Is there a long term future for the high end?

Audio Systems
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The thread Varese v, Vivaldi seems to have now diverted from this topic, recent posts dealing instead with the possible future of the high end audio market in general without reference to any dCS product. So I decided that I would create a new thread.

Are young people still interested in high end audio? The subject no longer seems aspirational for many under aged 40 at least in the UK or the USA (from what I have read). However this may specifically elate to these particular markets.

From a UK standpoint, other needs now seem to take precedence such as housing or alternative leisure activities. Today’s prices may discourage younger newcomers given depressed disposable incomes compared with earlier years.

The flip side seems to be the creation of a luxury market where products are deliberately made to exploit the substantial disposable surpluses now earned by senior management, for example. I have no issue with this if genuinely novel features are introduced. However I see cases of luxury models having little difference from their predecessors save for the use of exotic materials to enhance the price requested but without much audible or measurable improvement.

Is there any evidence that the head-fi market is maturing by encouraging the eventual purchase of traditional speaker based systems? Or is it limited to just the purchase of the current fashion in cans?

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Answers are obviously just guesses but i think hi end will be around for a long time. When i was a kid adults with a real stereo system was an oddity. Maybe a few in my rural community of say 10000.In high school tricking out your car with “high end” stereo was the thing and even that was really more of a clique thing. My college roommate had an all in one stereo system and i think there was one other stereo on the floor of 44 men. When i graduated i bought a top notch stereo jbl, marantz, garrard, teac and knew 2 other guys my age who had stereos. By this time higher end cars came with blaupunkt stereos and kenwood was one of the go to car changeouts. 2 years later im married and of 4 friends all had at least separates with turntable, receiver, speakers and shortly thereafter cassette players and then cd players. Higher end to most then meant an added noise reduction unit for your turntable and a parametric equalizer times have changed. Over the next decade portable cassette players, portable cd players and even pocket tvs and dvd players. Ive heard the question why would you buy cds. Cars dont have cd players anymore i think serious audiophiles continue in every age group, are still outliers who actually listen to music actively rather than passively. Yes, many of my friends have taken up more available listening due to familiar restrictions or other interests or obligations but i think its common in most hobbies to have one get more interested and others fall away. The percentage of the population still seriously interested over a decade id guess isnt changing although the price for the highest end is making that pursuit much more exclusive. An example would be cars. I have always had a reasonably nice sports car. A new 911 turbo in the late 80’s was about 65k. A testarossa was about 135k. These were pretty nice sports cars at the time. I believe the top dollar sports car was about 220k ferrari f40. Now those same step up cars are around 230k and the top showroom car maybe 2x that. But look at top aston martins at 3.5 m Try a new bugatti at 18 million. That market is there for the elite but dont expect to see many new bugatti la voiture noire in town. But you’ll still see tons of 50-75k new camaros and mustangs if they make them. There will always be serious music heads and serious petrol heads. Fortunately technical advances are still being made and we will eventually benefit from them. Unfortunately the price of the top is, like cars, becoming much more exclusive imho

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Obviously we can all have a guess at what might happen but, with my job I go into many homes each year, these range from a one bed flat, up to 9 bed, multi million pound places.

Hardly ever do you see a hifi system these days, years ago I would see the cheap tower system in the corner, or later on the multi speaker tv surround set up. But a nice hifi set up was and even more so now, a very rare sight.

But obviously these things are selling, or they wouldn’t be getting made. I am sure the market is moving in a different direction, and the middle ground is becoming much smaller and harder to survive in.

The Chinese makers are fast taking over the lower end, and starting to push higher up. I only have to look at my ÂŁ500 cd transport to see how things are going. I feel we will end up with only a handful of manufacturers left. They will support the rich, and people that want something special or with pedigree.

But only time will tell, and I am sure manufacturers like dCS have looked further ahead to try and predict what that might look like, and in doing so, will have a road map.

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Over the past years I have regularly talked with several manufacturers of high end and ultra high end equipment (in Switzerland there are quite a few). Some have become friends.

