
What happened with LEGO - AlexMuir
http://therealityprose.wordpress.com/2013/01/17/what_happened_with_lego/
======
Tloewald
I don't have a problem with the price of lego, having — as a child in the 70s
— saved my own pocket money to buy lego. The real criticism of lego is that
it's gone from being a collection of parts that can make the thing on the
cover of the box but also many interesting variations, to something that isn't
very malleable.

First, lego no longer has a consistent color scheme, so only pieces from one
genre go with other pieces of that genre.

Next, there's the proliferation of zany specialized parts. I remember getting
a lego cargo ship as a kid (the hull was four specialized pieces — bow, stern,
and two mid sections and thinking this was awful. Lego doesn't do ship
sections any more but many similar things.

It's not a get off my lawn thing. I still love lego. But it does seem to have
exchanged its DIY charm in the pursuit of merchandising.

That said, you can build much better looking models now — just not out of any
reasonable selection of pieces.

~~~
acabal
My beef is that Lego have become so highly branded. I would rather my kid play
with generic space and castle and pirate blocks, than with Star Wars and Harry
Potter and Pirates of the Carribbean blocks. As a product of the 80's I can
say I spent a lot of time playing with highly branded and marketed toys, so
it's not necessarily a bad thing; but there's something special about Lego
that makes me feel like they should be above film tie-ins and in a special
airy realm of pure imagination.

~~~
bentcorner
The reason why Lego makes sets that are branded is because other companies
make good-enough lego-compatible blocks that are cheaper than legos. If lego
stuck with the "generic sets only", they'd be history by now. Who would bother
buying a pack of lego-branded red bricks when you could get the megablocks-
branded one that is 90% as good for half the price?

~~~
rdouble
Only the dorky neighbor kid whom everyone hated to play with thought
megablocks were an acceptable substitute for Lego.

~~~
trhtrsh
Yeah, poor people are losers.

------
dalke
I agree with the thesis that the presumed expense of Lego sets as an adult is
based on an incomplete economic understanding of child experience.

I say this by comparing to personal history. The author writes "The 1990s and
before were a nostalgic heyday of affordable LEGO sets." but as a teenager in
the 1980s, really interested in the new "Expert Builder" sets, with gears,
axles, motors, I was astonished at how expensive they would be. I really
wanted the Auto Chassis/956, but it took a lot of lawn mowing (and help from
my parents) before I could afford it.

That's a high-end set, but even in the late 1970s, when my parents found that
I liked Lego, it was expensive enough that they would go to garage sales to
find old collections rather than buy new ones. Which also meant I had some of
the 1960s gears and wheels which really didn't go with the rest of the
collection.

So I, at least, never regarded Lego as being "affordable."

On the other hand, that same collection, augmented, was often used by my
sister's kids, making it affordable on an amortized basis.

------
fnazeeri
I love it! Summary: Legos seem expensive now because the first time you got
them they were free! ;p

~~~
beobab
First one free, and once you're hooked it's exorbitantly expensive? Sounds
familiar. :)

------
algorias
> There is no way LEGO sets have always been this expensive; it is just molded
> plastic.

This is the worst kind of fallacy. First of all, plastic is more expensive
than you think when many different pieces in many different colors need to be
produced, stored and packaged in a precise manner. Secondly, the cost of
development obviously gives huge added value to those pieces of 'just'
plastic.

What happened to lego prices? The company is figuring out ways to stay viable
in the market, that's what happened.

~~~
EliRivers
If you read the rest of the article instead of just the first few lines,
you'll discover that "There is no way LEGO sets have always been this
expensive; it is just molded plastic." is simply part of the conversational
setup leading into the discussion that disproves that part of the setup.

------
mrspeaker
Wow - a lot or work went into that article. Very impressive! On a vaguely
related note, here's the video that the quote at the top is taken from:
<https://www.youtube.com/watch?v=yVCOAFKjaoY>

------
alanctgardner2
What I find amazing in the linked article (from the footnotes[1]) about Lego's
financial situation was that every product engineer used to have carte blanche
to go out and acquire tons of resin, just to make one set. That, and the
effort they went to to service small, local stores. It's both amazing and
depressing; obviously it doesn't scale at all, but it really sounds like a
kickass corporate culture. Wired had a similar article about people who design
Nerf guns; they also had an amazing lab-area dedicated to cobbling together
new toys[2].

My point being, toy-making sounds like an awesome job. I wonder if the people
who do it are mech/materials/structural engineers, or if it's still a craft? I
would totally go and design toys and write Python scripts to model Nerf
trajectories for the rest of my life.

