HD Radio under $200, so…?

Yesterday HD Radio broke the $200 price barrier, and much to-do was made about it in the radio trades.

Billboard Radio Monitor even noted that “User reviews on the company’s Web site are quite positive,” and by “user reviews” Billboard evidently means all nine of them.

I have argued before that price has no bearing whatsoever on the success or failure of HD radio and we would all be better off if we didn’t look to price for salvation from the land of the technological also-ran.

Need I remind you that iPod shuffles are priced below $70, and you hardly see any. Instead, consumers favor the pricier Nano and Video models, ranging in price from $150 to $400. And you can bet that the next generation of iPods will do three things:

1. Eliminate the Shuffle altogether 2. Push the Nano and Video models down in price 3. Replace the high end – not the low end – with a new product that, despite its price, sells like hotcakes

Low price is a mirage, an excuse for products without a compelling value proposition. When consumers say they’ll buy something only when it’s cheaper, what they’re really saying is you haven’t convinced them that your product has the value it deserves to have.

Don’t seek refuge in that bottomless swamp.

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