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I bought for the purpose of comparing both a pair of Merlin TSM Black Magic with Master RC's and a pair of Maggie 1.7's. Sold the Maggies!
Love my Merlin Monitors. I think Bobby had a great speaker design.
Has anyone thought about gracefully and respectfully approaching the family to acquire the business? Could be a great opportunity for someone wanting to own their own audio business and also benefit his survivors. I'd hate to see this speaker design end.
Always enjoyed the time Bobby would take in talking with me, but maybe he was not the best business man. Will miss you Bobby.
Follow Ups:
John. thanks for the Basia bit, what a voice and tune. Made my day. Sorry for the diversion, back to Merlin etc.
I handled one semi-large transaction, an audio company where the founder was still alive and wanted out. It was a going business and reliably profitable and its books were in good shape, good enough to be audited by a stranger, and that is not usually the case!!!
My client did not want to spend the money, but I insisted that he get an independent business valuation from a certified analyst.
Best $5000 the guy ever spent.
The business valuator phoned me to say, "He has to sell as soon as possible. He is not quite breaking even on operations. The business is only profitable because of currency value imbalances."
And when the table turns, much misery ensues.
My guess is that of the hundreds of loudspeaker businesses listed in Stereophile's buyer's guides, the top 20% are plausible acquisition targets (Wilson Audio), the middle 60% would be a case of, you are buying yourself a 60 hours per week job that doesn't pay better than any other job, and the bottom 20% have no commercial value.
Fine audio is a totally mature industry that hit its peak in the 1970s and has been being squeezed in a vice since then. The high-end loudspeaker business is in the game of "Last Man Standing." Unless a business has a robust US dealer base plus steady exports to at least a dozen countries, it can't be worth much. Especially if the new owners have to hire people to build the loudspeakers.
Sorry to be a wet blanket, and no disrespect to Bobby. He and his wife were on my prayer list, but I had no idea at all that his situation was more perilous than hers. I emailed him and heard back from him less than a week before he died. So, I am still a bit in shock, and very saddened.
To use a different example, how much is the intellectual property (all the patents are expired...) and production equipment of Shahinian loudspeakers worth, in that they have as far as I know no US dealer base at all. You pay somebody some large amount of money to roll up your sleeves and work like a dog, while Andrew Jones is making $300 loudspeakers that are all the loudspeaker most people want.
Audio is a very tough business these days, and loudspeakers are extra tough because the cost of entry is not all that high. Five thousand bucks later I can have prototypes and a trademark and a room at a high-end audio fest. I might get lucky (speaking only hypothetically).
So, terribly sorry all around.
john
Your Numbers are off, Marks .. I would agree with the 20% , the other 80% has no value..
Regards..
Edits: 09/18/15
John,
I love audio, and worked in the industry during the late '80s and early '90s- did not see the long term growth for a worker (Not designer/owner), and so I went to traditional business-
I have had to switch industries a few times - I want to stay in the bay area - but I do not regret the decision.
Yes you can make money in this business, but it is fickle and discretionary.
Happy Listening
FICKLE
and
DISCRETIONARY.
When we cleaned out my mother's basement after her death, there were enough stereo components to make three and perhaps five systems. And stationary bicycles and other exercise equipment, and regular bicycles, too.
Back in the 1960s, if you wanted good sound, you had to buy component audio.
Today, I tell musicians to listen to test CDRs in their cars, the car is the best stereo system most people will ever have.
Most home theaters can play a CD or a concert DVD.
Cellphone sound stinks, but people still push in their earbids.
Add it all up, most people are doing fine without component audio.
So, the ecosystem has changed radically in 50 years, but, a lot of the audio industry persists in outdated thinking, outdated behavior patterns, and outdated business models and expectations.
Component audio today is a LUXURY good, but the problem is, it does not have the cross-platform aspirational appeal of all other luxury goods such as expensive wristwatches, for two immutable reasons:
1. A wristwatch takes up about 12 square inches on your dresser and a nice piece of Impressionist art a couple of square feet of wall space; but a full-range stereo system takes up floor space and shelf space in your living area and in most cases will dominate the room.
That living-space grab disqualifies more than half the market: "You are not putting those huge things in MY living room."
2. An ambitious stereo makes sense only if you sit down, shut up, and listen carefully. Please re-read that sentence!
If all you want is background music to accompany entertaining or any other activity, Sonos has got you covered for $600.