1\. <http://www.strategy-business.com/article/07306?pg=1>

2\. [http://www.wired.com/design/2012/09/how-nerf-became-
worlds-b...](http://www.wired.com/design/2012/09/how-nerf-became-worlds-best-
purveyor-of-big-guns-for-kids/)

~~~
wglb
I have an acquaintance who by profession is a toy designer. She is independent
and highly thought of, but all the work is speculative. If your design doesn't
make it past the first review, all your work is for naught.

She is very creative and bright and is quite resourceful in putting ideas into
prototype phase and has had some big wins. But there is a certain stress level
associated with any creative endeavor.

The situation you are noting is within the big toy companies, and no doubt
that they have an awesome job.

~~~
alanctgardner2
I can imagine in her case, it would require a very well-rounded individual to
design the toy, come up with marketing/branding, build it and pitch it. I was
definitely thinking of working in the pipeline at a larger company, like you
said, where someone could be more specialized and focus on one aspect of the
design.

Does she have any interest in moving to a big company? As in, doing spec work
until she demonstrates she's competent, and gets hired on? Or is there a
career in freelance toy design? Like any self-employment it would be
stressful, but you'd be more exciting at parties than the millionth person
building FarmBookVille Freemium.

~~~
wglb
I would say that she is very well-rounded.

She came from a big company, and I think it fell apart or moved away from
Chicago (at one time, the toy-design capital) and struck out on her own. I
think it is quite unlikely that she would now leave the freelance life.

------
ianb
Where I think this analysis is wrong is using the general inflation number. If
your inflation basket of goods was full of products similar to Lego – plastic
toys – the real price of Lego would not appear to be going down. Well, "wrong"
isn't perhaps the right word, but it doesn't address the perceived price of
Legos in a world where plastic goods are constantly going down in price
relative to other goods.

~~~
waqf
Exactly. _Pace_ the article, the reason that Lego seems expensive to us is
that other toys are now much cheaper (in real terms) than they were in the
'70s. If you corrected for "toy inflation" instead of "general inflation" this
would be apparent.

------
joering2
Unfortunately, with the 3D printers on the raise, the faith of a LEGO(r) brick
is doomed.

In the near future, there will be printers especially designed to print small
LEGO pieces. Of course none of those 3DP will market as "print your own LEGO
bricks", but kids will figure this one quickly.

It will work a bit like a baking machine. Turn it on, leave it overnight and
bunch of blocks roll out when you wake up in the morning. theLegoBrickBay.se
will arise where kids will be able to download any STL file for any brick,
LEGO set, minifig, etc, and LEGO with their tiny revenues (comparing to
MAFIAA) will not be able to shut down the site.

Even if, arguendo, price of that printer will be $2,000 or more, its a cost of
couple StarWars sets and any parent understanding the basics of financials
will go with "print your own" instead of "keep buying new sets" thought.

Material will be cheap and reusable. After you are done with playing or simply
dont need so many 1x4 bricks in grey color, you will put them all in a
"melter" and within couple of hours all your grey bricks will become one solid
cartridge ready to be used in printing new bricks, trees, horses, flowers, or
whatever you want to.

You will see this coming in <> 5 years. Whatever the future holds, its
probably wise NOT TO buy LEGO stock nowadays.

~~~
emddudley
I'm not holding my breath. There is no way that home 3D printers will be able
to maintain the same manufacturing tolerances as the LEGO factories,
definitely not within the next 5 years.

~~~
tlrobinson
I agree. On the other hand, 3D printing itself could displace LEGO as a
creativity outlet for kids. But there's something about physically snapping
blocks together and experimenting that couldn't be replaced by CAD software.

~~~
sliverstorm
3D design and assembling LEGOs are different levels of learning/play. Perhaps
we could compare it to oil paints vs. watercolors. A very young child is
perfectly capable of smearing oil paint on a canvas, but watercolors are a
better starting point.

Not to mention I found the inherently limited nature of LEGOs was a great
exercise in working within a set of constraints & thinking "outside the box"
to beat them.

------
cbr
Alternate hypothesis: pieces are getting smaller. Cost per piece looks like
it's falling because we've gone from
<http://brickset.com/detail/?set=WEETABIX1-1> to
<http://brickset.com/detail/?set=10223-1>

~~~
Avshalom
The article mentions this and also shows that cost per gram has gone down as
well.

~~~
cbr
Smaller pieces are probably also more dense; less internal air.

------
T-hawk
Lego prices were my introduction to economics and budgeting as a kid.

My parents worked out and explained that you should look for value per brick
in the sets when choosing purchases. I learned how to rapidly estimate mental
arithmetic largely from wanting to get the most Legos for my allowance. The
benchmark was 10 cents per brick (in the mid 80's), sets which worked out
below that were good buys, sets above that were a ripoff. Surprisingly, it
didn't correlate much with set size, bigger sets weren't always so economical.
There were quite a few very small sets in the Space line, things like one
figure and a spaceship composed of about thirty pieces for $2.49, which were
good buys and I accumulated several.

Side note, I actually didn't play with Legos as much as with a different
builder set called Construx. Anyone else remember that?

