Designing for margin versus volume

Article By : Brian Dipert

There are benefits to being a high-end product supplier, although there are also risks.

A report released by market research firm Canalys in mid-October of last year estimates that Apple was in fourth place among computer suppliers as measured by product shipments, with 7.8% share (behind Lenovo, HP and Dell). It should be noted that those other vendors’ shipments exceeded historical norms, likely due to the then-pending obsolescence of Windows 7 and users’ tendencies to replace their existing hardware versus upgrade it. However, analyst reports regularly note that Apple garners a disproportionally high percentage of total market profit; back in late 2016, for example, estimates were that the company, then with 7% of the computer market, single-handedly captured 60% of its profit.

Much the same is the case in the smartphone market. Even though, according to market research firm Counterpoint Technology, Apple’s worldwide market share was 12% as of the late-November 2019 report, Apple captured 32% of the overall handset revenue and, even more notably, 66% of industry profits. Clearly, there are benefits to being a high-end product supplier, although there are also risks; you’re more vulnerable than low-cost competitors to economic downturns that tend to compel consumers to be price-focused. And more generally, if those consumers don’t concur with the cachet you’re attempting to cultivate, the resultant downturn in sales will leave you competitively more vulnerable.

I’ve been thinking a lot about the potential risks and rewards of a high-end focus lately, but ironically not as they relate to Apple products (of which I write about a fair bit, as a long-time owner and user). In my previous post, I told you that I’d taken advantage of an Ebay promotion to pick up a factory-refurbished Microsoft Surface Pro 4 “hybrid” PC, in and of itself a premium alternative to other mobile computer form factors, products, and suppliers. But that wasn’t the only thing I bought:

docking station

This is Kensington’s $399.99 (MSRP) SD7000 Docking Station, which transforms the Surface Pro into a credible facsimile of Microsoft’s Surface Studio desktop computer design:

Surface Studio

As with the Surface Studio, the SD7000 enables the Surface Pro’s display (more precisely in this case, the entire computer) to be placed in a wide variety of orientations. Kensington also recently announced the conceptually similar albeit less orientation-flexible SD6000 for the smaller-screen Surface Go:

SD6000 docking station

The power and data connection between the SD7000 and Surface Pro exclusively leverages the Microsoft-proprietary Surface Connect interface. And from there, turning the SD7000 around you get an abundance of external connectivity options:

  • HDMI v2
  • DisplayPort++ v1.2
  • Four 5 Gbps USB 3.0
  • 5 Gbps USB-C
  • 1 Gbps Ethernet
  • 3.5mm combo microphone and stereo headphone
  • Security slot for optional cable lock

docking station ports

The SD7000 also includes an AC adapter sufficiently robust to power both itself and a connected Surface Pro. Each video output, when both are in simultaneous use, can “feed” a display up to 3840×2160 (“4K”) in resolution at frame rates up to 30 Hz. Note, too, that the Surface Pro’s integrated USB 3.0, Mini DisplayPort, and other connections (except for the Surface Connect and Surface Cover interfaces, of course) remain fully accessible and usable. This flexibility is valuable, for example, if you need to tether two 4K@60 Hz monitors to the Surface Pro. One can use the tablet’s built-in Mini DisplayPort interface, while the other leverages either the SD7000’s HDMI or DisplayPort interface.

Finally, here’s what it all looks like in action on my messy desk (yes, that’s a used bread bag filled with dead batteries, queued up for recycling, on the left and above them, a collection of lollipops):

Surface desk setup

Also shown are the Bluetooth-tethered Surface Mouse, Surface Keyboard, and Surface Pencil that I also picked up during the Ebay special. The SD7000 is simultaneously driving my two humble Acer H226HQL 21.5″ 1080p LCDs. It all works great, and with rock-solid reliability (at least so far).

About that $399.99 MSRP; the unit I bought on Ebay was actually $325 plus an extra $26.99 for shipping, and the vendor refunded me $25 after it arrived, since it turned out to be a display sample, not a brand-new production unit as advertised. Still, that’s a chunk of change, which admittedly gave me pause prior to clicking “purchase.”

Part of the reason, of course, is that the SD7000 leverages Microsoft’s Surface Connect interface; uniqueness (theoretically, at least) rationalizes a price increase. And after concluding the transaction, I did some additional competitive research, which justified (at least to me) the investment. Other docks with a similar connectivity suite are comparably priced, but, of course, solely focus on the external interface, while the SD7000 also enhances the user interface by transforming the tablet into a flexible pseudo-desktop. And bottom line, every time I walk into my office and look at the setup, I think to myself, “That’s way cool.” That’s got to count for something, right?

Thoughts, readers, regarding similar high-end product attempts, with you acting as developer and/or consumer? Sound off in the comments.

Brian Dipert is Editor-in-Chief of the Embedded Vision Alliance, and a Senior Analyst at BDTI and Editor-in-Chief of InsideDSP, the company’s online newsletter.

Leave a comment