To get a feel for just how serious the retail pricing challenge will be for the larger maker movement, I made the trip out here to check in with some of the maker movement's biggest movers. And sure enough, Frawley's take on the challenges of making money as a "maker" hit a bullseye.
Before Web-intoxicated investors dismiss Frawley's and Bdeir's perspective as unique to toys, he warned that some of the smart-product industry's smartest people confirm that a deep and bitter battle looms between smart-product makers and the people who will sell them. "I think all startups need to work out their details online," said Haytham Elhaway, executive director of the Zahn Center for Entrepreneurship, one of New York City's rapidly expanding hardware incubators, located at City College of New York in upper Manhattan. Elhaway explained that Web or no Web, retail is still critical for getting the large orders needed to create a truly low-cost product. "If you want to scale you have to go through retail," he said. "And there are big challenges there" -- which, by the way, is exactly what Frawley has been saying all along. "If you can only make a product for a wholesale price that is the same as your retail price," he said. "Who do you expect to do business with you?"