How large is the very high end audio market?

audioguy

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Does anyone have any idea of how many households have audio systems (surround or 2 channel) where the retail value of the hardware is at least $25K (to pick a somewhat arbitrary number). 50,000 homes? 100,000 homes? I am excluding the actual rooms which could easily exceed that number.

I was just wondering how small the lunatic fringe of this hobby really is :)
 

DWR

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I think the first thing you would have to do is define "very high end" I am not sure that 25k figure works for that, my combination 2ch/HT system fits into that definition but I in no way consider it a very high end system. I believe Steve probably has more into cabling on his system than I have on my whole system. Steves' system is is no doubt very high end. We might want to consider 100k as the point where very high end begins,maybe that is the question, what does everybody think??
 

DWR

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No thats quite true Steve, its not all about the $$$$ it is all relative to a point, and you are right about it being a dying commodity. I had 2 neighbors come over tonight who have never been in my place before to pick up a treadmill that I had to replace. I had the XM tuner playing thru my system when they came in. I kid you not they stood there for 4 or 5 minutes just astounded by the sound and look of the system. Their first words were, I have never heard music played like that in a home, and then the one fella said where do you even buy equipment like that, so most people out there just have no idea about high end audio.
 

JackD201

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For the heck of it, let's say 6 figure systems

At the proverbial "one in a million" that would be about 6,700 folks.

Does this look like a big or a small number to you guys? From Buggati's perspective, that might be "big enough".
 

MylesBAstor

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I think we should all bear in mind that high end does not necessarily equate always to dollars invested

My loose definintion of a high-end audio company is anything other than the mass market audio marketers like Sony, Pioneer, etc. Smaller audio companies whose primarily goal is getting as close to the sound of real music as possible. Or companies that earn in a year what Sony does in a day.

I also wonder how accurate are statements like the high-end is dying? If so, wouldn't you expect to see a high failure and drop out rate among high-end audio companies? That clearly isn't the case and as a matter of fact, several of the companies I talked to had Augusts, the usual the slowest month of the year, that exceeded the wildest projections. I also think we [in the US] tend to project based on our own experience but US high-end audio companies overseas sales continue to grow in emerging markets! You know it was like the old joke that Japan sends its junk audio equipment to us and in return brings in the best in US audio products.
 

JackD201

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That's definitely true. Hong Kong and Shanghai are HOT.
 

audioguy

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Steve's system would be in the ultra super very high end. While I realize you can get a great audio system for WAY WAY less than $25,000, I was picking that number (as noted, somewhat arbitrarily) just to try to understand how many folks (US only) invest those kinds of dollars into this hobby.

And I would totally agree with Steve: The high end is dying (in the US). For two channel, the funeral announcements have already been mailed.

One of the two largest dealers here (been in business for 23 years) folded earlier this year. The largest is a customer of mine in my business and has said his business has shifted from high end 2 channel to home theater and now to whole house system automation.
 

Orb

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This is no true indication but from what I understand Sonus Faber sold globally 18,000 speakers last year, the difficulty is this includes all their models.
However it is worth noting from my experience Sonus Faber are usually sold by those that would be terms audiophile related shops.

In a way maybe high end is still surviving when consider global sales, just that it has contracted in western countries while started to expand in other places that I know is helping to support quite a few high end manufacturers.
At a local level for western countries I do feel it needs to restructure to survive in terms of distributor/dealer model and day to day operation.

