2016, Chapter 17:
A Directional Assessment
Wow. Sounds pretty serious, right? “A Directional Assessment.” Eeek.
Don’t fear, though, we’ll keep this light and fun. One of the reasons I decided to name this chapter so oddly is that the year in itself was odd. We didn’t know where we were going when it started, but we came out of it with a whole new direction.
Yes, I know, I’m getting ahead of myself. So let’s go back to that first statement:
we didn’t know where we were going when 2016 began.
100% truth.
On January 1, 2016, we had only one firm product introduction in mind, and a bunch of nebulous blowhardosity about getting into 2-channel products. And yeah, I mentioned a new topology (which became Jotunheim), and I mentioned that I thought Manhattan would be a 2016 product (LOL) and that we had another non-digital shocker coming (still coming, ha) and that we were going to do more ads and improve distribution and stuff like that.
But the reality is that timelines slip (on the Manhattan Project and otherwise), and reality intervenes (direct distribution worldwide is vastly complex) and we didn’t get a bunch of the crap I yammered about done in 2016.
So, back to January 1, 2016. The one product we knew we’d be introducing? Modi Multibit. Yes, it was already running. Or limping, more like it. We knew that 2016 would be the year of Multibit for the Masses.
But Jotunheim? Well, we didn’t really have a solid timeline for that.
Saga, Freya, Vidar? They didn’t even have names, much less designs. All I had was a quote for a remote control.
Fulla 2? Not even a glimmer about that. I figured we’d just sell out Fulla and be done with it, at the beginning of the year.
So, let’s call 2016
The Year Without a Plan.
Life Without a Plan
Life without a plan really isn’t all that bad, for all the gloom and doom that many corporate naysayers will spout. Schiit long ago passed the point of being “big enough,” so we’re not in the crazy grow-grow-grow at all costs mode.
Aside: in my opinion, that path ends in only one of three ways: acquisition, insanity, or death, none of which are particularly interesting to Mike and I.
And, since we’re not out to
Meet Our Aggressive Revenue Targets or even to
Maintain Our Momentum, we were able to take a well-deserved breather for the first 6 months of 2016. During that time, nothing new came out of Schiit. Absolutely nothing.
And, you know what? The world spun on.
What’s more, sales
increased.
Yeah. Go figure. Sometimes less is more. And in the first half of 2016, that’s where we were. At least from the perspective of the outside world. In reality, we were busy. I was finalizing Jotunheim and working on the first prototypes of Saga, Freya, and Vidar. Mike was working on a whole slew of new stuff, some of which you’ll see very soon.
And somewhere in there, Alex asked me about Fulla, and I remembered the conversation about a next-generation Fulla, and we got a Fulla 2.
And also somewhere in there, I got a couple of other ideas which I’m still playing with. Big ideas. Ideas that I haven’t talked to anyone about (in one case, not even anyone at Schiit besides Mike and Dave.)
And also somewhere in there, Mike and Dave discovered they’d need some heavy-duty talent on the Manhattan Project…and ended up dramatically expanding the scope of what they’re taking on.
In short, even though it looked like nothing was happening, the first half of 2016 was really important. It was a time to sit back and think in broader terms, and even start wondering, a bit “what we want to be when we grow up.”
Aside: we actually decided not to grow up, but then again, you knew that already.
And, if I am allowed to be a bit grandiose, the first half of 2016, in many ways, ended up being the foundation for the future—maybe even many years to come.
The Concrete Bits
“Okay, okay, I know you’re gonna tease us about what you can’t tell us,” you may be saying. “So tell us something you can.
Okay. You want concrete, let’s talk concrete. Let’s talk about what we did in 2016, and why it was important. (We’ll get to the future a bit later.)
So, a summary of 2016 in products:
- Modi Multibit. AKA “the least expensive Schiit Multibit DAC.” AKA “the most advanced multibit DAC on the planet for the price—from any country of origin.” AKA “Multibit for the masses.” Why is this important? It should be obvious—this modern multibit DAC is built on an entirely new, proprietary platform that doesn’t rely on obsolete or salvage parts, and includes our unique digital filtering technology. And that means that more people can get a taste of what multibit is about, and decide if it’s something they are interested in. We’re not going to get into technology screeds about what’s better or worse in terms of measurement and perception—if you want to argue about that, I’ll remind you that the Modi 2 and M2U are both still available at $150 and $100 less.
- Jotunheim. AKA “the first sane DAC/amp,” AKA, “the first affordable, configurable, do-all balanced desktop amp/dac/preamp, AKA, “the first pivot point amp.” This one’s important because it eliminates the key drawback in combined products—that is, the problem of obsolescence—by using a modular, upgradable architecture. It also introduces our new, no-compromise Pivot Point gain stage, which allows for seamless integration of balanced and single-ended inputs and outputs. This is a key product that can easily be end-game for many systems.
- Saga. Our first dedicated, remote-controlled preamp. Also featuring a cost-no-object relay-switched stepped attenuator and passive or 6SN7 tube buffer modes. In a market filled with 4- and 5-figure preamps that use compromises fit for A/V receivers (like integrated volume control chips), the $349 Saga is a hard reset. This one is moving very well, even in the absence of a matching amplifier.
- Freya. Twice the phases and 4x the tubes of Saga get you a balanced preamp with tube gain, JFET buffer, and passive modes for $699. Even if you use only one of the modes, this slaughters the price/performance ratio in preamps. And yes, not yet shipping as of this writing. I’m hoping we can start shipping this year.
- Vidar. In a world full of $2K, $5K, and $20K amps, Vidar is a weird outlier at $699. Especially when you consider that it is a cost-no-object style design with linear power supply, huge transformer, massive heatsinks, and overbuilt Class AB output stage. Run one for 100/200W into 8/4 ohms, or run a pair with balanced input for 400W into 8 ohms. Although this isn’t shipping yet, it’s a vitally important product for us, especially considering that the list of great sub-$1000 amps is very small, especially if you add the caveat of “made in the USA.”
