Simaudio Moon CP-8 AV Processor: A Denon Receiver in Sim Clothing?

[XV-1]

Hmmmmm, Crazy

http://www.audioholics.com/av-preamp-processor-reviews/simaudio-moon-cp-8-processor

 

[JackD201]

When I was "window shopping" online for pre-pros a few years ago, I came across the CP-8. The resemblance was unmistakable. As such I decided to just buy a Denon sister (Marantz) and run the L and R outs through fixed gain outputs of a preamp I already owned. I pocketed the difference.

 

[danielk141]

XV-1,

This is quite eye-opening! I consider this a real black eye for Simaudio. They say their distributors, dealers, and anyone who asks are told about the Denon engine.
What about any consumer who buys the Sim piece, and has no idea about this situation?
Also, where are the Denon cores coming from, if Denon has no idea?
I dealt with a vendor once, who was using Master locks in a secure drinking water sample station. The locks were designed for indoor use only.
The vendor was using them in an outdoor application. We had a 100% failure rate on these locks. I called Master Locks. They sent a rep who assessed the situation.
Their next step was a cease and desist order to the manufacturer, to stop using a Master Lock product in the wrong application.
I guess as long as there aren't any problems with this Sim piece, Denon will probably let this slide. But if there are any issues with performance, this could harm Denon's reputation... (IMO).

 

[amirm]

They are buying retail units and modifying them one by one. So they don't need Denon's permission at least in US (first sale doctrine).

 

[Orb]

They are buying retail units and modifying them one by one. So they don't need Denon's permission at least in US (first sale doctrine).

Amir although arent they technically using Denon IP (wonder if any patents associated with their engine - they do have some digital related patents but not sure if in their AVP) in their own product that they then sell?
I think legally that is a tricky area even if they purchased retail units, not quite the same as selling still branded Denon "upgraded-modified" product.
Just my take on some of the bitter/acquisition telecom patent/IP wars (beyond Samsung/Apple).


I do take issue with the article though, so they classify what Simaudio has done in this one instance and label that as the general audio high end world with their: "The larger question, which I’m sure will spin rampant in the forums, is what this says about high-end audio in general".
Not all companies are equal in high end world (although this is a shocker considering the good reputation Simaudio has developed with stereo audio), and this goes back even to the early days of dubious boutique companies that liked to label themselves as the equivalent to high end back then.
Idiotic senior management decision when one considers their usually superb engineered electronics; thought they would had learnt what happened to another company that "rebadged" the Oppo
Cheers
Orb

 

[amirm]

Amir although arent they technically using Denon IP (wonder if any patents associated with their engine - they do have some digital related patents but not sure if in their AVP) in their own product that they then sell?

The first sale doctrine in US says that once you buy a product, you can do with it as you please. That is how Netflix buys discs and then rents them despite the wishes of the studios. The law is not that way in Europe so this defense won't hold there.

I think legally that is a tricky area even if they purchased retail units, not quite the same as selling still branded Denon "upgraded-modified" product.
Just my take on some of the bitter/acquisition telecom patent/IP wars (beyond Samsung/Apple).

It is a different situation. In this case, Denon made its money when Sim bought the units. So even if they win on any kind of claim, their damages would be zero since every Sim sale is also a Denon sale.

A valid point was raised that using the logos in front of the Sim box may violate trademarks. There may be an issue there but I doubt anyone cares enough to go after them.

I do take issue with the article though, so they classify what Simaudio has done in this one instance and label that as the general audio high end world with their: "The larger question, which I’m sure will spin rampant in the forums, is what this says about high-end audio in general".
Not all companies are equal in high end world (although this is a shocker considering the good reputation Simaudio has developed with stereo audio), and this goes back even to the early days of dubious boutique companies that liked to label themselves as the equivalent to high end back then.
Idiotic senior management decision when one considers their usually superb engineered electronics; thought they would had learnt what happened to another company that "rebadged" the Oppo
Cheers
Orb

I actually think they made a smart decision here. High-end companies simply cannot design their own HDMI products. Here is a post I wrote on this topic:
-----------------------

If you are a high-end guy, your forecast for entire product life may be 2,000 units. At say 10K retail, you would be looking at $12million in business (40% margin). Pretty good number, right? Well you go and contact the companies that make HDMI silicon. Let's say for the sake of discussion the chip costs in the order of $10. If the silicon company won your business, they would net 10*2,000 = $20,000. $20,000 to a silicon company is nothing. It won't even be round off error. For that bit of business, they would have to assign a field engineer to you, help you debug your design, answer questions, have meetings with you, etc. As you can imagine, they wised up a while back and decided this is a money losing business. Many have 100% policies of not working with "high-end" companies. The net is that none of them will even return your call let alone sell you the silicon! This was not a problem with component video that was pretty easy to design and did not rely on complex silicon. Not HDMI.

