After having thougth a lot, I arrived to several conclusions :
The "per device" cost is 525€ + shipping
The fixed cost for the whole project (R&D+Loan) is 190k €

The main way to significantly decrease the total cost of a device is to decrease the fixed cost, by selling more devices. I mean, if 1000 Neo900 are sold instead of 500, each customer pays 190€ instead of 380€. In many countries (with 20% VAT), it means more than 230€ saved for each customer. So what about finding a partnership, or launching a crowdfunding (as wicket proposed a few posts above) ? With a crowdfunding, the "per device" cost can be adjusted with the main goal of the project.

One more thing is the pool of donators who will not buy a device.
I'm sure not every donation will end with an order. And I'm sure there will be a few "new" customers who didn't previously donate because they were not aware of this project.
There were 423 donations. How many of them were at least 100€ worth ? Let call this number X.
As soon as there are more than 500-X orders without rebate, each new order (ie without rebate) means for the smallest rebate remaining (ie not used yet) :
- either it will be used, so (380 - its worth) € is gained for the project / could have been removed from the fixed costs
- or it will not be used, so its worth is gained for the project / could have been removed from the fixed costs

What I mean is if we can accurately evaluate the number of buyers (especially new buyers) and it's high enough, the price can fall for everyone, which means more potential buyers.

I hate to say it but while I could talk myself into £500, and even persuade myself that VAT on top of that would be grudgingly paid, closer to a grand (or even 900 notes) is just too much for me.

Based on the current list of vouchers (still under review) we have loans of EUR 100 or higher from 420 addresses.

The information we have on file for the number of devices is 449, but this information is likely to be outdated and unreliable. We'll get solid numbers from the shop anyway, and a rough "105-115% the number of loans" estimate is good enough for now.

How these numbers will translate to pre-orders is indeed the great unknown. They can go up or down, due to the effects you mentioned.

Making more devices would indeed help. Not only in terms of more customers sharing the fixed costs, but also in terms of improving our position when it comes to negotiating prices. If you buy a few hundred pieces, you pay catalog prices, if you buy tens of millions, you own the manufacturer's output and get to dictate what the product is worth. The closer we can get to the latter case, the better :-)

There are limits, though: while we can make lots of NeoN boards (limited by N97 cameras, I guess, but that may be in the tens of thousands), the market for N900 parts is more limited. So the maximum number of Neo900 devices we could make before looking for some plan B should be around 1 k, maybe 2 k.

In general, reaching more potential buyers is certainly a goal, and crowdfunding is one of the options to consider. However, crowdfunding adds new risks, so we have to be very careful with taking such a step. E.g., the EUR depreciation, while very unpleasant, is something a project like Neo900, that has some wiggle room with the final price, can survive. On the other hand, if this was standard crowdfunding, where the final price is set from the beginning, we would now be writing apologetic letters about "how it just didn't work out" or try desperate measures like freezing the project until the exchange rate improves. There is no shortage of sad stories of projects that fell into that trap with crowdfunding, and thus came to a tragic end, usual after prolonged and intense agony for all involved.

So it's important to choose a moment when the risks are very low and also when we can effectively market the project, and not divert already scarce resources into an ineffective campaign.

Thanks for your input, these are good thoughts !

- Werner

So to cut through the mustard ..
what is being said is ...
-the cost increase is ...in part...
a projection on the unknown state of committed peoples? ...
I would hope so...

Since what people are seeing is:
the original extreme estimate was 700 euros for a complete device at a number of 200 (potential) orders...
and now the estimate has increased to 1140 euros for a complete device at 400+ (potential) orders...
the (potential) orders were more than double but the overall estimate didn't go down ...even marginally...
it shot through the roof ..
putting it OFF the extreme end of the "How much would you be willing to pay for a Neo900 (complete device) with TI DM3730 1GHz/512M-RAM/1GB".. voting survey which was created to test interest at the beginning....
...and possibly even then "we aren't done with the finished cost being altered again?"
going from $1000+ to $1700+ cdn (for me) and "possibly" still climbing?
...it isn't something buyers of any goods or services won't be keen on seeing... just simply accepting an increase like that is awful hard for even Brand-Loyal consumer (us) to simply shrug off ...