Their assessment is indeed that the (ultra) high end market is changing from a purely performance based market (if it ever was that), to a prestige based market. Buyers in the ultra high end segment buy a product because is has a reputation of high exclusivity (with excellent quality of course). Still buyers who express their status through audio are a small minority vs. those who put on show cars, yachts or jets. The magazine Hors Ligne used to cater to that crowd. However I had never seen ultra high end audio there. What did feature were homecinemas for yachts (Trinnov target the yacht market specifically, so do deSede).

This goes to show that the ultra high end audio certainly is not mainstream (which Varese addresses). Audio brands get their pedigree through awards in Absolute Sound, japanese Stereo and maybe Stereophile European publications do not seem to contribute to brand reputation. So my take is that keeping a true exclusivity attribute for a brand (which translates into sales) will remain an uphill battle for manufacturers, as they continue to address a (probably shrinking) niche.

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Hi Pete,

In my humble opinion, the biggest obstacle to the evolution of hi-fi as it stands today ,is the way the new generation is being raised. Over the past two decades, I think we’ve “sold” kids too much on the idea of rights and stopped inspiring them to dream, as we did in my time.

I’m 45 years old, and when I was a kid, my grandmother sold me dreams that if i work hard and push myself, i could have a good life, a nice house, a turbo car, and good clothes. Nowadays, people sell the idea that owning a house is a right which it isn’t. It’s a privilege for those who work very hard and do a lot of sacrifices to earn it. Kids today also think if they get a degree, they can drive for Uber, rent a flat, and make a living doing TikToks or something like that and that’s enough.

I think a big part of being into this hobby is always chasing the “next big step,” but this new generation seems less and less interested in that. As for music, a pair of AirPods and a free Spotify account with ads seems to be good enough.

When I was a kid, I loved music, but my parents couldn’t afford to buy me a system. So I washed cars on weekends and during school breaks to save up for my first system and back then, Sony mini hi-fi units were all the rage. I’d read those magazines until the pages were falling apart lol.

I feel that today’s generation doesn’t seek excellence in anything anymore, being average seems to be enough, and that applies to more than just sound. But with the way prices are now like power cables costing €35K for 1.25 meters I think hi-fi as we know it has maybe a decade to reinvent itself and another to re-establish itself as a true reference. Because once this generation stops investing in audio, I honestly don’t think the next one will.

I also would like some common sense returns to pricing, I find the current state of high-end audio prices completely over the top. Now the MK2 as to cost double the price, makes no sense.

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The reality is that some tech has improved so much over the last generation. @dunc mentioned Chinese products at the low end - I’d argue that some of these products outperform even the highest end solutions on the market today. I recently looked at a Topping pre amp that is objectively as transparent as the Benchmark Pre and even outperforms Luxury solutions from CH, Pass and others for less than 1K! This simply wasn’t possible 30 years ago

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imho- yes there is…

like there is a market for Rolex, Patek,Porsche, Chateau d’Yquem or Leica.

If it touches your emotions, you’re willing to pay for it.

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I think high end audio is part of the luxury market, and in that specific market “cost” and “price” are no longer related factors.

My wife likes Chanel Handbags. She bought a “Classic” 4 years ago for £5500 - a huge amount of money for a bit of cow hide and some gold effect metal. That same handbag is currently £10700. Just 4 years later. How? …well - Chanel are more open than most, that they price their products to be at the top of the market (well, not quite,there’s Hérmes, but my wife only aspires to be “invited” to spend £22000 on a Handbag) and so it has no relation to the cost of production, they price the bags as to what they think represents the point where it’s eye wateringly stupidly expensive to 99.9% of people, and happily sell to the 0.1% because that’s how they guarantee exclusivity. They don’t publish numbers - but as far as I can see, they are a hugely successful and profitable business.

Now to say you need a strong brand to do this is an understatement.

