Why Does High-End Gear Cost So Much?

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Early B.

Re: Why Does High-End Gear Cost So Much?
« Reply #20 on: 28 Sep 2025, 03:55 am »
Am I missing something here?

Wouldn't this consultant be essentially a type of reseller? This so called bribe money should really be called dealer markup.

The buyer didn't hire the consultant to be a reseller. Dealer markups are legal (except when contractually obligated not to set prices higher than MSRP), the seller is in control of them, and the profits go to the seller, not a middleman, as in kickbacks.

Put it this way -- if I hire you to buy something for me and you go behind my back and work out a deal with the seller, and I find out about it, plus you expect me to pay you again for the same service, we're gonna have a huge problem. And don't try to hold me liable for nonpayment due to your involvement in an illegal activity.   
   

Rocket_Ronny

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Re: Why Does High-End Gear Cost So Much?
« Reply #21 on: 28 Sep 2025, 05:15 am »
That's the first time I ever heard of someone hired just to find the gear without selling it. That's one rare bird.

I do get the other issues regarding the story.

Rocket Ronny

Photon46

Re: Why Does High-End Gear Cost So Much?
« Reply #22 on: 28 Sep 2025, 12:10 pm »
An interesting take on the spiral of increasing prices from a Swiss audio website. The article is titled "When Flagships Sink." Use your language translator as it's in German.

https://www.avguide.ch/blog/high-end-audio-je-teurer-desto-besser-wenn-flaggschiffe-sinken
« Last Edit: 28 Sep 2025, 01:21 pm by Photon46 »

Early B.

Re: Why Does High-End Gear Cost So Much?
« Reply #23 on: 28 Sep 2025, 01:22 pm »
An interesting take on the spiral of increasing prices from a Swiss audio website titled "When Flagships Sink." Use your language translator as it's in German.

https://www.avguide.ch/blog/high-end-audio-je-teurer-desto-besser-wenn-flaggschiffe-sinken

Excellent article!!! 

One of the points it made is that flagship models are an act of desperation due to falling sales. The competition is fierce, so the strategy is to sell a few high-ticket items, as achieving volume on mid-level or low-end sales is increasingly difficult. The last of the old audiophiles are still buying uber-expensive gear, but younger people don't perceive high-end gear as a status symbol, so new, less expensive models will emerge. Of course, it's already happening with all-in-one solutions that are sounding nearly as good as separates.

Ten years from now on AC, the old guys will be gone, and we'll be raving about which single box is better. We'll have "sound manipulators" on our watches and cell phones, similar to preset effects on DJ mixers, and the equalizer will make a triumphant return. Upon gaining insight into our mood, AI will generate our playlists, and the big amps of yesteryear will be displayed in virtual museums.

toocool4

Re: Why Does High-End Gear Cost So Much?
« Reply #24 on: 28 Sep 2025, 01:49 pm »
Photon46, the only point I really agree with in that article is that flagships mainly exist to push up the price of everything else. The story is always the same: “Look at all the tech we developed for our flagship we can now trickle it down to the rest of the range and give you major improvements at a fraction of the cost.”

But in reality, many established companies that once made excellent gear at fair prices have now raised prices across their entire lineup. What they call “entry level” today often costs more than products that used to sit in their mid-to-upper tiers.

We’ve been conditioned to accept high prices, to the point where reasonably priced products are often dismissed as “not good enough,” while the expensive ones seem more desirable simply because of their price tag.

Just look at mobile phones. Not long ago, none of us imagined we’d be paying the price of a good high end laptop computer for a handset. The real problem is that we don’t push back we’ve normalised it.

Personally, I think companies should focus on making products that sound great at prices younger audiences can actually afford. That way, they get drawn in and see what’s possible at that level. Once they’re hooked and enjoying the sound, they’ll naturally want to explore higher-end options.

But when the spotlight is on products with astronomical price tags, it has the opposite effect. People look at those and think, “If that’s what it takes to get good sound, I’ll just stick with my overpriced phone and a Bluetooth speaker.

JLM

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Re: Why Does High-End Gear Cost So Much?
« Reply #25 on: 28 Sep 2025, 01:59 pm »
I place a great deal of high prices on the "eye candy" factor.  Much of what goes into manufacturing cost is aesthetics (fancy glossy cabinets) that impress others.  And the cost gets passed along out of greed. 

In the last few years of my audio nirvana quest I greatly downsized my system, got it down to a laptop running Tidal and active, wireless monitors that had a rated F3 of 25 Hz but my room was nearly ideal (dedicated to audio in the front and office in the back, 8ft x 13ft x 21ft - Fibonacci ratios, fully insulated, with isolated electrical circuits).