The only audio companies that will survive long past the death of their founders will be the ones that are not in deluded denial about the above, and that can offer both a Unique Selling Proposition and an Undeniable Value Proposition.
Ciao,
john
Despite all this I still marvel that a company such as Beats (Headphones and other) could be formed a few years ago and "succeed" in the audio business despite all the headphone companies that have been around for at least decades yet they were unable to seize upon the market that Beats took advantage of.
Course, I guess the answer is that they arent really an audiophile product -and to some degree explains why those extant companies would not "do" what they did - but again goes to show how "audio" and audiophile are really different things - a gulf that could be bridged in some cases but more often is not
JaroTheWise
And don't forget, everyone can see the wristwatch when you go out, along with your suit, as well as your house and the car in your driveway. They can't see the stereo.
I think you've just summed up Bose's philosophy and answered the question "Why do they sell so well?" It's exactly what most people want.
...and an aggressive, targeted marketing campaign doesn't hurt, either.
Audio is a very tough business these days, and loudspeakers are extra tough because the cost of entry is not all that high. Five thousand bucks later I can have prototypes and a trademark and a room at a high-end audio fest. I might get lucky (speaking only hypothetically).
The other problem today is most people can look at your speaker and figure out what the materials cost unless you do something very custom. The only thing that gives your box more value than that is people's trust in your voicing skills.
Thanks for the thoughtful post...
I agree that voicing is important, but there is more to to it than that.
I think that people also have to trust you to deliver a Value Proposition that makes sense for them.
And of course, that is a very personal thing.
I am a big fan of the Value Proposition of Harbeth's P3ESR, which is an LS3/5A descendant. I think that its heritage and looks and build quality easily justify its price, which is over $2000 a pair.
Another person might loudly scoff.
That person might say that the only speaker that makes sense for him is the new entry-level Sonus Faber that has replaceable side panels and which retails for $900/pair.
I think that in today's marketplace, a speaker has to do more than sound good or even look good. It has to warm the cockles of the customer's heart in a certain way.
For customers of Merlin Music Systems, I think that the personal connection with the builder and the aura of exclusivity and the sense that buying that speaker means that you make up your own mind and march to the beat of a different drummer all were part of the value proposition over and above how the speakers sounded.
Ciao,
John
Thanks for the reply. I agree there's more to it than what I stated.
Another aspect I forgot is the furniture/bling aspect (which you alluded to with the Sonus Faber). Companies like Salk make beautiful customized cabinets and for some people, the fact that there's a competent speaker design included is quite secondary.
My main point is that unless you're a really big end-to-end speaker maker, it's not hard to figure out where you get your parts and what you probably pay for them. This is actually a good thing since there have been companies who bought $1.50 drivers and hid behind a premium image (I have 2 names in mind.... one of them is very short).
hi-
The Sonus Faber speaker at $900/pr. I mentioned is not a bling item. It is made in China to a price point. The side panels that are replaceable are solid colors and not furniture wood.
Whereas, Harbeth's P3ESR, while I would not call it bling, is built to Fine Furniture standards.
Some people think paying for that quality of construction provides enjoyment for them over and above the sound, and I somewhat agree.
JM
John,
Would that be the Venere line? I believe the lowest price model starts at 1200 a pair.
nt
I think that the concept of a value proposition is a relevant idea in the context of this discussion on Merlin. For a small niche segment, the Merlin's speakers had a high-value proposition, and only if you buy into the full "package" as marketed by Bobby. You need to by the amps he suggests, the Cardas cables etc. All these dependencies make the niche smaller and smaller and in the end the business model is no longer sustainable. Having only 2 models might save on input costs as well, but doesn't work in favour of trying to win new customers that are not in the niche segment, as well making it difficult to justify marketing spend in a very connected global marketplace.
Furthermore, I guess, and only based on my own assumptions, he bought large stock of the 4 drivers he decided to work with many years ago and build competence to bring the best out of these drivers. When he reached a ceiling, limits to growth, he tried to reinvent the models by offering upgrades, as outlined often in threads, (Bam, lead-free etc) and never worked with different basic building blocks-newer technology from Scan-speak, which might and probably surpassed for example the midbass driver he use in the VSM.
It is a classic tale of how one's success can lead to one's failures as it blinds you for new strategic opportunities.
Support from those in the niche segment became stronger to a point of being evangelic and fanatical and which in turn probably did not help Bobby to read the signs of the failure of the strategy and business model accurately or with enough foresight.
