Because of a contact I have with Best Buy Canada I can tell (more like leak) exactly how much Shaw currently sells the DCT-6412 Phase 3 units to Best Buy/Future Shop. Since they charge us a criminal amount for this hardware after the fact that we pay them very well for the subscription I have no shame and I believe this info should be known. Shaw sells them for 547 dollars and change. After which we are expected to purchase them for $750 plus freaking tax. And Future Shop makes it look like some sort of generous "sale" when they sell the units sometimes for $700. In my opinion this kind of mark up for subscription based hardware with an antiquated hard drive is an absolute RIPOFF. Come on, does Future Shop really need to make $200 for a $750 unit? I doubt they make that much on a $3000 TV. Why can't they sell for $600 and make a still decent $50 profit per unit. Plus when you factor they sell more it's not as bad. But the REAL blame rests with Shaw for letting resellers price so high and setting the MSRP in the first place. If they can sell them to Future Shop (and I assume other resselers for around the same cost too) why can't they sell them to us DIRECTLY for $550? Since Shaw is a SUBSCRIPTION based service they should not be making too much profit on the hardware if at all, especialy when it's 2004 technology, amenic and crippled.

No one's forcing you to buy it.
You don't have to pay for digital either. You can get away with basic cable+HD for a very low monthly.

A 37% markup isn't uncommon in the retail business IMO. Mark-ups tend to be higher on slow moving stock.

Come on, does Future Shop really need to make $200 for a $750 unit?

You honestly think $50 would cover labour, advertising, million dollar stores etc.

You want million dollar technology for a buck. Good luck!

You honestly think $50 would cover labour, advertising, million dollar stores etc.

You want million dollar technology for a buck. Good luck!

You do not understand my point. Why does Shaw need to even sell through Future Shop? Why not sell directly to us like they do but for $550-$600 and cut the middleman.

They're called Sales Channels. The more the merrier. You could argue that the price at the Shaw outlets influence the retail price at other retail outlets. All oultets offer programming credits to entice new customers and bring the price down to around $547 (or lower). Seems like smart business to me unless they are really trying to grow their HD customer base. At this point they aren't.

Because of a contact I have with Best Buy Canada I can tell (more like leak) exactly how much Shaw currently sells the DCT-6412 Phase 3 units to Best Buy/Future Shop.
I would be more interested in knowing how much Shaw pays to buy the 6412 than how much they sell them for. Perhaps Shaw is buying them for $550 or $750 and selling them at a loss to get us to subscribe.

Remember this is subscription based hardware. It's not a TV you buy from say Sony where the mark up is justified because it's a one time purchase. Shaw is selling this as a means for us to subscribe to their service. We will be paying them $50+ possibly for the rest of our lives. Shaw does not sell hardware they sell service. I would not mind paying $750+tax for this unit if it had a 250gig harddrive and/or RAID support but it doesn't. Simple fact is Shaw should lower the price or at least get the 6416 from Motorola like Verizon has AND add RAID support. And the worst thing is you guys accept this highway rape and robbery from Shaw with open arms. It's like buying a 2004 laptop right now in 2006 for its original MSRP.

How about Shaw is selling them to FS/BB at a loss because they need the shelf space beside the competition. It is in Shaw's best interests not to simply let Bell have all the floor space in the Home Theatre sections of FS/BB stores. FS/BB has the leverage to get the wholesale price down where they want it.

Shaw's business model is to make money from services, not hardware. I can't tell you what the landed cost to Shaw of a 6412 is today, but I can tell you when they were first brought in to replace the 6208 ... it was over $600. Considering they sell it to first time subs for around $577 they are clearly not making money on the hardware.

When you then consider the replacement warranty included and Shaw's buyback policy of $300 ... words like rape and robbery are simply over the top. If anyone is gouging the consumer it's Motorola ... not the cablecos.

It's simply called a loss leader.

Shaw's buyback policy of $300 ... words like rape and robbery are simply over the top. If anyone is gouging the consumer it's Motorola ... not the cablecos.

