Is outboard gear still viable?

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The Maillard Reaction
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Re:Is outboard gear still viable? 2012/01/03 11:40:44 (permalink)
One of my favorite things about hi end discrete component construction is that you can easily look up the prices of all the pieces-parts that are used to make them. There's no mystery meat or voodoo in any actual hi end gear. You can even figure out the quantity discounts on the parts and figure out how much it costs a vendor to build what you might consider buying from them.

One of my favorite things about hi end discrete component construction is that you can decide for yourself if the cost of purchasing and using a particluar piece of gear is worth it to you.

Here are a few of the solid state, discrete, class A preamps in my rack:











best regards,
mike


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Starise
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Re:Is outboard gear still viable? 2012/01/03 12:50:08 (permalink)
Mike this is why I question the prices they charge for some of this gear.

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Re:Is outboard gear still viable? 2012/01/03 13:09:32 (permalink)
My, what a big transformer you have.  

But Starise, the right price is what you can sell a unit for and still eat.  There is a lot more to selling gear than just throwing a bunch of electronics into a pile - or assembling them.  Design, shipping, storage, hiring, insurance, taxes, taxes, running into government demands (see Gibson and their hardwood problems, and they are a major company!).

There is also support - a profit killer in software.  But even hardware.  Neve sold a console to a major studio in the 70s and the wood got ruined (I forget the specifics).  Mr. Neve sent their guy to NYC and redid the entire thing.  It cost him profit plus on a +hundred thousand dollar console.  Not too many companies are in a position to eat that kind of loss.  The happy ending was the word-of-mouth was worth much more in advertising.  Some times the good guys do win.

A few years ago I ran into a factiod that the entire music recording hardware industry ells were less than a major box store receits.  That is slicing a pie pretty thin.

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there came forth little children out of the city, and mocked him, and said unto him, Go up, thou bald head; go up, thou bald head.
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The Maillard Reaction
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Re:Is outboard gear still viable? 2012/01/03 13:26:37 (permalink)
This is why I posted photos of gear that has hundreds of dollars worth of transformers in them.

:-)

For example; The Jensen Transformers I buy direct from Jensen sell in quantities of hundreds for $70 each. I pay a little more for small orders.

Some of those preamps pictured above have 8 audio transformers of that quality and cost sitting in them. That's $500+ in audio transformers.

It's all there for each person to consider and form their own opinion about the potential for "value".

It seems like each year more and more small-shop hi end audio gear is being introduced and sold to happy buyers.

Personally, I find it entertaining to consider that the mark up rate on the mid and low end mass produced stuff is enormous compared to the mark up rate on the hi end stuff.

I think part and assembly cost equals a little more than 1/4 of M.S.R.P. for most small-shop hi end or pro grade product and most buyers pay about 80% of M.S.R.P.

If you can live with that... you buy this sort of stuff.

 

I think companies like Behringer are often making stuff where production cost is less than 1/10th M.S.R.P. Of course, those companies absorb lots of expenses through other activities like advertising, endorsements, and trade show booths.



all the best,
mike


post edited by mike_mccue - 2012/01/03 13:29:37


#64
Middleman
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Re:Is outboard gear still viable? 2012/01/03 13:27:38 (permalink)
Based on circuitry, the Porticos win. ( I have those too Mike)

The Chandler is a complete shock given the praise it receives.

It appears only the Neve unit has dedicated input and output transformers per channel.

Is that a Forrsel 3rd from the bottom? Maybe Great River?

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The Maillard Reaction
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Re:Is outboard gear still viable? 2012/01/03 13:31:47 (permalink)
Great River.

All the preamps pictured have in and out trannys.



The Chandler is actually a favorite of mine... it has a deep rich low end response that I save for the special stuff. Keep in mind, it's apparent sparsity reflects the fact that it is only 2 channels and it uses a big old fashioned external power supply.

best regards,
mike


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Re:Is outboard gear still viable? 2012/01/03 14:29:59 (permalink)
We did a shootout  a while back up in LA at James Lugo's studio, he is a moderator on Gearslutz. The preamp candidates were a Daking mic pre one, Neve 1073, Great River and the Portico 5012. There was no clear winner. Each one had a singer on which it excelled. The primary difference was a very narrow band in a range between 1 to 3k that each one seemed to light up on depending on the voice. The only conclusion I came too was that you can't have enough preamps to address the range of voices you may come across. A bad conclusion for my wallet.
post edited by Middleman - 2012/01/03 16:56:14

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#67
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Re:Is outboard gear still viable? 2012/01/03 14:45:50 (permalink)
Mike,

you forgot to list Behringer's lawsuits.

