Stereophile mag's parent company hits hard times
by Steven Kim 
posted May 3rd 2009 at 9:39AM
We've been steering around stories related to the woeful state of the economy -- and even trying to add some sunshine of our own -- because, frankly, writing about an endless string of companies hitting hard times is just depressing. But the bankruptcy of Source Interlink, parent company of Stereophile magazine, strikes a nostalgic chord for us. Our introduction to the crazy audiophile world came through the folio-sized pages, but recent glances at magazine racks show a slimming magazine and a move towards the nosebleed price regime of the high-end. We don't think that the growth in consumer audio -- and (gasp) convenience -- is at odds with high performance, and one magazine is hardly a bellwether for an entire market; but it's clear that manufacturers need to do more than put high-grade finishes and price tags on their goods to enjoy a healthy business that can survive changing trends in today's market. But we'd love to hear your thoughts -- what's your take on the health of high-end audio?
Filed under: Industry
Reader Comments (Page 1 of 1)
Godskitchen @ May 3rd 2009 10:22AM
I think these companies (the ones having trouble) would stand a better chance of getting market share if they cut out the BS. Denon selling a CAT5 cable for $499.99.......I lost all respect for them the day I saw that, to the extent of maybe not choosing Denon for my next upgrade. This coming from someone with mostly Denon equipment at present and is very happy with its performance.
They are all guilty of it. While it may have washed in the 90's to sell $500/Meter speaker cable, it is now 2009 and we have something called the internet to aid our research. The average consumer today is streets ahead of the average consumer from the 90's and can for the most part see through BS marketing.
Of course there will always be a market for unidirectional SPDIF connections............for those with their heads up their arse.
Andy Sullivan @ May 3rd 2009 10:43AM
Two things are bringing down high end audio. HTIB's and the superb quality that has trickeled down to the $300 - $700 street priced range receivers.
Tyrone @ May 3rd 2009 1:12PM
High End Audio and Video manufacturers need to do a better job outreaching to new consumers in both education and advertising. High End manufactuers do make more inexpensive gear, people just need to know about them. It sounds simplistic but not to far from the truth.
Wesley Burchnall @ May 4th 2009 1:29AM
I think that high end manufacturer's need word of mouth salesmenship. Seriously, I think their best bet is to make it really really cheap for stores like Best Buy to build a home-theatre sample room that actually is high-end.
So far, when I go into a futureshop and go into their theatre room and listen to their extremely noisy speakers made by 'Sony' I shrug. I go to a local home audio enthusaist show room called the 'Home Theatre Attic' and listen to the sounds of their PIB LoudSpeaker A1Bs, etc it almost blows you away and makes you feel like your in the movie. There's the 'wow' immersiion factor.
You really don't become a home theatre enthusiast until you actually hear high-end and at the moment, you won't ever hear high end in a big box store which is at the moment where the majority of americans do their home theatre shopping. If high end manufacturers setup home-theatre display rooms in big box stores, they could wow many new customers into seeing the worth of paying $275/pair to $500/pair and buy 1-2 pairs at a time and slowly build a home theatre rather than buying $500 dollar home-theatre-in-a-happy-meal-box.
That's at least how I made my home theatre. As a kid, I remember working my minimum wage part-time job while in college, saving a few bucks every paycheque for a few weeks and then buying a $200.00 pair of speakers which was like $300 now adays and slowly buying speaks every few weeks till I had a 5.1! setup rather than doing what most teenagers my day did and buy a cheap-htiab "Sony" 2.2(two speakers with build in sub on each speaker) ystem /w cd player that did mp3s and used the 'aux' via red/white analog cords from their vcr/dvd player.
nathan @ May 3rd 2009 1:55PM
This post is about Stereophile's parent company, equates that to the health of Stereophile, and then connects that to the health of high end audio.
Those are really three different questions, with tenuous connections.
Source Interlink is having some problems which have resulted in Chapter 11 filings (called bankruptcy). That's fine. They'll find a way to restructure the company or sell off the assets. Unfortunately, some people will lose their jobs, which sucks now more than ever. But it doesn't say much about high end audio.
Stereophile has always been a niche magazine and will continue to be. Why? Because high end by definition is not mainstream. I don't understand the comment about Stereophile being expensive itself. At $12/year for a subscription, it is the cheapest A/V magazine I know of.
High end audio will survive. Are there audio bargains to be had and is some consumer gear very good? Yes. Are there still gains to be had from going with some more expensive specialist gear? Sure. But just like some people don't see any appreciable difference between an LCD TV and a plasma TV, lots of people don't appreciate the last 10% in audio quality, either. That doesn't mean the high end is in trouble.
blackacex2 @ May 3rd 2009 1:58PM
Stereophile is one of my favorite publications of all time and it's really sad to see how the economy is affecting it. The fact of the matter is, rather or not people can afford to buy the ultra-high end equipment that Stereophile reviews or advertises, it's still fun to read about it.
