Video Used IT Equipment Can Be Worth a Fortune (Video) 79
In February, 2013 Computerworld ran an article titled A new way to sell used IT equipment about MarkiTx. The main differentiator between MarkiTx and predecessor companies is that this is primarily an information company. It is not eBay, where plenty of commercial IT equipment changes hands, nor is it quite like UK-based Environmental Computer, which deals in used and scrap computer hardware. It is, rather, the vanguard of computer hardware as a commodity; as something you don't care about as long as it runs the software you need it to run, and you can buy it at a good price -- or more and more, Frank notes -- rent a little bit of its capacity in the form of a cloud service, a direction in which an increasing number of business are moving for their computing needs. Even more fun: Let's say you are (or would like to be) a local or regional computer service company and you want to buy or sell or broker a little used hardware. You could use MarkiTx's price information to set both your buy and sell prices, same as a car dealer uses Kelley Blue Book. We seem to be moving into a whole new era of computer sales and resales. MarkiTx is one company making a splash in this market. But there are others, and there are sure to be even more before long. (Alternate video link.)
Robin
Miller:Frank, how did you get into this used computer
business and why is it coming back?
Frank Muscarello:Yeah, I really started my career as we were just talking about with a firm by the name [Comdisco]. They were into leasing of high-tech assets in the early 1990s, doing about $3 billion in leasing of what was sort of mid-range Mainframe, Supercomputers, et cetera. And then once they would come back off a lease, they would refurbish and resell them. I was only a summer intern there. I was fortunate enough to have the CEO and Founder pay for my last year of school, guarantee me a job out of school. And in the middle of 1993 when I got out of college, he wasn’t hiring and so I ended up starting my own business buying and selling retail technology equipment.
Robin Miller:So when we say retail technology equipment, we don’t mean like the – we don’t mean this guy here _____01:06.
Frank Muscarello:No, nothing like a tablet or anything like that, what I meant by retail technology, Robin, is really is some simpler – something you see in a retail store, like a CVS or a Walgreens.
Robin Miller:Okay. Okay.
Frank Muscarello:Any of their front end cash register equipment in my old business, I used to buy them from companies that would go out of business, or upgrade their technology, take a position on the inventory and then refurbish and resell them because I knew what the price was, and so I built that business to $20 million and 100 people and I sold it through a strategic about 16 years later, which was a great lifestyle business.
Robin Miller:So what you are saying is that in many cases for commercial enterprise type operations, used/refurbish point of sales stuff and computers are the way to go, is that so?
Frank Muscarello:Yeah, I think that’s right. I mean, I think that’s really the premise. After I sold that business just to give you the full story, after I sold that whole business I realized that what companies had was they really had information. They knew when they were buying the equipment, they knew what the market value was, but companies that were selling had no idea what the market value was. So they really would buy it as a capital asset, but they would really sell it as though it was worthless to them and it had no value. And so we focused on really at market X, really being able to disrupt that secondary market which is a $312 billion market, by providing transparency for what everybody is buying and selling around the world and getting them to one central marketplace to be able to connect, that’s really what we’re doing.
Robin Miller:So you’re telling me that used or refurbished commercial computers, that’s a $312 billion market?
Frank Muscarello:Let me clarify.
Robin Miller:Okay.
Frank Muscarello:When I’m really talking about commercial equipment, I’m really talking about things that we call big iron inside of a data center.
Robin Miller:Right, right.
Frank Muscarello:I’m talking Cisco grade, Oracle, Juniper server storage networking equipment, right, that every environment uses, that is a enormous market, and it’s about $312 billion. The secondary market is actually a huge, huge piece of this and you have to think about why, because look at the cloud, and look at what’s happening in the software world. Software matters, hardware really doesn’t. So in that environment someone like a cloud operator that’s running effectively a virtualized machine, they don’t care what the underlining hardware is. So there is a huge resale value for that equipment because Moore's Law is stalling. We are essentially that exchange to be able to connect buyer and seller on the basis of price and we guarantee all sides.
Robin Miller:Well, you just said something back to me that I’ve been thinking and sang for some months now, because the old thing was – in the consumer world you look on craigslist and the guy wants to sell his computer that he worked five years ago for $1,200, and he wants to sell it for $400 and he really doesn’t understand that I can buy a better computer new today for $300.
Frank Muscarello:Correct, no question about it.
Robin Miller:But that stopped all of a sudden, didn’t it?
Frank Muscarello:Well, remember the basis of what I’m talking about isn’t necessarily consumer grade stuff which is what you are referring to
Robin Miller:I was using an analogy.
Frank Muscarello:It is a great analogy.
