Deeming Regulations have been released!!!!

[Eskie]

I wish I could find the source for this but I really did read it. the current e-cig market is ~$3.4 Billion dollars. Of that, 2/3 is on cigalikes, or roughly $2 Billion dollars, which it s the market segment already occupied by BT. "We" are only one third of the total sales in vaping.

With that figure, it's easy to understand how it all works out to be a win/win for BT, but why they would want to change the predicate date. Remember, their products were not on the market in 2007, which means they will have to go through the approval process and "potentially" not be approved. In many ways, they're in the same position of us vapers. No one knows for sure if the FDA will ever even approve any product.

Yes, BT has lots of money to sepnd on all the paperwork. But what would be better for them? A guarantee of being on the market with Blu, Vuse, Market, as they currently are if the predicate date were changed, as they already "own" most of the c-cig business (by revenue)? Or would they rather take their chances on getting their PMTAs' approved by leaving the regs in their current form and hope they can spend enough on testing to meet the as of now unstated expectations the FDA will require for "approval"?

That's why it's a win/win. If the predicate date is changed to 2016, all the products BT has are set to stay on the market as is, and currently bringing in $2 Billion dollars. If the predicate is unchanged from 2007, BT at least knows they're the only ones likely big enough to ever get a PMTA approved.

If you think of future sales, most are going to go to cigalikes, as that's the typical path for a smoker. Whether open vaping systems remains around to compete really doesn't matter in BT's math.

 

[DC2]

If you think of future sales, most are going to go to cigalikes, as that's the typical path for a smoker. Whether open vaping systems remains around to compete really doesn't matter in BT's math.

I don't remember ever disagreeing with anything you've posted.
But if the grandfather date changes then Big Tobacco will eventually get buried.

Maybe not short term, but in the long run.
That's the only way I can see it, but I might be missing something.

 

[Eskie]

I don't remember ever disagreeing with anything you've posted.
But if the grandfather date changes then Big Tobacco will eventually get buried.

Maybe not short term, but in the long run.
That's the only way I can see it, but I might be missing something.

The way I look at it, when you already own two thirds of the e cig market, and growth is expected to be significant as more and more folks transition from combustible tobacco to e cigs, most of those folks are going to a cigalike, at least at first. Think how many folks here started out that way before transitioning to an open system. Look at how ubiquitous cigalike availability is at any gas station or convenience store. As long as they can continue to reach out to the same people buying a pack of cigarettes and then seeing a cigalike next to it, impulse purchases becomes more likely as well.

The e cig marketplace has the potential to continue to rapidly expand. If you already hold 2/3 of that market, which BT essentially does by revenue, assuring that the products you already put a great deal of money in to will be paramount. That's what changing the predicate date offers BT. Yes, it means open systems will remain as competition, but closed systems offer real benefits for widespread adoption. Even on this board folks will look at newer closed systems coming along.

I just don't see open systems knocking closed systems out even over the long term. They will coexist, and BT will own the loin's share of the closed system marketplace.

 

[coldgin96]

But if the grandfather date changes then Big Tobacco will eventually get buried.

Not if you're the only one's who can afford PMTA's and thus be the only players with new, innovative products.

 

[Semiretired]

I just don't see open systems knocking closed systems out even over the long term. They will coexist, and BT will own the loin's share of the closed system marketplace.

Even with the open systems - there are a lot of people that don't want to change / recharge batts, DIY, etc. They just want to charge, add juice and vape... So in a way they would be the mid way market...

 

[Kent C]

Please don't pick and correct parts of this. It's not an argument.

It would be too long of a post anyway As Zoidman points out, BT doesn't get much for their product vs. what the feds and state gov'ts get. If anyone is 'gouging' it's gov't. From an earlier post:

saw this at Yahoo - so take it for what it's worth:
Per pack cost : 27 - 35 cents a pack.
RJ Reynolds price to dealer 63 - 87 cents a pack.
Average store profit $1 the rest is tax.

Source: have worked for rjr since 1982.
(a month ago)

If you 'follow the money' you will end up with sales, mostly. It is only when gov't is involved where 'follow the money' makes any sense. And then it shows 'control'. And the original line was likely from a writer of "All the President's Men" not from Woodword and Berstein. (or Woodword made it up like he has many of his "stories".)

 

[skoony]

I am only bring into Question what is the Motivation as to Authoring/Supporting/Backing such a Bill?