- Fulla 2. Surprise, surprise. Developed from a conversation and a desire to see what we could do to move the barrier to entry down by half, Fulla 2 is blowing up our sales. For $99, it’s a taste of what good audio can be—and it’s versatile enough to span all the needs of your desktop. Taken together with Jotunheim, we now have two formidable DAC/amp offerings.
Six products. Not a bad product introduction schedule, if we’d spaced them evenly throughout the year. But hey, we still haven’t shipped two of them, so, well, there you go.
But consider what these product intros have done for us:
- They’ve given us the most formidable multibit DAC line around. Multibit now goes from $249 to $2299 here at Schiit—something for everyone.
- We’ve gone from zero to hero in combo products. Last year, Fulla didn’t really count. It was just another dongle-DAC. Now we have an uber-affordable step-in to great audio on the desktop with Fulla 2, and a versatile, upgradable platform with Jotunheim.
- We’ve reset the bar in the entry-level desktop market. Specifically, we’ve cut the bar in half—from $198 to $99—with Fulla 2.
- We’ve shown a full 2-channel system. Yeah, I know, we haven’t yet delivered it, and the Vidar is still planned for Q1, but the reality is, we had a great-sounding, all-Schiit 2-channel system running at RMAF.
- We’re now in the 2-channel market. Yes, still only with a single product at the time of this writing, but it will soon be two. And it gets us into remote controlled products as well. All of this can be applied to the future…and the 2-channel line can continue to grow.
So, you know what? For a year without a plan, I think we did just fine.
Looking Into the Crystal Ball
Crystal balls are notoriously hard to use, fuzzy, and unreliable, so perhaps they’re an apt metaphor as we look forward to the year. Because a lot of this stuff might happen…or it might not. We’ll see.
The near future, though, is pretty clear. We’ve been talking about the Vidar amp, we’ve been showing you sketches, hell, I wrote a chapter on how it wasn’t done yet, so it should be no surprise that Vidar is coming.
Still Q1? As of this writing, it’s still looking good. I have the new heatsinks in-house, I have prototype boards in-house, and I have unfinished first article chassis in-house. This means I’m not far off of final integration, including thermal testing. Then ordering of long-lead parts like heatsinks and chassis can be turned on in earnest. I expect we’ll be ordering at least some of these parts this month, so the clock will start ticking very soon.
Beyond Vidar, don’t be surprised if you see a couple of other small things in the first quarter, including a couple of products that are new to us. Details are murky, though, in the crystal ball, so I’m sorry I can’t give you precise product types, specs, and renderings. I will say that one of them is more than a simple product release…and it addresses a pain point you’ve started asking us to work on.
Beyond the first quarter, things get much more interesting…or not.
“Or not?” you ask. “What the hell does that mean?”
It means that beyond Q1, we’re working on a lot of big ideas. These big ideas are inherently more, ah, unstable than regular products. They could work great, and show up early. They could need a lot more development than we expect. Or they might not work out at all.
What can I tell you about these new ideas? Well, perhaps at least the number. We’re working on four big ideas, including the Manhattan Project. Beyond that, I have to get very cagey.
Let’s see if I can give you some hints:
- The Manhattan Project is the most speculative of the big ideas. It remains something that has never been done before, a product that does not fit into any category that has existed in audio. It has grown into something much more ambitious than originally expected, though, requiring the hire of a full-time Ph.D mathematician to work on it. We are getting results, but if anything slips far out the timeline, or fails entirely, this will be what fails. But if it works…it changes audio. (Without a ransom.)
- The mentioned Other Not Digital Thing from last year is still a thing, and I believe we will be shipping that this year. Buckle up. It won’t be for everyone, but it should be a seismic shift in one market.
- Another new thing is actually very old. Or at least moderately old. When people start inherently rejecting ideas for no good reason, sometimes it’s time to look at why they are doing so, to question the wisdom behind the rejection, and to see if it’s time for some new thinking. And that’s all I will say about that. I’d expect a family of products to come of this…but I’m still playing with it. That’s all I can say for now.
- And, one last thing that’s so obvious, I’m surprised nobody has done it before. But it’s a very different market for us, and I still need to build the prototypes, though the general idea has been validated…so I’ll shut up now.
Nebulous? Hazy? Infuriating?
Yes, perhaps all of the above. I know, I know, I wish I could say more, but hey, even the simplest intros sometimes slip (cough…Freya…cough). And none of these things are simple. None of these things are “business as usual.” All of these things are pretty darn big ideas. Some of them can literally change the audio business.
“Change,” you say suspiciously. “I don’t like change. Other people talk about change, but then they want a bunch of money.”
Yes. We understand. We know all about ransom-based schemes to remake audio. We hope they don’t succeed. Because if they do, Mike might just piss off to make deep fryers or something like that. We don’t need ransoms. We don’t need the Infinite Wisdom of the Anointed Few to light the One True Way for great sound. We don’t need the studios, artists, listeners, and manufacturers bound into proprietary standards that can change arbitrarily to “drive” demand for new stuff. We don’t need to be like home theater or medical devices.
What we need, at least in our mind, is more people doing interesting things, unique things that actually move the industry forward. And that’s what we’ll continue to do.
And nothing we do will have ransoms, or standards.
They will all be about choice. Your choice. To embrace and enjoy as you see fit…or to listen happily without them.
That’s where we’re going in 2017. Our new direction. Towards bigger ideas. Towards bigger goals. Goals like…
changing audio.
(For the better.)
(We hope.)
(And…without a ransom.)