How long the 'Free Updates' business model will last?

[Mac70]

The development of the DSP effects is not cheap, ,easy, or common, it requires highly trained engineers and a lot of work hours.
It is possible that next gen will have enough power that effects can/will be equal to high dollar studio rack effects, plugins or expensive pedals, why would they keep giving these effects for free during the entire lifetime of the guitar processor if they can sell them for much more individually (VST plugins, hardware, etc)?

At what point the 'free updates' business model for guitar modelers stops being profitable to the companies?
If it is directly tied to number of hardware sales, will it always compensate for the development time?

I imagine a very fragile balance between: DSP power, quality of effects/models, development time, engineering experience, hardware sales, business decisions, and maybe investors and parent company wealth.
This generation of modelers was just right for the 'free updates' business model and was/is very successful, but I am not so sure the next gen will be.

PS.
Not talking about any specific company, but Fractal and Line 6 are the example.

 

[fractal]

Works well for Apple.

 

[SUJ5]

Ongoing development of software upgrades is a lot cheaper/easier that continuous R&D on a new hardware device. You have a narrow view of why they are doing this. The Helix/AxeFxIII/whatever being sold today is in fact an upgraded device compared to the one they sold three years ago, even if the hardware is the same. People that weren't interested in the Helix of five years ago may be interested in the one of today. So they keep sales increasing over the life of the product without having to develop a new hardware device. They give the updated firmware away to current owners for free because to do other wise would just be rude.

 

[York Audio]

I think the “free updates” model for hardware units is pretty genius. It keeps their products exciting and engaging long after the initial purchase. It allows products to evolve while building brand loyalty.

 

[Jarick]

It makes sense if they keep releasing hardware units that build on the ongoing development. Line 6 and Fractal both do this, with L6 making more cheaper devices and with Fractal releasing new versions.

I think that's the way things are headed to be honest. I got a new Xbox last month, and there's very little difference from the old version except it's a lot quicker and some graphics are smoother. It runs all the same games as before and in some cases I can even resume games I was playing on the old one.

That's why I don't think Helix 2.0 will necessarily be a massive change, like the difference between Pod HD and Helix. I think it's more that you'll have way more DSP available to handle more complex effects like poly stuff and HX reverbs. Maybe there will be some new upscaled versions of the existing amps but then you break some level of compatibility with the legacy stuff.

 

[Mac70]

The Helix/AxeFxIII/whatever being sold today is in fact an upgraded device compared to the one they sold three years ago, even if the hardware is the same.

Good point.
Do you think potential customers review the newest state of firmware+hardware from the official website documentation, or watch youtube reviews from 2016 and get an outdated impression?

 

[SUJ5]

Good point.
Do you think potential customers review the newest state of firmware+hardware from the official website documentation, or watch youtube reviews from 2016 and get an outdated impression?

Yes

 

[JiveTurkey]

I think free is also something that is so embedded in the land of Farley airquotes it isn't even funny. A $2k device pricepoint is looming. And I don't consider that a pricepoint I am going to be down for, worth it or not

 

[Moe45673]

I think free is also something that is so embedded in the land of Farley airquotes it isn't even funny. A $2k device pricepoint is looming. And I don't consider that a pricepoint I am going to be down for, worth it or not

Zackly. These devices ain't cheap. Free updates are built into the initial purchase cost. The fact that Helixes today are almost as droolworthy as they were 6 years ago (when they were brand new), in a technology market where everything goes obsolete in a week, is savvy beyond compare.

Not to mention all those people who own multiple Helix devices. How many people own a big Helix (Floor or LT) and a Stomp?

 

[MWiggins]

With the Helix I waited a little while because there were a couple of things I was waiting for and even when I got it there were things that I wish it already had.

In some ways it feels like it is writing it's successor with all the updates. I don't expect the next piece of equipment with be as "empty" as the Helix was at release.

 

[Jarick]

I think free is also something that is so embedded in the land of Farley airquotes it isn't even funny. A $2k device pricepoint is looming. And I don't consider that a pricepoint I am going to be down for, worth it or not

To be fair, $1500 USD in 2016 roughly translates to $1825 today. And it's interesting that with chip shortages and rising supply costs, the price of a Helix has actually INCREASED from $1500 to $1600 (and I think it was briefly $1700).

