[HH] Spam (7.632):Re: Smoke detectors self-destruct

[Ethan Schwartz]

On 4/14/17 11:20 AM, Federico Lucifredi wrote
> On the business level, I do not agree: these detectors cost $25-50 because they have a government-guaranteed demand curve, and vendors are just waiting for the money to come in. While the government clearly has good reasons here, the combination of that with limited competition gives you… pricey sensors. I could be paying $50 for all sort of parts of my house that come for $4.50 today… like my basement flood sensor, which folks have to sell to me without a government mandated demand. I hope we get there soon for these as well, I see no reason for something produced in the tens of millions to be this pricey — It is not an iPhone!
You're making the argument that despite steady high volume demand there 
is limited competition in the market and that the limited competition 
has resulted in pricey devices which implies they are making large 
profits (your comparison to iPhone) at your expense.

I would argue that if there is profit and steady demand in the market 
then someone else will come along and make a device and sell it slightly 
cheaper.  However, if the cost of starting up a detector-making business 
isn't worth it (hence why there is limited competition) then it stands 
to reason there isn't actually as much profit as you might believe in 
these devices.

I also do not think that volume necessarily translates to lower prices.  
A CO sensor is more complex than a flood sensor--a flood sensor is 
generally just resistance measurement between two bits of metal and the 
resistance drops when water/moisture fills the space between them--so 
the pricing may be vastly different on these sorts of devices even 
before you consider that there is another sensor in there for detecting 
smoke, which may be ionizing, photoelectric or both...

If we wanted to compare the current combination CO/Smoke detector market 
to cell phone market, it would probably go something like this--
The $10-15 no-brand combination detectors you can find on the shelves 
are the ZTE or unknown Chinese-brand names.  Brand names change every 
few years, and those that survive are synonymous with build-grade 
cheapness.  These are the absolute lowest cost and minimum viable 
product designs to meet standards.  They may use older technologies that 
are still working but less than ideal when it comes to lifespan or 
reliability.

The $25-50 Kidde/First Alert detectors are HTC and Samsung, they have a 
wide range of model options from inexpensive to expensive with various 
features and other improvements coming along with the highest priced 
models, but the key is that the brand is established and trusted.

Then $100 Nest Smoke/CO detector would of course be Apple and their 
iPhone ;-) ...  They are essentially premium price and feature set, many 
would argue a vanity product based on feature set alone.

I must admit that I know very little about what goes into the COGS for a 
combination CO/smoke detector, so you may very well be correct that 
there is 300-1000% markup between manufacturer cost to build and the 
retail price on an average detector--but I have worked in the commodity 
device manufacturing world and I just don't see those kinds of margins 
going unchecked long term.

HOWEVER, all of that said... at the end of the day we've really only got 
2 manufacturers on the market: First Alert/BRK and Kidde/Knighthawk... 
So either I'm right and these guys are splitting the market share 
between themselves on what is a high volume, but low margin, product... 
or you're on to something and it's all collusion ;-)

>> If you have gas appliances in your basement I'd have an explosive gas alarm down there too.
> Now this is actually interesting. I have all of the above already but not the explosive gas alarm (I am a sensor guy, I get these even when I don’t need them to learn more about them), do you have a model you use/recommend?
>
> Thanks for sharing!
I can't recall the manufacturer, but it was either Kidde or First Alert, 
which if you note my last comment above stands to reason, since there 
really aren't other options!

IIRC it ran off of AC power with a 9V backup battery, and it also had a 
~7 year kill-clock based on the sensor gradually losing sensitivity over 
time.

I can't recall the price, but was under $50.