Cheers
Orb
 

Mike Lavigne

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relating 'the very high end' to a strictly dollars measurement is difficult as many systems are put together with a high DIY factor yet have excellent performance. i suppose adding the word 'very' might allow for a dollar figure but then where might that be? a great set of headphones attached to a good CDP or music server can be considered pretty high end to me; yet would likely be well under $10k. my personal viewpoint on what might be the 'high end' is more like Myles states; any gear where the focus is on actual musical performance and not simply packaging or features can be 'high end gear'. and it's more an attitude or aspiration of the participant which determines whether they are high end or not, more than the gear.

looking at the dramatic proliferation of new vinyl gear of all types and price ranges, as well as software.....considering all the people pursuing RTR tape......and observing my own local audiophile scene subjectively; i get the feeling that 'the very high end' is expanding. to exactly what number is hard to say.

i think where the lines get blurred is the distinction between 'high end 2-channel' and 'home theatre'. there are lots of expensive Home Theatres (likely millions) where the investment might be high end but there is little 2-channel music awareness. then there is the 'i-pod' factor. 8 or 9 years ago multi-channel music was just starting to get a tiny bit of traction in the marketplace and along comes the i-pod and moved the market strongly back to 2-channel. now today that has given some momentum to the 2-channel high end as those i-pod lovers move up market. those people are buying tt's now.....and some are going high end.
 

audioguy

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i think where the lines get blurred is the distinction between 'high end 2-channel' and 'home theatre'. there are lots of expensive Home Theaters (likely millions) where the investment might be high end but there is little 2-channel music awareness. .

That would really surprise me a LOT that there millions (at least two if plural) of expensive home theaters. I might believe 100,000. Consider the very largest 50 cities in America which probably account for the large majority of the US population. That means each of those cities would need to have 40,000 expensive home theaters and I just don't believe that. Now if an "expensive home theater" is a flat screen mounted above the fireplace with in-wall speakers and a sub, maybe so. I sure could be wrong on this and that is why I started the thread.

If we have any high end dealers on this forum, maybe they would be willing to enlighten us on their market penetration in their city.
 

FrantzM

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Apr 20, 2010
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Hi

A few things:

1) I will not repudiate the efforts of large corporations. This is a prejudice. :Large corporations have proven they can make good products. Harman (revenues of $2 Billions) is one of them and they produce some of the highest End of Audio Products. The price may not be outwordly but the performance often is ( The superlative Revel Loudspeakers for example). Pioneer TAD division is another example, Denon comes out from time to time with serious audiophile-worthy products. I am using one of their headphones and it is a contender among the best headphones around. Back in the days Panasonic's Technics division assaulted the High End to wit the RS-1500 quite sought after by RTR afficionados or their SP-1 Direct Drive TT which is knowing a regain of interest
2) The resurgence of vinyl is not much . Yes, there are more Vinyl sales and the surge is 89% but to put things in perspective.. Vinyl sales represent less than .01% of all music software sales in the US. The largest selling record in 2008, Radio-head 's "In Rainbows" sold about 25,000 copies .. which is less than the number of tickets they sold at their two days concert at the Hollywood Ball .. The vast majority of TTs sold are USB connected USB !!?? Would we care to inquire about the quality of the Analog to Digital conversion performed in those TTs? Entirey defeating the purpose ...
3) RTR ... What is the percentage of Audiophiles actively in RTR? Where is the software for RTR? RTR is a pea-sized limited market. There is a surge. It went from virtually non existent to alive and that means the percentage is close to infinite ... Real numbers? simple arithmetic? I doubt there are 2000 audiophiles in the USA actively in RTR..real number might be less than 500
4) The health of the High Industry while not the subject of this thread is not good.... The industry is not growing. Magazines and reviewers need to acknowledge the fact and discuss it as to find ways to reverse the trend. Not getting themselves in denial..

Finally a dab at a real number. I doubt there are 20,000 systems over 20 K in the USA ...
 

audioguy

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Finally a dab at a real number. I doubt there are 20,000 systems over 20 K in the USA ...

Going back to my 50 major cities example, that would be 400 systems per city. You could well be correct and I would be comfortable using that number. But I would be totally comfortable saying that there would be no more than 1,000 homes in each of those cities that owned a system whose MSRP was $25,000 or greater, for a total of 50,000.

There are a tad over 100,000,000 households in the US and if 50,000 have systems of this type, then .05% of the number of US homes plays in our hobby at this level. Assuming this numbers are correct (even if you triple them, it doesn't change much), this puts a lot of pressure on the manufacturers (what are there, 200 of them in the high end market?) to maintain growth.