Robin Miller:It doesn’t matter if it’s a one use server?
Frank Muscarello:No and you are right, it has stopped and the reason that it’s stopped is think about our iPhones or our iPads or our tablets, right, it has no hard drive on it, it has no movable parts, it’s connecting to the cloud to get the application and bring it down, take that forward and look at something like an Oracle Exalogic server that’s $1 million, it does the same thing, right, you don’t need to have all these heavy burden software sitting on that server when you can have it in the cloud. That’s the equalizer here, so those environments where you’ve said, look I bought it for $1,200 and now I can buy a better one for $400, that’s true in some environments, but think about your iPhone; just because you have an iPhone 4 and you spent $250, doesn’t mean you need to go and spend on an iPhone 5 and spend $400 and get anything more, it’s more about the software that’s driving the change, hardware is really, it doesn’t matter.
Robin Miller:Hardware doesn’t matter?
Frank Muscarello:Exactly, it’s a commodity and should be traded like one. Software is really what matters in these environments.
Robin Miller:So there is a whole hell of lot of – people at Dell, and HP and other companies and if they’re hearing this and they know this and they’re cringing, their sales are in a toilet, aren’t they?
Frank Muscarello:Well, their sales are in the toilet for a couple of different reasons, one because of the NSA threat, obviously that’s a huge thing. The other thing is really because of look the enterprise is getting smarter right now, it’s realizing that it can do more with less. Sometimes they virtualize the machines, they’ll have a private cloud, sometimes they’ll go to a public cloud and be able to use somebody else’s infrastructure, that’s a problem if you are major OEM, but what we’re trying to do is look there are still great products that still matter that everybody should have, the point is if everyone should know what the true mark-to-market value is for their particular infrastructure. So if a big bank spent $100 million on their environment, they depreciate it down to zero, but we’re telling them it’s worth $32 million because there’s a buyer in India, that’s expanding rapidly that wants to buy it, then they take the $32 million and they go and buy more products they need to from Cisco, so it’s just the whole market is changing, the whole thing is evolving and now there’s just a better way to be able to use it.
Robin Miller:What you’re telling me is, I can see this, everybody automatically buying new equipment, you shop used, you shop refurbished, you shop – well your company of course and others – there are others, right?
Frank Muscarello:There are I’m sure other competitors, there is no one like us; eBay is probably the closest competitor and it couldn’t be further from really what we’re doing. I mean, eBay only sells $6 million a month in Cisco products online. But the problem is, the prices are inconsistent and all over the place. And by the way, that’s only $72 million, this is a $60 billion market just in networking equipment, so it’s a huge, huge market and one that candidly everyone is offline, we’re trying to bring them online. So they’re not really per se a competitor because nowhere else other than market X can anyone connect a big bank with another huge bank or cloud provider that wants to buy it on the other side, that’s the difference, is we are collapsing that because there are no language barriers Robin in any of the equipment that we’re selling. So whether Cisco is sold in India or Cisco is sold in the U.S., they can effectively trade that equipment with one another because they’re all using the same type, that’s really for the first time ever there’s a company and in exchange that’s disrupting that market and that’s us.
Robin Miller:I know the guys. I’m actually the only American member of the New Delhi Linux Users Group.
Frank Muscarello:Okay, interesting.
Robin Miller:And there’s also a Suncoast Linux Users Group where I live in Florida. And you know, what you are saying, I mean these are commercial guys, these aren’t hobbyists, these are the people who are running big iron and virtualize. These are the top-end guys and these are technology help groups.
Frank Muscarello:Right.
Robin Miller:I’m having this problem, help me out and that the people in New Delhi and the people in Tampa, Florida have the same problems, they use the same equipment; they listen to the same music nowadays.
Frank Muscarello:Well, but they use it differently, Robin, one would use it for less time, where one wants to use it for more, that’ true in any environment. I’ll give you an example. Chase spends $1 billion a year on their IT to run all of their businesses. You know Bank of America is using exactly the same environment, right. They’re probably buying it from the same Cisco rep. They are probably buying the same Oracle servers, et cetera. The issue is Chase’s stock is booming, capital is slowing, they’re able to buy when they want to, and they get rid of their environment every year because they can. Bank of America might be more budget conscious, may not be able to refresh as often, so they’ve got to run it for 36 months. They still run the same environment, why not let them trade amongst each other and get the greatest return. That’s the difference, is for the first time now they’re able to get to one central place to be able to get a guarantee from buy side and sell side on one central exchange and that’s market X, that’s really what we’re doing.
