knew about it.

Especially if we add that to date there have been lots of restaurants that let you buy SOMETHING - even if it's not a taco - for $20-$30, but that in addition to being a $5 taco, the $5 taco restaurant is the ONLY restaurant you can sit down and have a $5 warm meal at in Beijing, and the next-cheapest warm meal costs $15. Because that is the situation today. The next-cheapest SoC with the Raspberry Pi Zero capabilities doesn't cost $7, or $10, or $12, or even $15. The next-cheapest system on a chip that is available (unlike the $9 CHIP which is not available) is a like a large multiple of the pi zero price. (Unfortunately my thread asking what that was has been locked, with reference to not talking about competition on a raspberry pi forum. Fair enough.)

It is no underestimation that the demand for a $5 taco is more than a thousand times higher than the demand for a $25 taco under the situation I have outlined. That is the situation today.

This is actually quite easy to validate. Suppose I put up a kickstarter to get the Raspberry Pi Zero into the hands of people who use it as a component. Suppose that the minimum size was 680 raspberry pi zeros and that the maximum is 1694 raspberry pi zeros.

I got this like this:

Pledge amt -|- Fixed price per pi -|- Kickstarter commission (5%) -|- -|- Commission (fixed): -|- -|- Foundation bribe to get them to do it -|- Number of pis -|- Price per

$10,000 -|- 5 -|- $500 -|- $30 -|- $1,000 -|- 1694 -|- $5.90

$8,000 -|- 5 -|- $400 -|- $40 -|- $1,200 -|- 1272 -|- $6.29

$5,000 -|- 5 -|- $250 -|- $50 -|- $1,300 -|- 680 -|- $7.35

-|- -|- -|- -|- -|- -|-

Goal: 1,000 backers committing $10,000 each for 1690 units each. -|- -|- -|- -|-

-|- -|- -|- -|- -|- -|-

= 1.6 million Raspberry Pi Zeros -|- -|- -|- -|-

= Additional $1 million bribe to the foundation to get them to actually accept this. -|- -|- -|- -|-

Let's break this down.

This is what pledgers would get:

Pledge amt -|- Number of pis -|- Price per

10000 -|- 1694 -|- 5.903187721

8000 -|- 1272 -|- 6.289308176

5000 -|- 680 -|- 7.352941176

The formula I used is as follows:

I included a 5% kickstarter fee:

Pledge amt -|- Kickstarter commission (5%)

10000 -|- 500

8000 -|- 400

5000 -|- 250

I included a commission that is fixed to the person (such as me) bothering to put up the kickstarter:

Pledge amt -|- Commission (fixed):

$10,000 -|- $30

$8,000 -|- $40

$5,000 -|- $50

I included a

**bribe contribution** to be paid to the Raspberry Pi Foundation / Raspberry Pi Trading to get them to support their educational mission / to get them to do it, respectively:

Pledge amt -|- Foundation bribe to get them to do it

10000 -|- 1000

8000 -|- 1200

5000 -|- 1300

And then by subtracting, from the pledge amount the (Kickstarter Commission, the "project" low fixed Commission, the bribe) and dividing by the fixed price of 5 we get:

Pledge amt -|- Number of pis

10000 -|- 1694

8000 -|- 1272

5000 -|- 680

And dividing the pledge amount by the number of pis we get: "PRICE PER PI"

Pledge amt -|- Price per

10000 -|- 5.903187721

8000 -|- 6.289308176

5000 -|- 7.352941176

So, again, in summary the pledgers would get:

Pledge amt -|- Number of pis you receive for this pledge -|- Price per pi (divide first by second)

10000 -|- 1694 -|- 5.903187721

8000 -|- 1272 -|- 6.289308176

5000 -|- 680 -|- 7.352941176

The goal would be to get 1,000 orders at the 10,000 pledge level (this is the maximum kickstarter pledge), which means that the order that the kickstarter campaign would end up placing would:

-> Consist of 1,000 orders (each of 1694 pis)

-> Total 1.694 million pi zeros

-> Include a bribe of $1 Million to support the foundation's educational mission, get them to do it.

-> Include $5 per pi paid to them.

It costs nothing to put this campaign up. Here's the million-dollar question: would the foundation/trading accept that PO for 1.69 million pis, yes or no?

Well...you guys are saying "no".

So -- how many PI's -- and what kind of bribe/support -- WOULD they accept? Give me

**numbers**.

*(Note: I've renamed the thread from "Does the Pi Zero have sensible unit economies" to "Pi Zero unit economics" to emphasize that this is an economics question. Obviously there is a number that answers my above question - if Apple gave the foundation a $1 billion bribe - not asking for anything in return - but they have to agree to manufacture for the world (not Apple) up to 10m pi zeros per year for $5 each, then obviously they would do it. --- this is just an example proving that there ***has **to be some number, it's impossible for that number not to exist. if that number is too high, it still exists. I'm asking for that number, whether it's closer or $1M or whatever.])
**Note: If I have any errors in my calculations above, kindly let me know!**