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In Reply to: Re: Stereophile Poll posted by jim@signalpath on April 24, 2007 at 08:46:13:
All of them got clobbered last Christmas by Wal-Mart's decision to very deeply discount flat-screen TVs. That and heavy ramp-up of flat screen production really killed the previously fat margins on these products that kept all of these stores happy.It's been some time since any of these outfits made serious money selling two-channel stereo.
The recorded music market seems to be moving in two directions: the price of disposable music is collapsing with the advent of Internet distribution (as opposed to physical distribution) and the revival of the "single" (which, in fact, was how such music was sold prior to, say, about 1967). People are consuming this music with cheap players, as they always have . . . just take a look at the typical "department store" stereo of the 1960s, or record player of the 1960s or 1950s.
On the other hand, growth serious music listening (i.e. where you listen with more or less undivided attention) probably is stagnant. It competes with other forms of entertainment for people's time. But, I think the decline in recorded media sales represnets mostly a shift of the "disposable music" market away from fixed media.
Follow Ups:
can you reduce it all down to questions this simple?(1) as the prices of flat panel TVs fell, the dealer margins fell with it....AND the additional units sold didn't come close to making up the dollars. When you consider that Video is > 55% of most dealers' business, it makes for a very very difficult situation. What's the answer? In the past it's been to sell more high margin audio, but :::
(2) As music purchases continue to increase via downloads and decrease via CD sales, we'll see a tougher and tougher market for the independent high-end audio specialist. What products will be appealing to the download generation?
"(1) as the prices of flat panel TVs fell, the dealer margins fell with it....AND the additional units sold didn't come close to making up the dollars."That's true for the Chain Retailers, but not true for the Independant Custom Installation Company. It's true that the race to zero among the flat panel manufactures reduced profit for the retailers, but in reality, TV's dropping to more affordable prices did two things for my custom business:
1) Opened the door to new clients who had been holding off on a Media Rooms because of flat panel prices. This actually helped to drive the business.
2) Helped to redirect budgets towards product that made more profit anyway. If a client has, let's say a $15,000.00 budget to spend for Family Room entertainment, then that client is now getting better and more expensive speakers and subwoofer, and a better remote control with greater and better programming. They're also getting better cabling for their systems.
Remember, when you read about how poor the 1st quarter was in CE, that applied to ALL the retailers, including those with little to no experience in CE, like Boscovs, Sam's Club, BJ's etc. For the established Independant Custom Install company, it was business as usual, meaning we were able to react quickly to market changes while the behemoths as well as the trunk-slammers were slowed by their own bureacracy, poor hiring practices or lack of strong service.
"When you consider that Video is > 55% of most dealers' business, it makes for a very very difficult situation."
Not for the Independant Custom Install company. That number is way off. For the big three cited elsewhere, more likely that's true.
"As music purchases continue to increase via downloads and decrease via CD sales, we'll see a tougher and tougher market for the independent high-end audio specialist. What products will be appealing to the download generation?"
This certainly is contributing to the demise of the High End 2 channel Brick and Mortar dealer, but far more damaging has been internet sales. I've said this before and I'll say it again, the manufactures are going to have to take dramatic steps soon, because unless they have the resources to open their own stores, this business and hobby is going to die off. At the least, self proclaimed audiophiles are going to find it very tough to audition equipment. The 30 day money back guarantee is gonna go away because of the beating it will take, and it will take a big one from the average audiophile, who, let's face it, is never happy for very long with any of their purchases. That one indisputable fact is what made Audiogon what it is today.
Maybe some manufactures will pool together as partners and open stores of their own, but don't count on seeing too many of these. The truth of the matter is that the high-end Custom Installation companies are now the ones who can afford to show these products to the audiophile, and once that dealer gets sick of the audiophiles ways, that'll be one less resource.
So in a nutshell, greed and lack of new hobbyists is what's gonna kill the business. The hobby won't go away mind you. It will just evolve into something else.
Most of the best upscale AV operations are surviving through their custom installation depts...but even the CI channel has felt an adjustment due to the iPod. And as companies like Niveus become more of a factor there will be yet another shift...Custom installers can make that shift because they can turn on a dime. Circuit City can't.also ::: The Magnolia division of BB has the ambition and the bankroll to address CI, but I think it will be very difficult. For some reason I think that no matter how successful Magnolia becomes, they won't affect the best custom installers in the least....but they will have an affect on high end B&M retail..
As for the I-Pod, it's really been another shot in the arm. It's another source, which requires another solution, which creates revenue for us. I see no problem at all.Magnolia on the other hand....well, money and ambition aside, it ain't translating to the floor help. I've got one near me, and after shopping my competition, I came away feeling great. Great because I like competition, and in the case of Magnolia, all they can do is serve to make me look better.