As you move to the OB/Mike Lavigne level of system, I would be surprised if there were 5,000 in the US (this does not include the cost of some of the exotic HT rooms [less equipment] we see whose build cost is probably well over $100K).

Interesting hobby we are involved in.
 

DWR

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A lot of hobbies are like this numbers wise, the difference in audio that I see is the fact that the manufacturers who make high end gear do not as a rule also make lower priced gear. I will give this as an example. My wife is into amateur photography and she has about 15k worth of equipment. Now if you asked the same question as this thread has about how many households have over 15k worth of photography equipment you would probably get similar numbers as with high end systems. Here is the difference, my wife uses Canon equipment, and while Canon makes seriously nice high end pieces both bodies and lenses you can also go out and get a decent point and shoot Canon digital for $150. The last time I checked Conrad Johnson, ARC, Wilson, Vandersteen, and I could go on and on offer any pieces of equipment at low price points. With Canon cameras they keep their profit margin up by selling the lower priced (quality) equipment and then when someone wants to move up into the more "professional" pieces of equipment they have them also. Sorry to ramble on like that guys, but I had to say it.
 

Steve Williams

Site Founder, Site Owner, Administrator
Knowing what I know now and seeing the giant steps in the industry as gear not only gets better but for less money my position now is that high end audio does not always equate to high end prices. By the same token not all high priced gear is necessarily high end.


If I were to build a system now, I know I could do it for far less money with perhaps just as good a result. I have, however been in this hobby for 50 years and have been fortunate to have been able to assemble my present system with buy and sells of older gear that has made it doable but has not made it inexpensive.

I would like to think that I have a good sounding system at present and TBH I am so satisfied that my present components are going nowhere but where they are now. I remain interested in getting back into vinyl however if I were to do anything new now, it would be to assemble a computer based server

At some point we all have to stop chasing rainbows and sit down and enjoy the music. I remain in agreement with my good friend Frantz on this one.
 

JackD201

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Knowing what I know now and seeing the giant steps in the industry as gear not only gets better but for less money my position now is that high end audio does not always equate to high end prices. By the same token not all high priced gear is necessarily high end.

Indeed Steve. What I do find perplexing is that there is a faction that will attack flagship or halo products as well as their owners based on price alone, while they sometimes unknowingly enjoy the technological improvements these designs fueled that later provided them their enjoyment via the trickle down route. Some examples are driver materials, discrete parts like capacitors, resistors and ICs, even what are now basic arrangements like the sub/sat brought to the domestic fore by Studer/Revox's Triton B and Serblin's Snail.

These are the "Concept Cars" of the audio world and like concept cars are expensive because of the development costs and the very small potential market that is the direct result of these. Today, successful hi-end companies continue to push their OEM suppliers for ever better parts.

I think that there will always be a small percentage of the population that will always be on the lookout for improvements and will be willing to patronize worthy projects. From that perspective I do not think the high end of anything will ever really die, unless that is the basic utility of it dies like the slide rule or the buggy whip.

My 2 centavos which would be about .04 cents :)
 

DaveyF

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Jul 31, 2010
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I really hope that the high end will not die...:( wouldn't it be a great shame for future generations to not have the chance or the opportunity to listen to a better reproduction of music in the home...a trip towards 'The absolute sound'.
It does seem that as long as I have been in the hobby, that the biggest problem that the industry has faced is to expose itself to a larger audience. This problem along with the escalating pricing has surely damaged the industry greatly.:(
OTOH, perhaps a cleansing is a good circumstance for any industry... high end seems to be going through that right now;Personally, I am optimistic that the hobby will come out for the better:). Realistically it would seem that even future generations would want to seek out a superior sound from audio equipment, even if that audience is small, I would think it would always exist..:D
 

elescher

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Sep 12, 2010
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Unfortunately I think the situation is going to get even worse here in the US (for all high end industries) based on our countries economic crisis and the objectives of Obama.
 

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