- Written by Ken Kessler Ken Kessler
- Category: SoundStage! UK SoundStage! UK
- Created: 01 August 2016 01 August 2016
[Warning: If you are easily offended, or a Democrat, or earning less than $200,000 per annum and bothered by it, or are inherently antipathetic to those with money even if they’ve earned it by hard work, please skip this month’s column, because no apologies will be forthcoming.]
Human nature leads us -- no matter how hard we might try to resist -- to utter those chastising words “I told you so” whenever the opportunity arises. Along with wallowing in schadenfreude, I do admit that it’s ugly. But in this case, it’s deserved: the two most satisfying high-end audio launches I’ve ever attended took place this year, in exactly the manner I have been screaming about for a quarter-century, and they worked as I knew they would. So, to the sluggards and slackers and losers in the hi-fi business: I Told You So.
Let’s back up a bit. On numerous occasions, during the past 25 years and in both the trade and consumer press, I have berated the high-end audio industry for its single-most inexcusable sin: a total lack of professionalism. High-end audio is the only commodity with luxury-sector price tags that absolutely refuses to address the very people who can afford the stuff. It still behaves like those warehouse-type outlets serving computer geeks circa-1976. But the hi-fi industry needs to learn that, to the people who can afford their goods, the smell of hot solder is not the same as Acqua di Parma.
For more than a half-century, as long as high-end audio has existed in the price plateau above mass-market dreck, the manufacturers have unfailingly addressed only committed audiophiles and the audio press. They’ve preached only to the converted. To make matters worse, they’ve been proselytizing to a market sector in which the majority of people simply cannot afford what they’re selling, and they are the sort of letter writers (or, nowadays, Tweeters and e-mailers) who respond to this by whining and bitching about prices.
You don’t believe me? Then, please, show me a car magazine or website full of complaints about the prices of Ferraris, Maseratis, etc. Show me a watch magazine or wine magazine or fashion magazine where the letters pages are full of kvetching about price. You cannot, because those readers -- whether they can afford the stuff or not -- accept that the goods are high-end and therefore expensive. The difference is, they aspire to them, while hi-fi bores prefer instead to whinge.
This quasi-socialist attitude has affected, too, the manufacturers who produce $100,000 loudspeakers or amps, for they, by and large, are of the same left-wing/socialist hypocrites. Like them, many of these manufacturers loathe the very people who can afford their goods. Trust me: at least half the hi-fi industry, from retailers to journalists (especially the journalists, the worst hypocrites of all) to manufacturers, are currently in mourning because Bernie Sanders lost out to Hillary.
In my little world, “incompatibility” in hi-fi should refer to more than a mismatched amp and speakers: it should also be applied to the disconnect between the hi-fi industry and fiscal reality. Sorry to break it to these guys, but it’s the wealthy who subsidise the entire industry for the rest of us, just like the passengers in those first-class seats in the airplane subsidise your economy ticket. And you hate them for it.
As unjust as this may seem to you, single-parent Somali immigrants and Lesbian buskers on welfare and refugees from Syria and underpaid avocado pickers do not buy moving-coil cartridges and air-bearing tonearms. If Magico, Wilson, MartinLogan, D’Agostino, Audio Research, McIntosh, Threshold, VPI, Vandersteen, Nagra, darTZeel, TechDAS, SME, Koetsu and the 500 or so other brands in the specialty audio sector depended on “regular” folks, i.e., those earning “normal” wages, buying their stuff, they’d all be out of business.
Here’s how bad the audio industry’s incompetence is: according to most sources, there are roughly 35,000,000 (dollar) millionaires on earth. Thirty-five million people who can afford any high-end gear they like. Conversely, the most dependable research I’ve found, based on things like magazine circulation and unit sales, suggests that there are only between 100,000 and 200,000 serial-purchasing audiophiles in the world. This is why newsstand hi-fi magazines have global circulation figures so low that a local newspaper like the Poughkeepsie Journal has a vastly higher figure. (And in case you’re wondering, the latest figures place the PJ’s sales at 103,000.)
Now do the math: if there are 35,000,000 millionaires on earth, and Ferrari has no trouble selling 5000 to 7000 cars a year, and Rolex has no trouble selling circa 1,000,000 watches every year, why is the total market in the USA for high-end audio worth less than an estimated $350,000,000? I can name watch brands you’ve probably never heard of doing double that, and with their cheapest models starting at $2500.
