Hegemony in Paintball - Is it possible?

[PBX Ronin 23]

With all the big boys lining up their ducks and a big rumor going around that supports the notion that it's not over yet, is it possible to have a company in paintball that is head-and-shoulders above everyone else in terms of market share?

Who will that company be? K2? NPS? Maybe even WDP perhaps?

Give us your thoughts on this and is this something that you believe is good (or bad) for the sport.

[Muzikman]

Good question. I am sure it will not be WDP. But it's going to be a battle between K2 and NPS. I am not sure which one I would like to see come out on top.

As for it being good or bad for the sport. For the growth of the sport it will be good. For the longevity of the sport it could be bad. You never want one company holding all your eggs. Even if there are other companies out there, the small ones will usually not be able to survive. The day of the garage gun maker is gone.

[shartley]

I too do not know who would come out on top, nor who I would want to. I however don’t see it as a real problem. I also don’t see it as being harmful to the industry.

I see it as opening up the door to after market parts and products. It will make it harder to compete head to head with the “big boys” when it comes to actual marker production, but it will not eliminate the niche markets nor after market market. It will be kind of like the auto industry which is comprised of a hand full of major players, but the public still gets what they want and there is plenty of room for peripheral businesses.

Things are still young, and the game is only starting to be played (business game)…… most of us can only sit back and enjoy the ride.

[Muzikman]

The only problem with that is a lot of these markers are coming off the line in the best function possible and looking really good. It's kinda like trying to make your ferrari better. Sure, you can take a Civic and toss a bunch of parts on it and make it better, but the guns coming off the line these days are not civics, they are your high performance elite cars. Not much can be done with them. And as people do come out with something to make it better, the mfg will turn around and start making that a stock part.

That besing said, as long as there are spyders and Tippmann's aftermarket products will survive:)

[BigEvil]

NPS is lacking big time in several areas... If someone was able to raise some capital, and get their act together.. anything is possible.

[Lurker27]

From a technological standpoint, We've been stagnant for 2-3 years. A 2k2 Intimidator with a WAS board is all you need, and while there are guns that have less kick, weight, or gas consumption, it's miniscule enough to still come down to preference.

Until someone comes up with a viable alternative to the traditional hopper, I think we'll remain stagnated.

So, really, the amalgamation of corporations doesn't quash innovation...If anything, it'll lower prices...

[Muzikman]

NPS is lacking big time in several areas... If someone was able to raise some capital, and get their act together.. anything is possible.


Where do you see NPS lacking? They have guns, masks and paint. They might not be the mfg for each of those, but they end up with the sole distribution of them.

Now, K2 has the same, plus their parents have more money. But again, that is why I am not sure who will come out on top. You have to look at how NPS got started, if anything Gino is a great business man.

BTW: I am not a supporter of NPS. They still owe my team prizes from IAO last year.

[Muzikman]

Until someone comes up with a viable alternative to the traditional hopper, I think we'll remain stagnated.




Qloader isn't different enough for you?:)

[sabrefanpc]

as long as they get to the price wars soon, i'll be happy. Who comes out on top is a looong way off. im sure they will both fight to the death, which means it could take years, or turn into gm vs ford auto style oligopoly

[Kevmaster]

I think that dominate NPS and K2 can exist in paintball and thats certainly where its going. K2 is definitely trying to take over the casual 'wal-mart' player. BE has been making a fortune on them for years. BE/K2 coulnd't care less about the tourny player who posts on AO. They have nothing to gain from them.

NPS however does. Making mostly nice stuff and selling paint, htey rely on fields and the high end ballers.

The two companies really fill a different niche. While there is some overlap, I don't think the two are in any real competition other than for name recognition and overall revenue. But BE/K2 wins over national in revenue every year. Not even a race really. BE clobbers them.

[PBX Ronin 23]

The only problem with that is a lot of these markers are coming off the line in the best function possible and looking really good. It's kinda like trying to make your ferrari better. Sure, you can take a Civic and toss a bunch of parts on it and make it better, but the guns coming off the line these days are not civics, they are your high performance elite cars. Not much can be done with them. And as people do come out with something to make it better, the mfg will turn around and start making that a stock part.
You're absolutely on point. Manufacturers are really beginning to tighten the screw on the after-market guys by restricting them legally (DYE) or by making sure that there is no need for anything else except for the OEM parts (WGP-Karni, WDP-Current Angels, AKA-Vikings, etc.).

The latter is okay by me but restricting the after-market guys like DYE has is just silly.