So what do you do? Well, the most common solution is to use a Taiwanese ODM. Companies you don't know of take the silicon and aggregate the volume of all the smaller vendors such as above and manage to get the attention of the silicon company. Or alternatively the silicon company gets them going so they can send all the customers they don't want to deal with to them. Being still a scruffy sort of situation, they are not going to put their A+ people to support them. The A+ guy will be assigned to major brands like Denon and Pioneer. Worse yet, the guy designing the HDMI module will build it to some generic spec as a sub-component and you will be lucky if it works half-way right. They will not have large suite of HDMI devices to test with in Taiwan either. And remember that HDMI is one of the worst standards. Calling HDMI a standard is one of the worse oxymorons!

The story gets worse from there. You have to give the ODM an order for all 2,000 day one or it is not worth their effort to build it either. You might convince them to ship those in four quarters but maybe not. Since this is a whole subsystem with HDMI, and possibly DSP, we are no longer talking about a $10 chip. Your volumes are too low to get that special price anyway. You could easily pay $100 or even $200 for each one. At $100, and 2,000 units you are now at $200,000 commitment to this company. At $200 it becomes a cool half a million dollar invoice to pay for a small company.

So you get all the modules in a year but you are going to ship them to your customers over say 2-4 years. In the second year you find a bug where the thing won't sync with a new Sony TV. You go back to the ODM and ask them to give you a firmware fix. They say that is not going to happen. Why? Because they are close to shipping the next version with new silicon (e.g. to support 4K) and the only way you can get an update is to buy a new board. The old design is long gone and no support for that would be forthcoming. But you already paid for all the boards and the last thing you want to do is scrap them all. The ODM says tough and that is that.

The story I just told you is not hypothetical. It happened almost word for word. We were at the receiving end of it. Took on the new line of AVRs that had "high-end" brand name but were priced at a small premium over Japanese brands. Demand got generated and we sold 5-6 of them immediately. Next thing we know, we are getting calls from the customers that when they change the channel on their Comcast set-top box, the video disappears sometimes and never comes back. As you know, no Comcast STB exists in Taiwan and even if it did, there is no service there to feed it. Exactly how do you debug this? Well, you don't. The dealer is stuck with the problem. So we take all the units back and replace them with Yamaha and wave goodbye in the process to that vendor. Our reputation got damaged because of the dynamics of this situation. Should have known better when I grilled them originally and found out it was an ODM solution.

BTW our currently "high-end" solution for a processor (sans amplification) is a Marantz. Customer doesn't want Marantz. He is a wealthy individual and wants equipment that looks exclusive and expensive. The Marantz is going into a rack of JBL Synthesis gear and a theater that is $200K to $300K. He has no idea who or what AVS forum is by the way and is asking why we are putting this "cheap" unit there. But what do we do? Can't trade reliability for this issue so we suffer the situation.

Bringing us full circle, I look at the Sim Audio and say, hmmm, that is pretty clever. Get the guts of the retail units and add your value outside of the HDMI. The customer will get a reliable HDMI implementation courtesy of Denon and the high-end tweaks courtesy of Sim. I would happily carry such a product knowing that aspect of it. So what is considered a negative in this thread and article is a huge plus. Now, is this a way to do business? No. Ideally you would have your own design and full control of your destiny. And that way you can implement the latest flavor of room correction, 4K, etc. But with HDMI that is generally not meant to be. The business model of the ecosystem excludes this otherwise normal development path.

 

[Orb]

Oh I agree it is smart to use the core functionality of the Denon or Marantz (funny enough Marantz has a very reputable name in Europe), but this is going to come back to hit them justifying the price they are asking.
I never realised they could use IP/patents if they purchased the product (in context of North America business), although I think Denon could argue there should be a license agreement for its use.
We have seen that quite a few times with a company forced into a license agreement; one aspect I am really thinking of is a special digital dsp algorithm-architecture Denon-Marantz own (but that may not be in the AVP).
I guess my key point is IP relating to software/firmware/certain architecture components, but I appreciate you work over there (and would a behemoth such as Denon really care for such a small focus group - tough call if they think it may help brand recognition for themselves).