High end audio needs exposure in the real world. This means high end shops that are set up to demo their goods. People need to sit down and experience why the high end can be worth the price of admission. I remember the first time I heard a 20k+ setup. It changed my life. Hearing is believing. Now I'm not one to admonish the rip-offs and ridiculously over-priced equipment.
However, a powerful mcintosh amp powering properly set up and well made tower speakers playing a flawless copy of vinyl on a great turntable through a nice phono preamp (use walmart quality cable for all I care) in a room that is acoustically treated...
Get people out in the real world to get a chance to listen to that, and their wallets will open wide and credit card debt will resurge as a leading contributor to the GDP =)
David A @ May 3rd 2009 2:17PM
The high end is very healthy judging by websites like audiogon.com for purchasing and audioasylum.com for message boards. The state of the magazines are a joke. As tiny portion of listeners buy that stuff but the advertisers had been able to support the ad because of huge profit margins. Now that's all over. I'm hoping the super high end will be supplanted by the middle high end and the magazines will recover.
Rob @ May 3rd 2009 2:34PM
People who buy "high end" audio products have ALWAYS had way more money than sense and there is no reason to think that will change. They buy the products BECAUSE they are expensive - not because of the performance. It's showing off and nothing more. It's the same reason they buy a Lamborghini or Maserati and then drive it around the city in first gear.
People chase this idea of "Audio Nirvana". As though there is some mythical way to constantly recreate and maintain the emotional thrill you experienced the first time you ever went to a live concert. But just like any high, you just end up spending more and more to chase a feeling that you will never again be able to recreate.
Phil @ May 3rd 2009 4:03PM
Ah, the haters and the ignorant... Never miss an opportunity to show off your stupidity.
The high end isn't just $500 cables or $100K speakers. It's also a pair of $500 B&W's and serious discussions of how to get really good sound for a grand or two or three. It's no more foolish than finding a difference between a BMW and a Honda Civic -- good engineering and a few extra bucks will show in the quality of the product.
Listen. Educate yourself, then offer an opinion. Otherwise STFU.
Canadian Bacon @ May 3rd 2009 5:12PM
That's the problem though, a pair of $500 speakers is not the high end, not even close.
When a pair of speakers tops out at about $200,000, how could you think that $500 ones, even B&W could be considered "high end"?
Steven Kim @ May 3rd 2009 5:29PM
I think that's Phil's point -- "high end" can be about good performance, regardless of price. I know it's entering a subjective area, but "high end" can be more about design/engineering values/priorities than price tag and cachet.
chuckdaly @ May 3rd 2009 5:48PM
The High End CE industry is no different than any other industry, you have great products and then you have snake oil. As consumers moved away from CDs, consumers also moved away from High End audio. Its hard for people to see value in something they haven't experienced. Today the media praises High End Cars, Homes, Watches, and Liquor, yet scorns High End audio, so the masses follow suit.
The high end A/V market is headed toward a rough future. The primary promotion of High end A/V were magazines, but as print media fades, there is currently no internet based promotion of high end A/V. Take EngadgetHD for example, writers here talk about $4500 50" plasma displays or complete home theaters systems in the $10K range as being astronomically priced. Ultimately, High End CE manufacturers will need to find a new outlet to promote their products. Someone has to step up to the plate and convince consumers to spend $30K on a car instead of $40K and take that extra $10K and spend it on Hifi.
Canadian Bacon @ May 3rd 2009 6:47PM
I don't think engadgetHD has ever called Pioneer Kuros astronomically priced. In the past they've simply said that the incremental quality increase isn't in line with the premium you pay for them.
As for audio, consumers themselves, not marketing geniuses, are going to have to weigh the pros and cons of paying that much more for (sometimes) incrementally better sound. There are some lower budget, quality speakers such as Paradigm, etc but even to get in at the low end of those are going to cost you over $2000 for 5 speakers, a subwoofer, and a receiver.
The other examples you listed are in the exact same boat as audio though. Consumers have to weigh the benefits of paying extra for a premium product and during the economic downturn, they're going to be more hesitant than ever to but a Rolex, BMW, etc.
chuckdaly @ May 3rd 2009 8:19PM
@Bacon,
I think you are missing the point. How can consumers "Weigh the benefits" or "Pros and Cons" of products they never experience? For example would you buy a Zenith watch? Magazines, Websites, Blogs, etc promote products. Without promotion, how would you even know a product or range of products existed? More and more consumers use the web to research product. Currently, there are few to any sites the promote or give any pros to buying High end A/V. Very few watch, liquor, furniture, or car enthusiast sites piss on the High End like the majority of A/V enthusiast sites. Consumers today read the web or read mags before they drive to a store, who is out there to convince consumers to drive to High end A/V retailers? Right now, no one, which is my point.
