Those are great questions and a good warmup for my AMA tomorrow. I'll do my best to answer them.
1. How is the current state of the headphone industry(without focus on the 40% Dr.Dre stake in it)? (very generally)
A: The current state of the headphone industry as recently reported by NPD Group is about a 1 billion dollar industry with beats by dre holding about a 70% stake in the market. That leaves about 300 million for the rest of them. I'd say the headphone industry is in pretty good shape right now. I'm not sure how much I trust their numbers though which is why I haven't paid for one of their actual reports. I do get information from other sources though.
2. More specifically, what is the current state of the professional stake in the more "pro" side of the headphone industry. It is easy to see that celebrity and mainstream headphones are gaining huge traction. But I am talking about the 'actual' Sony's that people like us buy and the Sennheiser HD6xx + and what not? Is it taking a small decline?
A: This is a hard number to figure out as headphones are only recently starting to be tracked by themselves. From memory, before beats by dre, headphone sales in general were about $300 million. It seems all the growth went into Dr. Dre's pocket. I'm not sure how to separate "pro" headphones but that's all there was before beats and skullcandy.
3. What is your opinion on the rampant music/media piracy? The arguments against it have been that , that property is that of the owner and that all laws and ToS give those rights to the company that owns it and it is illegal. The arguments against that argument(but not necissarily for it) have been that the media industry have had huge profit increases and have broken profit records. That most artists don't see the money won. That fans that pirate buy more music than those that don't. That it introduces fans. Etc Etc. So what is your opinion on it and do you think the arguments defending against the "it is illegal" side are valid or just bull?
A: My opinion is one of a musician and recording engineer. I went to recording engineering school about 15 years ago to learn how to make records. At the time, I could already feel the decline of the record industry as this was a time when Pro Tools was coming out and the beginning of the home studio. To me the writing was on the wall that record labels were going to have a rough time. My opinion is that if you sign away the rights to your music, that's your own fault. The artists that provide good music that their fans love to listen to don't seem to have a problem making money. Music listeners can see through artists that are just in it for the money. Some people don't care but the true fans do. In short, my opinion is that the music piracy issue is just bull. I think it's just something the record labels have been clinging to in order to make sure the guys in suits keep their jobs. This is just my opinion.
4. If you don't wish to answer that is fine, but how are the sales at headroom. This relates to question 2 on how the "enthusiast" market is doing Are you guys seeing profits, stagnation or series of up and down curves?
A: Traffic to our website and sales in general are down. That's why I'm here. The enthusiast market seems to be blowing up. This is still where a majority of our business comes from. You guys own multiple pairs of headphones and sometimes even multiple headphone amps. We do see a series of up and down curves. Typically, it's up around Christmas time. While we're still 'seeing profits', profit put simply is what is left over after we've paid all of our bills. We have to balance things like how much inventory we carry, expenses such as rent and utilities, and even the number of employees we have in order to turn a profit. This is the balancing game we play as a business. The competition is plentiful and fierce these days. Just take a look at all the head-fi sponsors. When we first started, there were only a few.
5. What is the most popular sub $200 amp sold and what is the most popular headphone sold?
A: This is tough to answer but I'll try. I am a bit biased and think the most popular headphone amp is the Total AirHead or Total BitHead. That said, FiiO has been selling a ton of headphone amps. As for headphones, I'd have to say the Grado SR60 has been most popular for us but that's because we have long been a fan of this headphone. In reality, Beats by Dre is the most popular headphone sold.
6. Is there a headphone or amp or source maker brand that you think we should all be watching as another rising star?
A: I would put my money on manufacturers that have a history of making great audio products and are willing to invest significantly in R&D, like Sennheiser for example. While I may get flamed for saying this, I would watch out for Skullcandy as they've hired a bunch of 'real' engineers and seem to want to improve their brand perception by making great sounding headphones. They have recently invested quite a chunk into R&D but it may take some time for them to realize their full potential.
7. How is the business at your brick and mortar headphone store?
A: Better than I would have expected being in such a small town and a little off the beaten path. I'd say it is pretty good for Bozeman, MT.
8. A lot of my friends and I are young. To you guys, it may seem like young people comming in to terrorize the headphones. So the question is, do you see young people toy around with the headphones in your brick and mortar store disrespectuflly or do you see young people showing actual interest?
A: Hardly anybody toy's around with expensive headphones. Most people that have an appreciation for music and audio gear treat our gear with respect, even the cheap stuff. Something I always keep in mind is that I was once your age. When I was in high school, this stuff was very interesting to me. I think there are way more people interested in headphones than there used to be. As an example, when I went to recording engineering school, there were only a few options for me to choose from. These days almost every major university has a "music technology" or some sort of audio production degree. To me that's a lot of young people interested in quality audio.
9. Would you rather fight 100 duck sized horses or 1 horse sized duck?
A: 1 horse sized duck. 100 duck sized horses would be hard to keep an eye on.
10. What is your opinion on Beats by Dre?
A: I love Dr. Dre's beats, like "The Chronic". That's an awesome album. When it comes to headphones, I think there are much better options for the money.
11. What is your opinion on Sony, Phillips, Beyerdynamic, and Sennheiser 'looking' at the mainstream market a bit more than the enthusiast one? Or if you don't think one of those company's is. Why?
A: I think companies that have the resources should concentrate on making great sounding headphones. It is my belief that when given a well engineered demo, people will generally prefer the headphone that sounds most natural, or closest to the real thing. For a long time this was just a gut feeling of mine but some recent research has echoed my gut feelings. Here's an example of what I'm talking about: http://www.aes.org/e-lib/browse.cfm?elib=16486
Thanks for all the questions!