I see a bit of this behaviour in the high end audio market. I think the best example is Linn. Now don’t get me wrong - I love my Linn LP12. But in the last year they’ve brought out a laminated plywood plinth (£9k - no really - nine thousand English pounds) an updated power supply in a new box (was £4k now £12.5k) and an updated single piece of aluminium arm board for £5k…. Nobody will ever convince me that these prices bear any relation to the cost of production. Yes there are overheads - but I do think Linn are taking the Chanel approach to pricing, and thinking of the absolute most they think they might get away with charging and then doubling it!

So Luxury is different. And the definition of luxury is as much about the price paid as the product received.

This isn’t a view exclusive to this small group of dusty old men. It’s as strong a factor now as it’s ever been - the trick is to get the Chanel crowd to bridge their suspension of pricing disbelief over to audio. There’s a reason that Bang and Olafson have a large show room in Selfridges, and Linn were in Harrods for a long time.

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Your wife would probably think the same if she saw the prices for a single piece of Transparent or Siltech “wire”

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From recent replies I think that I should have used a term other than “high end”.

I was using it in the sense that it was originally applied to audio in ( if I remember correctly) ,the early 1990s. I came across it in Stereophile and it was being used to describe the class leaders of products designed using the most advanced technology, offering the best objective performance and the most satisfactory musical outcome. Styling, exotic finishes etc. were not considered.

So a pair of LS3/5A speakers were and still are, “high end”. If there was such a thing as a Sonos unit in a platinum case with the manufacturer’s name picked out in diamonds then it may cost a fortune but would still not qualify as high end audio.

High End and Luxury are not really synonymous terms though sometimes products are both.

There have certainly been inflationary pressures on audio manufacture since the pandemic. This is affecting just about everything audio made in western countries ( real wages, social contributions, taxes as well as raw materials). However the economic circumstances in many of these territories where senior management salaries have escalated substantially compared to overall averages seems to have left some with large disposable incomes which some manufacturers seem to take advantage of.

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Yes. I agree with Petes comments and the direction of this discussion. I cant without significant research set a real bar, but in my mind and purposes of this discussion, a person doesnt have to spend a million dollars to have what i’d describe as a high end system. Without going down a long road id think someone spending say anywhere north of 5k (or less) on speakers for example is building a high end system. It is certainly not an elite system when there are speakers that cost nearly a million but i dont feel in todays dollars that amount of money is required to build a very nice high end system. I believe that every owner of dcs gear is likely an owner of an elite system yet im guessing only a few of us will purchase a varese. The comparison is of all music listeners and those who are willing and driven do build a serious system and not those who can build a system in excess of the annual average income in the us. If the concept were who can afford the most expensive gear available it would be pretty easy to mathematically deduce that only a few could and fewer yet would be willing to purchase a system that exceeds say a million dollars. As an example only about 5% of the us population has a net worth of $1million bucks. Many if not most of them would not spend their entire net worth on a million dollar system. Only 1% has a net worth north of 10 million. This demographic may be the target for the most expensive gear but certainly not worth building a business plan around. A boutique company like dcs or dagostino may have their exclusive top of line “varese like” product aimed at this demographic because they are striving for a product solution that pushes the technical envelope beyond todays capability but i suspect that neither company is building its annual business plan on the sale of these items. Its the balance of the line sales which carry the brand and solidify the business. Its terrific that we have these pioneers that constantly push for perfection and elite buyers who by paying for these outrageous products pay for the r&d required to take the balance of the product line forward in performance. Just my 2cents

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Oh absolutely - although i do think I’m very lucky in that she has a very good ear herself, values sound quality, actively takes part in the auditioning process…and is broadly supportive of investments to improve…she probably has a keener eye on the requirement for the investment to be proportionate to the improvement than I, but she’s definitely not one of those wives who I need to hide anything from.

I’m very lucky that she’s probably technically an audiophile herself… Here she is on our 3rd date… :grin::smiling_face_with_three_hearts:

IMG_2582
IMG_25821920Ă—2560 353 KB

(Yes I took her to a HiFi show. Who says romance is dead!?)

