LargeCoin Pricing Announced; Taking Pre-Orders

[coblee]

ttyl, thanks for clearing this up. If you reduce the price to $15k, you will find demand for your product. But at $30k, it's way too expensive.

[Fefox]

I think this product would need to be in the $10,000-$15,000 range to garner any real interest.

Would you buy one if it was $15K?

$15k would be my upper limit, sans the DRM...

a no DRM pre-production price of $12,500 or less I might bite.

DRM really bothers me. even if you had confirmed working units (right now) I doubt I would would pay more than 8k for it.
if you had working units (right now) no DRM I would probably be ordering a few units NOW at $12.5 any future sales would probably depend on what the delivered BFL Rigbox specs out at.

[DeathAndTaxes]

Like I said in an earlier post, this functionality could be useful if the user retained control over the actual control/head server sitting at the top of the rack, instead of having it hosted. Anyone spending $30,000 per unit for 40 units can damn well spend another $500 on a cheapo rack mount server to run them.

Good point and would be an awesome feature.

[lakeluke]

15k is much more reasonable; also license file non time liked with out remote drm. I like the escrow in fact it's essential; why not 5k up front and then 1k per month with each payment you send a license file until 15k is paid. You could also come up with a formulae on price by incorporating the difficulty ratio at the time.

As others have mentioned with delivery in late July and block rewarding halving in Jan it does not leave much room for a decent payback period if btw does not substantially appreciate in early 2013

[ttul]

15k is much more reasonable; also license file non time liked with out remote drm. I like the escrow in fact it's essential; why not 5k up front and then 1k per month with each payment you send a license file until 15k is paid. You could also come up with a formulae on price by incorporating the difficulty ratio at the time.

As others have mentioned with delivery in late July and block rewarding halving in Jan it does not leave much room for a decent payback period if btw does not substantially appreciate in early 2013

I know there is probably endless speculation regarding what will happen to the BTC exchange rate when the block reward is cut in half, but my own opinion is that the halving of the block reward will reduce supply therefore increasing the price - probably by enough to recoup the lost "revenue" from the cut in mining reward. Another consideration is that if the exchange rate fails to increase to recoup the halving of the mining reward, people mining inefficiently will leave the market, and those operating FPGA and ASIC based systems will reap a larger share of the mining rewards -- halved as they may be.

[TheOtherGuy]

You mentioned leasing earlier in the thread. Can you give us an idea of how that would work?

[ttul]

You mentioned leasing earlier in the thread. Can you give us an idea of how that would work?

At this point we have no firm plan to lease these units. It's an idea we have thought about, and the platform is designed to support it (hence the provision of license keys).

What would the community's interest in leasing be?

[ttul]

15k is much more reasonable; also license file non time liked with out remote drm. I like the escrow in fact it's essential; why not 5k up front and then 1k per month with each payment you send a license file until 15k is paid. You could also come up with a formulae on price by incorporating the difficulty ratio at the time.

If you have good credit, we can (as can any business) arrange an equipment lease. But keep in mind this will bind you to a 12 to 48 month lease contract.

[TheOtherGuy]

15k is much more reasonable; also license file non time liked with out remote drm. I like the escrow in fact it's essential; why not 5k up front and then 1k per month with each payment you send a license file until 15k is paid. You could also come up with a formulae on price by incorporating the difficulty ratio at the time.

If you have good credit, we can (as can any business) arrange an equipment lease. But keep in mind this will bind you to a 12 to 48 month lease contract.

How much for a 12 month lease?

[DavinciJ15]

Only a 90 day warranty on a $30k piece of equipment?  And tied to your host site?  Yeesh - you could fake mining at 20 GH/s for 90 days and then cut it off (claiming that the unit must be broken) and still come out way ahead.  Too many red flags here..

I agree I was excited until I looked at the numbers and thought about the agreement.  

1. $4500 is enough to build a fake and run off with the pre-orders.
2. No one knows for sure you can accomplish this.
3. You have no reputation, or testimonials of your past accomplishments.
4. I want to see your face, and more of web presence with an address and phone number
5. You can't start small by selling low cost systems as part of building your rep between now and July?

Well, I hope you are not a fraud as I would love to buy a system.

[coblee]

15k is much more reasonable; also license file non time liked with out remote drm. I like the escrow in fact it's essential; why not 5k up front and then 1k per month with each payment you send a license file until 15k is paid. You could also come up with a formulae on price by incorporating the difficulty ratio at the time.

If you have good credit, we can (as can any business) arrange an equipment lease. But keep in mind this will bind you to a 12 to 48 month lease contract.

The problem is that once you start doing contracts for leasing, the cost starts to approach the purchase price, and it may no longer makes sense to lease. The only reason to lease then is so that if the equipment breaks after 6 months, you can break the lease or get new equipment. But then if you do month to month leases, it makes less sense for LargeCoin to lease you the equipment when they can make more money just mining themselves with it.

[ttul]

15k is much more reasonable; also license file non time liked with out remote drm. I like the escrow in fact it's essential; why not 5k up front and then 1k per month with each payment you send a license file until 15k is paid. You could also come up with a formulae on price by incorporating the difficulty ratio at the time.

If you have good credit, we can (as can any business) arrange an equipment lease. But keep in mind this will bind you to a 12 to 48 month lease contract.

How much for a 12 month lease?

This is highly dependent on your credit score. What monthly payment would make sense for 20 GHash/s?

[ttul]

The problem is that once you start doing contracts for leasing, the cost starts to approach the purchase price, and it may no longer makes sense to lease. The only reason to lease then is so that if the equipment breaks after 6 months, you can break the lease or get new equipment. But then if you do month to month leases, it makes less sense for LargeCoin to lease you the equipment when they can make more money just mining themselves with it.

