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Price Rise For Lcd/plasmas


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30% price rise ....I'd like to see that.

Wait until the traditional Feb/March slow season hits on top of the GFC, I think they'll have to drop the prices by 30% if they want to move any stock.

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Agreed...cant see them jacking up prices in an already soft market and thats pre christmas when sales should strong. Wait until after the sales and see where things are...I'll believe it when i see it.

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Sounds like marketing hype to me.
30% price rise ....I'd like to see that.

Wait until the traditional Feb/March slow season hits on top of the GFC, I think they'll have to drop the prices by 30% if they want to move any stock.

As an importer, this is no bull. Almost all international trade is in US$. Since the AU$ has dropped from 95cents to 65cents, this effectively means that all replacement stock now costs Australian distributors 30% more. That is, where 4 months ago for every US$ an item cost we had to cough up about AU$1.06, now it will cost AU$1.54. That my friends needs to come from us poor old consumers. Now I don't think that will equate to those sort of rises effectively, because the manufacturers will be adjusting prices where they can, but don't hold out for too much. Most Asian currencies (including China) are centrally controlled and these have not devalued against the US$, so it will still cost as much to manufacture a good except that raw material costs have come back so this is where some savings will be made.

Guys, the AU$ is expected to drop even further in the first half of 2009 and this adds more pressure on retail prices. If you want to buy any pricy imported products, don't wait too long. Once the sales of existing stocks are gone, they'll all rise and by big amounts.

My qualification to make these comments is based on my management position in a large automotive related importer and distributor and we've just hedged $10 million at 66.9c to try to hold off raising prices by no more than 15-20% in the new year.

Believe me this is NOT marketing hype. It is fact!

Pfeff

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Maybe, but I'm sceptical.

That argument should have already filtered into the market as it has for speakers etc,

Yet we are not seeing it in the price of displays.

If anything they have come down even more.

Plus if sellers have a bad Xmas there will be lots of sales in January.

Post again in mid-January if you are right and say "I told you so".

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From the article: "Sony have flagged price increases of up to 30 per cent "

Funny that, the sales guy I spoke to on the weekend said exactly the same thing about Sony prices. Coincidence?

I personally think it's no bull.

As the shops are forced to buy new product at current prices (as their forward cover runs out) of course the prices will go up.

I think you would be ignorant not to think that they wouldn't go up - the dollar has copped a beating and will continue to do so.

It costs retailers more to buy the stuff... so they up the prices to cover. Pretty simple...

Not sure if 30% is an accurate number of not, I'm expecting some sort of price rise but I reckon the sellers will try and absorb some to still be able to shift units so might not be as bad as the article suggests.

Edited by dlcx
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I have no doubt that you are correct Pfeff, but I don't think the importers have the power in this market. They will need to find innovative ways of reducing their costs to meet the market.

Also, it's the buying power of the Gerry Harvey's and the like that dictates pricing to the importers, which is why Hitachi, Fujitsu, Philips and a few others no longer want to participate in the Australian flat screen market.

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Not sure if 30% is an accurate number of not, I'm expecting some sort of price rise but I reckon the sellers will try and absorb some to still be able to shift units so might not be as bad as the article suggests.

Yes, I think that is more realistic. Maybe the good deal sales will diminish. But a 30% increase on RRP is a big jump.

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As I have to pay my OS supplier in USD, was getting USD85c to each AUD$1 now its USD64c to each AUD$1 so my latest buy price has risen 32%.

I'd guess most of the majors buy forward money, but it doesn't last forever and may be about to run out, if this is the case then prices will certainly rise big time in 1st Q of 2009.

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yeah i personally think the price of tvs here is pretty good unless you look at pioneers etc, which if u compared them when the aussie dollar was almost 1:1 with US, the plasmas still cost 3K more here for an equivalent panel. 60" was 9K AU, could get in states for $5.5K US

the only problem i see is that, the price of tvs has always lowered with newer generations. it happened when i was in NZ and i noticed it happening here. but none of these price drops seemed to be related directly to a strong economic dollar, more the cost of purchasing hardware was less as manufacturing costs went down (typical example is pioneer as they did not drop in manufacturing costs, hence moving to panasonic for gen 10 panels, yet sony and samsung panels did come down in price each new gen).

i think lots of people were weary of that, and so not dropping the prices considerably at that time you might find it bites importers in the bum. milk the economy when its doing well, get owned by it when it really drops and no one wants your products for the price you you charge :P

it's quite obvious when you look now and say tvs were imported on a strong aussie dollar, advertised at say 2.5K. now that same stock is 1.8K. they must not be selling it at a loss now, they just realise the milking they were trying to do didnt work soo well :P

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On basis this being true, what are the chances of another PS3 deal do you think?

