Here's Jim on the Scarlet price change:
We have decided to add $1000 to the price of Scarlet and include HDRx™ capability. The extra money will go to more boards and another ASIC plus development. The improvement is more than worth the effort. The image possibilities and capability are incredible.
On why there is a price change:
We have made the mistake... or not, of talking to our customers as we have gone along. Things change... especially since we have an open dialog with our customers. Technology advances and opportunities arise. We have said clearly that "everything is subject to change".
As we add more capability to our program, prices have risen. At the same time, we have added many features at no extra cost. Go figure.
On the shift of Scarlet towards the higher end "professional" market
We thought we might get into the "volume" business... but we realized we cater to professionals.
On why the products were so delayed:
Why is RED so late releasing EPIC and Scarlet?
1. We had no idea what we were doing.
2. This is as difficult a trick as anyone could possibly pull off. 5K/120fps on a postage stamp has never been done before by anyone, let alone by a new company that has no idea what they were doing and no library of information.
3. Engineers are optimistic. They think they can do stuff faster than is reasonable. And they tell us dates that they can't make.
4. Stuff changes. We have added capabilities along the way the complicated the process. This is a disruption to the program and adds time to process.
5. Nothing works like it is supposed to. The amount of boards and lines of code needed for this project are not comprehensible. Everything needs to be done several times to get it right.
What does it all mean? Basically Red cut out a niche for itself with the Red One by supplying higher than 2K resolution cameras in a market where HD to 2k to 4k cameras had very well defined price and feature levels. They tried to do the same with the Scarlet for the ViDSLR market, where there isn't a compact, higher than HD resolution interchangeable lens camera at all, much less under $10k. Every business model that wants to make serious money need a volume seller where sheer volume make up for lower margins. The Scarlet was suppose to be that. Jannard and company just realized that their envisioned "volume" product wouldn't be competitive at the price they could make it at.
The competition haven't sat still either with Panasonic just releasing the GH2. Nikon also recently moved to 1080p with their range. Then of course the new darlings of DPs, Canon's range with the wide (and widening) appeal of 5D2,1D4 and 7D (and of course the soon to be announced 1Ds4 (Sorry no spoilers here! ) and the flurry of lenses and accessories available. All these cameras announced before the prototype of the Scarlet was even publicly displayed. No wonder they shifted.
The market for 2k+ resolution cameras is very small. Canon's own video division, with no products to protect other than the X series camcorders and the ENG lenses, can afford to push the boundary a little more. Panasonic and Sony, on the other, have the big production camera divisions to protect, and hence they are holding back with the codec and feature set.
If Scarlet can produce a 18 stop camera for under $10k, it'll still be a great product, especially for underwater. However, in trying to beat the volume players, who have years of experience and the human power to produce products at an annual pace or even faster, Jannard and company tried to bite off more than they could even fathom. And with their "open discussion" corporate culture, it's a very vocal shift in product placement, as opposed to the tight-lipped and secret Japanese companies. It's not a failure but just a product repositioning.