Extreme Luxury Pricing in Audio

[Another Johnson]

I’m all for audio companies pushing the tech forward and getting paid for it. Sometimes there are huge expenses in R&D which can necessitate huge prices for low volume sales.

Again, what I’m talking about is bs luxury pricing that has nothing to do with anything other asking a huge price of luxury minded consumers. If this becomes more than a rarity, I believe it leads to more of the same.

Personally, in the interest of great music reproduction, I’d rather see Audio resemble the luxury fashion industry as little as possible!

So … you can boycott any company whose products you feel are grossly overpriced. Or … you can establish a price control board to review and approve all products priced above your declared maximum.

Either of these ideas is patently absurd on its face. Seriously … I suspect you’re already not buying gear that you declare to be in Veblen territory. And who is going to appoint anyone to sit on a price control board and how would it’s edicts be enforced?

Let the free market sort it out. If no one flocks to bespoke $1M cartridges, their existence wont impact the cartridge market in general. And if a few do (wait til MF reviews them), the ripples will be felt far above the level where average well healed buyers buy. We wont notice it.

 

[bryans]

This is driven by two factors. First, there is no sales tax in NH, so if you want to buy a Corvette to squirrel away as an investment, it is cheaper to ship it or drive it home on a NH temporary tag than to pay sales tax which would be collected on registration in your home state. And second, vehicle allotments and kickbacks are often tied to past order volumes. This dealer has a great order history, so he gets the best deal from GM and can give you the best price. I’ve gone to NH with my trailer many times for vehicles.

I have purchased a few cars out of state. I always paid the state tax where I registered the car.

 

[Another Johnson]

I have purchased a few cars out of state. I always paid the state tax where I registered the car.

Yes. That’s because you wanted to register it.
In some states, FL for example, you pay their sales tax on purchase and get a credit against what’s owed when you get home. In NH, and in some other states, you do not pay tax at point of sale if you’re a nonresident. It all just depends. In NH there is no sales tax for residents or for nonresidents.

 

[Lee]

Small observation...what I have seen is that many audiophiles get more comfortable with higher pricing as knowledge of the manufacturing process increases.

As one example, some question the $10K premium for Wilson Audio's Pearl Paints. When you visit the factory and see the paint process and the extra layers needed which translate to an extra 6-8 weeks of painting, then it seems totally fair.

Most manufacturers are pricing at 4-6X BOM which is standard manufacturing markup.

 

[morricab]

1'000'000.01 in Swiss Franks is app. 1,129,684.38 in the U.S.That is outright robbery!

Not if you don’t buy it…

 

[XV-1]

How do you know It’s an inside joke?

Ask him.

 

[morricab]

Speaking of turntables, would there be an Obsidian if we had no Caliburn? Would there be a Doehmann Helix if we had no Caliburn? Would there be a Prime Signature if there was no HW40?

All these products involve accumulating knowledge. There is a reverse snobbery in audio that largely is absent in cars and watches. We hear:

"If you spent more than me then you spent too much."

"My $2,000 DAC sounds just as good as your reference DAC."

I would argue we should fully embrace the ultra luxury segment. In many ways, it is the venture capital provider for the industry.

But are these really advancing audio or just repackaged old ideas? Don’t get me wrong, many old ideas are really good, but you don’t have to pay a fortune for regurgitated ideas . Is the execution even better than in the past?

 

[microstrip]

This is the same discussion you can have with any hobby or any retail goods, and comes up on audio forums every 6 months. But with audio, there's a lot more indignation.

As far as value, you can do worse than the highest-end audio. Look at fashion, 5-6 figure handbags and dresses, totally normal and nobody laments about how dress prices are ridiculous or that Hermes just raised the price of their bags again. Or $1000 perfumes made up of $5 worth of synthetic chemicals, the packaging often costs more than the product.