Its surprising to see Sony so quiet when all of their competitors are showering consumers with freebies and bonuses.

edit: and when should we aim to buy our TVs before? I have seen a few articles mention the end of Jan 09 as when the price rise will hit... can we expect significant savings in early January as compared to what is out there now as retailers try to make some sales before it all dries up, or will the current prices be as good as it gets?

Edited by andrew81
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I also approached this news with some skepticism. However, whether its 10, 20 or 30% I think we can conclude that price drops are not in our near future - we've become so used to wait 3 months and buy it for less.

Lyle mentions the need to come up with innovative ways to sell at lower prices next year. IME such innovation usually involves:

1) Ordering much less stock.

2) Sacking (now) redundant staff and otherwise trying to reduce overheads.

Regards

Peter Gillespie

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If only there was an oracle for those questions :D

I'm REALLY close to buying at the moment... the freebies at present certainly helps.

If I knew that Sony was going to do a PS3 deal next month tho, I'd definitely hold off.

But who knows?

If prices go up as much as suggested in post above, you might as well buy now and then buy a PS3 - will probably work out the same :P

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If prices go up as much as suggested in post above, you might as well buy now and then buy a PS3 - will probably work out the same :P

that's really been bothering me too.... although a 20% price rise on a $2500 TV is still less than a $699 PS3...

Should we assume the fact that Sony have been quiet so far means they are saving up their bonuses for after the price rise?

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Maybe, but I'm sceptical.

<snip>

Post again in mid-January if you are right and say "I told you so".

Lyle,

I hope you and the rest of the optimists are right!

I and many other importers didn't think the dollar would keep going down like it did and remained an optimist. Well it did go down and now I have to pay the price. And so will the rest of us to differing degrees.

I wrote my warning as I would not like to see my friends miss out now and if I am wrong, the worst case I can think of is someone is going to buy soemthing they want a little earlier than they might otherwise have done. If everyone else is prepared to take the gamble that prices will stay this low, then it will indicate that there is a s**tload more margin in electronics than a lot of other industries and we've all been paying too much for too long.

Cheers

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Most car importers (eg Toyota, Honda Mazda etc) have also indicated via their marketing in the Carsguide and Drive like press that they will be increasing prices in January. Toyota is spruiking rises along the lines of 5% - not anything like the 30% being touted here for electronic goods.

I think it'll be smaller discounting so the RRP will be closer to what you pay for your new TV, not the 20-30% discount that can be negotiated ATM.

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Yes, I think that is more realistic. Maybe the good deal sales will diminish. But a 30% increase on RRP is a big jump.

I doubt the 30% number too. 30% cost rise doesn't enecessarily quate to 30% at retail. As I said we are trying to hold around 15% (which will happen in two jumps, one last month and one around Feb).

I think Sharp's 10% is more the number initially but if a leader like Sony goes up more then so will the others.

The thing is all the advice is the AUD is not going back up anytime soon and in fact drop further in 2009. If that is correct it will just add to the price pressures.

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I have heard that Sony won't be doing a PS3 deal because they are doing the Quantum of Solace promo.

I asked quite a few retailers including Sony Central and they all said the same thing.

this promo expires 24th Dec so fingers crossed we get the NZ deal come January!

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There is a lot more margin in electronics than we think. Players like Sony have been ripping us all for a long time. Prices of stuff in US is much cheaper after the exchange conversion, so Aussie wholesalers and the US/Japanese parents make a huge margin here. To make things even better for them. The products are costing less to manufacture in low cost geographies because their currencies have also depreciated against US$. Material costs are lower too. A good e.g. of what I am saying is a product made in Korea is cheaper for a US company to make therefore the cheaper cost should flow on to the Aussie market to offset the deteriorating exchange rate. These things should balance out exactly the same and result in no price increase here, regardless of the fact that the product is bought and sold in US$. If the US/Japanese parent puts up prices here its only to increase profits. They do it at their own peril, because the market will implode in Q2 of next year after Kevin’s Christmas presents have been spent.

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one thing, when the AUD$ rose up to the 95c mark in 2007, we didn't see tv prices drop

however prices do drop on tv models as newer models come out....

so i don't think that big price rises are going to happen, i think that the electrical retailers are just trying to 'scare up ' more sales for xmas, and they will worry about next year later......

I think that consumer sales in australia will really drop next year, and that once the xmas/dec/jan/$1000 bonus sales are over that sales of higher priced consumer items will really slump in feb/march...... and that this will really hit retailers hard......