Strange how Marantz are seen as the premier brand here in Europe compared to Denon, especially anything involving Ken Ishiwata at Marantz (the Pearl products sold really fast over here).
We have had some stunning high end Marantz products sold here.

There is definitely going to be some backlash over that price, look at the Oppo saga that I think had a 3x to 4x price increase, appreciate this is not like-for-like but there will be a lot of interest in exactly what Sim Audio did and the markup ratio of 15x.

Cheers
Orb

 

[audioarcher]

Great explanation Amir. Got to love technology sometimes.

 

[garylkoh]

Bringing us full circle, I look at the Sim Audio and say, hmmm, that is pretty clever. Get the guts of the retail units and add your value outside of the HDMI. The customer will get a reliable HDMI implementation courtesy of Denon and the high-end tweaks courtesy of Sim. I would happily carry such a product knowing that aspect of it. So what is considered a negative in this thread and article is a huge plus. Now, is this a way to do business? No. Ideally you would have your own design and full control of your destiny. And that way you can implement the latest flavor of room correction, 4K, etc. But with HDMI that is generally not meant to be. The business model of the ecosystem excludes this otherwise normal development path.

The problem is due to the low-volume nature of the high end. I had the original Stargate processor from SimAudio, and used it at a couple of shows until it was so, so obsolete. However, nothing else had the sound quality.

I think that this is the only option if you want the high-end sound, otherwise your $500,000 home theater with $20,000 amplifiers and $50,000 loudspeakers will have as it's "heart" a $2,000 Integra or Marantz or Denon processor. I suppose that you could buy a mainstream processor, and then send it to one of the mod-shops to put in a better power supply with separation between the digital circuits and the analog circuits, better op-amps in the analog stage than the 3-cent pieces that consumer gear would use, Faraday cage around the digital circuits, etc. etc.

Or.... buy a tweaked Denon from a high-end company who is likely to have taken the time and effort to figure out how to optimize the Denon.

It's no different from a loudspeaker company buying a driver from Scanspeak and optimizing its performance instead of designing their own driver and building it themselves. Or an amplifier company using an Icepower module instead of designing their own Class D module. It is a component that we utilize towards our ultimate goal.

 

[TheMadMilkman]

Amir,

How does this situation affect support and warranty claims?

 

[MasterChief]

Denon should use this to their advantage. Must be nice to see some of the best brands in the business use their products.

 

[amirm]

Amir,

How does this situation affect support and warranty claims?

It is a lousy situation. They are literally without a solution. As you can imagine they don't want to take the gear back either. So be prepared for lots of "try this, try that" and blaming it on the other box. We have an HDMI analyzer but no one in the dealer channel has one (it costs thousands of dollars) so finger pointing will work for them. Imagine calling Comcast and complaining that your no-average-person-has-heard of brand doesn't work with their box! In our case, we took them all back and fought to get a refund and replaced the units with another brand. Customer complained about the aggravation and lost sound quality (the faulty units had better room correction).

One rather high-end solution is to use a video process such as the Lumagen. This is a high performance HDMI switcher and video processor. It then puts out audio for another unit to process. Alternatively just go with top of the line mid-fi Japanese brand processors.

Another solution is to get a "high-end" brand that has bare bones HdMI implementation. Bryston and JBL counterpart of it are one example. The HDMI there just switches. The user interface is challenging on this device though and it has no room EQ.

 

[amirm]

Denon should use this to their advantage. Must be nice to see some of the best brands in the business use their products.

Good point. One of these major brands should sell their HDMI/video subsystem to these guys. Alas, they think they are all "competitors" and culturally hate to collaborate with them.

 

[Ronm1]

Good point. One of these major brands should sell their HDMI/video subsystem to these guys. Alas, they think they are all "competitors" and culturally hate to collaborate with them.

The only time I'm familiar with a joint venture is the Combak Reiymo cd player from a # of years ago that was a collaboration between
Combak•Jvc•and another company whose name escapes me at the moment. The unit used what each company did best or specialized in.

 

[JackD201]

Since the Prepro line is discontinued, I don't think it will really hit SimAudio at all.

Having said that, there are people out there that want a unified system as opposed to one that looks cobbled together. I know I wish my Pre/pro looked like the rest of the system. The player too. I just wasn't willing to pay for that even if I wanted it.