Like it or not, those price points will keep rising if only to keep level with all other costs rising.

 

[JiveTurkey]

To be fair, $1500 USD in 2016 roughly translates to $1825 today. And it's interesting that with chip shortages and rising supply costs, the price of a Helix has actually INCREASED from $1500 to $1600 (and I think it was briefly $1700).

Like it or not, those price points will keep rising if only to keep level with all other costs rising.

Oh I get it. But it's still creeping up to where I can't really be down much more than where we currently are.

 

[glanum3]

I could see things moving to a UA type model with a base unit and the option to buy sets of plug ins (let’s call them Amps and effects). This would help fund further expansion/development. Please don’t let developers move to a protools (rent software) model!

 

[primemover12]

Contrary to the OP, I think the "free updates" model is the newer and better one. Back in the old days, software products generally shipped as "done" as they got and you rarely heard about them again until the companies were ready to sell their next major version. Then, as tech became an investment industry, companies were feeling pressed to release products on-time, ready-or-not. Free updates allowed them to sell the public a beta-level product and beat their competitors to market, and then fix the glitches later.

Companies like Fractal and Line6 have demonstrated that the free updates model can do more than just that--it can keep your products competitive and even tempting long after the market catches up with the original release. The Helix is OLD, but the trickle of major updates has kept it supplied with new sounds and in-demand functionality. The Fractal team updates the device so often that it's genuinely exciting to see what the device will be able to do next week. Since I purchased my Axe III, they've introduced a new amp modeling algorithm, power amp tube modeling (like literally, choosing between brands of power tubes), improved speaker compression and drive, impedance curves modeling the interaction between the head and a specific cabinet, and tons of new delays and reverbs. And that's on top of all the other free updates getting the modeling closer to the real world and improving functionality. It's honestly a much better device to use than it was two years ago.

 

[ejecta]

Oh I get it. But it's still creeping up to where I can't really be down much more than where we currently are.

Personally I feel the gear buying party no matter the cost will end soon for a lot of people like it did in 2008. Will some still fall for the “Six easy payments” of the Candy Factory? I’m sure but just wait until interests rates really start to climb. More people will be looking at it just like you are. You’re just smart enough have that in practice already.

 

[SUJ5]

I could see things moving to a UA type model with a base unit and the option to buy sets of plug ins (let’s call them Amps and effects). This would help fund further expansion/development. Please don’t let developers move to a protools (rent software) model!

No

 

[JiveTurkey]

Personally I feel the gear buying party no matter the cost will end soon for a lot of people like it did in 2008. Will some still fall for the “Six easy payments” of the Candy Factory? I’m sure but just wait until interests rates really start to climb. More people will be looking at it just like you are. You’re just smart enough have that in practice already.

 

[Jarick]

I could see things moving to a UA type model with a base unit and the option to buy sets of plug ins (let’s call them Amps and effects). This would help fund further expansion/development. Please don’t let developers move to a protools (rent software) model!

Unfortunately, UA seems to have the opposite hardware model...charge a bunch of money for a single amp or effect with no ability to expand.

 

[the swede]

The thing is genius and helps the owner to feel satisfied with the investment. And also, there is a trust thing. It’s a warm and fuzzy feeling, a sense of being part of a caring family. That you belong. That someone cares. You start to call your dad Frank and you shout the name DI when you want to know what’s for supper…

Ok… I got carried away.

Seriously, it’s genius and in the case of Helix brand I suspect they’ll do some updates and stuff even when the next “whatever” line/flagship comes along.

 

[Jarick]

Personally I feel the gear buying party no matter the cost will end soon for a lot of people like it did in 2008. Will some still fall for the “Six easy payments” of the Candy Factory? I’m sure but just wait until interests rates really start to climb. More people will be looking at it just like you are. You’re just smart enough have that in practice already.

Agreed...as cost of living goes up way more than incomes, that spending will have to hit the wall. Heck my mortgage just went up $150/month because my taxes went way up, on top of the 5-10% increases everywhere else, and I think I got a 2.5% raise as usual...