As gerry harvey said-a lot of smaller retailers in electrical and other areas will go under.....

I would not want to be a retailer of non-essential items in 2009.... look at what is happening to car sales right now....

this slump in sales will also be influenced by all the bad news that will continue to come out from the usa and overseas...

plus job juts in mining companies will hurt consumer confidence even in WA

Edited by larry
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i think that the electrical retailers are just trying to 'scare up ' more sales for xmas......

I've been of the same belief too. But many others do believe the price rise news and are starting to panic.

I think that if a particular manufacturer (or cartel) tries price-gouging in a depressed market, it will lead to their balance sheets having even more red ink than they've got today.

The only positive point of buying over the X'mas/Boxing Day season is that you can get your hands on some freebies that may not be available otherwise e.g. free PS3, Wii, small LCD etc. Some of those promos do get extended into February, so there is hope for those who want to wait.

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A person from work, her husband is the regional sales manager for one of the top brand TV's, and he is saying the same thing.

They (as in wholesalers, importers) cannot get accurate figures on the cost of new stock next year, so apparently this year (the first time in 20-25 years or something) is the first time you will get a bargain pre Christmas and they cant guarantee it post boxing day.

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so i don't think that big price rises are going to happen, i think that the electrical retailers are just trying to 'scare up ' more sales for xmas, and they will worry about next year later......

I'm with you Larry.

What better way to increase sales of a luxury item in a period of financial uncertainty than a bit of consumer fear.

If prices do go up then even less units sold. Not good for anyone. If they do go up people will put of buying and see it for the cynical exercise that it is. Just like petrol prices - up like a bullet, down at a snails pace by comparison.

Pioneer's Australian price for the new 50 inch monitor is $5,899. I don't think it would have been any different if the $AU was still high.

Electonics goods always come down - the technology improves (the camera in your mobile phone probably has as many pixels as a camera that cost $1000.00 5 years ago.) and units become cheaper. Sure you can up the price of a new model but upping the price of something in the market place for a while is not going to wash.

And it's not as if prices were dropping like crazy as the dollar climbed........

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I have no doubt that you are correct Pfeff, but I don't think the importers have the power in this market. They will need to find innovative ways of reducing their costs to meet the market.

Exactly. People are often misled to believe that price is a function of cost where in fact there is no relation whatsoever. Price is a function of supply and demand. Of you cannot supply your product at the price set by the market AND make a profit then your product will inevtiably fail.

Book sales are a perfect example of this; Hardcover books do not cost much more to make than paperbacks, yet they are sold at a price often twice that of the paperback version. Hard covers are always sold first to meet the demand from people willing to pay $35+ to get a new release ASAP. When this market is saturated, the publisher releases the paperback at $15-ish and this is sold in the market of people who are unwilling to pay $35, but willing to pay $15. The content of the book is the same, the publishers have simply found a way to sell the same thing at different prices to suit different markets.

Panel prices (and car prices and a range of other big ticket items) will soften as the market depresses, and manufacturers who cannot remain profitable will either leave the market or reduce the price of their products to meet the new price expectation. This price reduction can be bought about in two ways, (a) reduce the cost price by laying off staff, reducing R&D, screwing your suppliers a little more, removing features from your product, etc; or (b.) reduce the profit margin.

Also note that transport and raw material costs (esp steel and plastics) are now significantly cheaper as the price of oil has dropped by over 50% in the last 6 months (30% in AUD terms) and raw materials have followed suit. This is one example of a cost reduction that the manufacturers will need to pass onto to consumers post Xmas to prop up demand.

So yes I will eat my hat if there are 30% price rises on panels and electrical goods post xmas in this market. Interestingly if panel makers/distributers are forced leave the market this will reduce supply in the medium term and have a stabilising effect on panel prices meaning a crash in prices is unlikely, but an increase is definitely out of the question.

Edited by evil_josh
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I'm with you Larry.

What better way to increase sales of a luxury item in a period of financial uncertainty than a bit of consumer fear.

If prices do go up then even less units sold. Not good for anyone. If they do go up people will put of buying and see it for the cynical exercise that it is. J

Yes nobody is holding a gun to my head forcing me to buy a new panel. If I can't afford one I just won't buy it. Panel price rises will affect this affordability decision further so retailers have no hope of increasing profit by increasing prices in this climate.

The fact that the average joe can nego a 20%+ discount in the store shows me there is still a lot of fat in the market. I agree with others that the ability to negotiate a discount may become more difficult but we will not see price increases as such and will likely see further reductions to bolster demand.

Also remember that as importers go out of business their stock will be sold at a loss further depressing prices.