I got the term "Astronomical" from Engadget. Regarding price premium, the price/performance difference between a Pioneer Elite and Sony XBR is the same as the price/performance differnece between a Sony XBR and a Vizio. Making the distinction between the Elite/Sony and not the Sony/Vizio is the same reasoning Consumer Reports uses to say that Paradigm loudspeakers aren't worth the incremental performance bump.
Andy Sullivan @ May 4th 2009 12:34AM
The question was concerning the health of high end audio and has nothing to do with Sony XBR's or Pioneer plasmas. High end is different to different people. If your sound system costs as much as a Toyota Camry then I would call that high end by most folks standards. Unless you can afford a dedicated home theater then $10K would be mid high end IMO. There are lots of people out there (we would probably be surprised) that can handle a $100K charge for a sound system. I just know them.
Todd Sauve @ May 4th 2009 1:58AM
I don't think most of the so called high end audiophiles have ever heard what truly excellent sound is: studio mixing room sound and gear. It simply puts 99% of high end consumer gear in the shade.
Don't believe me? If you live in any decent sized city just phone up one of the better recording studios in the area and ask for a tour. Most studios don't mind this as long as you accomodate yourself to their schedule and are respectfull of their equipment.
Since I trained as an audio engineer back in the late 1980s and have heard some pretty state of the art studio setups, I've had a jaundiced eye and ear for the so called high end.
Isaac @ May 4th 2009 11:03AM
Most high-end audio is BS anyway. Human ears simply aren't that good. Don't believe me? I've had more than a few people tell me that my $160 Sony HTIB sounds better than a friend's $1,000+ audio setup.
Fancy audio equipment is a status symbol; when the economy's down, people can't spend huge gobs of money on status symbols so the high-end audio market takes a big hit. Boo hoo.
skimrn @ May 4th 2009 1:21PM
High end audio is mostly BS? Are you an idiot? That's like saying exotic cars are BS because they are expensive.
Unless you are Beethoven you will hear a difference between an entry level Sony receiver and a properly set up high end equipment. Some of us do need to be educated how to listen to and what to hear when you hear the good stuff.
I remember when I was in college and stopped by my boss's friend's high end audio store. I brought some of my favorite CDs and sat down, powered up.
It was Wilson Audio Puppy Speakers connected to Krell Mono Amps connected to Accuphase CD Transport.
I never forget it. When I closed my eyes, Sarah McLachlan sang as if she sang right in front of me. The detail of the sound was simply jaw droppingly awesome!
Do you self a favor. Goto a local high end audio store with your favorite CDs and give yourself an audition. Many of us home theater nuts never have an opportunity what the high end stuff sounds like. We think Sonys, Pioneers, Denons, Onkyos, Panasonics, and even Bose are truly good quality... Ignorance is BLISS... (Famous Matrix quote).
Jeff N. @ May 4th 2009 7:14PM
Isaac yours is one of the funnies ands saddest posts I have ever read on Engadget HD. If you can't tell the different of a $160 HIB from a high end system you are missing something.
Charles M @ May 4th 2009 10:42PM
A couple of things. One, you're equating High End to $$. Not true. Yes the best can cost, but so can some real stinkers. You can't judge quality by price. Two, your friends may simply be being polite to you , or, your friend's $1000 system may not be very good (see item One).
To skimrn: One problem with with going to your local High End store is that quite probably there isn't one. (Yeah, I've heard some really funny answers to what High End equipment is too). That was a problem I had when I started out. Most 'audio salons' consider Denon or the like high end, or as you've noticed, worse yet, Bose. I remember finding no difference, despite the salesman telling me how great this or that piece (which they carried) was. It was only by chance that I came across a truly high end store. I sat down expecting long periods of listening to hear the minutest of difference. Within a fraction of a second of listening, I realized that everything I had believed to that point was totally wrong. But those kind of stores are few and far between. Probably less than 1 per state. Probably much less. I haven't really checked what stores are out there in, oh , ten years or so, but I doubt its changed much.
