Raspberry Pi: We’ve started manufacture

http://www.raspberrypi.org/archives/509

by pauldino • 15 years ago

329 104 15 years ago

rch• 15 years ago

It is interesting that they at least explored the idea of building in the UK, and that tax policies factored in so negatively. Does the US have similarly structured import taxes?

Permit• 15 years ago

I was curious about the taxes as well. Does anyone know what the argument for having a tax system set up this way would be? I imagine there must be some reason, but I'm not sure what it would be.

yardie• 15 years ago

Actually, and maybe I'm missing something, they are quite wrong. Yes you pay a VAT on components, but as a business you reclaim it and pass it down the line.

Import components -> (pay VAT) build item (reclaim VAT) -> (pay VAT) wholeseller (reclaim VAT) -> (pay VAT) retailer (reclaim VAT) -> (pay VAT) buyer.

As long as you are engaging in commerce you never pay VAT on the items you for your business. Also, there are electronic schemes to speed up the reclamation process. If you have a business ¿TaxID? number some resellers will drop the VAT for you knowing they'll reclaim it anyway.

objclxt3• 15 years ago

I will have a go answering this - tax and import laws in the UK, like the US, are extremely complicated and often bizarre.

It's therefore almost certain nobody except Raspberry Pi's accountant / legal advisors would be able to give the definitive reason, but I am pretty sure it is to do with how components vs full computers are classified for duty purposes.

There are specific import laws designed to aid manufacturing industries, and it could be that these laws need to be extended to component assembly. For example, the UK does very well in car and aerospace manufacturer, and there are import laws regarding components designed to aid this.

pash• 15 years ago

In the United States, there are no import duties on computers or on computer components.[1] But there are no duties on assembled computers or on computer components entering the United Kingdom either, so far as I can tell.

Assembled computers are listed under heading 8471 of the Harmonized Tariff Schedule, which is used by all trading nations. (They are referred to as "automatic data-processing machines"; the terminology and categories are all quite archaic.) The UK imposes no import duty on computers of any type.[2]

Parts and accessories "suitable for use solely or principally with" computers are listed under heading 8473.30 and likewise can enter the UK duty-free.[3] It's possible that some required components are listed elsewhere in the HTS and that those are not duty-free. But that seems unlikely; almost everything in Chapters 84 & 85, which cover all electronics, can enter the UK free of duties.

I'm not familiar enough with the UK tariff regime to know whether there are other considerations beyond the base duty rate. (But it doesn't look like it; the relevant Acts of Parliament setting duties for each class of good are noted on the BusinessLink site linked below.) So I have no idea what import tariffs Raspberry Pi need (or think they need) to pay. It certainly doesn't look like the UK has some screwy import regime that penalizes firms wanting to assemble computers there.

1. So long as the goods' country of origin has "most favored nation" status. This means, essentially, that it has normal trade relations with the United States. That includes all members of the World Trade Organization.

2. http://tariff.businesslink.gov.uk/tariff-bl/export/heading.h...

3. http://tariff.businesslink.gov.uk/tariff-bl/export/heading.h...

njharman2• 15 years ago

I don't know about import taxes. But, US does not have a VAT like UK. It has a sales tax which is only paid by the end user. Usually the consumer. Materials like cotton (and I guess electronic parts) used in manufacture aren't taxed (at least not with a sales/VAT).

IgorPartola2• 15 years ago

No? I was under the impression that if I wanted to buy a bunch of cotton or silicone or diodes that I'd have to pay taxes on that. Then once I manufacture my awesome device using only those materials, plus a Swiss army knife and a rubber band, I could sell it to you and you'd get to pay another round of sales tax. On the backend of this transaction of course is the machinery used to harvest/manufacture the raw materials, for which the farmer/manufacturer also paid a sales tax on. Unless there is some kind of subsidy at play here.

willyt2• 15 years ago

I don't understand why Raspberry Pi doesn't have to pay VAT on the assembled imported items? Is it because they are a charity?

