It also explains why only (for the most part) Jalapenos are the only ones shipping. They are the least profitable in their lineup as difficulty increases.
That is a good point. They show that they have equipment that works, but not letting huge amounts of hashing power yet. 
Topic: Inside the ASIC companies? (Read 1782 times)
It also explains why only (for the most part) Jalapenos are the only ones shipping. They are the least profitable in their lineup as difficulty increases.
...this could explain both BFLs ability to produce AND ship actual units, but without any significant volume. We also know that Josh may think similar to the above, even trying to pass it off as a 'burn-in' test to make sure the devices work.
Exactly! I find that pattern of behavior extremely suspect. Burn-in testing? Like hell!
If I were an ASIC manufacturer/distributor holding miners today, I would just mine and mine until the exact point in time where the miners are profitable for the consumers (barely) given the price and difficulty. Then I would ship.
Remind me to never do business with you.However this could explain both BFLs ability to produce AND ship actual units, but without any significant volume. We also know that Josh may think similar to the above, even trying to pass it off as a 'burn-in' test to make sure the devices work.
ASIC companies don't mind having to ship product without mining with it first. Why? The sooner they ship the sooner difficulty goes up, and the sooner their first ASIC customers return seeking more ASICs to keep profitability up. Selling gear is guaranteed instant profit. Even better when customers prepay and you have money in the bank before shipping. Using the units to mine always carries risk as bitcoin could crater and be worth $1 tomorrow with the company left with a lot of useless gear no one would want.
It seems to me like the economics of the situation would drive demand for new ASIC *down* as difficulty goes up, unless there is an offsetting change in the relevant exchange rates. If I were Avalon, I would want difficulty to remain as low as possible for as long as possible to keep demand for the pre-orders up. If a 100 Gh/s miner gets only 0.5 BTC per month or less, what sane person would pay 20BTC+ for one?
If I were an ASIC manufacturer/distributor holding miners today, I would just mine and mine until the exact point in time where the miners are profitable for the consumers (barely) given the price and difficulty. Then I would ship.
Any way we can really know if the ASIC miners are mining already, or do we just take their word that they'll ship as soon as they physically exist? From the company's perspective shipping without mining a bunch of BTC first is like throwing money away.
ASIC companies don't mind having to ship product without mining with it first. Why? The sooner they ship the sooner difficulty goes up, and the sooner their first ASIC customers return seeking more ASICs to keep profitability up. Selling gear is guaranteed instant profit. Even better when customers prepay and you have money in the bank before shipping. Using the units to mine always carries risk as bitcoin could crater and be worth $1 tomorrow with the company left with a lot of useless gear no one would want.
I may be naive, but aren't we paying for the new ASIC hardware in BTC? How much do you think the ASIC companies are converting to fiat?
Any way we can really know if the ASIC miners are mining already, or do we just take their word that they'll ship as soon as they physically exist? From the company's perspective shipping without mining a bunch of BTC first is like throwing money away.
ASIC companies don't mind having to ship product without mining with it first. Why? The sooner they ship the sooner difficulty goes up, and the sooner their first ASIC customers return seeking more ASICs to keep profitability up. Selling gear is guaranteed instant profit. Even better when customers prepay and you have money in the bank before shipping. Using the units to mine always carries risk as bitcoin could crater and be worth $1 tomorrow with the company left with a lot of useless gear no one would want.
Alex Jones' website is over there
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I have a theory that over the next few months the difficulty might not increase as much as expected as ASIC units ship to consumers. Basically I think these machines are already online. So when they ship from KnC, BFL, BitFury, Avalon, they aren't really going online for the first time.
Any way we can really know if the ASIC miners are mining already, or do we just take their word that they'll ship as soon as they physically exist? From the company's perspective shipping without mining a bunch of BTC first is like throwing money away.
Any way we can really know if the ASIC miners are mining already, or do we just take their word that they'll ship as soon as they physically exist? From the company's perspective shipping without mining a bunch of BTC first is like throwing money away.
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