What makes an expensive speaker expensive


When one plunks down $10,000 $50,000 and more for a speaker you’re paying for awesome sound, perhaps an elegant or outlandish style, some prestige ... but what makes the price what it is?

Are the materials in a $95,000 set of speakers really that expensive? Or are you paying a designer who has determined he can make more by selling a few at a really high price as compared to a lot at a low price?

And at what point do you stop using price as a gauge to the quality? Would you be surprised to see $30,000 speakers "outperform" $150,000 speakers?

Too much time on my hands today I guess.
jimspov

Showing 9 responses by erik_squires

Hehe, I just posted about this. Please see my blog entry on a Cynical View of Speaker Pricing as well as the Stereophile Reviews - The Data Doesn't Lie

But to answer your question in two lines:

  • Driver cost * 10
  • Must match the Stereophile Curve, which is far from neutral.

Let me know what you think.

Be well,

Erik
I did a lot of research on this subject. The answer is, roughly, driver prices and gimmicks.

For most high end speakers (and I use the term pejoratively) the final cost is between 20 and 30x the cost of the DRIVERS of one speaker. I know, you’d think it was something else, but it’s usually not. This formula explains about 85% to 95% of these speakers. In addition, to be rated highly at Stereophile at any price-point it usually must follow the "Stereophile Curve."

For more details and some examples, please visit my blog on the subjects:

http://speakermakersjourney.blogspot.com/2016/05/a-cynical-introduction-to-speaker.html

http://speakermakersjourney.blogspot.com/2016/05/stereophile-reviews-data-doesnt-lie.html
There are exceptions to the rule. I'm just saying that in general, this is how they seem to line up, the blanket reason being business, marketing and making money. Not that I'm against any of that. I'm against low value, juiced speakers being touted as the best we can have.

As I wrote, making your own drivers is often a way to reduce the costs, and going way past the 30:1 mark.

The real loss in my mind is that the industry tries to promote the idea that only the richest can have good sounding music. This puts a huge barrier to music and culture for most consumers.  The more of the middle class can afford great sounding speakers, the better off our society will be. :) 

I've seen this effect in person. Introduce a person with little musical education to great sounding speaker system and bam, they are suddenly interested in a lot more types of music than they were before.  The entry level for this should not be $20,000.

Best,

Erik
The real answer, is in the slide from Focal. Modernity, brand, perceived advancement. All of these contribute to what consumers perceive as value. I’m sure there’s more. However, there’s no real connection between cost or quality of the parts and the perception of the value of the finished product. That is an entirely subjective thing which good product managers milk for all they can.

What I can say is that most of the high end speakers come in around 20 to 30 times the driver cost for a single speaker. Mind you, I used the term "most" so for sure there are outliers. However as an investor, builder you want to be on the top of that range. For _most_ that is the math they seem to use.  The latest Sterephile has yet another example of this, the Marten Coltrane 3.  On the upper end of that range, and like the Sony AR1, has a very lukewarm review.  The review, like the AR1 concludes they are worth their price. Hah.  
Not really. The R&D, and design costs are fixed, but the number of units sold is not.  If you double the units sold, you cut your R&D investment per unit in half.  Now whether that investment actually produces "better" sounding equipment is another story altogether.

Bose used to have (may still) massive R&D spends, but they were laser focused on what consumers would pay the most for while spending the least.  It wasn't just about selling units, but about getting the ratio of price to cost as wide as possible. Not a bad strategy to make a company successful. The Bose Wave radio didn't just come out of a garage, it was tested and retested by consumer interest groups many many times.  Focal and other companies do the same, to various degrees. 
One thing that keeps coming up is that we are paying for R&D.  Wrong. If a speaker maker sold speakers for the sum cost of their expenses it would be almost like loosing money. 

No product, good or service should be sold at cost.  You always pay for more than what it costs, you pay for the perceived and relative value.  That perceived value is complicated, but that's what product managers get paid to calculate. 

Mind you, I buy and sell services and goods, so I'm not saying this practice is wrong.  I just want to make sure readers and posters understand this. 
Well, if we are now talking about what makes an upgrade expensive, I read online, but never verified myself, that B&W has a couple of very closely related lines.  The higher end line is identical except for a Mundorf MKP replacing the default polyester tweeter cap. About an $7 upgrade (retail) for a couple of hundred bucks in MSRP for the speaker. 

Best,

Erik 
About listening at shows.... one tip that I go by now is I go through the hallways first. If the music sounds good outside, then and only then do I bother to go in.

It sounds really weird, but this was a tip I had learned before, and was confirmed by an acoustician from ASC at one show.  If a room is well treated, it's going to sound good inside and out.  You can tell outside the room how well a room is going to sound. 

Of course, if you are on the "never acoustical treatment" camp this tip won't work for you and you don't care about what I was listening to in the first place, but for those on the other team, I suggest nest time you go to a show, pay attention and see what you think.

One thing I also realized is that there are a lot of audiophiles who are perfectly happy to listen past the rooms, while I'm usually not.  There are usually only a handful of rooms I can even tolerate to be in.  So, depending on your listening style this tip may help you. 

Best,


Erik
@tomcy6

Agreed.

Your emotions cause you to buy speakers, not your oscilloscope. Buy what you like, but always keep an ear out for what else you might like, and different types of emotional engagements.

It’s like baseball. Stats are fun, but it’s the game that keeps you in your seat during the overtime innings. :)

Also, I'm sorry but I'm not convinced the goal should be to spend the most. Anyone can spend $300 to get a great bottle of wine.  I think the best audiophile and music lovers need to be looking for that $20 dollar bottle of wine that is just as good. :) 

Best,


Erik