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Also remember that as importers go out of business their stock will be sold at a loss further depressing prices.

Sometimes I wish it were Pioneer :D Why they do not sell their clearance through their clearance center <_<

Sometimes you have to divide RRP by 2 or to get closer to market price. So 20% discount from "regular" price (read RRP) offered by saleperson is like a joke.

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one thing, when the AUD$ rose up to the 95c mark in 2007, we didn't see tv prices drop

however prices do drop on tv models as newer models come out....

so i don't think that big price rises are going to happen, i think that the electrical retailers are just trying to 'scare up ' more sales for xmas, and they will worry about next year later......

I think that consumer sales in australia will really drop next year, and that once the xmas/dec/jan/$1000 bonus sales are over that sales of higher priced consumer items will really slump in feb/march...... and that this will really hit retailers hard......

As gerry harvey said-a lot of smaller retailers in electrical and other areas will go under.....

I would not want to be a retailer of non-essential items in 2009.... look at what is happening to car sales right now....

this slump in sales will also be influenced by all the bad news that will continue to come out from the usa and overseas...

plus job juts in mining companies will hurt consumer confidence even in WA

I don't agree that prices haven't dropped since '07. I've seen TV's dropping quickly in price since May of '07. A 42" HD LCD tv was nearly $3000 and now you can get a Full HD from $1500 to $2000. Prices haven't gone up for quite a few years and does anyone here think retailers will be happy if they do go up anywhere between 10% to 30%??? Fear will hit the market and people won't buy. So what will happen is retailers will have to absorb some of the price rise to get some ground back but the discounts won't be as big so the prices people are getting now won't happen after January, February next year.

I hope I'm wrong about all this and prices either stagnate or go up just a smidge, but I doubt it.

And Evil_josh, the average discount wouldn't be 20% off ticketed prices, maybe off the RRP these idiot companies suggest to the retailers but if anyones ticketing a TV at RRP then they should get their head checked. The prices I've seen on some TV's like the TH-50PZ800A ticketed at $2599 instore is competitve so I doubt you'd get it down to $2079. Even an LA46A650 at $2899, 20% off is not possible. Not being a smart arse here just trying to be realisitic.

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I don't agree that prices haven't dropped since '07. I've seen TV's dropping quickly in price since May of '07. A 42" HD LCD tv was nearly $3000 and now you can get a Full HD from $1500 to $2000. Prices haven't gone up for quite a few years and does anyone here think retailers will be happy if they do go up anywhere between 10% to 30%??? Fear will hit the market and people won't buy. So what will happen is retailers will have to absorb some of the price rise to get some ground back but the discounts won't be as big so the prices people are getting now won't happen after January, February next year.

I hope I'm wrong about all this and prices either stagnate or go up just a smidge, but I doubt it.

And Evil_josh, the average discount wouldn't be 20% off ticketed prices, maybe off the RRP these idiot companies suggest to the retailers but if anyones ticketing a TV at RRP then they should get their head checked. The prices I've seen on some TV's like the TH-50PZ800A ticketed at $2599 instore is competitve so I doubt you'd get it down to $2079. Even an LA46A650 at $2899, 20% off is not possible. Not being a smart arse here just trying to be realisitic.

Retailers have already absorbed enough this winter when AUD$ was strong. I do not remember any significant price drop at that time (Olympic Games promotions is different story).

In my opinion fear of uncertainty (or possible price increase) will get many people buy now. Manufacturers/retailers are also scared about future market uncertainty and Xmas sales results so most price increases are "advertised" since Feb 09.

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Price rises have already hit. I went to buy a Side-by-side fridge (WSE7000SA) today, which I got a quote for $1775 2 weeks ago, a price close to cost due to special priveleges I have. When the junior manager of the store who gave me the quote looked it up today the unit price had gone up by $200 but he had to wear it as the quote was less than a month old. He had to sell at a loss. As I was finished paying for it I overheard him conversing with the senior about the loss they just made and he was told in rather severe tones that it is imperative that they move as much of the stock they have, and not do deals on things they have to order in, due to potentially unaccounted price rises like in my case.

So the price rises are real. However, the effect on whitegoods and applicances may be more marked than with rapidly superceded tech like plasmas/LCDs, where discounting of previous generations/models occur on a regular basis anyway. I think there will be relative price rises like-for-like ie. the latest and greatest models (Samsung Series 7, 8, 9, Sony Z/XBR) will come at a higher price than today, but superceded models like the Samsung 6 series will still drop in price in the new year, but not to the same degree as before. Will a 6 series Samsung LCD be cheaper in the new year? Yes, but not by much, and not with a bonus Blu-ray player. Will the 9 series screens cost more? Perhaps, but also not by a huge margin I suspect.