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“Matt, any speakers we’re considering must be shorter than I am.”

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:joy::joy: …a hairs breadth, but yes! :joy:

(Not my cuppa tea PMC)

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“Which one would you rather take home, me or this monstrosity?”

:rofl:

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i presume that if you have to choose one on this picture you choose the loudspeaker :face_with_peeking_eye::ghost:

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Ha! …we’ve been together 12 years - I do sometimes wonder if I made the right choice!

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That’s true, I agree, but at the same time perfection + elite buyers encourage approaches that aren’t cost effective even where they could very well be used. For example, Andrew explained in his Lina X video how the base and sides of the casework are a single piece of metal, as the whole thing is machined from one block. I think this applies to Varese too. Yes, I can understand the stated advantages (fixings are part of the casework and don’t have to be added; very effective electrical isolation can be created where needed) but at the same time it seems to me over the top and a solution that would have been dismissed as too costly if there was more “price pressure” (downwards) in the high end.

Regarding demographics: I’ve read in the FT in the UK (it has probably appeared elsewhere too) that aggregate consumer spending is no longer dominated by middle income people, but by the wealthy. That tends to put a floor under inflation - they are less resistant to paying more.

It’s funny how discussions about the very high end in hi-fi, and in other products, sooner or later becomes about money, and status, and society. Has music got lost in all of this?

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I disagree that milled-from-solid is OTT. This construction (in combination with the single-circuit board technology and some clever design for manufacture) actually ends up saving cost through dramatically reduced assembly man-hours compared with the plate construction of the gen 3 products.

These are state-of-the-art techniques that were embraced as part of the Varèse development, yet because of the cost benefits they confer we were able to leverage them in our least expensive product line. I am not aware of anything else at or close to the Lina price point that benefits from such a refined construction.

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Yeah. Im guessing there are both sides to the elite listener demographics. I know that there exists a demographic of buyers who just buy for status. Easy enough to look at exotic cars for sale and see most have only 1-5000 miles after 5 years. Conversely, there are serious listeners who want the best ( likely but cant afford it). When i truly look at the dagostino or dcs line i compare to the bugatti or pagani. Someone else say Pete may know the history. My guess is like any business the owner determines their target market share based on what they offer. None of the mentioned brands wants to compete with say mcintosh or porsche. They are cost conscious but are hand building not mass producing their product and not being wasteful but looking at value add. Ill use a car comparison for example … if i got into a 911 porsche i would expect to find plastic parts. Ive had 5. Its not cheaply built but economic where plastic can be used. Ill compare that to an aml… i expect to see no plastic. None ( plastic is the panel connectors on the underside of the dash) Aluminum or carbon fiber would be the selection. Could they use plastic. Yes. Would their customer pay 195k for the cheapest aml if it were plastic. No. The one big difference is others actually see your car occasionally. A stereo is often never seen. Mine for example is in its own wing behind a door and not accessible to invitees unless escorted there. So there is the rub. If i were to pay the porsche/ limited production price for my stereo id look for cheaper switches and finishes and budget components. But in the mfgr doing that they lose the essence of “the best money can buy” endorsement. Did i buy it for that reason no but when i am paying for the best sonics money can buy i expect no flaws none

I look at dcs like if i were to do it myself:

  1. i just figured out how to squeeze more out of the best i can do at any cost - price what the market can bear - if i only sell a few thats ok - its not for everyone

  2. this is the best thing i can do - price what the market will bear

  3. something with similar technology and capabilities as the best i can do but still top of the heap - price lower cost of admission but not to compete with mass produced

  4. something to give budget buyers a way to get my technology but cutting way back on everything - its still a hand built piece but with economical styling. Still functions like my product line but … still more than mass produced or it cheapens my whole line of product

  5. youd be better off buying used or going elsewhere because i dont want to cheapen my name to compete with mass produced -

Just my opinion

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