It's simply called a loss leader.
JohnnyCanuck, the knew of the buyback policy of $100 (for Model 2500) what is the $300 buyback policy for?

Thanks

40% margin on electronics is expected.

I would prefer that there's two options - buy from Shaw or BB/FS and of course they can't sell direct at 40% less... that's the same as any online manufacturer - they aren't going to sell wholesale to retailers and consumers.

The alternatives are being only able to buy from BB/FS (ugh!) or
Everyone having to buy from Shaw - that's crazy -

40% margin on electronics is expected.

Well I never sold electronics but I did sell camera equipment. If the markups are the same then it is more in the 10-20% range at best. I used to be able to buy a camera on sale with my staff discount at below cost. Perhaps electronics have more of a markup. Maybe someone in the electronics business with actual knowledge of costs and markups could comment. (Could be you Bluecruiser, I don't know)

There is no standard markup. Big tv sets and in demand items have larger margins. "what the market will bare" is how this equipment is priced...not based on any other factor. I'm far more concerned about low bit rates and stability issues than the markup on the box. Shaws purchase model does seem strange considering how US cablecos are renting thier boxes, but as Canadians we are getting used to paying a huge premium on everything. As competition from telcos ramps up shaw will be forced to rethink the hd/pvr business model.

I'm more concerned about low bit rates as well and lack of timeshift etc.

As for renting, optomisticaly assuming Shaw HD improves. That depends if Shaw will replace a purchased 6412 free of charge if something were to go wrong after the 3 year warranty. If they will than $750 straight up is better than $20 dollars a month for the next <3+ years. That said there should be a low interest rate purchase plan. I assume you can get one from future shop etc. at high interest rate.

i got mine on ebay for US$280....

i got mine on ebay for US$280....
Yeah, the markup on stolen properly is infinite.


Edit on 2006.09.01. Some people have objected to the above remark. This remark was made at a time when several similar threads were on the go regarding purchasing US Motorola STBs. If you wish further clarification regarding this remark, please see the following:

http://www.digitalhome.ca/forum/showpost.php?p=417430&postcount=44

http://www.digitalhome.ca/forum/showpost.php?p=416636&postcount=39

Part of the reason for the price is to get the consumer vested in a given provider. i.e. if you have just spent $750+ on the PVR, but don't like the service you are less likely to change as it means a potential loss of $750 you invested in the first place.

Beside which typical markups in retail start at around 42% and can go as high as 150% or more depending on product, sales etc....

As for renting, optomisticaly assuming Shaw HD improves. That depends if Shaw will replace a purchased 6412 free of charge if something were to go wrong after the 3 year warranty. If they will than $750 straight up is better than $20 dollars a month for the next <3+ years. That said there should be a low interest rate purchase plan. I assume you can get one from future shop etc. at high interest rate.
I had a lower model Shaw digital box. I bought a new one, upgraded my in-laws to digital cable and gave the older box to my in-laws. Within a year, they had some problems with it.

Shaw came out promptly and replaced their box (my several year old hand-me-down-to-them box) without question and without any charge.

Try doing that with satellite. :)

Yea I know they do that with the DCT 2xxx series no problem. I'm just not sure about a DCT 6412. If it breaks down say 5 years from now will they give you a new unknown DCT or other STB/PVR or even replace with a old refurbished 6412. My guess is they would. Is a good business decision IMO. If your paying $150+ a month for subscription they should get back their cost pretty quick.

So if their is anbody out there with a old DCT 2XXX without toslink/digital coax output, take it to Shaw. Tell them it's not adequate for your home theatre cause it doesn't output DD 5.1 . They will exchange it for you no problem. They are good about this.:) These they probably get their cost back after a month of subscription.

Yeah, the markup on stolen properly is infinite.

It's probably not stolen, but one of the USA units, good luck in getting that to work. I see USA units on eBay all the time for fairly cheap. I've been checking prices almost daily for a cheap Shaw 6412, and the lowest I've ever seen these last 2 months is $550 Can for a used box.