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Re: Some thoughts on Linn's woes and other matters... (longish)


I think about many of the items discussed in the OP all the time, and will try to address them as objectively as possible ;>) Great post, btw...

1) not sure that any of us know exactly what's happening at Linn. Something tells me there will be a lot of conjecture in the following months, however. There are some shifts in the market that have created problems for ALL high-end companies. I don't want to get off track from the original question but Linn's woes are probably being felt by high-end electronics maufacturers on an international level. In the US, RIAA statistics show that the category of business that includes SACD, Vinyl LP, and DVD-A is down 54.5% from 2005 to 2006. Down 86% from 2003 to 2006 (Yikes!)CD sales in general are down 25% from 2003 to 2006. Meanwhile downloads are WAY WAY up. The health of the high end has always been tethered to the growth of new music lovers looking for a better way to appreciate their music. Current stats show that an awful lot of music is being purchased but the growth areas are decidedly non high-end. (at least in a traditional sense...go over to the PC Audio forum and you'll get a peek at the "new" high-end) ) Are we trying to sell more audio to the same group of old crusty audiophiles? Maybe...and it looks like a lot of those sales are going to the used market.

2)SME...don't know. Something tells me that their overhead is probably very low and that they will always have a certain amount of demand. Plus...their name is VERY sellable. (hate even mentioning that)

3) "Immature and rapidly-evolving market segments such as AV/HT demand constant and high R&D expenditure just to keep up with the opposition, but this also implies frequent product supercession which, in turn, implies shorter product life-cycles and, as a result, a limited window in which to recoup any R&D spend."

Yep::: entering in to the HT/AV manufacturing business is a huge expense and even more of a gamble. I could go on and on. Look at what it did to Adcom, Proceed, Tag McLaren, Cal Audio, Sunfire, etc...etc...millions of dollars lost, and in a couple cases the company with it. Even commodity suppliers have problems with this category of business.. Kenwood's HT division is practically bankrupt today after doing $250M in 1995 in the US alone!

4) "So, maybe - just maybe - the secret for survival for these companies is to carefully select the market niches in which they will play - and to do so based on the "stability-factor" (or maturity-level) of both the standards and the technology required by the niches, to enable them to maintain long-ish product life cycles."

you should be paid for that kind of advice.




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  • Re: Some thoughts on Linn's woes and other matters... (longish) - jim@signalpath 11:16:56 04/29/07 (0)


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