[eke2k6]

I made a response in the AK240 thread that was deleted because it was off-topic. I was given the option to post it elsewhere or start a new thread. So, here's the thread.
 

   
I hate to go back on my words, but...

 
I'm typing this with a completely calm demeanor, by the way. There's no vigor in my keystrokes.
 
Panda man, you're cool as hell but your argument is fundamentally flawed. A&K hasn't innovated a thing. Their streaming store can be achieved via simple mobile websites, and the Android OS already allows downloads through the web browser. The true heavy lifting is done by the primary manufacturers like Knowles, Sonion, Wolfson, etc. who make these chips and drivers, then publish schematics to get the most out their designs. If the AK240 was so much more difficult to make than the other DAPs, and provided SQ that was worth the effort then maybe they could start to get away with the price. Production lines are relatively cheap and easy for small electronics, especially on a small scale. Plus, A&K's touted music stores could easily be mobile versions of these stores running on the built in browser. Music streaming over wifi only requires the DLNA protocol. 
 
I know some people think I'm talking out of my arse, but I did get a minor in economics while doing my bachelor's. I see the trend as its happening. If companies could pour out the sweat and blood for $500 flagships back when I first started out in audio 4 years ago, what has changed now? Sonion and Wolfson definitely aren't charging enough extra to warrant this. Minimum wage hasn't increased. For example, Sony and Vsonic developed diaphragms using bacterial biocellulose. You have to culture living organisms, feed them, and extract their waste products to dry and layer them into exquisitely tuned products. The price of the Vsonic offering? $179. JVC's FX700 uses a wooden housing, as well as a central diaphragm made of wood. Price? ~$300.
 
The A&K's pricing example is somewhat analogous to the way a person becomes morbidly obese. One day you're fit and running 3 miles a day, then you're eating an entire large pizza alone, and browsing the walmart aisles in a scooter because your knees can't support your own weight. It happens little by little.
 
Some have made the point that "the free market will decide". To respond to that, I will quote myself from last week:
 
 
Quote:

   
That would be true under most circumstances, but not in this echo chamber of a hobby. Allow me to dust off my crystal ball and describe what will take place over the next few months...if the AK240 is not clearly above the competition (and I believe MUST, given that it costs double the price of its competitors).
 
1) Someone who doesn't care will buy an AK240. Likewise, others will receive a sample AK240.
 
2) Said individuals will defend their new purchase, despite how they feel about its performance. Likewise, the selected reviewers will want to talk about the product in a way that ensures they get more in the future.
 
3) People who read these glowing reviews will be convinced to buy these DAPs. Most will, again, try to defend their purchase. Only a few will speak out, but those few will be silenced. I've seen this happen before several times. I remember a certain IEM that had a wonky sounding midrange to a lot of folks. But one member shouted from the top of a rooftop that these iems had no such issue at all. Later, he confided to me via PM that he was using fabric filters to get the IEM to sound normal. This is what the consumer is up against.
 
4) A&K's strategy will have worked, leading to the sale of units for them, but also the impetus to continue with price increases.
 
5) More DAP makers will see this and want in on the action. I predict more $2k+ DAPs within the next 6-12 months.

 
 
And as you blink, you weigh 450 pounds.
 
 
 If my long paragraphs and prolific posting didn't get what I'm trying to say about innovation and market trends across, maybe this list of truly innovative products will. Also look at how richly the market has rewarded them, even to the point where they often cannot meet demand. 
 
1. Google Chromecast
 
2. Apple iPhone (revolutionalized an entire market)
 
3. Apple iPad (yes, the giant ipod touch)
 
4. Love it or hate it, the iPod.
 
5. The Sansa Clip+
 
6. Apple TV/Roku...made any TV with a HDMI port into a smart TV without having to pay huge markups
 
7. The Ford Model T
 
8. Countless others, excluding Astell and Kern.
 
9. The Stax SR-009. I left this one for last because it's so expensive. BUT, it unmistakingly BLOWS away every other thing I've put on or in my ears. I was in a room that had the likes of the LCD-3, HD800, etc. on some uber amps like the GS-X MK2, Decaware, etc. They all sounded good, but the SR-009 simply made them comparatively sound like dirty, foggy windows blocking my audio scene. In my opinion, it is only when you create such separation from your competitors that you can begin to charge such a premium. I'm getting a set of SR-009s as soon as possible. I included this to counter the thought that I'm some scrooge who can't understand the finer things in life. Look at my profile for a bit of my audio history.
 