Robin Miller:Okay, you know Craig Newmark, is hated roundly in the newspaper business because he collapsed the classified market. He is a nice man, I know him, I like him, but a lot of the newspaper people hate him. Now the Cisco, Oracle and IBM, do they hate you?
Frank Muscarello:Look, craigslist has done an unbelievable thing for the environment, they’re disruptive force, but I would also say so is Uber, right, and so is Airbnb. So, to those that are sort of those in the market and those that essentially are providing disruptive platforms, sure there’s an element that people do not like because people generally speaking do not like change. However, the reality is we can actually help Cisco and Oracle and Juniper and any of them because we’re giving their customers a better way to refresh and refresh sooner and get a greater return on their investment. So they truly are innovative in their products and we get the company a greater return for their investment, they can then go and buy more of the technology that they need to sooner.
Robin Miller:What I’m hearing is, I mean it’s for many years car makers and I’ve told you about resale value, oh our cars have top resale value, buy it.
Frank Muscarello:Right.
Robin Miller:Isn’t that kind of what you’re saying now, the resale value is becoming a factor in your computer _____12:14.
Frank Muscarello:Robin, it’s precisely what we’re doing, it’s very smart analogy and the secondary IT market is very much like the used car market, right?
Robin Miller:Used truck market.
Frank Muscarello: Okay. Fine, however, the difference is, in those markets they havecars.comor they haveautotrader.comand they have Kelley Blue Book, they have someone telling them what the fair market value is, right. People don’t just buy a truck and then decide, oh I’m just going to leave it on the street because it’s garbage. Right? It may have no value to them, but the truck still has a residual value, just like the $100 million of Cisco networking equipment that this data center bought, it may have no more useful life to them, because they’ve upgraded and need to refresh to the next. Fine. But to the city of Chicago who is running 12-year-old legacy hardware that could yet buy two-year-old hardware and get 10 years more current than what they want for the citizens of Chicago, that’s a much better play. You could roll the same analogy to governments, to education, right, to cloud providers, you name it, hardware is the commodity, use it and trade it like one and that's why we're building the New York Stock Exchange of IT.
I pick up all the hard drives I can. (Score:2, Interesting)
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Magnets?
Slashvertisement? (Score:5, Insightful)
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Long? Bennet Haselton's titles are longer than that.
Re:Slashvertisement? (Score:5, Informative)
I would *never* make or run a paid ad unless is was clearly identified as "sponsored content" or "advertisement" or some such, and when you say that's what I'm doing without the notice, you're insulting me. No problem. I have thick skin.
What this company is doing that's different from others is building a worldwide database of used enterprise-level hardware prices. This is a GREAT tool if you need to buy or sell (or just [price) used/rehabbed equipment. Nothing to do with Dice -- although if it makes you happy to believe it does, go right ahead.
Meanwhile, I'm sure there are some Slashdot users who are looking at this and thinking, "Hmmm..... there's a business opportunity here for me."
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Thanks for the reply. It still reads like an ad. I also thought it was an ad until I saw this reply.
I didn't even get through the whole summary. I started skimming as soon as my "this is spam"
meter went off. I'm not sure what the solution is but it would be best to avoid making articles look
like someone paid you to post them.
On a somewhat related note, my dad cut up some old generators from a power plant and sold
them as scrap only to find out later that they could have possibly been worth $250k apiece
if
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Yeah, I didn't realize until rob's reply that the link actually does contain a way to sign up for their pricing database/exchange. That does seem nifty but I didn't get that from the summary.
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thanks for responding here. it did read like an ad, and i did not get a clear idea on what's so special about this company from the summary - it went round and round with cars, construction equipment... i got lost
Re:Slashvertisement? (Score:5, Insightful)
The problem is that it looks like an ad.
It seems to be a common trait of video-related articles, likely due to the way the videos are produced. Rather than general discussion of a new technology's impact or contribution to the state of the art, the videos often focus on one brand's selling points. To those familiar with the brand, the article is just a review of what they already know. To those outside the brand's narrow field, the benefits of the industry are obscured by the focus on the single brand.
This inconvenient focus often transfers to the summary as well. In this example, the brand MarkiTx is mentioned six times. In comparison, James Schlesinger's obituary [slashdot.org] includes his name only three times. Many stories include the subject's name only once in the summary. This disparity becomes very obvious when the reader skims the summary, and their eyes are drawn to the capitalized names.
Unfortunately, I don't have a good solution to recommend. The typical news outlet avoids the issue by making their segments a compilation of several interviews and depictions, but that requires a rather large investment of labor and a specialized workflow, which I don't believe Slashdot's set up for. As for the writing, it is natural that the articles read more like a press release than an article. I assume that you've spent longer writing this piece than you would spend proofreading a user-submitted summary, so it's now a personal effort. The quality of the writing is higher than the usual submissions, and as you're more familiar with the subject, it's longer as well.