~~~
wiredfool
The thing Im noticing with the sets these days is that overall, there are a
lot more tiny pieces, variations on a 1x1 or a 1x1 flat, round, or light or
something. That can really drive the piece count up on a set. I was just
looking at the Fire Plane that my 6 yr old got yesterday (yay, birthday, 5
presents, 3 lego sets), and it's got a ton of little pieces to be the water
that fills the plane's hold.

(Also, Compare the Tower Bridge @ 4k pieces for $250, vs the Death Star at 3k
pieces for $400, though there's some licensing difference there as well)

------
gfunk911
Average set size has gotten bigger, so the average set costs more, so they
seem more expensive. Seems straightforward.

------
rhplus
The average price per gram chart is interesting, as it shows price fluctuated
quite wildly 1980-1995 and then smoothing out to a much more stable curve 1996
onwards.

[http://therealityprose.files.wordpress.com/2013/01/priceperg...](http://therealityprose.files.wordpress.com/2013/01/pricepergram2.gif)

I have some possible ideas:

1) There's more data in recent years, so the smoothness is just reflecting
less variance in the data 2) The author didn't consider currency exchange
rates when most production was done in Denmark 3) LEGO got better at managing
shock from fluctuations in supply costs (i.e. buying futures in petroleum) 4)
LEGO got better at managing production costs with more larger, cheaper
factories (central Europe, Mexico) 5) It's harder for the supplier to
experiment wildly with retail costs because everyone (distributor, retailer,
consumer) has access to year-on-year comparison information now (no need to
look up last year's prices in a huge catalog)

------
nhebb
As the father of two boys, I'm amazed people are willing to pay these prices.
After buying a couple of sets, I refused to do it again. The pieces come apart
easily and wind up as vacuum fodder in the carpet. And in my experience, they
didn't actually get played with very much. The plain bricks, though, got
played with _a lot_ over the years.

------
michalu
The question should be what happened to the US dollar not lego. Lego is
manufactured in Denmark, where they managed to spare themselves from several
rounds of quantitative easing.

The author could really spare herself all the time and effort and just post a
chart of dollar. He/she took it from the wrong end.

~~~
bostonpete
How does this explain the trend of legos getting cheaper?

------
shocks
I've always called them Lego. Not Legos. Is that an American thing? (UK
citizen here). Just curious.

~~~
Nursie
Lego is definitely, definitely a collective noun like 'sand'.

You have a grain of sand or if you have a lot you just have sand. You have a
Lego brick or if you have a lot of them you have Lego.

I am also British

~~~
jmount
But wouldn't different types of sand taken as a collection be "sands?" Just as
many types of fish are fishes?

~~~
Nursie
I'm not sure 'fishes' is valid (British) English either TBH, maybe it's a
pointer to a more general rift between UK and US language use. The OED does
list 'fishes', but I've never heard it used except in jest or by people trying
to be cute. Lolcat speak :)

We would say 'The sands of the sahara' and 'different types of sand' or
'different sands' sound equally valid.

~~~
rhplus
See also formal versus notional agreement. British English tends to favor
notional, prime example being sports commentary: "Liverpool are playing well"
versus "Boston is playing well". Wikipedia highlights some other good
examples: "The staff is busy" versus "The staff are busy", "The Rolling Stones
are a classic band" versus "The Rolling Stones is a classic band".

The differences sound stilted if you're not used to them. Except, of course,
when they're poetic: "Oliver's Army are on their way/Oliver's Army is here to
stay".

[http://en.wikipedia.org/wiki/English_collective_nouns#Metony...](http://en.wikipedia.org/wiki/English_collective_nouns#Metonymic_merging_of_grammatical_number)

[http://en.wikipedia.org/wiki/American_and_British_English_di...](http://en.wikipedia.org/wiki/American_and_British_English_differences#Formal_and_notional_agreement)

------
danielhughes
A little off topic but last weekend I had the privileged of watching an FLL
(First Lego League) event. This is a robotics competition for kids ages 9-16.
And it's AMAZING. The energy from the kids and parents was exhilarating.
Details are here <http://firstlegoleague.org/>. There are also a lot of videos
from the competitions posted on YouTube (search First Lego League). If you
have children I definitely encourage you to introduce them to FLL. And if you
don't have kids consider volunteering to coach one of the teams.

~~~
schreiaj
And if you are an adult and want to get involved volunteer! I've volunteered
at several levels ranging from helping a local team all the way up to judging
at their World Festival and it's probably the best reminder of why I went into
engineering. Plus, hearing a student be excited to explain the concepts of
torque is just awe inspiring.