Ya get what ya pays for...
It strikes me that one of the drivers for decent stereo in the lat 1960s and 1970s among 20-somethings was that a lot of album-oriented-rock really required some pretty good playback equipment to be appreciated. Whether or not you consider a lot of the stuff from the time to be over-produced or not, it certainly suffered from being squeezed through some low-rent 4" paper speakers.Something that strikes me now is that for 40 years now pop music has consisted, more or less, of a few singers, a few electric guitars, an electric bass and a drum kit.
Let's take a quick look at all the instruments from the previous 40 years (i.e. from 1927 to 1967) that pop music has thrown on the trash heap:
trumpet/coronet
trombone
saxophone
clarinet
acoustic pianoPop music isn't written for these instruments anymore.
And yet, I believe, the accurate reproduction of these instruments is more difficult than the accurate reproduction of any kind of electric guitar or electric bass.
So, my point is that what people listen to doesn't demand the kind of fidelity that audiophile equipment delivers. Yes, it sounds better on audiophile equipment (assuming that equipment is capable of ear-splitting loudness) but the incremental improvement isn't that great.
On the other hand, I suspect an MP3 of even a jazz trio would sound pretty poor; and an MP3 of the Duke Ellington Orchestra would sound positively nasty. Indeed, RBCD has a tough time reproducing brass instruments played loud without causing ear bleed.
So, the music that people listen to drives the demand for hifi playback, too.
Hi Bruce,What follows isn’t for the purpose of contracting your post at all, I’m sure that, to some extent, you’re right. But it’s also a fact that, after all these years, way too few even know that they have the option of a good system that’ll make a clarinet sound like a clarinet. It’s not that they don’t have an appreciation for what a good system can do once they hear one, but most of them still have no idea that such a beast exists.
Last week I brought one of my employees over to the house to hear a system. He was blown away. The very first words out of his mouth were, “Who needs surround!” A couple days ago he told me that when he tried to explain what he heard to his friends they told him that what he described was impossible.
It seems to me that Bose’s secret to success is in ignoring the audiophile and going after the straights. They advertise everywhere but the audiophile magazines and they are a household name. It just seems to me that there’s a lesson to the whole high end industry there. When you think about the untapped market out there, it almost seems silly that all these companies are still fighting over the little scrap of the market we audiophiles represent.
has indeed insulated itself to the point where our theme is the one from 'deliverance'....
“has indeed insulated itself to the point where our theme is the one from 'deliverance'....I imagine the same can be said about any group that gets so rabid and passionate about their hobby. I’m sure that for every crazy audiophile there’s an equally fanatical wine aficionado or tobacco connoisseur out there. I was nuts for biking but I never got into the hardware like some cyclists do. Lets not even get into golf clubs! I guess every hobby has its lunatic fringe. :-)
That, too. A good number of people visiting my house have been slack-jawed when I tell them that what they're hearing is a record. " That's a record !" they say. Who knew?? (Not that I'm trashing digital; it's just that the supposed inferiority of vinyl has been drilled into a lot of people's heads, including, regrettably the heads of some so-called experts who write in major publications that somehow believe that knowledge of computers is concomitant with knowledge of, say, high-end audio.)So, people's heads have been stuffed with a lot of b.s., including the supposed inferiority of vinyl.
But, ask yourself: how many people are there out there who have even heard a clarient live, or a trumpet or a trombone?
“But, ask yourself: how many people are there out there who have even heard a clarinet live, or a trumpet or a trombone?
A depressingly small number, I'm afraid.”I’m quite sure you’re right, Bruce. But there should always be something that even a novice can identify as something they can relate to. A stable and crystal clear voice is something most people haven’t heard from a system, for example.
But getting back to your clarinet example, I guess it gets its start with the fact that there’s so little accessible live music in so many parts of the country. I’m convinced that to hear a good symphonic performance is to gain instant respect for classical music. People make fun of Operatic divas, but to hear an opera live is to instantly gain respect for what those people can do—-it’s amazing! Some things just don’t easily translate to the home listening environment. I believe you have to have the experience live before you can even imagine transplanting that experience to the context of the listening room.