EDIT: added 'assembled'. Does anyone have a link to the IR rules about this?

roel_v• 15 years ago

It doesn't say VAT, it's import duties.

willyt2• 15 years ago

All right then, why is there no import duty (which is charged at the same rate as VAT) on a Raspberry PI when there is on a stick of RAM? Genuine question: I'm curious to know how the rules define one item as separate from the other.

Edit: OK sorry my comment was a load of crap, I was confused. They charge both VAT @%20 and duty @~3% but duty is only charged on a massive and seemingly random list of things.

objclxt3• 15 years ago

Assuming its import duty we're talking about here, you won't be able to find this information online. It's crazy, but the actual tariffs for import duty (basically a huge list of goods and the import taxes required for them) are only available from the revenue if you subscribe to them, which varies between £300-2000 depending on what format you want.

Which is a bit of a joke, because really these tariffs should be accessible online for all!

petercooper• 15 years ago

Even if they did, they could claim it back, assuming they were VAT registered and charging their customers VAT.

dman3• 15 years ago

The pricepoint is simply revoultionary. I intend to make a few amateur home automation gadgets with this.

Florin_Andrei• 15 years ago

It's a perfect complement to platforms like Arduino.

stephengillie• 15 years ago

The 'Pi itself is exciting, but more exciting will be seeing what everyone makes with them. I hope to read your posts about what you've built!

Looking at the comments to their FAQ - http://www.raspberrypi.org/faqs#comment-3239 - reselling devices based on the Raspberry Pi is OK.

dman3• 15 years ago

The first thing I am targetting is semi lame, but useful for me - a batman style lamp. Its for my parents and me to birectionally coordinate on when to come on skype. Right now I first have to call them and then ask them to come online and same the other way around. This way either party can speculatively just push the button and if the other one acknowledges the computers can be switched on.

nitrogen2• 15 years ago

If volume commercial purchasing is possible at prices slightly above what they charge schools and students, we could see a revolution in low-volume consumer electronics. If 3D printing or other low-volume enclosure manufacturing is cheap enough, that is.

MartinCron• 15 years ago

I love the idea of being able to 3D print a custom enclosure for a cheap, tiny, capable computer. I can do anything

wiradikusuma• 15 years ago

Oh man, we would see democratization of manufacturing! How durable the stuff printed from such printer? How long would it last (doesn't deteriorate/vanish/melt)?

ChuckMcM3• 15 years ago

Actually I was thinking 'unsustainable' rather than revolutionary.

Having lived in/through/with the birth/blossoming/commercialization of both the microcomputer and the non-factory robotics businesses, I find the breathless ecstasy of 'getting into production' a wonderful thing, but its a lot like falling in love, there are a lot of things that happen next that you're going to have to live through.

Given that they are taking nearly zero margin on these devices (at least according to this post), they have many pot holes to look out for:

1) Their Chinese factory turns out to be some guy's brother-in-law who got them a cheap price because he's using counterfeit parts. Or worse the guy that bid for the job expects to build the factory to build them with the money your going to pay him up front.

2) Their board vendor tech sneezed and accidentally added a direct short to the films they are using to make the boards.

3) The part they ordered for the USB connector is discontinued by the vendor who gave them a price of $0.25 and its now only available from some other vendor for $2.25 each.

4) The pick and place robot put a set of boards on 90 degrees out of kilter, so the entire batch has all the parts soldered into the wrong places.

5) The customs guys open them up, and not seeing the requisite safety symbol/OfCom/FCC/ISO/CET whatever certificate denies them entry into the country

The list goes on and on. One of the challenges of manufacturing is knowing not only what the parts cost but what costs the system is going to impose on you. You need to build in a margin that covers both otherwise you'll underestimate what it will cost you to build a product.