I.Greyhound Fan

Re: Why Does High-End Gear Cost So Much?
« Reply #26 on: 28 Sep 2025, 06:31 pm »
This is why Van Alstine gear is such a great buy still.  Their prices are creeping up but the cost of manufacturing and inflation accounts for that.  Their DAC/preamp is fabulous and if it were in a fancy chassis they could sell it for double, it is that good.

Early B.

Re: Why Does High-End Gear Cost So Much?
« Reply #27 on: 28 Sep 2025, 06:41 pm »
In the last few years of my audio nirvana quest I greatly downsized my system, got it down to a laptop running Tidal and active, wireless monitors that had a rated F3 of 25 Hz but my room was nearly ideal (dedicated to audio in the front and office in the back, 8ft x 13ft x 21ft - Fibonacci ratios, fully insulated, with isolated electrical circuits).

I think that's where audiophiles are headed (i.e., downsizing and consolidating). Do I really need to hold onto my 80-pound amp? Is that extra 2% of detail retrieval (or whatever...) worth the stupid amount of money I've spent on separates and cables?

Freo-1

Re: Why Does High-End Gear Cost So Much?
« Reply #28 on: 28 Sep 2025, 06:59 pm »
I get better sound from my pair of 22 Lb. Devialet integrated than any of the massive set of separates I owned in the past. 

Photon46

Re: Why Does High-End Gear Cost So Much?
« Reply #29 on: 29 Sep 2025, 04:07 pm »
Photon46, the only point I really agree with in that article is that flagships mainly exist to push up the price of everything else. The story is always the same: “Look at all the tech we developed for our flagship we can now trickle it down to the rest of the range and give you major improvements at a fraction of the cost.”

But in reality, many established companies that once made excellent gear at fair prices have now raised prices across their entire lineup. What they call “entry level” today often costs more than products that used to sit in their mid-to-upper tiers.

We’ve been conditioned to accept high prices, to the point where reasonably priced products are often dismissed as “not good enough,” while the expensive ones seem more desirable simply because of their price tag.

Just look at mobile phones. Not long ago, none of us imagined we’d be paying the price of a good high end laptop computer for a handset. The real problem is that we don’t push back we’ve normalised it.

Personally, I think companies should focus on making products that sound great at prices younger audiences can actually afford. That way, they get drawn in and see what’s possible at that level. Once they’re hooked and enjoying the sound, they’ll naturally want to explore higher-end options.

But when the spotlight is on products with astronomical price tags, it has the opposite effect. People look at those and think, “If that’s what it takes to get good sound, I’ll just stick with my overpriced phone and a Bluetooth speaker.

Well, the article's author made a similar point in his conclusion. He's of the opinion that the hi-end as we know it will disappear in the future and buyers from younger demographics will support companies offering good sound at sane "high end" prices of around 10,000 Euros.

Early B.

Re: Why Does High-End Gear Cost So Much?
« Reply #30 on: 29 Sep 2025, 05:05 pm »
Well, the article's author made a similar point in his conclusion. He's of the opinion that the hi-end as we know it will disappear in the future and buyers from younger demographics will support companies offering good sound at sane "high end" prices of around 10,000 Euros.

I also believe the concept of the "audiophile" will evolve in the next decade, as young people increasingly prioritize convenience over cost and sound quality. There will be less emphasis on sonic distinctions among DACs, cables, power conditioners, room treatments, etc. So yeah, the "high-end" as we know it will quickly wither away, but it won't die. The new audiophiles will be more nerdy than us -- they will focus almost exclusively on the technical aspects, and hardly any of them will ever know (or care!) what true audiophile quality sounds like.   

I also think we're at the peak of ultra-high-cost gear for the same reason: the decline of old wealthy audiophiles. Yes, there are more millionaires today, but the young ones won't be investing in super expensive audio gear.         

Zuman

Re: Why Does High-End Gear Cost So Much?
« Reply #31 on: 29 Sep 2025, 05:12 pm »
This is a genuine, not "loaded" question:
So, when you buy from a manufacturer who sells direct to the public, are you getting greater product value for your money than you would if you bought from a retailer(assuming that the retailer's expertise adds nothing to your decision)? Or is the manufacturer just doubling up on their own profit margin?

DaveC113

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Re: Why Does High-End Gear Cost So Much?
« Reply #32 on: 29 Sep 2025, 05:40 pm »
The existence of high-$ "flagship" products are NOT an act of desperation. Maybe in some cases, but this is just fantasy-land thinking, it's absolutely not the main reason.

