Why does the XH A1's price keep dropping?

[Leila Alkadi]

I bought my XH A1 for $3949. That was the same week
it was released to US dealers. (bought mine from forum
sponsor)

Now the price has gone down to $3450 at most places,
including most forum sponsor dealers. On top of that,
there's a $250 rebate from Canon USA, which brings
the price to almost $3200. The rebate ends in June.

At this rate, is there a chance that the XH A1 will go below
$2999 by this summer?

By comparison, the XH A1's most obvious direct competition,
the Sony V1U, is still selling for around $4000.

What's going on here? Is Canon USA having a hard time
getting the XH A1s out the door?

How will this affect the resale/trade-in value of my XH A1
a couple years down the road?

Thanks!


P.S. I'm glad I bought mine from a forum sponsor. They
did a return/re-purchase, so I can now get the $250 rebate!
Thanks! :)

[Don Palomaki]

The street prices for almost all high tech stuff drops over time. As a point of reference, the street price of the GL series and the XL series dropped for the first 6-9 months then stabalized. I suspect the same will happen with the XH series, but the exact time to do so and percent drop may be different depending on what the competition does. (The GL2 street price has hovered around $2k for a couple years now, with the $250 rebate in effect for much of that time.)

Early adopters usually end up paying more for the fun of being the first on the block with the new tool/toy.

[Steven Fokkinga]

At least here in europe they have no problem getting it out of the door. It's sold out constantly over here! Luckily I finally found a dealer and it's sitting happily next to me now (the camera, not the dealer) =)

[Jerome Marot]

Originally Posted by Leila Alkadi

I bought my XH A1 for $3949. That was the same week
it was released to US dealers. (bought mine from forum
sponsor)

Now the price has gone down to $3450 at most places,
including most forum sponsor dealers. On top of that,
there's a $250 rebate from Canon USA, which brings
the price to almost $3200. The rebate ends in June.

At this rate, is there a chance that the XH A1 will go below
$2999 by this summer?

By comparison, the XH A1's most obvious direct competition,
the Sony V1U, is still selling for around $4000.

In Europe, the price of the A1 has stabilized around €3500 (including tax), from €3300 before Christmas. On the other hand, the FX7 has dropped to about €2700. The V1U, being a pro-only camcorder, is not available through internet discounters and the price did not drop apparently.

As to the rebate ending up in June, I don't know. Rebates are often extended. As far as Canon's marketing is concerned, knowing the name and address of a customer willing to invest $3500 in a camcorder is certainly worth something. Those customers often buy other gear, don't they? ;)

[Todd Mattson]

Originally Posted by Leila Alkadi

What's going on here? Is Canon USA having a hard time
getting the XH A1s out the door?

How will this affect the resale/trade-in value of my XH A1
a couple years down the road?

Hardly, it seems they're having trouble keeping these things in stock, which may be why the price is dropping so much. As for your resale prospects, you're going to take a harder hit than folks like me who are only now, after the months and months of glowing reviews, are finally going to jump in. That said, the A1 is gaining a place in the prosumer DV/HDV hall of fame, like the DVX100, and will continue to be in demand, not only by producers gun shy and leary of possible HVX card issues (cost, malfunction, what have you), or wanting an inexpensive dual backup (HDV & Firestore), but by new entries into filmmaking as well. As an early adopter of the DVX100, I'd say I took a hit around 40% - I'd expect the same for your XHA1 a few years down the road. There always is renting if you're worried about taking hits on your investments....

[Chris Hurd]

A camcorder purchase is not an investment, because camcorders seldom appreciate in value. Ideally, a camcorder is a business tool, to be used in order to earn money covering not only its purchase price but additional income as well (and no, this not the same thing as an investment). If the camcorder has paid for itself, then any amount of money it brings when it is sold is pure profit. Even if its resale value is only 25% of its initial purchase price, as long as it has paid for itself in previous use, then that resale value is a gain, not a loss... no matter how little it is.

[Todd Mattson]

Originally Posted by Chris Hurd

A camcorder purchase is not an investment, because camcorders seldom appreciate in value. Ideally, a camcorder is a business tool, to be used in order to earn money covering not only its purchase price but additional income as well (and no, this not the same thing as an investment). If the camcorder has paid for itself, then any amount of money it brings when it is sold is pure profit. Even if its resale value is only 25% of its initial purchase price, as long as it has paid for itself in previous use, then that resale value is a gain, not a loss... no matter how little it is.

Good freaking point.

[Peter J Alessandria]

Never heard anyone complain about dropping prices. By all accounts, the A1 (and I assume G1) are stellar performers, so it isn't like Canon is dumping weak product on the market. Perhaps it's a reaction to healthy competition in the camcorder market - which is unlike the higher end DSLR market where Canon doesn't have significant competition and thus continues to charge outrageous prices for it products. (In the past couple of years Canon has seen some real competitors in the lower end DSLR market and prices have dropped accordingly.) So $2999 by summer for the A1? I say, "yeah baby"! (Of course, I don't have one to resell yet, so I might be singing a different 'toon if I did ;-) )

[Don Palomaki]

...A camcorder purchase is not an investment

Well, I would say that any purchase made with the intended to produce income is an investment. A camcorder just is not an investment intended to appreciate in value on its own as people expect stocks, rare coins and stamps, precious metals, or real estate to appreciate. The camcorder produces income through its use to provide a service, or perhaps as inventory for resale in the case of the site sponsors.

As a business purchase, how do you account for it? If you expense it (take it as as a full, immedaite business expense tax deduction) then when you sell it, the sale price becomes income. If you capitalize it and then depreciate it over time, any sale price return over remaining (not depreciatd) book value is probably treated as income.

Was it a "good" investment? - did you make money with it? Did you make more money than if you had bought a lesser model?

Should you have waited a few months to buy it? - Did you make more money as a result of buying it than you would have it if you waited? (That is a tough one for most folks to answer.)

If you buy it as a hobby item, well then you pays your money and has your fun, and forget about this boring investment talk...

[Win Edson]

Hi Leila,

You mentioned that you were able to get the $250 rebate by doing a return/repurchase from B&H. Did you have to send your camcorder back? Or did they just do a 'refund-repurchase' over the phone? I bought my camcorder about 9 days before the rebate was available and I've just got off the phone with them and they said the only way to receive the rebate is to send the camcorder back for a refund, then buy a new one, which I don't have time for unfortunately.

[Bill Pryor]

It seems very common to me that all camcorders seem to drop in price from their manufacturer's list after a few months, especially if they're popular models. I fully expect the XH A1 to drop by 500 bucks within a few months, and it did. I couldn't wait to buy, however, and paid the original list--such is the price for being on the bleeding edge of technology.

[Chris Hull]

Originally Posted by Jerome Marot

In Europe, the price of the A1 has stabilized around €3500 (including tax), from €3300 before Christmas. On the other hand, the FX7 has dropped to about €2700. The V1U, being a pro-only camcorder, is not available through internet discounters and the price did not drop apparently.

As to the rebate ending up in June, I don't know. Rebates are often extended. As far as Canon's marketing is concerned, knowing the name and address of a customer willing to invest $3500 in a camcorder is certainly worth something. Those customers often buy other gear, don't they? ;)

i think you meen 1700 sterling.not all users by cam as business tools as some say though.