So new manufacturing experience aside (and its going to be a great learning experience if they can keep reminding themselves that it is a learning experience), it sounds like they have a really great way of bringing home to the politicians how their policies affect jobs locally. It almost seems like a reasonably responsive government should sponsor some group to manufacture a new product domestically and then carefully track the barriers to doing so and eliminate those that are amenable to a political fix. Tariffs on imported semi-conductors (protecting the local fabs?) and electronic components when such components cannot be locally sourced seems like a good starting point.

I certainly hope they will be able bring that message clearly to Parliament. It would be refreshing to have really hard to object to facts in the debates going on.

elchippo• 15 years ago

From all i read, it seems that it is the first time that these guys are producing a board on industrial scale. Good luck

nextparadigms• 15 years ago

It will probably end up being $50 at retail, but that's still pretty good.

EwanToo• 15 years ago

While all your comments are valid, the people behind Raspberry Pi are not entirely new to this.

You can see the trustees here:

http://www.charity-commission.gov.uk/Showcharity/RegisterOfC...

David Braben has been in the computer games field since the 1980s and has made a fair amount of money from it, Eben Upton works for Broadcom (the chip supplier for the Pi), and the rest are all pretty well known in their fields too.

So overall, I think they should by now know what they're doing, and with Braben on board should have some money to make it happen.

kokey• 15 years ago

Indeed, I think they really did set themselves in by setting a price point. We have seen so many projects, like the OLPC $100, I mean $200 computer, the OpenPandora and a number of others go down this same route and learning the hard way.

Fortunately there's a massive amount of buzz around this project, so even if the initial batches are unreliable and the units get to market at double the initial intended price, people are willing to put up with it. Perhaps the initial buzz is not a bad strategy, since it has a similar effect to Microsoft's strategy in the 90s. Many people hold off on buying other things waiting for this product, and even if it's not delivering as promised they are now psychologically invested in it.

As you say, it's also a good way for many people to learn about the barriers UK manufacturers have to face. I hope this will help bring about some change.

tankenmate• 15 years ago

Have you guys really been reading about the raspberry pi? The founder is an SoC architect at Broadcom, I'm sure they'll find a reputable and cost effective manufacturing partner with their industry contacts.

blhack• 15 years ago

The people behind raspi seem really, genuinely good. If this is all marketing, it doesn't feel like it.

They're going to do what manufacturing they can in the UK, even though it would net them a lot more money to do it overseas. Awesome.

brador• 15 years ago

I love the speed they're working at and their no excuses, no BS approach. It's surprisingly refreshing.

Are they funded?

lftl• 15 years ago

I have no clue as to their financial status, but Liz (one of the team members) said this in the comments:

Indeed – and I’m pretty sure that those psychic people would be a bit more cautious if it was their mortgage that this thing was secured on

ahel• 15 years ago

Yes they are. That's why they won't allow pre-ordering. I think it's said in the FAQ or in one of the earliest posts.

corin_3• 15 years ago

Do keep in mind that they're a registered charity, a not-for-profit.

The reason I mention this is that "even though it would net them a lot more money" means that by doing it in the UK it isn't hurting shareholders, but the charity's goals - as mentioned in the blog itself.

I don't know whether it would be better to have £x more profit for the charity or to make y more boards in the UK, but either way you have to assume they're doing what they think is best as a charity.

wavephorm• 15 years ago

Personally I could care less about whether they were a charity, or for profit. At this price level, they are an order of magnitude cheaper than competing SoC solutions, and there is an ocean of opportunity for uses of systems like this where it wouldn't have even been close to economically feasible before.