[PBX Ronin 23]

as long as they get to the price wars soon, i'll be happy. Who comes out on top is a looong way off. im sure they will both fight to the death, which means it could take years, or turn into gm vs ford auto style oligopoly
Actually, we have and still are in a price war. Just look how prices on paint have dropped over the last three years. Also look at the price drops on the low-end of the market.

But indeed, I can see what you're saying about an oligopoly.....for sure.

[PBX Ronin 23]

K2 is definitely trying to take over the casual 'wal-mart' player. BE has been making a fortune on them for years. BE/K2 coulnd't care less about the tourny player who posts on AO. They have nothing to gain from them.

NPS however does. Making mostly nice stuff and selling paint, htey rely on fields and the high end ballers.

The two companies really fill a different niche. While there is some overlap, I don't think the two are in any real competition other than for name recognition and overall revenue.

Well NPS owns the "Traditional Paintball Distribution Model" by being a dominant supplier to the stores, fields, internet and trade shows.

K2 dominates in the "Non-traditional Paintball Distribution Model" by taking up more shelf space in the WalMart, Dick's, et al of mass retailing chains.

With K2 picking up WGP, it gives them more credibility on the mid to high end of the market. If the speculations are true that they may have picked up Planet, then it follows a certain definitive pattern of encroahing onto the "Traditional Model". If they would pick-up PMI, then they have the potential to become that monolith in the industry.

NPS has and will always be a big irresistable force in the industry. But with the introduction of new technologies such as the Evolt (airless PB marker), they have the potential to drastically eat into K2's niche.

That being said, I believe that in as much as financial muscle comes into play, the foreseeable future is more about who has the larger IP portfolio. Based on actions taken by NPS that's available for public consumption (i.e. grabbing techno-geniuses like Manike and coming up with the Evolt), it looks like they may have the lead on this race.

But a lot is still left to be seen.

[Kevmaster]

Well NPS owns the "Traditional Paintball Distribution Model" by being a dominant supplier to the stores, fields, internet and trade shows.

K2 dominates in the "Non-traditional Paintball Distribution Model" by taking up more shelf space in the WalMart, Dick's, et al of mass retailing chains.

With K2 picking up WGP, it gives them more credibility on the mid to high end of the market. If the speculations are true that they may have picked up Planet, then it follows a certain definitive pattern of encroahing onto the "Traditional Model". If they would pick-up PMI, then they have the potential to become that monolith in the industry.

NPS has and will always be a big irresistable force in the industry. But with the introduction of new technologies such as the Evolt (airless PB marker), they have the potential to drastically eat into K2's niche.

That being said, I believe that in as much as financial muscle comes into play, the foreseeable future is more about who has the larger IP portfolio. Based on actions taken by NPS that's available for public consumption (i.e. grabbing techno-geniuses like Manike and coming up with the Evolt), it looks like they may have the lead on this race.

But a lot is still left to be seen.

you're right. if K2 goes after PMI/RP they would be almost unstoppable. They could probably overpower NPS and while that would take some time, it would mean a big drop in prices in the process.

I think K2 has a lot more potential to be the hegemonic power than NPS does. NPS doesn't have many places to expand. K2 can do quite a lot. And, imho, at present they are already ahead

[Toxic Dave]

NPS is maybe 5% of of the size of K2 in the big picture of things, and paintball really isn't a big part of K2's portfolio. I don't know how much K2 cares about the traditional paintball market, but I'm sure it isn't too big a deal for them when they are shipping a thousand trilogy's to Sports Authority every week, not to mention the ungodly amount of BE product.

[chairman_mao]

I don't pretend to know much about the paintball industry and polotics but it seems that having two major distributors/manufacturers can't be too much of a bad thing. While one may always have more of the market share they will not (in all likelyhood) cause the other to go out of business. The way I think of it is like Nike and Adidas (I know there are other major shoe/athletic companies) they are and have been battling each other for what seems like EVER and they are both still around. Understandable PB is a very different animal but the comparison is there.

It has already been stated that marker quality has reached a pinnicle and will most likely platue or has already. So does that mean that now we are just looking for the creation of two or more conglomerates to increase the scale of production and reduce the cost to consumers? Will paint be $25 a case soon? Probably not but I think we'd all like to see it. I wish I had some incredible and insightful perspective to offer this discussion but really all I want is cheaper paint. I know currently it's markedly cheaper than it has ever been but I want it cheaper still. That's just my opinion.