 
Hopefully this gives some insight into what I'm trying to say.
 
 

---

 
This is definitely hopefully my last post in here, unless I hear a set for myself and want to post impressions.
 

 
 
 
The post I was responding to:
 
 
 

   

---

Please Read this before continuing with your flame wars people:

 
I am absolutely in favor of stuff like the AK 240. I absolutely am. We must first acertain that we are in a niche field. 
 
Jude's comment on pushing the envelop of innovation is exactly why I think stuff like the AK 240 is good for the field. Look around guys, half the audiophile DAP's on the markets have problems here and there. The AK's aren't without their share of problems from what I've heard, but its like the Apple of DAP's. It doesn't need the best sound or anything. It just needs to 'work'.
 
How does this push the field better? Well, IF WE WERE ALL to use the mindset of hating on the AK240 right now as we did back with the CMOY's, headphone audio may not have gotten anywhere.
 
THEY ARE CHARING 2X for a new amp!?? What? Nah bro. I gots me a Cmoy. That stuff is too expensive!!
 
I  don't see or use price as ANY type of object in a niche field like audio. Because think about it. Companies that are pushing the field and focusing on perfecting - or at the least attempting to perfect - one aspect of that device are spending lots of money and going somewhere others aren't. 
 
But of course, there is then going to be a price precedent and the fact that cost still matters. I'm not going to ignore this. Hold one with me. Let's talk economics now.
 
The AK 240 is obviously VERY expensive. But that's good. That's very good. It means that there is a chance for competition and lots of it. This is why companies in niche fields charge insane amounts of money for their flagship items. Because competition and like products will come out soon that will more or less force them to do something about it or lower the price. They need to make back the money from R and D AND IN TAKING A CHANCE. Companies charge and overcharge to make up for the fact that they are taking such a huge gamble in the market becuase sooner than later, another competitor will come up.
 
Look at FiiO, look at Hisound! This is the competition we are talking about. One company that pushes the field a few years ago (AK 100) will soon receive a challenger that sets a price that people want. Introducing the X5, X3, DX50 etc etc. 
 
Therefore, the price of a product that a company in a niche field products isn't of issue. If it's a shawty product, it won't sell and will fail. If it's TRULY innovative and pushes the field in the direction that other companies see as the future, then competition will soon arise.
 
Guess what guys, the AK class pushed it in that direction. Look at the FiiO X5 and DX50. They recognize that direction, and the fans innately want it and thus are pushing for that direction also. This is the type of directional innovation I was talking about. It is something that also corelates with economics. If its bad in a niche market. It fails. But if it's good, but very pricey, but pushes the field into a new direction. Then, other competition will soon join to produce units with same features or sound with lower price.
 
Now go back a few steps and put yourselves into the shoes of a niche enthusiast company. Your sales, revenue, profit, margins etc are X Y Z. You are a small company as compared to others. Can you imagine the costs, and gamble you must take? Hence the price
 
Those that can afford the price of the very expensive first innovative products will buy them. Simple as that. If you can't afford it or rational it. Wait. 
 
 
Can't ANY of you see that your maxims will fail if you were to castrize something like the AK 240? Look at the Tesla motors car, the first SUV's, the first hypersonic jet. YES, the COST A CRAP TON of money. But they are the ones that creates the futures in each field that they are in. 
 
You guys that are castrizing the AK 240 are setting up very dangerous maxims that you may not understand. A maxim is a sort of law that has to hold true the first AND last time you do it. The example would be a maxim of asking to borrow money from a friend without the intention to pay it back despite the promise. This maxim fails because you can't do it again as your friend won't lend you money.
 