Perhaps it is to offset the idea they were behind the deeming regs. Whether they
were or not isn't important. Many of us have lamented that the regs give BT
the vaping industry hook,line and ,sinker. Even the ANTZ are starting to
pick up on this mantra and are using it to push for even harsher regulations
and more scrutiny of BT.

I wish I could find the source for this but I really did read it. the current e-cig market is ~$3.4 Billion dollars. Of that, 2/3 is on cigalikes, or roughly $2 Billion dollars, which it s the market segment already occupied by BT. "We" are only one third of the total sales in vaping.

I have seen references that seem to indicate that cigalikes seem to dominate
the market. There is a trade magazine for convenience stores that I have seen
referencing simulator outlays for the market. I believe these figures just represent
sales from the non-tobacco store/vape store retail outlets. It was noted earlier
in the year these figures were declining. Coincidentally I have noticed in the new
members section the vast majority are starting out on advanced devices.
Regards
Mike

 

[Eskie]

I have seen references that seem to indicate that cigalikes seem to dominate
the market. There is a trade magazine for convenience stores that I have seen
referencing simulator outlays for the market. I believe these figures just represent
sales from the non-tobacco store/vape store retail outlets. It was noted earlier
in the year these figures were declining. Coincidentally I have noticed in the new
members section the vast majority are starting out on advanced devices.
Regards
Mike

While you are correct folks showing up in the New Members area are using advanced, or open systems, the folks you find there are a self selected population. They're the ones motivated to use something "better" and seek out a forum like this to help guide them in their purchase and use of vaping gear. The larger market of closed systems supplied by BT don't come here, at least not unless they get tired or dissatisfied with their cigalike and want something better.

 

[Semiretired]

While you are correct folks showing up in the New Members area are using advanced, or open systems, the folks you find there are a self selected population. They're the ones motivated to use something "better" and seek out a forum like this to help guide them in their purchase and use of vaping gear. The larger market of closed systems supplied by BT don't come here, at least not unless they get tired or dissatisfied with their cigalike and want something better.

Yep that was me. When I first started looking into vaping - I looked at the malls and the gas stations and decided there had to something better or at least I wanted to learn more about this stuff before I jumped in - I found ECF... Google was my friend. But a lot of people don't research before they jump in. They just jump.

 

[Eskie]

Hey, that's how I started out. Went with Vuse for a trip as I was tired of not being able to smoke anywhere, and hated leaving my hotel room to go downstairs to step out for a smoke. Turned out by the time I got home 5 days later I was all switched over. Tasted like meh, but with 48 mg nic, it sure took away my desire for a cigarette. Got tired of buying those expensive cartridges, did some hunting, and eventually ended up here. But if it hadn't been for that experience with Vuse, I never would have gotten this far. Now I have a desk cluttered with tanks, mod, juice bottles, along with drawers stuffed with well, stuff, and boxes filled with more supplies and juices.

Oh, and all that nic in the freezer for my vapocalypse stash. Quite a journey over the past year or so (it will be a year at Thanksgiving I started with Vuse, and the the past Spring for actual "vape" gear).

 

[mikepetro]

Not to mention, and I know this for a fact, BT will pressure C-Stores into carrying their ecigs under threat of cutting the C-store off from their name brand cigarettes. "You stock our ecigs or we wont sell you any Marlboros"! (Not sure if Marlboro was the company, just used them as an example, but it was one of the big 3)

 

[zoiDman]

Not to mention, and I know this for a fact, BT will pressure C-Stores into carrying their ecigs under threat of cutting the C-store off from their name brand cigarettes. "You stock our ecigs or we wont sell you any Marlboros"! (Not sure if Marlboro was the company, just used them as an example, but it was one of the big 3)

Wow... Market Manipulation by BT.

Who-Da Thunk It.

 

[seminolewind]

Wow... Market Manipulation by BT.

Who-Da Thunk It.

They are still lying slithering snakes who will do anything they can to keep their fortune rolling in by keeping their addicts addicted.

IMO BT has been on this for years putting their plan together. They have people that do that. And lots of lawyers. And the drive to keep the billions flowing in. I don't think that anything they do is what it seems. Everything that they do is done for them to come out on top with their competition squashed. There's no guessing what cards they play . It's all about money.

"Follow the Money" IMO is who benefits the most from the sale of cigarettes? I think in terms of whatever BT does Is related to keeping the big money coming in. Who's 2nd?

 

[seminolewind]

Yep that was me. When I first started looking into vaping - I looked at the malls and the gas stations and decided there had to something better or at least I wanted to learn more about this stuff before I jumped in - I found ECF... Google was my friend. But a lot of people don't research before they jump in. They just jump.