With cars, nobody looks at hypercars like La Ferrari, Porsche Carrera GT, Konigsegg or McLaren Sennas and the first thing out of their mouth is their own modded Corvette will beat it around a track and the owners are crazy for not just buying a Corvette. Everyone would look at you like #1. You're naive and have a childlike view of the subject, #2. You're just jealous. Few people I know in the car world, either racing or show cars, would respect the opinions of a person after they make a remark like that.

The highest end audio systems are cheap compared to expensive hobbies like racing cars and yachts. For some, buying a top-end audio system just isn't a ton of money.

The world is made better by creativity unencumbered by cost constraints for many reasons. This applies to art, architecture, vehicle and aircraft design, and certainly audio systems. We all benefit from seeing or experiencing cost-no-object design, and we all benefit from the lessons learned from such endeavors. Few can afford to buy and race a F1 car, but it's still fun to watch F1 racing and a lot of tech from F1 has made it's way into cars we actually own.

I have no idea why people can't appreciate high end audio in the same way, without feeling such negativity. I often hear about it being "fake luxury" but that also applies to everything else too. The Cadillac Blackwing CT5V for $125k rides on the same chassis as a $25k base Camaro, it just has a larger engine and fancier interior trim. That $20k dress is just fabric sewn together like any other garment. I think some consider the folks who buy these products idiots who are being ripped off and simply don't know any better, but imo that's coming from a place of naivety and sour grapes.

People can make their own choices, there are options. I often sell my cables to people who can afford anything they like, but would rather have something that works well without the dealer-sale luxury goods experience. Others may go all-out and spend $250k on top-end Siltech. Both options are available and folks are free to choose how they want to spend their money. For a lot of people that difference between spending $250k vs $25k just isn't a big deal. The dealer will bring it all to their house and offer setup and and other services I simply can't offer. Despite the fact I make a living on offering the high-value non-luxury route I don't judge the folks who buy top-end dealer-sale brands either. It's all good.

Fully agree, but is skips a relevant question we were discussing: in real world, choosing wisely, can we expect an existing $500k euro speaker to have better performance than a $100k one? Are high prices a social-economic process, just due due to wealth and free will or are they a manifestation of superior sound reproduction?

Apologies for focusing just on speakers, but they seem the less controversial of all high-end gear!

 

[microstrip]

I’m all for audio companies pushing the tech forward and getting paid for it. Sometimes there are huge expenses in R&D which can necessitate huge prices for low volume sales.

Or simply the production costs of elaborate and hard to manufacture designs are high or because they are manufactured in countries with high labor costs.

Again, what I’m talking about is bs luxury pricing that has nothing to do with anything other asking a huge price of luxury minded consumers. If this becomes more than a rarity, I believe it leads to more of the same.

Well, if you state it this way you will get a large agreement, you avoided the serious matters. But the real question is that if high prices are luxury or performance.

Personally, in the interest of great music reproduction, I’d rather see Audio resemble the luxury fashion industry as little as possible!

No problem, it does not look at all, although some audiophiles probably have more cartridges than pairs of shoes!

But IMO if by any reason audio would resemble the luxury fashion industry great music reproduction would improve.

 

[marty]

Oh, I think the first two offerings are the real deal. The third is a bit of a "wink", as it were, IMO.

Mike, here's the link:

https://neverheardbefore.com/

Remember, that's Swiss Francs. It's even more in USD!
Not sure about you but it's the 0.01 in 1000000.01 that precludes me from purchase as I refuse to spend over 1M.

 

[Audire]

Remember, that's Swiss Francs. It's even more in USD!
Not sure about you but it's the 0.01 in 1000000.01 that precludes me from purchase as I refuse to spend over 1M.

I could purchase 62 Air Tight OPUS 1’s for a million dollars. Hopefully, that’s more than a lifetime’s supply.

 

[DaveC]

Fully agree, but is skips a relevant question we were discussing: in real world, choosing wisely, can we expect an existing $500k euro speaker to have better performance than a $100k one? Are high prices a social-economic process, just due due to wealth and free will or are they a manifestation of superior sound reproduction?