The maxim set in the case of the AK 240 by those that are criticizing its price, is one of stopping innovation, and in stopping the future. Does the huge asking price set a precedent for the $10,000 DAP? Sure. Could it still have some non-perfect issues? Sure. But guess what, this is just part of the field and part of the game. Those that will buy that $10,000 DAP on initial asking price are supporting those practicies and that company. If what is inside that $10,000 DAP is TRULY good, and is something that the people want. Guess what, competition will arise. And that non perfect player? Its gonna happen, you don't have the money? Don't buy it and wait for the comeptition
 
 
I repeated a lot of the same info about 2-3x to make sure that I can use different examples and situations as a way to explain my view point on the AK 240 and similar devices.
 
 
-------------
I believe the reason with why I agree with Jude is due to us reviewing a lot of stuff. He obviously has reviewed a lot more than I have. But even with the amount I've done. It's come to the point in where everything is literally very stagnant. Oh, new package with an IEM. Cool. That stuff just isn't interesting anymore, seeing the same design, seeing the same type of functionality. It's just gotten boring. Stuff comes in costing tens of dollars to digits much higher than Iwould ever care for. It's all, just very stagnant. They sit on my shelf. It's just not interesting anymore. That's why it is there may be such a disconnect between some of us. Some of us see the AK 240 as something they may possibly 'use' or own. And thats why the $2,400 may be alarming to them. But to others, that device can be $5,000, but if it won't push the envelope, its still just part of everything else. That doesn't mean to say its not going to be a 'good' device'. It will be. But there comes a time of when you get bored of the stuff you get, and just want to see some REAL innovation that tries to push the envelope. 

---

 
Disclaimer: This post has some heated text inputed in it. NONE of it was directed at any individual, company, entity, product. Any mention of any company or product in it was used soley as an example for innovation and is not a true representation of their product or their standing in their persepctive fields. 
 
If anyone's feelings are hurt by this post, despite it not referencing anyone, please note that it was not intentional as I was not referecing anyone here. This post is also not in protecting the AK 240. I have not used the AK 240. This post is rather in showing some of the faults of logic and rationale some are using in terms of real life innovation with the AK 240 and audiphile niche DAP market as its main example for use. I do not believe any HF ToS was violated by this post or in anything referenced in it. I, Panda, encourage discussion, debate, and learning on a higher level. I can definately be argued on some of my points. If so, please do. Everyone can learn. These are but the type of economics, business practices, and other situations that are represented by my type of thought.
 

 

 

[vwinter]

Forget sound.
I know crazy notion.

Forget, what it'll do to the market, which is probably make other companies put out the same product for what it should have been priced at.

But if we for a second focus on innovation, R&D dollars if you will.

AK as far as I can tell is not a mom and pop shop. So it's not like they have no market advantage to get tooling or can't control manufacturing costs to justify this price.

So my question is, as far as anyone knows, is there seriously enough innovation in the 240 over what went into the 120 to justify the doubled price?

 

[eke2k6]

Exactly. I'll quote a message I just got:
 

  Not only did that happen (the new Westone TOTL universals), but the new/recent TOTL Earsonics universal, universal Roxannes, The Wiz's N6, UM's Mentor and some other expensive Chinese universals. Ah, but let's never, ever, forget that moar drivers = better.
 
So, that fancy low-pass filter warrants a price-tag of $1,000 for a mass produced product AND made in China? Does everyone who auditions the 846 go 'Oh, my ****** God!?'. Why on earth didn't the first iPhone retail for $10,000? (or the next couple of models?) — I'd say that was a little more revolutionary than the 846 — practically everyone who tried an iPhone in the early days went 'Oh, my ***** God!'. Oh, but wait, Apple is evil, crap and just greedy bastards, right? Oh, and they sell by the zillions, so that's alright then that they charge a lot less.

 

[eke2k6]

And to bring things into perspective a bit, here's the review of the original iphone. A device that is stone-age technology by today's standards. It's predecessors are aeons ahead in tech advancements, yet they are cheaper. Just more food for thought.
 
http://www.engadget.com/2007/07/03/iphone-review-part-1-hardware-interface-keyboard/

 

[CosmicHolyGhost]

Thank God we have Fiio still. After X5, I have complete faith that X7 will set the pricing straight. The AK240 product is a good idea but the pricing is too outrageous... I think most of us here agree and no matter how good their PR is, they cannot change this fact.

