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Google On-shores Manufacturing of the Nexus Q
An anonymous reader sends this quote from the NY Times:
"Etched into the base of Google's new wireless home media player that was introduced on Wednesday is its most intriguing feature. On the underside of the Nexus Q is a simple inscription: Designed and Manufactured in the U.S.A. The Google executives and engineers who decided to build the player here are engaged in an experiment in American manufacturing. 'We've been absent for so long, we decided, "Why don't we try it and see what happens?" ... It has become accepted wisdom that consumer electronics products can no longer be made in the United States. During the last decade, abundant low-cost Chinese labor and looser environmental regulations have virtually erased what was once a vibrant American industry. ... At $299, the device costs significantly more than competing systems from companies like Apple and Roku. Google says this is in part because of the higher costs of manufacturing in the United States, but the company expects to bring the price down as it increases volume. The company is hoping that consumers will be willing to pay more, though it is unlikely that the “Made in America” lineage will be part of any marketing campaign.'"
"The company is hoping that consumers will be willing to pay more, though it is unlikely that the “Made in America” lineage will be part of any marketing campaign.'"
People excoriate execs and companies who move parts of their businesses offshore (often rightly, and also often without questioning the policies that contribute to it often being cheaper and easier to employ people thousands of miles away in other countries).
They (and especially the most indignant among them) should be happy to pay a little more to keep the work local; after all, they're demanding that others do it.
Quite a lot of the components inside the device are probably imported.
"low cost Chinese labor and looser environmental regulations"
Those aren't the only factors. The fact of the matter is that pretty much everything is clustered in SE Asia nowadays, and that the labor market is a lot more dynamic. Need slightly shorter screws? Call the factory down the street, they'll start arriving within the next hour. Changed the specs for your unibody case? The factory downtown will deliver new ones the same day. Need a new assembly plant? Build it and staff it by next week. Everything is done locally, reducing ETA and shipping costs in the process. These things also count tremendously.
"But where do all the parts come from?"....anyway, it's expensive as hell to make something here but there's some business value and even cost saving in the fact that they can get any manufactured phone to any place in America in 1 day with Fedex. Even the fastest but still economical shipping methods from Asia are 2-3 weeks lead time at least because it's all ship-based. Get your stuff held up at the port? Time to order another couple thousands then because you've got waiting customers. The other option is to just over-order and pay lots of money to ship and guard your expensive inventory state-side and then have to put them on clearance when the sales figures don't match up with their overblown estimate. Do you know how much Nintendo lost on Wii shortages? Do you know how much HP lost on excess tablets? So there's some value in making things in the US from a cost saving perspective.
I keep waiting for them to replace Chinese workers with American robots. If they did that it could actually cost less. You pay less shipping. Maybe we just don't have a robot that's good enough and cheap enough; but we will. A lot of the outsourced labor is things like cleaning, assembling, etc. Come on Google. If you can program 'bots to drive cars, surely you can program them to polish screens.
There should be a rule on Slashdot that no paywall links are allowed to be posted. How can we comment on an article that we cannot see?
Proverbs 21:19
The real issue with this thing is it is too limited. Why does it not also act as a googletv?
Then it could run onlive, netflix, google play, etc. You could also side load your own apps. Instead this is a streaming media player for way too much money.
Why does it need a good amp? I have a receiver, that is where the good amp lives.
Because at the end of the day you will pay either way. Either pay more for your products and give your fellow citizens a reasonable living or pay more in taxes for their unemployment, food stamps and welfare and on top of that deal with the social ills such as higher crime rates that can come when someone has nothing to lose.
So, this is not a Google TV device yet can connect to a TV with limited functionality. Its too expensive as a standalone network media streamer compared to other products available. I don't need a network device to power its own speakers. Compare this to a $120 Apple TV or even a $190 Boxee Box and its a very over-priced and mediocre competitor. So what is the point?
Obviously if Google is using on-shore manufacturing they are already assuming this as a niche product and don't have to worry about huge demand and high production costs.
I think Google mucked this product up as they are positioning it as an expansive hipster device in a market already saturated with better value and feature rich products. All Google should have done is create a little HDMI dongle that sits on a TV/Receiver that provides AirPlay like connectivity for Android devices which are capable of providing all the same functionality as the Q and could do so for a small fraction of the cost.
I haven't thought of anything clever to put here, but then again most of you haven't either.
People might go along with the the "buy American" line for a while, but if they can save money by buying cheaper products with the same or more \better features they will soon turn to doing just that.
Well, that's the question, isn't it? Does an American company building the products it designs nearby have any advantages in quality control or innovation that offsets the slightly higher (China's edge here is often exaggerated) costs?
In an area where innovation is gradual and nobody has a chance of a killer technological lead, I think that cost is likely to be king. I have friends who went to work in the auto industry and were amazed to find that managers would sell their soul for a $1 saving on a $30,000 car. In areas with rapid and radical innovation, there might be an advantage. I don't think you can answer this question generically. It depends on the character of the market, industry and the company.
Apple is an interesting case. Apple didn't start by offshoring manufacturing, and even after they'd gone that route they hung on to their last domestic plant because they thought there was value to keeping designers close to the manufacturing process. And it worked. Even in the pre-Second Coming years when their product line was complicated and supply chain messy, they manufactured very high quality stuff. It'll be interesting to see what happens when that know-how fades with time. People will automatically attribute any decline in quality or innovation to Jobs' death, but if those things happen they may be the result of changes in corporate culture introduced by Jobs.
Offshoring iPods definitely was a winner because of their relatively low cost and high volume, and the need to compete against low cost alternatives. It seems to me that the same factors would apply to the Nexus Q, which is just another streaming media box. But maybe Google knows something we don't. Or maybe Google needs to gain more experience before it can rely on overseas contractors.
Bottom line on the question of on-shoring vs. off-shoring: it depends.
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