------
DanBC
One frustration with Lego is the difficulty with buying it in wholesale
quantities and prices.

A small charity wants to buy up a lot of Lego (and Duplo) to redistribute to
children of poor families. There are some suitable sets, but they're
expensive, and you need to buy eye-wateringly huge amounts to get a price
break on it.

And the second-hand market keeps value, meaning they can't even buy loads from
auction / parent websites or car boot / yard sales for redistribution.

Still, it's a good idea and they're working the problems out before going any
further.

~~~
unthunk
They might want to try talking to the local LEGO Users Group/AFOL group and
see if the group participates in buying bulk from LEGO and would be willing to
order for the charity. The members of the group in my area, NCLUG, jointly and
annually order in bulk at a discounted rate. It is a slow process, but saves
them a bunch of money.

------
jacquesm
> I wrote a web scraping program

Better to ask beforehand, many websites are quite happy to hand you data if
you ask nicely and your goal is something non-competitive.

~~~
DoubleCluster
Scraping a website is absurdly easy. You can have the data before you'd have
finished writing the email.

~~~
user24
But it's not very polite to do (someone runs that website that you're
hammering), and it doesn't open you up to a conversation that might get you
even more access/data than you originally thought was accessible.

~~~
desas
You don't have to hammer a website to scrape it. You can write scraper
programs to limit the number of HTTP requests per second.

------
fduran
A little off-topic but I find LEGOs are usually over 50% more expensive in
Canada than in the US :-(

[http://www.amazon.ca/LEGO-Star-Imperial-V-wing-
Starfighter/d...](http://www.amazon.ca/LEGO-Star-Imperial-V-wing-
Starfighter/dp/B0063WFEC8/)

[http://www.amazon.com/LEGO-Star-Imperial-V-wing-
Starfighter/...](http://www.amazon.com/LEGO-Star-Imperial-V-wing-
Starfighter/dp/B004478GNI/)

~~~
gee_totes
That is bizarre. I always attributed the higher Canadian prices to the fact
that the Canadian dollar was weaker than the US dollar, but nowadays they're
about equal.

------
tcbawo
Lego is now competing for attention with applications such as Minecraft. It
will be interesting to see if pricing trends hold, or whether they attempt to
preserve market share by cutting costs. Maybe Minecraft will start to move
into the themed application market (Lego Star Wars, etc.).

~~~
anonymfus
There is a Minecraft themed Lego set.

------
Persephone404
It would be interesting to see price per brick variation with pack size -
those $500 dollar sets have prices per brick under $0.05. The increase in
volumes of larger sets could be balancing the increased pricing of small sets,
leading to the stable average.

------
speeder
Again this post?

Well, at least this time I can comment.

I must say that Lego in Brazil is ABSURDLY expensive, it is just ridiculous.

And this is very bad, since I love Lego!!

And I miss "Tente" (a Lego clone that existed here, and had some nifty stuff,
like wheeled blocks with metal axles)

~~~
ufo
Everything imported has ridiculous taxes here in Brazil. I wonder if Lego is
just "normally" absurdly expensive or if its even worse.

~~~
swah
You have to import stuff under 50 USD to get it without taxes, but then the
shipping gets (proportionally) expensive.

------
TorKlingberg
I think any perception that LEGO has become more expensive is because other
toys have become cheaper. Or more correctly, cheap low quality toys have taken
a larger part of the market.

------
DannoHung
The one thing I'm thinking is this: Didn't the pieces used to be a bit bigger?
Like, not the studs, just the number of studs on each piece?

Seems like a lot of pieces now are 1 and 2 stud-ers.

------
bonsai80
Profitable companies charge what the market will pay for their products.

<http://news.ycombinator.com/item?id=5039567>

~~~
gwern
Your link doesn't work for me:

> We've limited requests for old items. If you're running a crawler, you can
> get this data a lot more easily from <http://hnsearch.com/api>.

In any case, <http://en.wikipedia.org/wiki/Lego_clone#Legal_challenges>

~~~
bonsai80
It was a HN link to this: <http://37signals.com/svn/posts/3394-how-to-price-
something>

------
Zarathust
I don't think that the prices are adjusted for inflation. I remember asking my
dad for 100$ sets in the 80s, which would amount to gazillions of today's
dollars

~~~
trhtrsh
$200 - $250.

------
startupstella
there is a great planet money podcast on this issue:

[http://www.npr.org/blogs/money/2012/12/13/167055503/why-
lego...](http://www.npr.org/blogs/money/2012/12/13/167055503/why-legos-are-so-
expensive-and-so-popular)

------
jyap
I'll tell you what happened to LEGO. They stayed in business.