Maybe Bobby was a talented designer, I think he was, but his business strategy and supporting business model failed in the end. I am curious as to how many Scan-speak midbass 8545 units, Esotars, and Morel drivers are in stock at Merlin and whether it has been paid for..
I think the human side of all of this is a completly different story altogether.
Stefan,
Bobby never bought a large stock of drivers unless he absolutely had to AFIAK. The most of any one driver I ever saw at the plant at any one time over the years(stretching over 20 years of which I probably made several dozen visits to Merlin) was probably a couple dozen pairs of Dynaudio Esotar tweeter (only because I think Dynaudio required such a minimum purchase quantity after they stopped offering their drivers to the public marketplace and Bobby had to buy them from Dynaudio directly). The last time I visited Bobby/Merlin (this past spring IIRC) I did not see any large stacks or inventory of drivers there.
He stuck with the drivers the TSM and VSM used over the years because he liked them and how they worked in the designs he had. For example, I know he was not a fan of the recent Scanspeak (ring radiator I think its called) tweeters. He did not like the Esotar2 as well. He did not always see something new (driver tech wise) as better.
I do think he hit a funk (in not developing a new speaker to add to the line up) during the past 7 or so years... many of us (friends in the trade and customers) repeatedly asked him about making a 3-way. The why that he did not do that was I think many fold (and not all business/market related).
Happy Listening,
Rich Brkich
Retailer & Audio Asylum Industry Liaison
Rich
Your views are probably the most informed views of what lies beneath the problems at Merlin. In my post I tried to stay objective and tentative about the situation that unfolded. The Hifi industry, perhaps like the wine industry, are notably driven by the passion of the chief designer or winemaker. A very focused approach and almost blind faith are required to get unique products out there. This passion to a chosen pathway is is both required but also a serious risk of such endeavours. The challenge is to find enough customers to make one's vision viable from a business perspective.
For me, the Merlin scenario is interesting from many perspectives. I have one foot in the hifi world, and another as a strategist for companies large and small. I have also dabbled with speaker design as well and know very well how treacherous that idea can be and therefore, ringfenced my obsession as a hobby.
Bobby's views informed my own thinking, and I still agree for example with him that working with a driver you know very well is probably a better approach than going for the latest and newest ones on the market. In that sense. I also don't care much for the Scanspeak radiators as tweeters and would prefer the Esotar any day. However, and purely as an example, I also realised that the same ring radiators are not bad units but more importantly that many audiophiles out there were of the opinion that they represent the best that there is. I think lately the Beryllium tweeters are now in vogue.
I only focus on one angle in this analysis and as highlighted by other inmates there are also other aspects such as industrial design of the Merlin range, the limited range, no 3 way etc. that we can bring into this analysis.
In summary, this thread is about Merlin as a business, and not about the sound quality of the VSM or TSM. In strategic literature, the idea of a "slow death" is often discussed as a function of the inability of a business to read changes in the marketplace and customers needs, values and perceptions. accurately. The passion to start a business is not always functional to sustain a business. That is why new competencies are enlisted by companies that focus sustainability and the founder is very often elegantly sidelined and even removed. The nature of the beast we call business. Maybe Sonus Faber with Franco Serblin as founder and how he made space for new ideas can be cited as an example of dealing with the challenges of sustaining growth.
I worked at NHT over 20 years ago. They have always had very good product, well liked on Audioasylum.
They are still around, but only for the love music. They really never made much money - it's a shame
way for nearly 50 years. Many have suggested over the years that I enter the business, but self preservation is too strong, knowing what I know about business. I love it as a consumer, but it never made sense as a business, at least not since the '70s, as you say.
Thanks.
In the 1970s, Winslow Burhoe's Epicure speaker company was the largest employer in Northeastern Massachusetts, and now he can't hardly sell his Stereophile-recommended Silent Speaker IIs onesie-twosie...
Time and tide take their toll.
Unless you are Ms. Trzetrzelewska--in which case, you can just ride the tide.
JM
(nt)
There you go trying to confuse us with reality.
John
It's a great idea. The problem is finding someone as unique a person and designer as Bobby to take over. I'm not optimistic. I hope I'm wrong.
Typically in a smallish company there is one talented driving force that creates these beauties. Sadly he's now gone.
charles
I hope is that my TSMs are nearly completed and that someone can assemble it and send it.
Problem with this is the following:
I dont think Bobby started with my speakers
I dont think there is anyone else in the company.
No question about Merlin speakers ..... I really dont want anything else.I want the TSM StudioBlack with Master RC networks that I paid for.
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