In short, the whole thing just seems different from Slashdot's usual fare. Given the somewhat-paranoid anti-corporate disposition of the userbase, the assumption is that it's a sponsored submission.
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is this an ad? (Score:1)
is this an ad? you have to tell me if it is.
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is this an ad? you have to tell me if it is.
No, it's not an ad. Also no, I am not a cop.
worthmoney couldn't find ... (Score:2)
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"That does not make sense!"
That's because Chewbacca is a Wookiee that lives on the planet Endor.
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Uh, I am pretty sure they do much of this already.
I've known this for the last 20 years (Score:5, Informative)
Same thing with other tech gear, radios are particularly lucrative as they're still useable, and people like to listen to radio all over the world. Of course, you can't sell any old gear...it has to have some kind of collectors value OR usability value, perhaps even both. Those items I've collected are all high-end products from their own time. Rare portables with rare interfaces fetches a small fortune. Some laptops have very good serial port functions, and runs well on older operating systems - this is excellent for programming older micro-controllers and burning special eproms that can't be programmed with modern burners.
There are specialty plotters & cutters & cnc machines that doesn't have new drivers and the businesses can't afford to purchase new CNC machines when their old ones are doing a perfectly good job. That old computer comes in and saves the day.
If you think everything can be solved with a new computer, think again - old serial port based equipment (RS232 etc.) Parallel port etc. have timing issues with newer computers that simply are too fast, and the operating system "simulating ports" is just way too incompatible in "dos mode" etc. Trust me, I've been doing this for YEARS - and no matter HOW good you are as a coder/hardware hacker...you simply can't solve all these issues just like that.
The old "If it's not broken, why fix it?" applies here.
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See, I run a charity that gets those machines as donations - we have hundreds. So please, tell me so that I can get what we REALLY need.
Virtually none of the machines you're getting are that special. If they were, they'd have been sold or given to someone who cared.
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P4's are pretty much at the bottom of the depreciation curve. Too out of date to be used as general use machines, too new to be retro, and common enough that they're still "just an old computer". In 20 years, the P4's that manage to survive may appreciate in value, kind of like how a 486 in good working order can fetch decent money whereas in the late 90's they were worthless. But then again, maybe not.
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Come on, what a ridiculous "article" (Score:5, Insightful)
Oh, please...
Used IT gear has been sold professionally for as long as there's been IT gear.
This is just a crappy ad for another Johnny-come-lately vendor.
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So if he's just another "johnny-come-lately" then who is already doing what they're doing? Because I'd love to be able to go to one place and check prices of our old gear.
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You have clearly never worked for/consulted small businesses. Budget is paramount, and a used server can be the difference between a viable setup and a user's laptop running as a fileserver.
Dell PowerEdge (Score:5, Insightful)
Last time I went to Weird Stuff [weirdstuff.com] they had a huge stack of 1U, 8GB DRAM Dell servers for about $150 each.
I don't think a "Blue Book" system could ever work:
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Weird Stuff [weirdstuff.com]
Whoa. The kids can catch up [weirdstuff.com] with Slashdot nerd culture.
So many blade servers (Score:3)
So many good blade servers show up on ebay with pretty decent specs but they are useless without the rack to supply power and most lack a way for adding video. I'm talking about 3 year old blades with dual quad core Xeons and 8Gb of memory for $50. Even if you did rig one up the cooling fans would be deafening for desktop use.
Also a big problem in science labs. (Score:2)
Suppose a university scientist wins a grant to buy a million dollar instrument. Thirty years later, the scientist dies. Nobody knows what the instrument is anymore, or what it is worth. University policy does not allow the sale of excess property. Nobody knows what restrictions were placed on the sale of the equipment in the grant award. Nobody wants to pay money to figure any of these things out. So, the equipment is either ignored or landfilled.
In my experience this happens often.
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Suppose a university scientist wins a grant to buy a million dollar instrument. Thirty years later, the scientist dies. Nobody knows what the instrument is anymore, or what it is worth. University policy does not allow the sale of excess property. Nobody knows what restrictions were placed on the sale of the equipment in the grant award. Nobody wants to pay money to figure any of these things out. So, the equipment is either ignored or landfilled.
In my experience this happens often.
Yup. At work there is still an old VAX sitting in a room because nobody wanted to deal with the disposal forms. It still had residual capitalization since the asset was tied to the value of the work required to deploy it (the hardware is the cheap part of a custom software project), and the writeoff went across many years. It couldn't be disposed of without fully depreciating it, which is a PITA. So, it just sits there.