Nice looking collection, too.  I'm glad I wasn't on my tablet or I might have drooled on it.

And yea, Middleman, it is kinda like being in the 1% with all those.  hard to go wrong, just that one might be a tad better on each source.

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there came forth little children out of the city, and mocked him, and said unto him, Go up, thou bald head; go up, thou bald head.
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Re:Is outboard gear still viable? 2012/01/03 15:39:16 (permalink)
Starise

This drives the price of the unit down but sometimes compromises the quality of the signal chain,using cheap capacitors etc. . Those who claim they make their gear of a higher quality and "hand assemble" it shoot themselves in the backend by charging some of the prices they do. We both know that most of those components don't cost that much. I don't even think R&D expenses should justify some of those prices.

The only way I can see they make anything is that if they sell three of em' in a year they make money lol.....and they won't sell one to me.

The price of the components really has nothing to do with it. This is a common misconception, usually by folks who haven't ever run such a business. Everyone always seems to think, well if you just halved the price you'd do so much better. Well, no, you probalby wouldn't. If you half the price, you have to sell a good bit more than twice as many just to be in exactly the same place you are already in. To make it really pay off you'd probably have to sell three times as many. And in a boutiquey market, within an already small music production hardware market, the odds of you selling three times as many (enough to really have made it worth it) is probably pretty low. So most likely you'll end up worse off.
 
If you want to go that route, you'll have to end up being closer to the Behringer camp and having it assembled overseas in large quantities at lower quality. If you choose to assemble it here and be serious about quality, and you have to pay two or three times as much for the labor, and labor is a big part of the cost, then obviously it's going to cost considerably more.
 

Dean Roddey
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Re:Is outboard gear still viable? 2012/01/03 16:26:36 (permalink)
How does the old joke go - "lose money on each unit but make up for it with volume."

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there came forth little children out of the city, and mocked him, and said unto him, Go up, thou bald head; go up, thou bald head.
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Re:Is outboard gear still viable? 2012/01/03 16:52:33 (permalink)
I love my A Designs Audio MP-1.

it wasn't cheap, tho.


i also love my little DBX MC-6.
it WAS cheap!

it's probably my favorite 'color' piece of outboard gear i own.
there isn't any plugin i've ever used, that can do what that thing does......

so for me, the answer to the question is YES........ outboard gear rocks for me.


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Re:Is outboard gear still viable? 2012/01/03 18:37:22 (permalink)
Starise


 Danny,your actually talkin' to me? I though I peeved you or somethin? lol. 

  
Aww man, I don't know what I might have said to make you feel that way. I'm sorry if anything came out wrong...but no, I'm not peeved at you or anyone else on this forum or in this discussion. I think this has been a great discussion and shows what everyone is into as well as how passionate we all are in our beliefs. Again my apologies for anything I said that may have made you think I was upset with you. :)
 
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#72
ampfixer
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Re:Is outboard gear still viable? 2012/01/04 00:09:18 (permalink)
Thanks for the pictures Mike. The Chandler is the only one I'd even try and repair with my eyes and tool kit. Even the best stuff is becoming modular, in that you can't do much more than find a bad board and replace it.

An audiofool audiofile friend of mine has a techniques CD player in his system. But this techniques CD player is 2 components that are 3 spaces high each. One unit is just the drive and pickups system and all the other stuff is in the second box. There are no IC's just dicreet components. For shielding they use solid copper plates 1/4 inch thick between sections of the PCB.

 It was a very exclusive unit imported from Japan and never sold in North America AFAIK. Ultimate engineering and build quality. It should be for $25K - used.

Regards, John 
 I want to make it clear that I am an Eedjit. I have no direct, or indirect, knowledge of business, the music industry, forum threads or the meaning of life. I know about amps.
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#73
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Re:Is outboard gear still viable? 2012/01/04 09:06:01 (permalink)
I have to strongly agree with Danny.  Once you have a really healthy signal, It's hard to beat a great plug-in. It just takes some patience getting it programmed to get the right sound out of it. At the same time, there are some hardware that you just can't find a suitable plug-in for like Bat's DBX MC-6.

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Starise
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Re:Is outboard gear still viable? 2012/01/04 10:54:55 (permalink)
 I have bought hardware in the past and I do understand at least on a surface level business demands involved in expenditures to prodice a good product so I'm not schlepping good hardware or the expenses involved in making it....I think my point is that some of this gear is overpriced no matter how you slice it.