Apologies for focusing just on speakers, but they seem the less controversial of all high-end gear!

As much as anything else, the audio market is diverse and has a wide range of values. So the notion of performance isn't going to be universally agreed on, I think that's a given considering the extremely wide range of speaker designs and the disagreement over preferences. You can also include looks... industrial design of a speaker and how it's finished can be a big factor for some, while others pay big-$ for speakers in simple boxes. In the end, for all luxury products, the buyer relates with the company they are buying from in a way that's meaningful to them.

When considering price you also have to look at distribution. I think people often conflate dealer-sale and direct-sale products, and while they may have some overlap they are largely different markets.

But in general and everything else equal, I definitely think you get more for a $500k speaker vs $100k and the differences are often very significant. My own horn speaker would have to sell for near $100k, and it's super easy to get to that point, I would have no problem designing a speaker system that would get well into the 6-figures and yes it'll be a lot better in many ways vs the current ~$100k speaker.

Prices are both socio-economic and the result of superior design. It's impossible to make the case that people aren't impressed with high MSRPs and like getting discounts. No matter how much you rationalize that money isn't tied to "performance", you can't overcome this bias 100%. In some cultures low MSRP simply won't sell anything, and the same speaker with 3x the MSRP will sell. That's an unfortunate reality, but wishing it was different won't change it. It seems like many think of the audio industry in odd ways, personifying it into some kind of monolith with an unholy agenda to make money off of ignorant customers. Reality is far from that.

Speakers are less controversial because cost often scales with size I'd guess, it's easier to see what's gone into it.

 

[microstrip]

(...) Prices are both socio-economic and the result of superior design. It's impossible to make the case that people aren't impressed with high MSRPs and like getting discounts. No matter how much you rationalize that money isn't tied to "performance", you can't overcome this bias 100%.

IMO this true bias comes from experience and knowledge. I can not see any rational argument why we should not expect money to be tied with performance if we buy from reputable manufacturers with a long and strong presence in the market. Surely we should always think that rules can have exceptions and be aware of them.

In some cultures low MSRP simply won't sell anything, and the same speaker with 3x the MSRP will sell. That's an unfortunate reality, but wishing it was different won't change it. It seems like many think of the audio industry in odd ways, personifying it into some kind of monolith with an unholy agenda to make money off of ignorant customers. Reality is far from that.

Well, I can't see what cultures you are exactly addressing. As far as I have been told asiatic markets buy large quantities of low and medium MSRP products.

Speakers are less controversial because cost often scales with size I'd guess, it's easier to see what's gone into it.

I don't think so. IMO speakers are less controversial because their quality and characteristics are easier to perceive than that of electronics and most audiophiles still consider it the most important part of a system. Also because their differences are easier to explain - they are electromechanical devices, needing less time and effort to explain to a consumer than electronics or cables!

 

[gleeds]

With all the high prices there still companies that have somewhat reasonable pricing for exceptional gear. Just today I was looking at some Maggie’s. Though I’ll probably be going with some Alsyvox speakers, the Maggie’s still looked very interesting.

This said, sooner or latter some of these companies will price themselves out of the market. I just desire the best sound at a reasonable price (we all do). I don’t think you need to spend a million to get that, only $999,999.99 Seriously, one may spend a lot less and out perform many of these million dollar status audio systems.

Joe, panels for you? I assume this is for a second listening room you are building.

 

[Lee]

Remember, that's Swiss Francs. It's even more in USD!
Not sure about you but it's the 0.01 in 1000000.01 that precludes me from purchase as I refuse to spend over 1M.

I can’t believe all the poor people on this forum whining. Buncha lazy people making only six or seven figures. What are you doing with your life? Pussies. This is the What’s Best Forum, not the What’s Mediocre Forum. That’s Audiophile Style. (By the way, shouldn’t Audiophile Style have a logo of a white sock in a sandal? Isn’t that really audiophile style?)

