2016, Chapter 9:
The Elephant in the Room
Let’s talk about the elephant in the room.
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So What Do We Do About This?
Well, it’s obvious, isn’t it? We need to take up arms and storm the castle!
Except, well, there is no castle, and there is really no need for a violent revolution. The end-game of high-end is plain for all to see—ever-increasing prices for an ever-shrinking market, until the elephant crashes all the way through the dance floor.
What we need to do, as manufacturers, is keep our wits. The siren call of higher prices is a huge temptation. As the super-high-end hyperinflates, the sensible high end will want to raise prices, too. Hell, they’ll be called on to raise prices.
Think I’m kidding? I can’t tell you how many times I’ve been told that we should raise prices because we won’t be taken seriously if we don’t.
Well, here’s my response: **** you.
I give exactly zero ****s about being taken seriously. I care about only one thing: bringing high-end within reach of as many people as possible and building the ranks of audiophiles, so that when the ultra-high-end implosion comes, there’s plenty of sensible music-lovers out there.
And that’s what manufacturers can do: resist the temptation to inflate up, as the ultra-high-end bubble spirals out of control. Remember how to make an inexpensive, attractive chassis. Remember old production methods like sheet metal and casting. Remember that higher production numbers will reduce your costs. Remember to pass that along to the buyer. And consider—if you’re not already there—going direct. That’s the biggest benefit to the buyer, really, since it effectively cuts prices in half.
So what can you do, individually? You can, of course, choose less-expensive components. Like, well, duh. You can also be more pointed in your questioning—ask manufacturers where the cost goes. What percentage of that high price tag is the chassis versus the electronics? Hint: if it’s fancy, it’s a lot. What unique technology are they bringing to the table? If it’s off-the-shelf chips and implementation, how do they justify the cost? Hint: R&D on unique tech is a lot higher than a datasheet implementation, so R&D amortization really doesn’t fly there.
But there’s more. I want to do more at Schiit. So consider this our manifesto: we will continue to bring the highest-value products, at the fairest-possible margins, in the largest-quantity runs (for even lower cost) to assure that as many people can enjoy high-end audio as possible, and to grow the audience for the future. And we’ll continue to do this both in personal and desktop audio, and in the world of speaker amps, preamps, and other gear, as we can. You’ll see our 2-channel products this fall, and, if the reaction of various industry people is to be believed, they may have an even bigger impact on that market than we have on the desktop.
Because, you know what? We need to do more than talk about the elephant. Talking is only the start. What we really need to do is get the thing out of the room, entirely.
Here’s to a sane, affordable, and high-end future!