 Anyone who reads Sound On Sound knows what I mean, say you have a unit that might have 4 of those 70 dollar transformers and was made in the UK by unionized workers and the R&D costed  40% of the price( but it probably didn't because the design is likely modified from something already existing)....long story short, the jist of it is this thing costed $600 to make including everything and averaging out the number of units sold to estimate profit. A reasonable business man might expect to get no more than 1500.00 for the unit....why do they sell for 5000 dollars?
 
 Danny- I'm glad its cool.
post edited by Starise - 2012/01/04 12:37:22

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Re:Is outboard gear still viable? 2012/01/04 11:27:40 (permalink)
well, all a DAW and a Plugin can do, is take the source, and do new math on it.


whereas, HARDWARE actually changes the audio before it ever hits the convertors.

there is an intangible element in sound, that is for me, the reason to bother capturing it to begin with.

the ESSENCE of capturing audio happens outside of the DAW, for me.

it's just that using plugins is so dirt easy.

but i happen to be of the opinion that the MAGIC, happens outside of the DAW

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#76
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Re:Is outboard gear still viable? 2012/01/04 14:05:46 (permalink)
Starise,

several people have already explained why it costs so much.  Mike has explained how it is realitively easy to get around the excess costs by making your own gear.  Or buying the api/neve clone units instead of the real thing.

They sell the real thing at such high prices because they can is the simple answer - and enough people are willing to pay for it.  If you don't want to buy it the answer is simple too - don't buy it.  But if you are going to obsess you might as well start saving now because you'll never be happy and Rupert Neve ain't going to lower the price because he's worked 80 years for his reputation which helps sell his units.

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there came forth little children out of the city, and mocked him, and said unto him, Go up, thou bald head; go up, thou bald head.
24 And he turned back, and looked on them, and cursed them in the name of the Lord. And there came forth two she bears out of the wood, and tare forty and two children of them.
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Starise
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Re:Is outboard gear still viable? 2012/01/04 14:24:43 (permalink)
 Not obsessing,not buying...using plugs for now. The explanations don't totally explain it for me, but that doesn't matter because I don't intend to use super expensive gear.
 Things are overpriced sometimes based on name recognition IMO. I'm not knocking it, but I'm not buying it either. People keep on buying it because they want it and will pay the price,everyone is different.

 I have also explained why some of this gear could cost less. This isn't a personal attack on you or your opinion or an attack on audio hardware. Just my personal observations on what I percieve to be overpriced gear.

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#78
The Maillard Reaction
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Re:Is outboard gear still viable? 2012/01/04 15:08:30 (permalink)
"....long story short, the jist of it is this thing costed $600 to make including everything and averaging out the number of units sold to estimate profit. A reasonable business man might expect to get no more than 1500.00 for the unit....why do they sell for 5000 dollars?"

My guess is that if you scrutinize some particular example you may see that your cost price estimate is low and you sales price is high.

As I said I believe, but of course I can be wrong, that most hi end gear generally sells for approximately 3.2x what it costs to make where as your example cites a factor of 8.3x.

I guess you can find an example to illustrate that rate but I think the norm is very close to what I am quoting.


all the best,
mike



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Re:Is outboard gear still viable? 2012/01/04 15:10:59 (permalink)
Another (common) misconception you have is that the retail price of the gear goes into the manufacturer's pocket, which isn't the case. Almost all gear is sold via retail outlets and those folks take their cut, else they wouldn't bother selling it. So, right off the bat the manufacturer is probably only getting maybe somewhere around 70% to 80% of the retail price. Plus the cost of parts, of labor and secretaries and sales people and all of the taxes and liabilities that employees entail, of shipping, of storage, the business taxes, the facilities, the computers, etc...
 
Companies can sell direct, but unless they are willing to sell ONLY direct and give up on all o the exposure that having their product sold through retail outlets provides, they still have to make the price such that they don't completely undercut those retail outlets. Else those outlets will dump their products.

Everyone who has never run a business tends to have a completely distorted view of the price structure of products. No one in the boutique audio processing hardware business is getting rich. Same with the software side of it. Even the larger companies would be considered piddly by real business standards in other industries.