The dynamic isn't pleasant with such forecasting.
How many specialty burgers would McDonalds sell if they said they were coming out with a new-type of burger and said they were going to be more expensive?... tops...advertised between 5-7 dollars ...not everybody who eats at McD's may be keen on it..that's a given....many will line up to buy it though...
starving.. the customers lining up waiting for lunch... are presented with a price hike of not the top end at $7 ...(figuring that the price must be hiked to compensate for the projected number of customers not showing up to buy the specialty burger?)..but $11.40....and as the customers come close to the counter to order there is an employee getting ready with the pricing board to possibly mark the specialty burger up higher still?. how many are going to afford it now...few ..precious few would bring enough..some may have come with a little extra....most weren't expecting $7 let alone 8-9-10 or $11...how many customers will express their astonishment, despondency or outrage and/ or simply leave the fast food joint under such inflation..such pricing uncertainty conditions?
Most assuredly the situation escalates with every passing non-commitment ..lack of sale...the new burger then gets more expensive by the drive of the escalating cost and feeds itself...
It become self-fulfilling prophecy

The above scenario of understanding isn't pretty...
I would hope that isn't the case...

Either way regardless..
ALL that being said... the two camps here...
the team who are making the device and the people who want to buy it ...
better flat out get their crap together...
In no particular order...

A-

-IF (and I completely believe it) the device will be so security conscious that essentially there simply isn't anything like it ...safety-wise...past or present
why.. in this over sensitive post-snowden wiki-leak era...in these absolutely perfect conditions..

1-why don't we have more of the security conscious in society to the downright neurotically paranoid average consumer stepping up to purchase? I mean there are literally BILLIONS of paranoid potential purchasers out there...and millions of neurotics with enough cash to buy...so why are we stalled at 423 donators/purchasers?

2-why don't we have the corporations who MUST HAVE secure communications banging down the door to order? A decade ago Blackberry ruled the corporate and business world and their angle was in great part ..the secure communications..they're done and their methods of security with them..and really no one has stepped up to the plate and filled the gap or done even better still..until now with the neo's un-comparable security....so why aren't there the 100 000's...10 000's ...even 1000's of companies and businessmen banging down the door?

3-Why ...(like Mr. Stallman has mentioned many times) ...that Governments MUST have secure systems... and secure linux is what they run... Why are they not banging down the door to purchase everything that is available?

4- IF (and I completely believe it) there is the ability to create such a limited number of devices... 1000 possibly 2000 units...
why isn't that being reflected in a stupidly-rapid escalation of demand?
Demand should be choking the living-crap out of supply ...
There simply should not be one single unit available for purchase... out of the maximum 2000 units (that is the ceiling) to produce ...

Considering all the above "1" to "4" ...there is no reason why... in all of creation's green and pleasant lands ...there shouldn't be one unit left 2 years on now...available for purchase.

Only 400+ people in 2 years ...something is off PR wise....really.

A Seriously professional PR (possibly team) is needed here...really really really badly.
To Pitch it , wrap it up pretty for advertising, directed right at the audience intended.


When I make a "line" of pieces..in a collection...the fact that "there are only these units or a single unit is available" and then...no more..is pitch...part of my pitch also is selling the story behind the pieces..their meanings..selling that they can have the same things ...do the same things..be the same things as me..live the "kind" of life I live...also part of the graphic story I've carved painted..worked.. is little sometimes common...but usually little known and obscure mythology...so imparting to the client the visibly seen yet "hidden" meaning(s) rendered makes the client feel inclusive..part of the story...privileged..to own it...which they should...there is soul to the product...business-wise that is also pitch.....selling "must have" elements...(longevity, quality..etc)..more pitch..diversity..wife wants jewelry, husband wants belt buckles, embellishment work in a favourite gun stock ..etc..more product pitch...and security..."quality hand weapons, knives, swords, blunt and otherwise rendered unique and exquisitely for the protection of self and loved ones..for you, your wife, your kids..some are great for practice..great for training ..all are heirlooms to pass down...quiet..and no reloading bullets required" ...I pitch products across the board...
All told after estimating the intended audience and their needs ..doing some good pitching.. and that usually creates a frenzy right there and the work is sold...