I would actually prefer this company to be FOR-PROFIT, so they have an economic incentive to continue increasing the performance per dollar. I am afraid this will be a one-off product that eventually dies off because there's no incentive to innovate further.

jobeirne• 15 years ago

Why is attempting to limit international commerce "really, genuinely good"? Are you aware of comparative advantage (http://en.wikipedia.org/wiki/Comparative_advantage)?

sliverstorm3• 15 years ago

Well, among other things you burn less energy to get the goods to your doorstep.

ck2• 15 years ago

if we build the Raspberry Pi in Britain, we have to pay a lot more tax. If a British company imports components, it has to pay tax on those (and most components are not made in the UK). If, however, a completed device is made abroad and imported into the UK – with all of those components soldered onto it – it does not attract any import duty at all

Wow this sounds worse than job exporting in the USA

marchdown• 15 years ago

I wonder if these restrictions could be circumvented somehow by transporting components in a form which is technically a functioning assembly.

vyrotek• 15 years ago

You may be on to something.

What's inside the box? That's not a box, its a large paper weight. The random stuff inside is just to add weight.

gravitronic• 15 years ago

Not in any means that would remain profitable as it would require post-processing from the component manufacturer and then modification before they could feed the components back into the pick and place robots.

kevinpet• 15 years ago

Not exactly what you were getting at, but Ford does something similar with the Transit Connect. It's imported as a passenger wagon with back seats and windows, which are removed in the US.

revorad• 15 years ago

I'm not sure that's entirely correct. I thought there was some duty even on complete devices imported into the UK from outside the EU.

rmoriz2• 15 years ago

depends on the goods.

e.g. most IT related products are free of duties due to strategic reasons. others have a penalty when imported from countries that do allow/finance price dumping.

If you, as a private person, import goods (shipping) into the EU and it's value is beyond 150€, then you don't have to pay any duties except import-VAT (which is usually the same as the VAT of your country, like 19% in Germany). If you take the goods with you, e.g. back from holiday shopping spree, the minimum is even higher.

drtse4• 15 years ago

The first batch will be of 10k boards. Will be sold out in a few hours...

jamesRaybould• 15 years ago

It appears that you spelt minutes wrong. Just take a look at the massive fire sale that revolved around the HP Touchpad and I think thats the kind of interest this will receive.

corin_3• 15 years ago

I don't think they'll receive nearly as much general interest as the touchpad, one is a device that consumers can see as "like an iPad, but amazingly cheap", the other as "a programmable system for geeks".

Certainly I know friends who bought the fire sale touchpads, and many more who would have if they had the chance, none of which will be buying the raspberry pi - except the really techy ones.

Also, to do with the press it will get. Articles of "huge fire sale, get one while you can!" will be replaced with "this could change education" and "look what you could create with these" pieces.

Don't get me wrong, they will be hugely popular, and 10,000 is far less than the number of touchpads there were. It will also depend, obviously, on the per-customer limits they put in place.

I certainly expect them to sell out fast (will it be minutes, hours or days, I have no idea), but to compare the level of interest to the touchpad fire sale is huge exaggeration.

patrickod• 15 years ago

I don't see the first 10 thousand boards lasting very long on their shelves. I can't wait to get my hands on one.

yanksrock777• 15 years ago

I am waiting for the day I can buy one of these. Ok maybe I'll be like five. These will be so much fun to mess and hack around with. I can't believe that this is the price of an Arduino!

RexRollman• 15 years ago

I will order one once OpenBSD is running on it, which I am willing to bet won't be too long.

justincormack3• 15 years ago

Buy one and make it run on it then.

Karunamon• 15 years ago

Not exactly a reasonable proposition for most mortals.

jnbiche• 15 years ago

Actually, Rasberry Pi runs on an ARM microprocessor and OpenBSD is a whole lot more ARM-friendly than most Linux flavors are. It should not be hard at all to get it running yourself.

Nate75Sanders• 15 years ago

Hopefully some nice cases will come out. I'd like to see one with an integrated USB hub.

Additionally, as it takes USB power for the computer itself, having a monitor with USB ports would enable you to power the entire computer with only a short USB cable. You could then mount the small case to the back of the monitor, perhaps to make everything neat.

lateral113• 15 years ago

Not buying one until it's made in UK.

sliverstorm3• 15 years ago

Best way to get it made in the UK would seem to be to buy one and support the movement so that they can continue pressuring the government to allow them to make them in the UK.

