Comment on We don’t need 75-inch TVs, we need 75% off basic survival. 💀
theparadox@lemmy.world 21 hours agoSo you are saying that they are talking about profit and not revenue. Profit - the actual net gain the company gets and the sole reason businesses exist in a capitalist economy, and arguably the more important responsibility of a corporation to its shareholders…
Gross profit:
| Source | 2021 | 2020 |
|---|---|---|
| Device | 25.6 | 58.2 |
| Platform+ | 57.3 | 30.6 |
To me, it looks like they are making more profit from the platform than from the TV sales themselves. To the point where they could, as you say, literally sell TVs at a loss, and still profit…but that barely matters when it comes to the price of the TV?
When the TV is on the modest end, I think that matters a whole lot.
They won’t be giving away 75" TVs or anything, but I think “platform” revenue has sizeable impact on why you can get absurdly cheap 27" flat panel TVs from Vizio and the like.
Gladaed@feddit.org 20 hours ago
The issue with this calculus is that they would not turn a profit from the services if they stopped making tvs. This means dividing out these into separate accounts with separate costs is idiotic.
theparadox@lemmy.world 20 hours ago
So in order for it to be real, everything must be merged together into a single source of revenue/profit?
I am in no way confused as to whether or not they could make a profit without selling TVs - it says to me that the more TVs they sell, the more the platform can make. The platform becomes the profit generator and the cost and sale price of the TV hardware then becomes a line item in the platform profit calculation.
I’m not a business major but I don’t understand how separating the services and hardware that delivers the services into two measures invalidates my assertion that the services are the profit driving force and the hardware is secondary to that. With the hardware being secondary, keeping its price low or at a loss makes economic sense if the platform generates that much more profit.
I’m arguing such logic has driven down the prices. What are you actually asserting that is relevant to my point?
Gladaed@feddit.org 20 hours ago
Arguing for cost of production vs cost of service offerings in a vacuum is the issue since. And trying to argue that they make their profit just in ads and services is the thing you shouldn’t do, as they do not add the TV cost they “subsidize” to their cost. Since profits are very slim any small source of income with low cost suddenly becomes the source of profit if you fudge the math this way. Imagine that they would sell remotes separately at high cost compared to the materials cost e.g. for 20 bucks. Then they could reduce the TV price by 20/buyrate dollars, lowering TV profits but have a high margin item they can tout to investors. Even though almost nothing changed they reduced their tv manufacturing profits without changing their total profits.
theparadox@lemmy.world 19 hours ago
I understand what you are saying. If they reduce the price of their TV (and the profit that TVs sales generate) they are just removing the profit from one category into another.
I honestly don’t have enough energy to write a better researched response - I spent more time than I wanted trying to find any numbers as it is.
If you want to believe that the gigabytes of data your TVs regularly send to their manufacturers and their business partners aren’t a primary driver of lower prices… and that it is really because it has become markedly cheaper to mine precious metals and manufacture semiconductors than it has to run factory farms, then go ahead.