The value of any kind of specialized hardware also depends greatly on finding the rig
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I've seen it happen too, and the time scales are often a lot sooner than 30 years. All it takes is a professor leaving for another school, or in some cases all the grad students who were the actual users graduating. Oftentimes the true ownership of the equipment is confused enough that no one is sure who it technically belongs to, but the threat of an audit from the feds/state/university is enough to keep them from disposing of it, so the equipment just sits.
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I tend to packrat hardware. It pays off in the long run. When I want something, I build it. When the clutter starts to grow I will throw parts on EBAY and see what flies. Usually I can get about $10 per part for most, some I get nothing.
I just sold late 90's HP RAID controllers for the NetServer SCO servers, new in the original box. I got $900 each for them. Somebody has an old server running a critical legacy application, when they see working spare parts for it, they snatch them up. Apparently there were
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I think you can get both lightly used almost anywhere. Microcenter around here has PATA drives of all sizes and AT power supplies can be had online.
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"If I were building a secure network machine,"
I would got with SPARC, you can get SPARC stations for dirt and they have decent specs even today. Compile BSD for it and you will have a 100% virus and trojan proof computer.
Go with a robust and oddball platform. If you want flashy and street cred, get your hands on some old Silicon Graphics hardware.
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Compile BSD for it and you will have a 100% virus and trojan proof computer.
While it may be true there are less known exploits for oddball platforms, an oddball platform is not inherently more secure, and certainly not 100% virus / trojan proof. All you do is add a level of difficulty, which may stop script kiddies, but a determined attacker (or sophisticated attacker who might see more oddball equipment then you think (read NSA)) will still get through.
The problem with eBay to sell electronics (Score:2)
eBay could be the perfect place to sell used electronics. The problem is the way they handle auction / buy-it-now listings.
Suppose you have a used Dell-brand server. You know that almost nobody is going to spend more than $800 on it, because for that money you could buy a new model. On the other hand, you figure someone out there might spend $500 on it because they're nearby and need it ASAP. And, you're willing to let people bid on it for a week and get it rid of it at the end of the week.
You can't acc
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If I'm the seller, I don't care if someone needs it right now. Once it's passed the reserve price, which should also be the buy it now price, I'm getting more money so those people's problems are not my problems. Yay capitalism!
eBay most specifically wants it to sell for as much as possible so they get a bigger cut
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You should care. If someone needs your widget right now, is unwilling to wait a week for your auction to end, and is willing to pay more than your reserve price, then you're losing that sale opportunity. That's where the reserve == BIN assumption fails.
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You should care. If someone needs your widget right now, is unwilling to wait a week for your auction to end, and is willing to pay more than your reserve price, then you're losing that sale opportunity. That's where the reserve == BIN assumption fails.
It only fails if you fail to match your reserve to your buy it now price.
If your goal is to fleece someone hard because they need the hardware now, I'm not sad that eBay won't help you.
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That, plus the fact that you need to find a buyer willing to pay for your item during the 7-day window that you've run your auction, and who's willing to wait until next Tuesday to get it.
eBay is terrible for low-volume items for this reason. (I personally flooded the eBay market for SGI Indigo workstations a while ago -- the first two sold, the rest of them never did)
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Auctions might be fine for very casual purchasers, but people who actually need to get something to get the job done are shut out by an auction
They have double the fees of eBay (Score:2)
I do sell IT surplus equipment and the real issue I see here is that the fees are about double that of eBay's. The exchange getting a 20% cut is a huge deal on the lower-end items. Combine this with their limited user base, general shopping practices, and small amount of value add, it's not worth the extra pricing information.
For instance: I have a stack of Cisco 2960G Switches. I can go to eBay, do a search for closed auctions, or go to any number of pricing services to get historical selling prices. Sinc
Sign-up required to browse (Score:2)
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That's insane. 20% commission is absolutely ridiculous for an online middleman used gear matchmaking service.
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Thank you very much for reaching out. User-experience on the MarkITx exchange is our number one priority. I am sorry that you were annoyed.
My name is (redacted) and I would love to assist you anyway I can. Was there anything in particular you were looking for, to buy or sell? If so, I can definitely help you with that. The reason we encourage sign up to view items on the MarkITx exchange is t
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Junk? (Score:2)
I checked prices of stuff I've been trying to buy, and its way, way off. Like 10x off. C2950's used go for like $18-150 and they say it starts at the high point. Ok, sure. Maybe its all new stuff, but I cant tell, so what good is this?