[PBX Ronin 23]

NPS is maybe 5% of of the size of K2 in the big picture of things, and paintball really isn't a big part of K2's portfolio. I don't know how much K2 cares about the traditional paintball market, but I'm sure it isn't too big a deal for them when they are shipping a thousand trilogy's to Sports Authority every week, not to mention the ungodly amount of BE product.
You're right if you were to aggregate all of K2's businesses. But if you were just to look at paintball division, the differences isn't all that. What K2 has is what everyone of the PB big boys want. NPS with their new gun could have just the ticket to start occupying more shelf space at WalMart.

The suspense of this impending major announcement is killing me.... :p

[SlartyBartFast]

Maybe even WDP perhaps?

Those drums from over the pond?

The gossip is just fighting to get out of your head isn't it. :nono:

[Kevmaster]

You're right if you were to aggregate all of K2's businesses. But if you were just to look at paintball division, the differences isn't all that. What K2 has is what everyone of the PB big boys want. NPS with their new gun could have just the ticket to start occupying more shelf space at WalMart.

The suspense of this impending major announcement is killing me.... :p


Mel,

BE alone in 2003 fiscal year pulled in 115 million gross. (about 15 of that was profit if i remember right). National's numbers arn't public as they arn't a public company, but I can't imagine NPS topping them in that regard.

[PBX Ronin 23]

The only reason that I put WDP into the mix is that within the next twelve months, they may be the sole owners the patent for electros. If the SP patent gets invalidated (and smart money says that it could), this leaves the boys from Birmingham sitting on the cat's bird seat with the ability to influence the industry for the life of that patent.

I'd like to get Ged Green (WDP), Lynn Scott (BE/K2), Bud Orr (WGP), Jeff Perlmutter (PMI) and Gino Postorivo (NPS) all in the same room....get them drunk...and have them spill the beans. Because of one these gentlemen will most likely be in the middle of the hottest rumor in paintball. :D

[manike]

National's numbers arn't public as they arn't a public company.

So maybe it would be sensible not to make assumptions about how they lie in relationship to BE/VL/WGP?

[PBX Ronin 23]

Mel,

BE alone in 2003 fiscal year pulled in 115 million gross. (about 15 of that was profit if i remember right). National's numbers arn't public as they arn't a public company, but I can't imagine NPS topping them in that regard.
Although that's true about BE (since they're a publicly traded company) because it's easier to get the info, don't under estimate the boys from Mantua, NJ. It's tough to put any number for them since they're a privately held concern. I would speculate as an outsider that there's more than meets the eye.

NPS certainly have made some bold forward-thinking moves (i.e. TV show, various exclusive distribution deals, new technology, etc.) that practically ensures their market position for years to come.

[PBX Ronin 23]

Welcome back Manike. I hope all is as well as can be expected.

[Enemy]

so far with the exemption of the wgp buy out k2 has had a main stay in the lowend market!! nps so far is strictly highend.. lets face it for every person thats willing to drop 100+ in a marker there are 50 that think 200 is highpriced!! but i think NPS will never be out done especially with empire, bob long, and some actually good paint backing them. k2 however wont be out done but in the same stroke i dont see them really going after major big time gun manufacters why would they when the low end is so good to them!!

[Steelrat]

AKA's website states that they will be coming out with a major announcement. Could that be a coincidence?

[pump]

soon it will be against the law to shoot any paintgun that is not made by a so called manufacturer

muuuuuuhahahahahahahaha

[PBX Ronin 23]

so far with the exemption of the wgp buy out k2 has had a main stay in the lowend market!! nps so far is strictly highend.. lets face it for every person thats willing to drop 100+ in a marker there are 50 that think 200 is highpriced!! but i think NPS will never be out done especially with empire, bob long, and some actually good paint backing them. k2 however wont be out done but in the same stroke i dont see them really going after major big time gun manufacters why would they when the low end is so good to them!!
Well, NPS does a lot of low end too but you're right. K2 with BE and with the Trilogy series from WGP are pretty strong when it comes to the Walmart side of paintball distribution.

Who knows what's going to happen. Maybe K2 might want to start moving up in the market place and encroach on the high-end to add more credibility to their existing brands.

[BigEvil]

Where do you see NPS lacking? They have guns, masks and paint. They might not be the mfg for each of those, but they end up with the sole distribution of them.

Now, K2 has the same, plus their parents have more money. But again, that is why I am not sure who will come out on top. You have to look at how NPS got started, if anything Gino is a great business man.

BTW: I am not a supporter of NPS. They still owe my team prizes from IAO last year.