 

[z3r0day]

- Maybe bad idea for you, but not others.
- Have faith in the free market, which will regulate itself.
- tl;dr

 

[JackDiesel]

Have you heard the AK240?

 

[goodvibes]

This fear of expense if ill founded. Lexus didn't ruin Toyota, Levinson didn't ruin Yamaha or the demand for lower priced products. HiFiman, AK and Ibasso haven't hurt Ipod or Sansa pricing. JHaudio and Westone haven't adversly affected Skullcandy. Expensive HiDef downloads hasn't weakened or price increased the mp3 market. If anything, they generate interest and raise the level of the the cheaper products.
 
Market share dictates volume produced products and that share is greater influenced by price than anything else. The way to get an even greater bit of that market share is to give a device specs and features of better kit while not raising the price. It's how you keep your current market while expanding it a bit. MP3s are now available in res above 192 at the same prices. Ipods,  Ipads and andriods are now HiDef ready at the same pricing as the past. These are good things brought about by higher expectations. 
 
A luxury item is just that and you can think a Bentley owner with his $30k onboard Naim stereo a fool for waisting so much money but he can afford that Bentley for a reason that probably doesn't relate to foolishness and he's rolling with what is by far the best tunes available. Think about the stereo that came in a Honda that was purchased before HiEnd companies put more advanced units in luxury brands and the stock offerings that come in everyday brands now. McDonalds will always outsell all the premier steak houses put together. We have more to worry about regarding lack of goodness that we do about pricing precedence.
 
Welcome to the headfi bubble.

 

[vwinter]

This fear of expense if ill founded. Lexus didn't ruin Toyota, Levinson didn't ruin Yamaha or the demand for lower priced products. HiFiman, AK and Ibasso haven't hurt Ipod or Sansa pricing. JHaudio and Westone haven't adversly affected Skullcandy. Expensive HiDef downloads hasn't weakened or price increased the mp3 market. If anything, they generate interest and raise the level of the the cheaper products.

Market share dictates volume produced products and that share is greater influenced by price than anything else. The way to get an even greater bit of that market share is to give a device specs and features of better kit while not raising the price. It's how you keep your current market while expanding it a bit. MP3s are now available in res above 192 at the same prices. Ipods,  Ipads and andriods are now HiDef ready at the same pricing as the past. These are good things brought about by higher expectations. 

A luxury item is just that and you can think a Bentley owner with his $30k onboard Naim stereo a fool for waisting so much money but he can afford that Bentley for a reason that probably doesn't relate to foolishness and he's rolling with what is by far the best tunes available. Think about the stereo that came in a Honda that was purchased before HiEnd companies put more advanced units in luxury brands and the stock offerings that come in everyday brands now. McDonalds will always outsell all the premier steak houses put together. We have more to worry about regarding lack of goodness that we do about pricing precedence.

Welcome to the headfi bubble.:wink_face:

Personally, the price doesn't bother me as much as the justification.

That's why I don't think the car analogy works even a bit.

Bentley's are very much as hand crafted as a semi mass produced car can be. They use very expensive materials and craftsmanship, compared to even a regular luxury car like a BMW or a Lexus. They are customizable to a ridiculous level and they make sure the customer feels that they can see, feel, and experience what their extra buck is buying them. Does that make them worth what I'm sure is still a pretty sizable markup? That's not for me to decide. But at least there, I can clearly see where extra cost is going.

Now take Lexus for example, you're paying a whole lot more for an LS than a Toyota Avalon. You're giving them a greater margin for a more luxury product. Now say next year Lexus comes out with a car that costs twice that of an LS. Do you think people won't bat an eyelash if it is just really a different LS?

And that's exemplified in the car market by the creme de la creme of cars, the forefront of technology, R&D, being ridiculously expensive and still sold at a loss.