Isaac @ May 4th 2009 1:51PM
@skimrn
High end audio has repeatedly failed double blind tests...despite what audiophiles claim. I would LOVE to see you listen blindly to 10 audio setups and then list them in order of least to most expensive based purely on sound. I'll bet my $160 Sony HTIB that you can't.
chuckdaly @ May 4th 2009 5:01PM
The national research facility in Canada, where loudspeaker companies Paradigm, PSB, etc use to design their products include double blind tests. Floyd Toole, former lead engineer for Infinity Loudspeakers, helped develop the facility. No one doubts the ability to tell the difference between loudspeakers, although there are sceptics for wire. Julian Hirsch of stereo review recanted a similar statement to yours regarding power amplifiers.
Most High End audio dealers enjoy young poor college students visiting their stores to expose themselves to high performance audio. As long as you let them know that you aren't in the market yet, but just want to see whats out there, they will be glad to give you a first rate tour.
You don't have to be a chef to tell that Mortons Steakhouse is better than Ponderosa, you also don't have to be a Symphony conductor to tell the difference between B&W and Bose. Only the ignorant will say they can't tell the difference.
Charles M @ May 4th 2009 9:50PM
Depends on the systems. If you're comparing anything that can be formed from stuff at Best Buy, then no, you probably can't tell. At best different colorations, but no real difference in quality (i.e., this gets highs better but is more harsh and wearing, etc).
But if you compare a system of , say, top of the line Magnepans, ARC amplifiers, Linn turntable against any of the aforementioned Best Buy systems, its no contest. Its not even remotely close, not in *any* criteria. The high end system is better in everything and its better in ways that you can't even imagine a stereo system being able to reproduce. Lets put it this way, if you're expecting a subtle, need to listen double blind to tell kind of difference, you are flat out wrong.
EatingPie @ May 4th 2009 4:26PM
I have tinnitus. That means I have hearing loss at certain frequencies.
However, I can tell the difference between various sound setups that I've double/single-blind tested.
I single-blinded two pair of Grado headphones off an amp. I could tell which was which, and these were very similar models. I double-blinded (using a Radio Shack switcher!) my $800 MicroZOTL and an $300 XCANs. The MicroZOTL had greater resolution, but over time tended to aggravate my tinnitus for some reason. But the difference was there, and I heard it. I wish I didn't have tinnitus, I wish I didn't have to sell my MicroZOTL, but the X-Cans I am still very happy with! I double-blinded (or single blinded, not sure) a Yamaha RX-V795 against a Technics HTIB. The difference was massive, and you can guess which one I kept.
Speaking of which, I just upgrade my Yamaha RX-V795 to an (on sale) RX-V3800. I am constantly amazed by the difference (though this isn't double blind). The channel mix/separation is far better, and the quality of sound is also better. It also fixed a distortion problem with my sub and speakers. So there is more to high end than *just* the reproduction of sound frequencies.
Okay, so I said all this to contradict the assertion of "repeated failed double-blind tests." I've proven that untrue. I can tell the difference between various systems quite easily. It's also important to note that different systems can emphasize different sounds. Paradigms are warm, while Polks are bright. I can hear that even with my tinnitus. So sound -- particularly the high end variety -- can tend to be a matter of taste (do you like bright or warm?).
But to pooh pooh this whole notion outright really boggles my mind. Go to an audiophile shop and give a listen. See if you can tell. If not, great! You can focus your dollars on other hobbies! But don't go criticizing those who *can* tell, like you are the be-all-end-all authority. After all, everyone is different, and that includes likes/dislikes/sensitivity to quality sound.
-Pie
v0x @ May 4th 2009 10:19PM
How I see the decline of the audio industry
1) Vinyl replaced by CD. CD replaced by MP3.
2) The music "industry" declined. Music became less important to pop culture. Consumers purchased less high quality recorded music and listening to music in different ways in a compressed form.
3) Quality differences in equipment became more difficult to hear with poor software
4) Fewer people buying nice stereos, so small audio manufactures were forced to move toward higher-end, higher-margin products marketed to a specific consumer audience to offset lower sales volumes
5) Traditionally low end products (massed produced receivers from Japan) became better
6) Higher prices and upscale (snob appeal) marketing turns off many mid-range consumers who like heavy metal and beer, not female vocals and a good pinot.
7) DVD introduced. "Home Theater" replaces 2-channel stereos in most homes including many who used to purchase high-end stereos. Nice two-channel stereo with big speakers no longer a status symbol -- replaced by big plasma TV hanging on wall, Creston, and custom installed in-wall speakers.
8) Market for high quality two-channel stereos continues to decline but kept alive by niche market of enthusiast who still enjoy vinyl and tube amps.
9) Prices continue to rise to offset lower sales volume but enthusiast continue to purchase with disposable income
10) Recession hits. Disposable income gone -- even the enthusiast need to cut back.
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