News:

  • February 05, 2023, 06:36:19 PM

Login with username, password and session length

Author Topic: How Host got started.  (Read 496 times)

Garyhlucas

  • Hero Member
  • *****
  • Posts: 384
How Host got started.
« on: January 20, 2022, 09:03:59 AM »
In looking at the Host website I read the How It Got Started Post.  I suspect you may have had an interesting conversation back then with Tim Holman then CEO of PLCDIRECT because of me.   I wanted to buy a $199 PLC and there was no way to do that if I had to buy a $1200 programming package.  So I argued with him that PLCs were like razor blades and to sell razor blades you need to give away the handle, or software in this case.  A week later they came back with an offer of $149 for just the DL205 and $499 for all the PLCs and I bought a DL205 to replace a TI315 brick.

So at that point in time I may have inadvertently cost you a whole lot of revenue!   Seeing that DoMore Designer  is free today I'm guessing it all worked out.  AD is a multi-billion company and I'm...still working for someone else, story of my life.

Gary H. Lucas.

BobO

  • Host Moderator
  • Hero Member
  • *****
  • Posts: 5793
  • Yes Pinky, Do-more will control the world!
Re: How Host got started.
« Reply #1 on: January 20, 2022, 01:04:22 PM »
In looking at the Host website I read the How It Got Started Post.  I suspect you may have had an interesting conversation back then with Tim Holman then CEO of PLCDIRECT because of me.   I wanted to buy a $199 PLC and there was no way to do that if I had to buy a $1200 programming package.  So I argued with him that PLCs were like razor blades and to sell razor blades you need to give away the handle, or software in this case.  A week later they came back with an offer of $149 for just the DL205 and $499 for all the PLCs and I bought a DL205 to replace a TI315 brick.

So at that point in time I may have inadvertently cost you a whole lot of revenue!   Seeing that DoMore Designer  is free today I'm guessing it all worked out.  AD is a multi-billion company and I'm...still working for someone else, story of my life.

Gary H. Lucas.

Nah, not your fault. DSP was never more than $500, and the lower price individual packages was in the works long before then.

When we started, Host was just a software arm of PLCDirect, so that's how we made our money. When we broke into hardware several years later, that started shifting, and when we finally developed Do-more, we decided that we never wanted software to be the deciding factor or a revenue dependency.

PLC sales breaks out in roughly 3rds...1/3 end users, 1/3 OEMs, and 1/3 VARs. End users buy a copy or two, and then upgrades, so you only make money as the market expands...derivative, not proportional. OEMs might sell a copy per system or not, but even when they do, they bought discounted volume packs...so they were split between derivative and proportional. VARs were generally all proportional, a couple or two per customer. The point being, programming software was split between proportional and derivative growth, and as the market matured, your growth tended to slow down.

Hardware however, is all proportional. We felt our best path to future growth was there. While the software remains a major development expense, I'd rather make our money from hardware. It also eliminates the pain of IP protection and licensing, which is a nuisance to everyone...ADC, Host, and users.
"It has recently come to our attention that users spend 95% of their time using 5% of the available features. That might be relevant." -BobO

Controls Guy

  • Internal Dev
  • Hero Member
  • ****
  • Posts: 3478
  • Darth Ladder
Re: How Host got started.
« Reply #2 on: January 20, 2022, 01:37:44 PM »
Autodesk (and Microsnot) is trying to become integral, which is why I'm using BricsCad now, which really rocks btw!

**Oh yeah, and Rockwell ('and a hard place') Automation.
« Last Edit: January 20, 2022, 01:47:53 PM by Controls Guy »
I retract my earlier statement that half of all politicians are crooks.  Half of all politicians are NOT crooks.  There.

Garyhlucas

  • Hero Member
  • *****
  • Posts: 384
Re: How Host got started.
« Reply #3 on: January 20, 2022, 03:58:09 PM »
Bob,
I once had a product myself, a watering spraying robot for commercial greenhouses.  Computer was programmed in assembler and burned into an Eprom.  We chose to make money on the hardware.  Customers reported a problem and we had a fix in the program.  Then they'd get a new EPROM and not only did they get the problem fixed they got more capability than they originally purchased.  They loved that and we only supported one version, the latest.