Best,
JP
for more than three decades i've amazed friends, family and business associates with the sound of vinyl. not one has had an urge to buy a 2 channel stereo system, or has learned to play the trombone.
agree strongly with both of you re: Lack of EXPOSURE to high quality and high performance audio being a problem. Some years back I attended an HE show in San Francisco at the Westin on Union Sq. I dropped in on my old friend Michael Kelly from Aerial to see his room packed with an entourage of folks from Texas Instruments. Sitting front row center was a middle aged exec in a suit who was there to check out the high-end AV business. TI had invented the DLP chip just a few years previous, and wanted to witness first hand what high end AV was all about.The demo blew him away. He said "If more people knew this level of performance was available in the home everybody would want it..Price would not be an obstacle"
While I think that organizations like PARA and the CEA have done a lot of good for our industry, they've done a terrible job of creating demand for high end audio and video in the average home. Why is it that people won't think twice about spending tens of thousands of dollars on Jacuzzis, raised hearth firplaces, granite top kitchen and bathroom counters, Viking stoves, and Bosch appliances, but as soon as you mention a $30,000 theater or $15,000 listening room they absolutely cringe?
The industry statistics I mentioned are sobering. Is there a link between the demise of traditional audio retail and the shift in music purchases to downloads? I think so.. The major growth in audio is through a retail channel that has nothing to do with the high-end . Where will the new customers come from?
"While I think that organizations like PARA and the CEA have done a lot of good for our industry, they've done a terrible job of creating demand for high end audio and video in the average home. Why is it that people won't think twice about spending tens of thousands of dollars on Jacuzzis, raised hearth firplaces, granite top kitchen and bathroom counters, Viking stoves, and Bosch appliances, but as soon as you mention a $30,000 theater or $15,000 listening room they absolutely cringe?"Well, let's think about that for a minute. All of the items you mention bring added value into the sale of a home. So they become investments with a financial return. You might get away with calling a home theater an "investment", esp. if it's outfitted like the rooms shown on "this Old House" and "Hometime" like shows. Problem is, none of these rooms are actually set up for sound. Listening rooms and WAF or even decorator's sensibilities typically don't co-exist. Just pulling the speakers into the room gets most people to throw a fit. How do you think they'd handle room treatments, equipment racks, and big cables across the floor?
Bob, I'm going to mildly disagree::if you look at the work that custom installers do...distributed audio and video..home theaters...media rooms...custom lighting...LANs...etc...etc.. All of those appointments are value added additions to the home. I would place them above swimming pools and outdoor hot tubs, which are sometimes a negative ( personal experience ) and below high end bathroom and kitchen additions like granite counter tops, custom tiles, and high-end fixtures.
dedicated listening rooms are a tough sell. Integrating them in to a theater seems to be the current demand; sometimes with less than satisfactory results.
Jim you got me here....I did say that properly designed home theater installs might be considered an investment - see my comment on "This Old House" and "Hometime" featured installations. But I will argue that most of the time, when I see pictures of these setups, the focus is on the visual, not the sonics. I've seen pictures with Watt/Puppies placed against the wall and close to the corners. Same with 801s and 802s, or worse, inwall speakers with inwall subs. I'll occasionally take a look at the AV mags and I don't recall many (if any) feature stories on installing speakers for proper soundstaging, or even proper speaker placement.
sorry, Bob. reread your post and see that we're pretty much agreeing.the mention of custom installation is important for several reasons. The most important being :: In many cases it's the only way that high performance products can make it in to the home. ( WAF...) And, if industry statistice were available you'd see that a lot more of what we consider high end audio is sold through the retail installation channel than through the internet or over-the-counter retail. I will exclude "used" sales for obvious reasons.
Of course, unlike the home improvements you mention, we can take the hifi system with us.But I hear you. There’s much progress to be made in the area of promoting the aesthetic acceptance of a high-end system in a particular room in the house. Baby steps? In any case, there’s a lot of middle ground to be covered between what most of us think of as a music system and the two Bose speakers tucked away on a shelf that most people think is the pinnacle of musical entertainment in the home.
John, I understand youe feelings about the middle ground, but let's face it, in both your example and Jim's the demo systems are on the extreme end of the spectrum. The question is how would the same people react if the demo system were say... Creek and Epos? Is there a definable point for the general public where the reaction goes from ehh! to WOW this is worth investing in?
Hi Bob,I suppose that middle ground will vary with each potential purchaser, but I’ve dropped jaws with fairly modest systems such as a pair of ACI Sapphire XLs and a Musical Fidelity A5 integrated. In such cases what people are responding to, mostly I think, is a properly set up system. Most people don’t even know what the object of a stereo pair of speakers is. Invariably they’ll point between the speakers with amazement that it sounds like there’s someone standing there. They have no idea that this elementary part of the experience even exists.
In raw numbers I have no idea how many budding audiophiles are out there to be shown the light, but I can say that I’ve prompted my share of people to buy systems and I’ve helped many others to maximize what they have. Who knows what could be accomplished with a little more awareness.
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