I mean really, who are you protesting against? The government, right? What does the government care if you don't buy a $25 gadget?

lateral113• 15 years ago

I would pay more than 25 GBP were it made in the UK. And this isn't a movement -- it's not "occupy".

perokreco2• 15 years ago

Why not? Are UK residents more deserving of a job than Chinese?

lateral113• 15 years ago

if you have an ounce of patriotism as the inventor, yes.

mjwalshe• 15 years ago

Hmm - I will be contacting a few MP's about this nonsensical tax situation.

noonespecial2• 15 years ago

I think they're dead wrong about the demand of the model B, vs the model A. I think most people are going to want to buy a model A for $10 less and stick a sub-$10 usb wifi onto it than run a wire.

Most of the projects I think of and don't build are scrapped for want of $50 worth of ridiculous "zigbee" wireless hardware that can barely push 250kbits across the room. The internet of things is made of wifi.

genbattle• 15 years ago

But what about the extra 128MB of ram, and the extra USB port?

Also, You'd be hard pressed to get a USB Wifi Stick for less than the cost of the whole Raspberry Pi board in my country. Plus as you add more devices Wifi can get very saturated. Installation and configuration of USB Wifi adapters under Linux is a bit of a challenge. Ethernet on the other hand is practically plug and play.

There are also plenty of ideas which can use wired networking. Ideas from home automation to set-top boxes to microservers are all going to benefit from a more stable and high-bandwidth wired connection.

For general tinkering I would rather pay the extra $10 or whatever and get more options in terms of the hardware.

someperson• 15 years ago

See eBay, even with shipping sub-$10NZ is easily possible. "nano" dongles especially.

Andys• 15 years ago

An alternative might be the TP-link TL-WR703N: a wireless router available on ebay for about $30 delivered.

It has a MIPS CPU, has built in 802.11b/g/n, 1 ethernet port, a USB port, and runs at low power off a USB jack (5V). It can be flashed with Linux but you have to navigate chinese menus to do so (not hard).

njharman2• 15 years ago

For something that has to be tethered to monitor, power, keyboard, adding ethernet cable is no problem. I much prefer wired connections over wifi for non-mobile devices.

jeffreymcmanus• 15 years ago

I think that the number of people for whom the extra $10 is an issue will be small, particularly early on.

suhastech• 15 years ago

Well, outsourcing to China is probably "charity".

Think about it. If people are working there accept such low wages, they probably don't have other options. The alternative is, lower wages?

DrinkWater2• 15 years ago

There are some discussions about the supported OS's in the Raspberry Pi Forums. And this is what is still holding me back from dancing and screaming about this project.

dspillett• 15 years ago

This is something I need to look into. I'll be buying one B when they are available anyway, but may get more depending on a few things including the OS question. The claimed "can play 1080p h264 video at 30fps" claim is most interesting to me, but if I slap Debian on there (which seems to be the suggested distro) will it be able to use that hardware video acceleration out of the box or will I need to jump through a few nasty hoops to get some proprietary chipset driver to cooperate?

DrinkWater2• 15 years ago

Exactly!

rmoriz2• 15 years ago

There is also another interesting board project in the UK, but it's still in the design-phase:

http://rhombus-tech.net/allwinner_a10

Maven911• 15 years ago

Am i missing something here, some versions of the andruino seems to be in a similar price range (at mouser.com), or is this board vastly superior to the cheap model andruinos ?

adestefan• 15 years ago

The Adruino is built around the 8-bit Atmel AVR microcontroller line. It also exposes numerous digital, PWM, and analog pins for easy hookup to external devices. It is in no way a general use computer.

The Raspberry PI has a 32-bit ARM chip that can run Linux. It has a video output, USB for keyboard and mouse, and one version has an Ethernet port. It's aim is to make a cheap general purpose Linux system.

Raspberry Pi: We’ve started manufacture

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