You're partly correct - leasing is no free lunch and is quite different from "renting". Leases are mostly used for tax purposes and for cash flow management in a business that can prove to the financer that it has the ability to pay a series of lease payments over time.

$30,000 is a large chunk of money for many folks, but this appliance is not aimed at the hobbyist miner. We're selling to industrial operations who are concerned about rack density and power consumption. For these types of operations, a lease may be preferred because the lease can be written off against income, whereas the equipment must be depreciated over a longer time period (for tax purposes).

If you're a hobby miner, my suggestion - and we don't mind helping with this - is for groups to get together and buy a LargeCoin appliance, and then find a rack to host it in collectively. At the current difficulty rate, these appliances will generate close to $25,000 per year with negligible power consumption. I don't know how many other investments you can make where you get a near 100% ROI within one year. But this is probably less risky and more profitable than angel investing.

[TheOtherGuy]

15k is much more reasonable; also license file non time liked with out remote drm. I like the escrow in fact it's essential; why not 5k up front and then 1k per month with each payment you send a license file until 15k is paid. You could also come up with a formulae on price by incorporating the difficulty ratio at the time.

If you have good credit, we can (as can any business) arrange an equipment lease. But keep in mind this will bind you to a 12 to 48 month lease contract.

How much for a 12 month lease?

This is highly dependent on your credit score. What monthly payment would make sense for 20 GHash/s?

I would have to do a little math to determine what I would pay for a lease. The driver for me for leasing would be to address the 90 day warranty.

I will make some calculations on what I think a reasonable lease payment would be and get back with you.

[DeathAndTaxes]

15k is much more reasonable; also license file non time liked with out remote drm. I like the escrow in fact it's essential; why not 5k up front and then 1k per month with each payment you send a license file until 15k is paid. You could also come up with a formulae on price by incorporating the difficulty ratio at the time.

If you have good credit, we can (as can any business) arrange an equipment lease. But keep in mind this will bind you to a 12 to 48 month lease contract.

The problem is that once you start doing contracts for leasing, the cost starts to approach the purchase price, and it may no longer makes sense to lease. The only reason to lease then is so that if the equipment breaks after 6 months, you can break the lease or get new equipment. But then if you do month to month leases, it makes less sense for LargeCoin to lease you the equipment when they can make more money just mining themselves with it.

WTF?

None of those are reasons why legit companies lease equipment (do you really think Google signs leases to get out of paying when equipment breaks ).  Companies acquire assets by lease because it frees up capital.

I am not saying you can or should but hypothetically lets say you had two options:

A) Pay $30K for a single unit.  
That gives you (at current difficulty and price) ~$2K revenue.

OR

B) Pay $5K deposit ea on 6 units and lease them 48 months @ $600 per month with $1 buyout.
That gives you (at current difficulty and price) ~$12K gross revenue - $3600 lease payment = $8,400 revnue.

THAT is why companies lease equipment.  It provides better utilization of capital.  Now you may say I could just buy the 6 for $180K cash and pocket the full $12K.  Sure, but with 180K cash you could also lease (hypothetically) 36 units by putting $180K down and making $21K per month lease payment with gross revenue of $72K monthly.

None of this should be viewed as an endorsement it is simply illustrating how/why companies would use a lease for capital deployment.

[Clipse]

Im confused why you keep mentioning that this is meant for "Industrial operations", do you honestly think any large scale operation wouldnt raise an eyebrow at the terrible ROI proposed by this solution?

[ttul]

Im confused why you keep mentioning that this is meant for "Industrial operations", do you honestly think any large scale operation wouldnt raise an eyebrow at the terrible ROI proposed by this solution?

Yes, they are. We've had orders for five at a time already. Everyone knows that power efficiency is important with mining, but there hasn't been much mention of spatial efficiency. With ASICs, we can crank 7x more Bitcoins for the same power investment as an FPGA, and yet use 1/10th of the space. Compared with GPU the ratios are at least ten times better again.

[Brian DeLoach]

We've had orders for five at a time already.

You won't know for sure until money starts changing hands. Do you think we'll ever see a 42u rack completely filled with c200s?

[Clipse]

Im confused why you keep mentioning that this is meant for "Industrial operations", do you honestly think any large scale operation wouldnt raise an eyebrow at the terrible ROI proposed by this solution?

Yes, they are. We've had orders for five at a time already. Everyone knows that power efficiency is important with mining, but there hasn't been much mention of spatial efficiency. With ASICs, we can crank 7x more Bitcoins for the same power investment as an FPGA, and yet use 1/10th of the space. Compared with GPU the ratios are at least ten times better again.

This is all just text, there is no evidence available to suggest anyone ordered this equipment from you.

ROI is the key to investing in something as volatile as bitcoins. If spatial efficiency and power usage is such a huge concern, then anyone would be a fool hosting this at a datacentre considering you keep saying it uses so little space you may aswell host it at a different location that is way more cost beneficial than a datacentre.

As many noted in this thread @ $30k a pop the ROI is terribly low and anyone investing in this would effectively be gambling for the next 24-36months hoping to get to breakeven and then start to profit.

[ttul]

We've had orders for five at a time already.

You won't know for sure until money starts changing hands. Do you think we'll ever see a 42u rack completely filled with c200s?

That depends on whether anyone is willing to take such a sizeable wager on Bitcoin mining. A full rack costs $1.2M; but for that you'd get 800 GHash/s with still negligible power costs. Throw in $1,000/month for hosting the rack and you're still earning an operating profit of something like $80K/month at today's exchange rate and difficulty metric.