And Lexus did do that. The LFA. Around $380,000 IIRC. It used a brand new engine that Lexus collaborated with Yamaha to build. It was made almost, if not entirely of weaved carbon fibre, of which only two looms in the world could produce. It eschewed staples in cars that couldn't keep up with other pieces of it's technology, like analog gauges that weren't fast enough for the engine. Toyota went through a whole lot creating that car, and you could see where your dollar was going even though it wasn't the best performer at the lowest price. And still sold at a loss.

I'm not taking anything away or denying the potential greatness of the AK240. I just don't see at a glance what went into it that was worth that much of a price increase.

And it goes for most other products.

 

[Lostinspace]

As far as I can glean from all the press, the big USPs of the AK240 are - to quote from the What Hi-Fi article here: http://www.whathifi.com/news/astell-kern-unveils-new-ak240-portable-audio-player-at-ces) :
 
- In addition to a brand-new look, the AK240 includes a series of new features not currently offered by any other high-res portable players on the market.
- The new features include 256GB internal memory and one microSD card slot supporting up to 64GB of microSD card storage – resulting in a total of 320GB of music storage.
- A dual-core processor allows the AK240 to handle requests and play high-res audio files with no lag time, while users will also be able to connect to music download sites directly from the player.
- Other features of the new player include a 3.31in AMOLED touchscreen with 800x480 resolution; Dual Cirrus Logic 4398 Digital-to-Analogue Converter chipsets and native DSD support – including DSD64 and DSD128 files.
- The AK120 can play DSD files natively, not having to convert to PCM as is the case on other hi-res music players.
- It's also the first Astell & Kern machine to have WiFi. This allows you to download files directly to the player via the Store section of the interface.
This will be stocked with relevant HD audio suppliers for your territory, such as HDtracks. We were told Linn would most likely be one such store in the UK. 
 
 
So basically, for your $2.5K, the only thing different from any other smartphone or decent music player is the larger memory and the hi-res capability.
 
Given my agnosticism regarding hi-resolution files - essentially, I firmly believe any provable, detectable differences from standard 16/44 are solely down to mastering at source - this means you're paying over 2 grand for that extra memory....extra memory which you only need for the heavier hi-res files in the first place.
 
Bit of a no-brainer really. Massive rip off.
 
There's nothing 'innovative' here except the marketing.

 

[goodvibes]

Personally, the price doesn't bother me as much as the justification.

That's why I don't think the car analogy works even a bit.

Bentley's are very much as hand crafted as a semi mass produced car can be. They use very expensive materials and craftsmanship, compared to even a regular luxury car like a BMW or a Lexus. They are customizable to a ridiculous level and they make sure the customer feels that they can see, feel, and experience what their extra buck is buying them. Does that make them worth what I'm sure is still a pretty sizable markup? That's not for me to decide. But at least there, I can clearly see where extra cost is going.

Now take Lexus for example, you're paying a whole lot more for an LS than a Toyota Avalon. You're giving them a greater margin for a more luxury product. Now say next year Lexus comes out with a car that costs twice that of an LS. Do you think people won't bat an eyelash if it is just really a different LS?

And that's exemplified in the car market by the creme de la creme of cars, the forefront of technology, R&D, being ridiculously expensive and still sold at a loss.

And Lexus did do that. The LFA. Around $380,000 IIRC. It used a brand new engine that Lexus collaborated with Yamaha to build. It was made almost, if not entirely of weaved carbon fibre, of which only two looms in the world could produce. It eschewed staples in cars that couldn't keep up with other pieces of it's technology, like analog gauges that weren't fast enough for the engine. Toyota went through a whole lot creating that car, and you could see where your dollar was going even though it wasn't the best performer at the lowest price. And still sold at a loss.

I'm not taking anything away or denying the potential greatness of the AK240. I just don't see at a glance what went into it that was worth that much of a price increase.

And it goes for most other products.

That's justified but it doesn't make it a bad idea. It does quantify your choice to not consider it as personal considerations do for us all. 
 
You are cherry picking a bit on your cars by pointing at a loss statement vehicle as opposed to what allowed them to make it. Exceptions don't prove a rule. Most Lexus are glorified Toyotas with better bits and goodies. Bentleys don't have to be hand made. They choose to be and some (not me) would berate them over the lack of value in doing so. It's all relative and the market does a fine job of sorting it out.