I guess you know that they arent exactly the most 'customer friendly' organization out there. I had been dealing with their subsidiaries for years (888pb & 800pb) since they opened there doors, spent literally thousands of dollars for myself and my team with them, then the one time I had a major issue with product they sent me I was basically told "Sorry, your screwed". And yes, this was a direct dealing with NPS... I really dont want to go into it, since there is an investigation from my credit card company going on, and I also dont want to raise my blood pressure anymore from thinking about it.

Basically my point is, that if there was an alternative to dealing with NPS, I think people would take it. They ARE the industry in many cases, and you just can not avoid dealing with them in some manner. It is very difficult to buy from somewhere that doesnt do business with NPS.

[GT]

The irony here is that we as consumers want choice from DIFFERENT companies. The problem is that we want cheaper prices. In order for that to happen products need to be made in a larger volume. At some point we will only see 1/2 dozen pb companies with a higher quality gun at a better price. Befor this plunges into a poly sci desucsion lets all reameber that choice is expensive.

Personally I wasnt always an NPS fan, but after meeting Manike, and witnessing the care that is put into thier products, and others he designs, I think the future is in good hands with a company like nps.


-gt

[SlartyBartFast]

Who knows what's going to happen. Maybe K2 might want to start moving up in the market place and encroach on the high-end to add more credibility to their existing brands.

Why? How does "credibility" with a minority of paintball players in a low magin elite part of the sport help their sales to the unwashed masses in Bigbox stores?

And doesn't K2 have some "upscale" cred already with WGP products?

[teufelhunden]

I don't believe WGP is considered 'upscale' anymore. Look at how few Karnis sell. WGP is surely holding firm in the midrange, but for whatever reason, the Autococker is not looked upon as a high end gun, no matter what it's dressed in.

If the Eclipse rumors are true, however..

[PBX Ronin 23]

Why? How does "credibility" with a minority of paintball players in a low magin elite part of the sport help their sales to the unwashed masses in Bigbox stores?

And doesn't K2 have some "upscale" cred already with WGP products?
WGP's presence is definitely sliding from the upscale segment and they're putting a lock on the mid-range. If K2 is successful in creating an "upscale" flavor in some of their product lines, it would have a coat-tail effect and add some more legitemacy to some of their other product lines.

[GT]

no offense,
when did wgp ever offer a true top notch product? there top crop line is littile more than nickel plated pneumatics with an e frame. Please, Ill take the super stock for half the price trabeck. What is the gun that wasn't a complete rip off in the wgp line?


The only cockers that were creme de la..... were third party made, aka, splatattack, doc, bbt, etc.....

[PBX Ronin 23]

Outside the Karni, WGP really hasn't done a true high high-end. Maybe a true low to mid high-end like the e-Orracles or even the old STO's. They've always historically followed the innovation set by third-parties. That's always been the case historically.

[Kevmaster]

So maybe it would be sensible not to make assumptions about how they lie in relationship to BE/VL/WGP?

You're right. I know all I am doing is making assumptions. However, it is my FEEL that NPS does not approach the 100M mark. Maybe I am way off base. Only a select few at NPS probably have the real answer (Yourself included). In my dealings with the industry, I just don't see NPS being as large and as powerful as BE/VL/JT/WGP.

Again, though, I could be entirely wrong

[manike]

NPS is far larger and more powerful than you think.

[smilestyler]

NPS is far larger and more powerful than you think.

LOL, sounds like the dark side of the force. :rofl:

[Kevmaster]

NPS is far larger and more powerful than you think.

Fair Enough.

[PBX Ronin 23]

If the SP patent gets invalidated and WDP has sole ownership of the E-gun patent, would WDP have the necessary leverage to become the biggest force in the industry?

[Lurker27]

Um...Yes.

That's assuming that the US Navy patents that predate even the WDP patents aren't upheld.

[JoshK]

I think K2 will because they have Viewloader, WGP, Pure energy they have all the bases covered with products, and all are popular...I have a feeling that they will control alot of the lower end market, and WDP the higher end. But thats I just me, I have no idea who will come ahead.


EDIT: I beleive I was wrong with pure energy...but WGP still makes tanks.

[rabidchihauhau]

You all are not looking at the BIG-ENOUGH picture.

BOTH heavy-hitters (NPS, K2) need to grow market share in order to stay afloat.

NPS developed the traditional market and is strongest there. K2 developed the mass-merchandise market and is strong there. (When I say K2, I mean the whole conglomeration.)

The ONLY place for either of these guys to go is into each other's backyards. K2 started working in the traditional market with their Maxis line (a line where the guns are available in both markets but the accessories are only available to traditional outlets).

