I'd like to upgrade to the K20D from my k10D but won't until the price comes down. The question is how far will the price drop. The only real difference in the K10D/K20D regarding raw goods cost is the sensor. As Richard Day said in an earlier post the Sony CCD sensor cost Pentax about $40. A CMOS sensor is less expensive to manufacture than a CCD but it is a new chip with lower volume so giving it the benefit of the doubt let's say it is costing $50. That translates into an additional $100 at retail.
Samsung continues to offer the GX10 for $650 with lens. It would be reasonable to assume Pentax is selling this to them at a price that gives Pentax the required lowest profit so it is "Priced to cost", meaning production cost plus 10% profit. Subtract the lens from the equation, add the cost of the new sensor and you have a "Priced to cost" selling price of $700 as a bottom number the K20D could be sold for and still maintain profit.
"Priced to Market" is a much more intelligent way of pricing goods especially if you have limited production capacity. The easiest way to hold down the volume you sell is price the item higher. If you think the market is going to perceive the K20D an equal to the Canon 40D you should price it the same. The two are not identical but one has features the other doesn't so they will appeal to different buyers in that price range. As long as sales meets production capacity you can make an extra $600 profit per unit, smart. You can then start dropping price to keep production up.
It will be interesting to watch how this plays out as the reviews of some of the new cameras come out, especially the Sony A350. My guess is it will break the $1,000 mark rather quickly then slowly work it's way down to $700 near the end of the product cycle in 18 months. I'll be a buyer in the $800 to $900 range.
Last edited by regken; 03-16-2008 at 09:32 AM.