 

[eke2k6]

  This fear of expense if ill founded.

 
It's not a fear of expense. 
 
Here's another analogy:
 
You have a young, impressionable child. Your next door neighbor has a slightly older, poorly behaved child. This child swears like a drunken sailor, and is incredibly rude. Its parents don't seem bothered by it, but all the other parents in the neighborhood keep their own children away for fear that they may pick up their bad habits.
 
I realize this example is a bit of a stretch, but hopefully it gets the point across.

 

[truckdriver]

There is nothing about the AK240 (including price) that makes it a “bad idea” (IMO).
 
I complained about the price of the Shure SE846 but I bought it anyway (and don't regret it). I wanted an IEM (for my job circumstance) with a little more sub-bass, and that is what I got. The “Shure is a big company” was not my rationale. I simply didn't want to shell out a grand, but I did. And again, I don't regret it.
 
I don't know the particular circumstance of Shure's IEM division. Like most companies (that make a variety of products), I'm sure Shure expects every division to justify its costs and produce a profit or face being phased out. In my town (metro population of approx 1 million people), I have never (in ten years) come across another person with a Shure IEM. Shure IEMs use to be sold out of several retail outlets years ago (including the Apple Store where I bought my 530). Now, only one place in town sells Shure earphones, and very few people happen past that specific concourse at the airport. This is simply to say that the “big company” line doesn't mean a company should absorb costs for absorption sake .
 
I would like to see a breakdown cost analysis of many of these products like they do with the phones, tablets, and computers. We know that Apple is such a magnificently wealthy company because an iPhone is $200+ worth of parts sold for more than three times that amount (and they sell millions of them). I'm sure Apple recovers R&D in the first five minutes of pre-release orders. I don't know how that would work in the case of Astell & Kern. I imagine that if Shure pays (in the neighborhood of) $40 per driver that that alone is $320 in just that part of the 846 (but anyway....).
 
I like the fact that what is a luxury item soon becomes standard stuff. The much acclaimed ESS Sabre DAC ES9018 is a chip in a phone now (at least a version of it). The more “features” are on these boutique music players today---the more ideas phone manufactures get in what consumers may want. A 41 mega-pixel camera use to be ridiculously expensive, now it's on a phone (no one wants...., but still). Some company is going to make a phone that is pure audio-centric (loaded with high quality circuitry) probably because they saw it (or heard it) on a boutique player. It will probably be Nokia.

 

[eke2k6]

Again, people it's not specifically just about the AK240 as a product. It's about the trend it will spark.
 
The SE846 may be good, but it's from a legendary manufacturer with pull in the industry. Other large manufacturers followed Shure's lead. Westone was not to be outdone, so they pushed out their own 6-driver $1k iem. Unlike Shure's there's almost zero new tech in it, just a  3-way crossover and a couple of extra drivers. Price jump from the W4? and extra $500. 
 
Huge price jumps without equal/similar steps in quality are bad because they inspire a wave of me-too pricing. Have you not noticed how the standard pricing for top-tier iems has now risen to over $1k? A flagship isn't a flagship anymore unless it's >$1k. Using Westone again, look at the difference between the W2 and W4. They had to redesign the crossover and add an extra couple of drivers, yet they managed to do it for just $200 extra. 
 
Again, not just the product but the trend.
 
 
If you really want to cry, look up the actual cost of parts for many of these iems and DAPs.

 

[truckdriver]

The price didn't jump for the W4. If the price is higher for a brand new product, so what? You can still buy the W4 (and probably for cheaper). You are not required to buy the new product on launch day (or ever).
 
My examples were how new stuff of today will soon become the cheaper stuff of tomorrow. Phone manufacturers are gradually shipping better earphones with the phones. The phones themselves are sounding better. My brother got a Nokia 1520. It sounds pretty damn good with just the Windows Phone 8 standard player and EQ.''
 
I can remember many years where improvements at this pace was a pipe-dream. Nowadays, there's a cheap knockoff version of Beats (that Tyll says) sound better than the original (which probably wasn't hard—but still). I don't care what they come up with and how they price it, they will be undercut by choice in the marketplace.