NPS is busily trying to solidfy their base and workinig, no doubt, on breaking into mass merchandise. (I see a bit of a hiccup there, as NPS likes to stay on top of their dollars and chains like Wal-Mart like to do the same, so there's potentially a bit of a clash there; add to that the fact that K2 will basically get 'right of first refusal' over any product introed to W*M that is in a niche they already have product in; lets put it this way. K2 has an inside track with most 'box' stores, which makes it difficult for competitors to get in there.)

Given that the market is somewheres between 2/3rds and 3/4s backyard players, most of whom are introduced through box stores, the REAL battle is in finding ways to transition those folks to the respective product lines once they become 'regular' players. In that battle, K2 has the edge on OPPORTUNITY, while NPS has the edge in migration path.

So far as muscle, reach, funding and etc goes - again, K2 has the edge. While BE/WGP is only a small part of their empire, in their first quarter earnings, BE had the best numbers, so you can bet the K2 corporate types are DEFINATELY paying lots of attention to paintball.

When it comes to IP, again, K2 has the dollars and the muscle to obtain whatever they want/need AND to enforce it. NPS is definately working on the innovation end and building their portfolio, but IP is dicey. The system is ultimately designed to pressure folks into competing through innovation (screw those guys, I'm not paying them a royalty, I'm going to invent around them!).

If you spend several mil making the next best, gear up for production and then someone else, a little more innovative than you, improves your product or designs around it, it leaves you with a white elephant. So, ultimately, the issue is not over IP control, its over control of the distribution chain.

Both NPS and K2 could be doing things better for themselves. Will there be a hegemony? If so, only temporarily, as the US Government holds the monopoly over all trade in this country and when someone gets too big and influential, they can be called in on grounds of anti-trust - so what both the industry giants actually want to do is to get to that magical 70% of the market and then stay there.

[SlartyBartFast]

BOTH heavy-hitters (NPS, K2) need to grow market share in order to stay afloat.

A disgusting falacy that is at the heart of many failures in the business world and the skewed fiction of the stock market. THere is a rediculous beleif that an investemtn is only good if the business continues to expand and profits always increase. Stable companies and good investments are those that remain viable and continue to make steady profits and maintain their market share.

Growth and capture of market share DO NOT equal profits or sustainable business. I don't think Glenn Palmer has EVER gained market share. Yet, PPS is still a going concern ("afloat").

Sure, growth IS good and CAN be extremely profitable. But, the day that a company starts looking like it is growing for the sake of growing is the day that you want to get your investment out.

[hitech]

I've seen growth kill companies. I don't personally subscribe to the adage that you have to grow to survive. It's never that simple.

[PBX Ronin 23]

Both NPS and K2 could be doing things better for themselves. Will there be a hegemony? If so, only temporarily, as the US Government holds the monopoly over all trade in this country and when someone gets too big and influential, they can be called in on grounds of anti-trust - so what both the industry giants actually want to do is to get to that magical 70% of the market and then stay there.

The only problem to this Steve is that the paintball industry still doesn't have it's own SIC (Standards Industry Code) and still fall within the Sporting Goods Manufacturing realm. This is the mechanism that the Federal government uses to track a company's market share within a certain industry in order to prevent the creation of monopolies through the Hart Scott Rodino Act.

The necessary triggers that requires reporting requirements with the Feds will not happen until the industry is assigned its own SIC number. So a company that has 90% market share in the paintball industry will only be seen by the Feds as having a miniscule percentage of the Sporting Goods industry....and thus no need for concern on the Feds' part.

That's why it is a possibility (not a probability) to have hegemony in paintball.

[Automaggin2]

Actually, we have and still are in a price war. Just look how prices on paint have dropped over the last three years. Also look at the price drops on the low-end of the market.

But indeed, I can see what you're saying about an oligopoly.....for sure.


Prices have dropped considerably, and the technology is getting better.


For someone to take hold of the market, they have to have a dominate gun, or own several companies. Every year theres a new hot gun or product, it was angels for a few years, then impulses, then timmys...Companies have to consistently put out a gun/product that appeals to everyone and is the best value. But if theres a company like K2 who buys up anything they can, eventually they will start to dominate. K2 owns so many companies, a lot more then most people think. Hell, they own about 4-5 snowboard companies. If K2 keeps growing, I believe they will eventually swallow up a good chunk of the industry. They will have companies that will appeal to everyone, and they have the money to hier top notch engineers and designers.