These products exist because the market demands it. I live near a couple of high end audio companies, Boulder Amplifier and YG, and these folks put out top-end products because their customers and dealers literally demand it. Why? It's a REQUIREMENT to be seen as a desirable brand in key markets.

There's also upsides to having a market for cost-no-object products, the technology and artistry can be on another level vs products that must hit a price point, and this tech will trickle down. Just like the contributions of NASA and F1 racing.

On kickback vs referral, that's going to be on the consultant/integrator. If the consultant lies or hides the fact they get a commission or are a dealer for a brand, then sure, that's obviously unethical. But what if they are totally upfront that they are, in some fashion, a representative or reseller of certain brands? Example: You're an audio integrator and you have a website that shows examples of your work and provides a list of equipment the integrator uses/sells/recommends? The fact is, you can be both a consultant AND have a transparent sales arrangement with gear manufacturers, these are not mutually exclusive.

I agree misrepresentation of the service you provide is very obviously unethical, but there are ways to do business transparently and ethically too. Making money for providing a service is good. It seems like a lot of people have a negative view of making money doing anything other than building stuff.


DaveC113

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Re: Why Does High-End Gear Cost So Much?
« Reply #33 on: 29 Sep 2025, 05:56 pm »
This is a genuine, not "loaded" question:
So, when you buy from a manufacturer who sells direct to the public, are you getting greater product value for your money than you would if you bought from a retailer(assuming that the retailer's expertise adds nothing to your decision)? Or is the manufacturer just doubling up on their own profit margin?

Can be some of both, it depends on the business in question.

There are a lot of differences, some good, some not... The fact is in audio there are A LOT of questionable products, both from big manufacturers (think BOSE) and from small direct-sale businesses. Big businesses are more likely to know exactly what they are doing, smaller companies are more often simply incompetent. So as a consumer, it's how it's always been, an uneducated consumer is going to get taken advantage of more easily.

At this point I've reterminated a lot of big-brand cables and have been shocked and disappointed. There are A TON of Bose-like large dealer-sale cable companies and the good ones are really expensive. I just reterminated a big dealer-sale phono cable that retails for $13k and I would be surprised if the BOM came out to $100. OTOH, I reterminated a broken direct-sale cable that was poorly designed in the cable will not flex repeatedly without breaking. This is actually very common. It's also very common for manufacturers to disregard corrosion, as in "air dielectric"... even big companies like Synergistic Research use air dielectric and imo it's unethical.

Putting aside the minefield of poor value that pervades high end audio (not just cables!), assuming the direct-sale and dealer-sale brands have comparable products, then the direct-sale business will have lower costs. Not only do you cut out middlemen but you also often have lower overhead. Cut out glossy brochures, fancy packaging, 6-7 figure advertising budgets, attending many audio shows per year, etc. I cut out ALL of that, but as a dealer sale brand you NEED it for dealers to want to carry your brand.

OTOH a direct-sale brand must do everything including taking orders and offering some amount of consultation with the end customer, and maybe even sending out demo products for folks to try before they buy, they must have some sort of packaging and must pack and ship orders. This is not trivial at all, and is a main reason retailers exist. So direct sale does have some additional responsibility and costs that dealer-sale brands do not.



 

Photon46

Re: Why Does High-End Gear Cost So Much?
« Reply #34 on: 29 Sep 2025, 08:02 pm »
This is a genuine, not "loaded" question:
So, when you buy from a manufacturer who sells direct to the public, are you getting greater product value for your money than you would if you bought from a retailer(assuming that the retailer's expertise adds nothing to your decision)? Or is the manufacturer just doubling up on their own profit margin?

Seems to me there's so many different things going into the concept of "value" that there's never going to be a definitive answer to your question. Small company with direct sales but low efficiency vs large manufacturer with dealer network but high efficiency could be a wash in the end. Too often small start ups with direct sales models competing on price/value have failed and then there's no product support. Then you have a boat anchor if that product had proprietary circuit boards, modules, display screens, etc. After being stuck with a few unsupported products after the brand failed, I've realized there's long term value in a more expensive brand that's going to hang around (hopefully) and support their offerings. Finding those kind of products is becoming increasingly more difficult as the market size shrinks and remaining brands keep getting sucked up by investors looking for quick profits and planning to sell the company again soon.

Early B.