With the exception of hi-fi’s multiple-brand conglomerates like Harman International or McIntosh Group, and a lone giant in the form of Bowers & Wilkins, there are no high-end audio brands turning over anything near that. The most prestigious high-end audio brands aren’t even minnows in the real world. Indeed, they barely qualify as plankton.
For this, they should all be ashamed, because the opportunities have been squandered. Music is omnipresent and universally experienced and enjoyed, save for countries ruled by ISIS. Everyone loves music. Millions of millennials and X-gen kids are wired to music 24/7, and plenty of them have money. Hipsters spend like there’s no tomorrow. So tell me: why should the likes of Bose and Beats and Apple earn many times more than all the rest of the hi-fi brands combined?
Simple: professionalism. And that involves words considered dirty by the ideologue-driven former hippies running most of the high-end audio sector: “advertising,” “marketing,” and “promotion.” You don’t have to graduate from Harvard Business to realize this: if nobody even knows you exist, how do you expect to sell anything?
You’re wondering, by now, what happened to provide the teensiest, tiniest glimmer of hope for me this year. Not counting Meridian’s launch of MQA nearly two years ago in London, because it was aimed solely at potential licensees in the form of record labels’ executives and selected members of the press, but not at consumers, two debuts have given me reasons to be slightly optimistic.
Twenty-five years ago, when the UK had a scurrilous trade magazine called Private Eye-Fi, I was berating in its pages hi-fi manufacturers for completely missing out on the biggest increase in consumer spending the luxury sector had ever seen: the post 1980s / early 1990s elevation in aspirational targets. It affected the global market for everything, from coffee and suitcases to sunglasses, cigars, and cufflinks. Yuppies, maturing baby boomers, early dot-com money -- I don’t care who had the cash; they wanted quality goods. A new dawn declared: make something better, make it exclusive, make it desirable, and people will buy it. Period.
Italian style no. 1
This year, a new brand called Yar decided to skip the traditional hi-fi show misery. The company makes only one system, it starts at £250,000 depending on the chosen-and-bespoke finish, and only 99 systems will be produced. It consists of floorstanding speakers and a tube-hybrid control amplifier/DAC to accommodate any and all sources. One of the two founders was Italy’s distributor for MBL, so he knows what’s what; this isn’t the creation of an “outsider.” How did they launch it?
First, they hired a professional PR company with a mailing list that goes beyond the hi-fi titles, featuring mainstream magazines read by ABC1s. Then they set up a system in one of the most luxurious buildings in London’s Mayfair and demonstrated it to invited guests. Finally, they exhibited not at some crappy little hi-fi show with a turnout smaller than a typical bar mitzvah, but at a luxury lifestyle extravaganza called Masterpiece London, alongside antique shops, art galleries, and bespoke tailors.
And what did it do for Yar? It earned coverage in every major upscale magazine and website in the UK, places that the most hallowed of high-end brands would have to kidnap the editor’s children to get into. Overnight, Yar made its mark . . . among those who can afford it.
Italian style no. 2
As for the second, it was McIntosh Group’s decision to gather retailers, distributors, and members of the press (including lifestyle publications) for a three-day conference, free of the distractions of rival brands as at CES, and with presentations worthy of a new car launch. The star of the show was the Sonus Faber Sf16 all-in-one unit. The result was blanket coverage and, most importantly, a complete sell-out of the first 200 units, at roughly €8000 apiece at retail. That’s €1.6m in sales for one rather specialised product, way above what an Apple Store would ever carry.
Mirko Sanna leads off the McIntosh Group presentations
MG used professionally made films, over-the-top fanfare, a professional compere, and deliberate melodrama. I was reminded of automobile launches. They built up the suspense. They delivered a product worthy of the ballyhoo. The vast majority of the audience had never seen anything like it. What they were used to was some poorly attired slob talking about custom-made capacitors.
Yar and McIntosh Group showed that it can be done. Hi-fi manufacturers can -- and must -- emulate Hermés and Cartier and Goyard and Porsche, and we know that they can do it without compromising performance one iota. Thus, even unreconstructed audiophiles would have absolutely no grounds for complaint. Unless, that is, they really do hate the idea of their beloved hi-fi brands making a profit.
Ken with the Sf16 and Mauro Grange, Mcintosh Group CEO
[Postscript: After the MG event, I heard one of the distributors, in classic audiophile fashion, whining about how the presentation was all show-biz and how it was “all about them.” D’oh -- what a moron. I wanted to wring his neck. And to tell MG to fire him immediately.]
. . . Ken Kessler