(perhaps in this sitch ..selling the pitch to a more general audience is a good idea...since I see the pitch aiming at a very small section of the hacker community...Broadening that pitch's scope to include the stock-broker, corporate executives in companies who need secure comm. , government security agents, government low-high level officials...etc ...would help I'm sure..)



B-

- to all the donators/ investors...
I know it is hard...despair and feeling hopeless ain't an easy thing to deal with and it isn't a solution...
and I'm sure the team has had enough rough patches of their own and dealt enough with that..

Take a breath...Grit your teeth boys ..
I know that isn't easy...and lets wait a bit ...
It isn't just up to the team to come up with solutions...

We all can help with that...

Being re-active never helped anyone..
It doesn't take control of the sitch.
It's just "responding" to it.
Being pro-active will help.

Wicket, wpwrak and some others voiced that...and I agree..
what is needed are solutions ..alternatives...ideas....
scrutined..
accepted or rejected...

Our best ability as a community of gadgeteers is finding a way... problem solving...
It isn't the ability to "give up"..

Walking out the door because we "hear" or "see" a number isn't an answer...
well it IS an answer...
but it is the wrong one at this point.

this is a good point. I hope it will change massively as soon as shop with *true preorders* opens and even more when we can demonstrate a working sample (proto-v2)
we already had 2 requests from software houses that sell security-improved/hardened phones resp OS for phones, and they are highly interested in cooperating with us. I think I reported about it in IRC and here in TMO
dunno. There's a certain err... inflexibility in authorities when it comes to such things.
This is exactly our problem. For risk parts like N900, 1GByte RAM PoP etc we only know how much we can source when we sourced it. That's why we start the webshop now.
Well, the UG is just one year old, fundraiser started some 4 months or so earlier iirc. 2 years is a tad exaggerated.
Yes, that's a valid point. Do you volunteer? We're only 2.5 guys here (depending on how you count it) and none of us is a professional PR guy. It's not easy to find somebody doing professional PR and website maintenance and all that, particularly with that low budget we have. And then this gal or guy must actually understand the project and the concept behind it.
Thanks for this, couldn't have put it better. Also from my mouth it would sound somewhat strange

cheers
/j

Because there is no "over sensitive post-snowden wiki-leak era".
Sure, there is Snowden and there is Wikileaks, but it didn't create a new era. Some people noticed it, but it's just a tiny avalanche running down a random mountain that barely derserves the name. It's not a huge glacier announcing a new ice age.
It just looks big from your perspective (and from mine and everyone else's in this thread) because we happen to be right inside the avalanche.
Everybody else in the world doesn't care. Most don't even notice.

Because these BILLIONS you see don't exist. How many billion people worldwide are even in a potential position to think about such a bagatelle topic like a "privacy phone"? One?

I talked to several people I know personally about the Neo900. Most of them are intelligent people (well, at least I like to think so, otherwise I wouldn't talk to them). They all find the Neo900 a good idea, but none of them is as IT- or privacy-affine as I am. They are just not willing to pay 500 Euros (original optimistic estimate) for a device that to them is essentially a heavily outdated smartphone.
They just don't care enough for privacy to do that - just as I don't care enough for healthy food to stay away from frozen pizza, or for fair production to stay away from electronics made in China from resources mined somewhere in Africa.
How many people who care enough to consider buying a Neo900 do you know? ("know" as in: "I drink a beer with him every friday evening.")

Well...1 and 2(especially good news that..I must have missed the mee-mo ),
3(well ALL gov't's inflexibility I completely understand...I forgot for a moment exactly the kind of entity we are dealing with...they'll get on board 20 years after the fact... after spending billions on the necessary studies to see if it is viable and cost effective ) BUT...just as an example..my federal gov't went all out and gave all the ministers working ..top of the line (at the time) Electrovaya slates ..most expensive model they carried at the time...when gov't does finally commit...they don't mess around.
4- yes number 4...yes I understand it is a worry to source the parts asap...but it is also an edge...the best. If there can only ever be 1000...perhaps at best 2000 units...ever.
(unless a new compatible body design is created for the 2nd run ...the neo901..in the future..even then..for this 1st run)...
there isn't a "false" supply (report) created here for the purposes of marketing to drive interest, demand..this is dictated by the availability of the needed parts...
.this is a huge bonus...
there could only ever be 2000 units produced..ever...
THAT is a huge hook...the best.
Because it's honest, it's true. Plain and easy for all to see.
That alone is more than enough fuel to drive demand.