Re: Why Does High-End Gear Cost So Much?
« Reply #35 on: 29 Sep 2025, 10:06 pm »
Seems to me there's so many different things going into the concept of "value" that there's never going to be a definitive answer to your question. Small company with direct sales but low efficiency vs large manufacturer with dealer network but high efficiency could be a wash in the end. Too often small start ups with direct sales models competing on price/value have failed and then there's no product support. Then you have a boat anchor if that product had proprietary circuit boards, modules, display screens, etc. After being stuck with a few unsupported products after the brand failed, I've realized there's long term value in a more expensive brand that's going to hang around (hopefully) and support their offerings. Finding those kind of products is becoming increasingly more difficult as the market size shrinks and remaining brands keep getting sucked up by investors looking for quick profits and planning to sell the company again soon.

There are trade-offs based on what you value. I find that the best "value" comes from the guys who build stuff in their garage (literally!). Typically, you receive exceptional customer service, high-quality construction, and customization options. However, the value diminishes significantly when you choose to sell it. 

But back to Zuman's question -- yeah, generally, direct sales provide more value, in my opinion. I don't purchase new, brand-name audio components because I perceive them as having lower value. All of my gear is purchased either used or direct sale.

DaveC113

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Re: Why Does High-End Gear Cost So Much?
« Reply #36 on: 29 Sep 2025, 10:22 pm »
There are trade-offs based on what you value. I find that the best "value" comes from the guys who build stuff in their garage (literally!). Typically, you receive exceptional customer service, high-quality construction, and customization options. However, the value diminishes significantly when you choose to sell it. 

But back to Zuman's question -- yeah, generally, direct sales provide more value, in my opinion. I don't purchase new, brand-name audio components because I perceive them as having lower value. All of my gear is purchased either used or direct sale.

As a counterpoint to your post I'd point out ZenWave cables have the highest resale value of any cable brand on the market, in fact far better than all dealer-sale brands. Some of my higher end cables sell for 75% of retail price on the used market and usually sell immediately. Resale value has a lot to do with how you sell your product and a history of happy customers over many years. If you regularly have 50% off sales and your stuff gets closed out on partsconnexion and similar discounters than your perceived value will be far lower. If people aren't happy with your product or service it will hurt your resale value. I think there are much more important factors than direct vs dealer sale when it comes to resale values.


viggen

Re: Why Does High-End Gear Cost So Much?
« Reply #37 on: 30 Sep 2025, 12:34 am »
oma's business model is not av integrator friendly.  the video should stop at that.  this has nothing to do with the billionaires' buying behavior.  lots of people without $millions hire av integrators to renovate their home with av equipment and ht automation.  integrators make money by performing a service much like a mechanic or home decorator.  they buy parts, install them in a manner that provides the client a solution.  and, of course they try to keep their cost down.  many audio manufacturers thrive on integration business.  OMA is obviously not one of them nor should they be.  it doesn't mean av integration is not a legal and viable means for others.  doubt high end gear cost more because of integrators.  but they sure keep a lot of mid fi businesses afloat.

mick wolfe

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Re: Why Does High-End Gear Cost So Much?
« Reply #38 on: 30 Sep 2025, 03:45 pm »
I think this is a case where this particular "AV guy" is trying to pull the classic double dip. In the process he certainly doesn't give his client (the billionaire) what he paid for. He gets a system the AV guy can get a cut on....which almost certainly is not the best system truly available. I'm sure there are many honest AV guys out there, but this particular guy isn't one of them.

DaveC113

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Re: Why Does High-End Gear Cost So Much?
« Reply #39 on: 30 Sep 2025, 05:28 pm »
I think this is a case where this particular "AV guy" is trying to pull the classic double dip. In the process he certainly doesn't give his client (the billionaire) what he paid for. He gets a system the AV guy can get a cut on....which almost certainly is not the best system truly available. I'm sure there are many honest AV guys out there, but this particular guy isn't one of them.

Except we don't really know that. IF indeed this is the case it's clearly unethical, but why assume the worst? You can't get away with stuff like this for very long these days, and screwing over a billionaire isn't a smart career move. It could be the integrator was exploring other brands to expand his offerings to his clients, and he'd like to offer OMA products to his customers on an ongoing basis. We just don't know and OMA assumes the worst because they dislike integrators in general.

If I hired an "integrator" I'd assume he's selling me stuff he makes a profit on. They likely work with specific brands of equipment manufacturers that they are familiar with and can install in the home properly and with manufacturer support.

This whole thing is making a mountain out of a molehill and to even go there you must assume unethical conduct. Personally, I'd like to think unethical conduct is the exception rather than the rule.