I get a lot of snide comments about equipment cost. Surprised? I’m not. This shit is expensive. And by expensive, I mean “send my kids to college” expensive. Or condo in Miami expensive. Or sports-car expensive. Or [insert your own analogy here] expensive. However you cut it, high-end audio isn’t like buying an iPod and downloading from iTunes.
But does it have to be expensive? I think a lot of folks are pretty much convinced that the sticker prices they see are some kind of joke. What could possibly cost $40,000 in that DAC? What on Earth could make that amp cost $80k? And how can you possibly justify asking for $200k for a pair of loudspeakers? “And don’t even get me started on cables,” goes the rant.
Look, I hear you. It’s criminal. It does seem to be the case that the prices for some of this stuff are just insane. Clearly the work of a gouger, or a profiteer, or just a complete asshole. Right?
Look, I’m not going to defend specific offenders here. I’ll grant that there are bad apples in the barrel. Some of the prices out there are clearly the work of the sick and deranged. But before you go haring off on a Walmart-inspired crusade of price cutting, take a breath. Remember. Life isn’t fair.
That’s a hard pill to take, and one I find particularly annoying. I work. A lot. And get paid. A lot. I admit it! And I am still faced with the “I don’t have enough to do what I want to do” reality of the everyday. I used to think that if I just worked a little bit harder or got that new job that paid just a little bit more, then, finally (FINALLY), everything would be just perfect. I’d be able pay all my bills, get the new car, save for retirement and my kids’ college funds, finally rip out that ugly ass carpet and get the new floors for the living room, and still have money left over to get that new stereo component. Yeah. Guess what. Ain’t happening. Life’s a bitch that way. I think that this is true for most of us, to some degree. But the point is, no matter what you make, unless you’re bizarrely rich, this level of irritation will float up with you. The rising tide lifts all boats — including your expectations, debts, and obligations. C’est la vie.
What I mean by all this is fairly simple — just because it’s expensive doesn’t make it a personal affront to or an indictment of you, your hard work, or lifestyle or life choices, or well, anything to do with you at all. Just … chill.
Pricing does come from somewhere. This is Capitalism, after all, and absurd pricing has to be supported somehow, someway — or the pricing would be different or the products and makers of those products would be forced out of the market. The fact that the high-end of the high-end is still cranking out ever-more-expensive products should be a clue that it isn’t just some jackass vendor channeling hope.
I’ve written about the linkage between parts-costs and MSRP before, so I won’t rehash it again. Feel free to check it out here:
So yeah, shit costs whatever it does. Don’t like it? Don’t buy it. It’s pretty simple, really — if you have a severe allergic reaction to the price of a product, vote with your wallet. If enough consumers do that, the market will change. The fact that it hasn’t, though, should tell you something.
I had a preamplifier here from Sonus Veritas. Marvelous piece of work. But I was asked, repeatedly, “is it worth $17k?” I get it. That’s a lot of money, right? I think so. So does the designer! But with $4k worth of parts, there’s not a lot of room for them to move. They have to recoup build-time, right? And then there’s all the R&D that went into the final product — that has to get absorbed somewhere. Just think of all those prototypes. Those had costs, too.
So, once the design is finalized, you, the eager consumer, will presumably need to actually find out about it and hear about how awesomely it does its job — enter “Advertising.”
Note that this is al before we add in any profit to the maker. I mean, we’re all capitalists, right? A designer/manufacturer deserves to do better than simply break even, right?
Said another way, if you can’t make a profit on it, you don’t actually have a product — regardless of how awesome or innovative or beloved it actually may be. So, with all that in hand, you now have to get it out into the hands of the folks that have the expertise to sell it (and support it). That means dealers. Sure, a lot of manufacturers either skip this step and do it “direct” — but that means even more money up front for advertising, marketing, and brand management, and ongoing costs to support customer through that purchasing decision — and after.
That’s all real money.
Is that it? Nope.
Say that we’re talking about a boutique designer who’s a wizard with circuits who’s made a great product. Do you honestly believe that every wizard is somehow magically also able to eloquently advocate for their product? Ever met a designer? “People person” isn’t a common way these folks get described. Making them the de facto sales contact not only entails a struggle (honestly, some folks just aren’t cut out for it), it also means that there’s an opportunity cost — shouldn’t the smart person really be building something or designing something new? You’d think. So, they need to pay someone to do that “sales stuff” for them — they need to hire someone. Which means they have to pay them. Factor that back into the “cost” equation.
Or, they could start a dealer network. Personally, I think this is why most manufacturers go this route — it makes sense, and it’s easy. A good dealer can provide a lot of value. I talk a bit out this, here:
Of course, they don’t work for free, either. Why should they? Capitalism, remember? And this is where competition first enters the costing equation. There are a lot of other manufacturers vying attention, so to get that attention focused on you, to earn that love and loyalty, quite frankly, you have to pay them handsomely. Given that the high-end audio biz isn’t really all that transactional, you can’t seriously ask them to take a crappy margin and make it up on volume. Do that, and they’ll sell someone else’s gear. And you can’t fault a dealer for this. Remember that bit about “pay all my bills, get the new car, save for retirement and my kids’ college funds, finally rip out that ugly ass carpet and get the new floors for the living room” — that’s true of everyone, including dealers. Now these folks aren’t stupid, and falling more on the coin-operated side of personality disorders, dealers need incentive — which (perhaps unfortunately) means a (dramatically) higher MSRP. But hey, everyone has to earn a living.
And that’s why things cost a lot. That’s how $4k worth of parts end up as a $17k component. Whether or not it’s actually a product will depend on many things, including whether or not folks buy it. But that’s another story.
So, when you see a $200k/pair of loudspeakers, feel free to rail at the injustice of not being able to afford them. I can’t either, and yes that sucks. But that doesn’t mean that there isn’t a valid economic equation in there that spat that number out. Just because we can’t afford it doesn’t mean it’s not valid. Sure, sometimes pricing is arbitrary. But not always. Not even commonly. But … sometimes.
Outraged? No worries. This is capitalism. Remember, you get to vote — with your wallet. And done. Move on.
I’m in the middle of a rather expensive detour through audio’s high-end. It’s interesting and fun, sure. The air up here is really different! But as a reviewer, it helps tremendously to have a baseline of what’s possible. Of actually know what terms like “SOTA” and “cost-no-object” actually mean and refer to. It makes me better, as a writer and a reviewer. Sure, I’d love to be able to afford this stuff — more properly, I’d love to be able to afford whatever I damn well please. Oh well. One of life’s many little disappointments. In the meantime, this tour is turning out to be quite eye-opening.
Anyway, I appreciate your patience. I’ll be returning to more affordable stuff shortly, I promise. It’s where my heart is, and more importantly, it’s where my wallet is.