Volunteer?
well...whatever way I'm capable enough for ..sure...
don't know how I could help...
1-My webwork skills I think are adequate at best...
2-Design wise sure...but my speed in delivery I cannot say would be lightning ...it always depends on the quality, complexity and/ or simplicity required.
3-PR...I'm not sure I could do it...the shmoozing ..my necessary contacts here to do it right...know exactly who to interact with to get things moving "I-know-a-guy-who-knows-a-guy-I-can-put-you-in-touch-with" network in this field of interest ...the people I know to talk to and they to talk to people they know...It is far away from the work I do and the people who I know and interact with to accomplish it ...to put us in the "loop" ..get us that exposure... art, rare collectibles, that kind of field and those who are in it... is a different beast to the handheld tech world...not saying the neo isn't a rare collectible ...it is...just a different shade of horse compared to the llama I'm riding

But whatever way anyone thinks I could help ...
sure...
I wouldn't "try"..."trying" ..I "tried" ...is the expression of failure before the fact.
But I'd give 'er a shot and do what I could...
how's that..?

Well I've enlightened more than a few beer drinkin' buddies onto the neo...they are watching...some of them have the coin and like their toys...they're the wasteful kind...buy the next top end whatever when it comes out...for example..one of them buys a brand new 80 000 dollar truck..then trades it in next year for the next...he doesn't care about the loss he's incurring...I personally am not so cavalier...but some of my friends are quite free with their money...when it comes to having the "best" of anything.
As far as most of humanity being oblivious...
I don't know about that.
Thing is...
the media are ALWAYS keeping the people (regardless of the country) reminded how unsafe they are ...how unsecure..it's the natural fear-mongering element the media does...24 hours a day...7 days a week...alll year long...regardless of holidays...
Sure most people try to forget about it...daily...but the thought is there..
Sure some think..apathetically and say "nothing can be done"..or "I-have-nothing-to-hide.." so it's ok for me...but still the thought is in their heads..from print, radio, tv, and internet.
It's bringing the neo solution into their faces and showing the alternative.


Just as ..in the media there are more and more stories about the husband/wife/lover/coworker/boss/....."stalker" (no other word suitable here)...who has hacked into the poor victims's phone and is "with" them ...knowing every move...every spoken word..everything..unbeknownst to the victim...just one media story...
http://www.ksdk.com/story/news/local...king/17650361/
or even online services which provide this service now..for the no other word for it...the "stalker"...and sure the authorities shut down the "app" ...until the next easy stalking "app" pops up ..under the guise of "monitoring your children's safety " or-what-have-you...
And I'm sure the numbers of those who were victims, are victims or are about to become victims ...are legion.
THERE...RIGHT THERE ...IS ONE PERFECT GROUP IN SOCIETY ...REGARDLESS OF BORDERS... TO FOCUS SALES ON.
I would suggest contacting such support groups (non-profit, government and for profit) for those who have been terrorized in such a way...
they would see the neo as a HUGE relief...
How many here wouldn't spend almost every penny they had to safeguard their wife, mother, sister or kids...if suddenly it were realized they were being stalked?
If I couldn't get my hands on them to kill them....I'd sell every gold crown in my mouth if that's all I had to keep them safe.
I'm sure the neo would sell out of stock.. to that special interest group alone...
Peace for the victim and the victims family ...from fear...from worry...that is worth a lot of money...and in the situation or afterwards (for that matter)...many would unhesitaitingly pay.
Thank you sulu ...your post helped with a bit of good brainstorming.