My view is that you should not be hanging out for massive price drop in the new year, and buy what you can afford at the time that is right for you, be it now, or later.

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another small example of price increases ......

1 TB Western Digital External HDDs were going for $199 in a JB brochure ending the 24 Nov. In the most recent brochure - the same item is now $239. Brochure ending 24 Dec

320 gig Passport - prev $149 - now $178.

Yes - they are only small examples - and probably items that fluctuate - or it would pay to shop around a little - but - there is evidence of prices rising.

(added - it PAYS to keep copies of old brochures for price comparisons as well - START COLLECTING !!!!)

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So the price rises are real. However, the effect on whitegoods and applicances may be more marked than with rapidly superceded tech like plasmas/LCDs, where discounting of previous generations/models occur on a regular basis anyway. I think there will be relative price rises like-for-like ie. the latest and greatest models (Samsung Series 7, 8, 9, Sony Z/XBR) will come at a higher price than today, but superceded models like the Samsung 6 series will still drop in price in the new year, but not to the same degree as before. Will a 6 series Samsung LCD be cheaper in the new year? Yes, but not by much, and not with a bonus Blu-ray player. Will the 9 series screens cost more? Perhaps, but also not by a huge margin I suspect.

My view is that you should not be hanging out for massive price drop in the new year, and buy what you can afford at the time that is right for you, be it now, or later.

Whitegoods are a slightly different market, some could argue they are more of a necessity than a luxury item therefore demand is more likely to hold up (although for a side-by-side with ice maker this could be a bit of a stretch but I hope you get my point!).

I priced new tires for my car in July, Goodyear Assurance, were $154 ea back then pretty much everywhere. I finally bought them last week. When I rang around all the usual retailers had them at $175 however I found K-mart auto had them at $158 and discounted them to $150 as I was buying 4.

I am not suggesting there is no upward pressure on costs, there most certainly is. However as big screen panels are a luxury item people will simply stop buying them if the prices are too high and this will depress prices. This is different to imported items which could be classed more as necessities like whitegoods, auto parts etc.

Lastly remember that the panel cost only represents a small % of the price. Many years ago (15+) I worked at DSE. Back then I was told that 30% of the ticked price was local costs (rent, staff, local shipping, warehousing, head office, etc). To use a simple example, if a retailer has a 20% profit margin, the price breakdown on a panel will be 50% panel cost, 30% overheads, 20% profit. Thus for a 30% increase in panel price the retailer only has to increase their price by 15% to hold their margin as their overheads remain unchanged. This is yet another reason why I strongly doubt the 30% figure.

Josh.

Edited by evil_josh
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I received a email from Sony stating that most of their goods would go up in the new year. I sent them a email back

saying that if prices go I won't be buying Sony.

The best tool we have as consumers is the power of choice and patience, sure a tv migh go up 30% but in 6 months time it will come down by that anyway. If the Aus is heading into a recession I bet raising prices will have a big impact on sales, ie none.

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another small example of price increases ......

1 TB Western Digital External HDDs were going for $199 in a JB brochure ending the 24 Nov. In the most recent brochure - the same item is now $239. Brochure ending 24 Dec

320 gig Passport - prev $149 - now $178.

Yes - they are only small examples - and probably items that fluctuate - or it would pay to shop around a little - but - there is evidence of prices rising.

(added - it PAYS to keep copies of old brochures for price comparisons as well - START COLLECTING !!!!)

Compueter hardware went up almost immediately as the dollar started to tmble. But to be honest i havent seen a huge jump. Prices rose early in the AU$ drop but did really keep rising. For example a 1 TB WD drive from MSY only went up about $10 to $175 odd and has stayed that way since. Intel CPU's jumped greatly but that was due to a shortage. Guess all we can do is wait until next year and if prices do rise then the nly ones to suffer wil lbe retail outlets as people just wont buy. As i've stated before, sales are only as they are now due to pre-christmas puurchasing and bonus deals going on. And probably partly due to the government stimulus package. Once thats all gone what will encourage people...nothing. Price hikes certainly wont help things either. But if they have to do they have to do it..I can wait.

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It's not a question of whether it's marketing hype or it's really going to happen, IMO it's both. Two points: first, the only reason for them publicising the price rise is to get people to rush out and panic buy. If the price was rising today they sure as hell wouldn't be sending out press releases and spam crowing about it.

Second, if they're really intent on raising the cost to retailers, then all they're doing is proposing to sell fewer units at a higher price, sliding back down the supply-demand curve. I'm sure they've done their research on this, but it's pretty easy to be wrong.

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