Yup starting will a mall or gas station e. cigarette is okay until you realize what else is out there and how good it really is. Someone told me they bought an ecig and ejuice at a gas station and inhaled once and it was burnt and nasty tasting and they threw it away. Why? No one was there to tell them that they need to put the juice in and wait 5-10 minutes while the juice gets wicked up.

 

[Rossum]

"Follow the Money" IMO is who benefits the most from the sale of cigarettes?

Kent C answered that in the second post of this page.

The FedGov alone gets double to triple the profit that BT makes on each pack. Most of the individual states get even more than that.

 

[Lessifer]

Kent C answered that in the second post of this page.

The FedGov alone gets double to triple the profit that BT makes on each pack. Most of the individual states get even more than that.

That math doesn't quite add up though. I'm not arguing the point, just the math. Ok, maybe I'm arguing the point that BT does make a significant profit on their cigarettes, though it may not be the majority of the price to customers.

In California a pack of Camel's regularly costs about $5.15(before sales tax). The fed takes $1.01, currently the state takes $0.87, and if the cost to produce is $0.35 which leaves $2.92 of profit for someone. My father used to manage a grocery store, cigarettes are not a profit maker for the stores, they are often a loss leader meaning that they are sold for as little as possible in order to attract customers into the store.

Recently, there was a bill proposed in California to limit cigarette sales to stores who made the majority of their sales numbers on tobacco products, i.e. tobacco stores and not gas stations/c-stores and there was a lot of noise made from those c-stores. The sales of tobacco themselves would be a negligible loss, but the add-on sales those stores would lose out on without cigarette sales would put many of them under.

 

[Kent C]

"Follow the Money" IMO is who benefits the most from the sale of cigarettes? I think in terms of whatever BT does Is related to keeping the big money coming in.

Who benefits the most from the sale of iPhones - Apple..... from the sale of Chevys - GM.. from the sale of gasoline - Exxon Mobile.... from the sale of Big Macs - McDonalds.... d'uh.... All do whatever they can to 'keep that money from coming in'. Or they'd be out of business.

 

[seminolewind]

That math doesn't quite add up though. I'm not arguing the point, just the math. Ok, maybe I'm arguing the point that BT does make a significant profit on their cigarettes, though it may not be the majority of the price to customers.

In California a pack of Camel's regularly costs about $5.15(before sales tax). The fed takes $1.01, currently the state takes $0.87, and if the cost to produce is $0.35 which leaves $2.92 of profit for someone. My father used to manage a grocery store, cigarettes are not a profit maker for the stores, they are often a loss leader meaning that they are sold for as little as possible in order to attract customers into the store.

Recently, there was a bill proposed in California to limit cigarette sales to stores who made the majority of their sales numbers on tobacco products, i.e. tobacco stores and not gas stations/c-stores and there was a lot of noise made from those c-stores. The sales of tobacco themselves would be a negligible loss, but the add-on sales those stores would lose out on without cigarette sales would put many of them under.

This is exactly what I was wondering-how the profit gets split up.

 

[seminolewind]

[QUOTE="Mazinny,

What their real motivation is, i don't know. Fact remains, their opposition to the deeming regulations has gone way beyond writing sob stories to the FDA and playing the " victim card " and " pretending to be friends to vapers ". They have actively lobbied many members of congress, and orchestrated the push behind HR2058 and Cole/Bishop. HR2058 is their bill, literally, word for word.
[/QUOTE]

This is why I say "follow the money". I think it does clear up what the real motivation is. That's why I think that they started planning how to win this without stinking years before.

 

[Kent C]

In California a pack of Camel's regularly costs about $5.15(before sales tax). The fed takes $1.01, currently the state takes $0.87, and if the cost to produce is $0.35 which leaves $2.92 of profit for someone.

. Federal cigarette tax is $1.01 per pack. Not shown are the special taxes or fees some states place on cigarettes made by NonParticipating Manufacturers (NPMs), the companies that have not joined the Master Settlement Agreement (MSA) between the states and the major cigarette companies. Some local governments also have their own cigarette taxes, such as Chicago ($1.18), Cook County, IL ($3.00), New York City ($1.50), Philadelphia ($2.00), and Juneau, AK ($3.00).

https://www.tobaccofreekids.org/research/factsheets/pdf/0222.pdf

Also look at state 'wholesale tax' on cigarettes... too many to list here.