Edit: Not to mention...the platform of "keeping your wife,kids, and family safe from stalkers.. predators ...from the evil elements in society..." why that is candy to a political party...I don't know too many governments or their elected oppostions who wouldn't unanimously support such incentives, bill, passings, monies to be given out ...for a politician it's a quintessential "brass ring" platform to take. It's part of an election re-election platform...It's the kissing-the-baby photo opportunity not to be passed up.
Opposing such incentive makes the individual look worse than a fascio-commo-capitalisto endorsing baby killing-rapist-murderers...If I could integrate all three reviled concepts in one...hehe ...
Politically the neo is the perfect product to endorse...and perfect timing...
Regardless of target audience...it's about how to read that audience in question...how to phrase and word the proposition...how to "work" the product into their needs... into convincing that the product is necessary..needed...essential. One of the neo's qualities...The neo's stated security ...gives that assurance ...little is needed to convince other than a sentence or two of choice words...put together exactly. then you have the bullet-proof pitch.
Even better is visuals...
print is great ...but limited to subscribers...
radio is great but same thing again..
television commercial spots are too expensive...and you have to hope your targets are watching...forget it.

internet is as cheap as it gets...

decent camera...a couple 1 minute commercials..

say one highlighting the in use greatness and versatility of the neo.

another with a mom and her baby shopping ..and unbeknownst and oblivious to them...But the viewer becoming aware of a stalker or potential stalker...threatening their peace..
and the neo she owns thwarting the attack.

Bam.
Sure it sounds cheesy ...but I assure you ...
whoever sees it will be sold.

A fabricated scenario with the camera / audience / viewer being helpless to only watch... banging on the proverbial soundproof glass at the mom and baby .....to "watch-out" for the "bad guy."..and then then..."whew" ...the neo intercedes...ach..no need to worry.. these two are fine...
It's a foregone that it will be flat-out instant CAPTIVATED consumer interest.
Think about it...
how much...how valuable..how coveted.. is peace from fear and terror worth?
Especially when one has or is experiencing it?

This is working the psyche of the target audience properly...

It isn't "manipulating" or "playing" the audience or "fabricating" or fear-mongering anything that isn't already there ...
these societal diseases exist now...
and the cure is the neo

hehe..
101 of advertising, art and the psyche
...the use of stimuli to elicit the desired response...
with colour, image, placement, symbolism, archetypes etc...
In this case it is visualizing and bringing to life an innate societal fear..
the viewer is forced to think "this could be my mom / wife / sister...someone I care about.."
that is powerful imagery.

Toss 'er up on youtube...
it's as low budget as it gets...
but EVERYONE can see it..
email out links of the videos and flood the planet aiming at target audiences globally ...tech reviewers..news and media outlets...everyone that has an e-mail address (I know it "sounds" like "spam"..but I wouldn't call it "spam" if it is to aid in the legitimate and noble cause of stopping stalkers, predators and ne'er-do-well's ...would you? ...) that has the power to spread that "Wholesome Neo Goodness" to the world...gotta send it to people who have audience reach...freakin' Oprah ..whoever...don't just "hope" it goes viral...engineer it ...

Anyway..just an idea ...
however the tack is taken with the target audiences..
however it is said, written, expressed and/ or visualized.....
if how the product is expressed - explained to work... (..pitched just right) making it no different than it's real life working...
you have the audience believing in you.
(too many times a product is "advertised" to have something ..the reality cannot deliver... and so it fails)
Essentially... aim well ..say it well..and the audience will follow.

Keeping your family safe from real and imaginary threats for sure is a noble goal, but what really worries the man on the street is something else:

https://www.youtube.com/watch?v=XEVlyP4_11M

(John Oliver interviewing Edward Snowden.)

- Werner

how have I never heard of this host? (probably because ..I'm on an island at the edge of civilization and the known world...maybe...)
I have to watch this guy now...
funny, educating and illuminating...
all in every single sentence...
the guy is terrific at delivering disturbing news with comforting hilarity.

Hmmm...yea..the patriot act ...that alone...
the timing though is perfect for the neo ..
this is a gift from the gods..er..snowden...um secret services everywhere?
This whole program ...so far...(still watching)...
just further states the case of pervasive media fear-mongering concerning surveillance alone...
this should be harnessed as a selling point for the neo ...
to safeguard the privacy of american "junk" everywhere...
it's low-hanging fruit ready to be plucked....so to speak