Look, I have three of these million dollar cartridges. Herve stays in my guest house with 12 bedrooms. These are the best cartridges out there. If you don’t have ownership experience then have a nice tall glass of STFU.

Now excuse me, Alon is here setting up a pair of M9s in my master bath.

 

[Kingrex]

Peter, I believe you. I’m the same way. Every listening session is for my personal enjoyment. I do value my equipment as most components are unique, one of a kind, or custom built for me.



There lies the fallacy; thinking that cost correlates with performance. You have been around the block but I think that you have lived your audiophile life in the mainstream. I have experienced the more esoteric, underground and DIY/Custom/Bespoke factions of the hobby and can tell you and show you that the cutting edge of high-end audio is not with the “extremely expensive items” advertised in magazines, displayed at shows, or discussed here on this forum, but with the experts and explorers in the DIYAudio community. You would be surprised how many of today’s sweethearts in mainstream audio are simply monetizing ideas, concepts and circuits that originated in the DIYAudio community.The latest technologies and circuits designs are there and being discussed and progressed there. I own a great deal of these products and can tell you that in a number of cases there are no commercial equivalent sonically. This is how high-end audio was in the 70’s, 80’s and early 90’s before greed set in and took over the industry.

It is not about money, as I’m sure that your wealthy friends have lots of it, but I can assure you that none of them have the awareness or knowledge of what is available out there and what is really cutting edge as I do, and I’m not alone in this respect. There is a whole world of extraordinary audio equipment out there than what is discussed in this forum, reviewed and reported in audio magazines, or shown at Munich and similar audio shows. Some of us are hardcore audiophiles and some are just living in the mainstream. You would be surprised by what you and your wealthy friends might find if you really took this hobby as serious as I do.

This is my #1 gripe with magazine's. Its difficult to find the true high performers at a reasonable price.

This kind of Veblan pricing is detached from actual value. It’ a luxury fantasy world. I think it would be unfortunate if this type of marketing seeps further into the high-end audio market as I believe we can already see this trend effecting prices (over and beyond costs and inflation). This effects a broader population of audio buyers than the luxury buyers.

You don't have to buy overpriced equipment. Carlos is correct in that there are loads of premium products that are undervalued.

Maybe a better thread is, what are the premium products for real world prices. Those threads seem to die in 2 or 3 pages.

 

[Joe Whip]

Really Lee? That is rich.

 

[dcathro]

The owner of an elite brand of electronics has told me on more than one occasion that his greatest revenue comes from his ultra high end. People complain that he doesn’t offer entry level anymore. He thinks about it on the way to the bank.

I remember back in the 90's, I worked part time for the UK Boulder distributor when they brought out the 2000 series, I couldn't believe the prices and wondered who would buy them. It turned out that they couldn't make enough of them.

The hobby that we knew from the 70's through the 90's, where regular (non audiophile) people were buying CD players and mid priced separates is all but dead. Philips/Marantz were making millions of CD players a year in the late 90s and small audio companies like Arcam and Naim were selling amplifiers in the 100s of 1000s.

There is just a small bunch of hardcore audiophiles left to support the industry. The small margins on entry and mid level gear make it hard for companies to survive when the volumes are low. The ultra high end with it's big margins are sustaining the industry today.

 

[leyenda]

I have no problem seeing absurd audio pricings, but do have problem when I see people, especially those with vested interest, trying to relate such pricings to audio advancement etc. etc. It's simply margins and paying those in the chains to get the sales done...

 

[Ron Resnick]

That’s Audiophile Style. (By the way, shouldn’t Audiophile Style have a logo of a white sock in a sandal? Isn’t that really audiophile style?)

Every time Tinka joins me at an audio show and she looks around at the "fashion" she wonders why the show is being hosted by Walmart.