BTW, could you name a product with $600 worth of parts that sells for $5000? I doubt you'll find one. The world has become infected with the Walmart Mentality, IMO. It's one of those bizarre manifestations of the internet I think in some ways. It's destroying quality at a scary rate. People complain about all our jobs going overseas but refuse to pay for products that would provide livable wages and company stability. Even fairly low pay companies like Best Buy and Circuit City are going under because of this trend. And there's this ongoing anti-business sentiment, even against folks like we are talking about here, who are about as close to farmers and carpenters as you can get in electronics. 

post edited by droddey - 2012/01/04 15:15:28

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batsbrew
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Re:Is outboard gear still viable? 2012/01/04 15:15:19 (permalink)
you're not paying for the raw material costs, when you buy an expensive piece of gear...

you're paying for the brains behind putting it together.
and you're paying for the quality of the build, and hopefully, quality control.

if it was so easy to build a high end unit, everybody would do it.
but they don't.


somebody had to put the time in, to do a lot of experimenting, a lot of research, and development of a product.

professionals GLADLY pay the going rate, because they believe in that old adage....
"you get what you pay for"


and they have enough high quality gear, all the way down the line, to actually hear the collective difference of it all, versus simply putting one individual piece under the microscope and studying just it.


it's a 'big picture' kind of thing.



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The Maillard Reaction
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Re:Is outboard gear still viable? 2012/01/04 15:17:20 (permalink)
One of the defining factors in the notion of "hi end" includes a limited and streamlined distribution system that minimizes the number of middlemen.

It's difficult to find value in "hi end" gear if it is distributed via a complicated and multi-tiered distribution system that ads cost without increasing value.


best regards,
mike




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Re:Is outboard gear still viable? 2012/01/04 15:27:26 (permalink)
This is true, Mike. Many of us who work in Electronics manufacturing understand how the tier system works. The cost still has to be justified. High end generally means low volume, thus the end user must pay the price for the added features and quality associated with a low volume product. I guess to some extent the same holds true for software ( Plug-ins ), but there is a much smaller overhead to distribute software vs. hardware. Maintenance of software, though, is much harder to manage than hardware.
post edited by Tap - 2012/01/04 15:29:00

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The Maillard Reaction
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Re:Is outboard gear still viable? 2012/01/04 15:34:13 (permalink)
The cost is "justified", if you will, when you actually start shopping for an audio transformer and you find out that it costs about $70 bucks to get one that doesn't make the term "transformerless" seem like an actual benefit. :-)

That's the thing... the stuff just costs that much.





How come no one get's upset that the distribution system that finances the warehousing and transport of Behringer cartons around the planet gets $100 for a box of pieces-parts that only costs $10 to build, breaks within 2 years and isn't worth fixing?


Like I say... I find the situation sort of entertaining. :-)

all the best,
mike


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Re:Is outboard gear still viable? 2012/01/04 18:11:39 (permalink)
mike_mccue

One of the defining factors in the notion of "hi end" includes a limited and streamlined distribution system that minimizes the number of middlemen.

It's difficult to find value in "hi end" gear if it is distributed via a complicated and multi-tiered distribution system that ads cost without increasing value.


best regards,
mike

I'm not sure what you'd call 'complicated', but retail outlets like Sweetwater sell plenty of $2K to $4K boxes, from well known high end audio processing companies. And there are various others that a bit more off the bulk volume path, Mercenary, Pure Sound, Vintage King, etc...
 

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Re:Is outboard gear still viable? 2012/01/04 19:19:40 (permalink)
that minimizes the number of middlemen

 
Gosh I hope not.

Gear: A bunch of stuff.
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The Maillard Reaction
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Re:Is outboard gear still viable? 2012/01/04 19:27:06 (permalink)
Complicated is when some entity listed in the layer as a business to business distributor is nothing more than a financier who underwrites risk while the product is in a container at sea.

For Example; Behringer Germany > Behringer China > Behringer USA > Wholesale Music Instruments Distributor > Dealer > End User

Complicated is when big box mail order retailers also maintain operations as wholesalers to smaller retailers.

I was just speaking of stuff that is more complicated than the simplest forms.



For example Manufacturer > Dealer > End User.

or

For example Manufacturer > International Distributor > Dealer > End User

or

For example; Manufacturer > End User


all the best,
mike



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Re:Is outboard gear still viable? 2012/01/04 19:36:34 (permalink)
Send it directly to me, and cut out the middleman (sorry about that, middleman).

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there came forth little children out of the city, and mocked him, and said unto him, Go up, thou bald head; go up, thou bald head.
24 And he turned back, and looked on them, and cursed them in the name of the Lord. And there came forth two she bears out of the wood, and tare forty and two children of them.
#88
droddey
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Re:Is outboard gear still viable? 2012/01/04 20:16:47 (permalink)
But, there again, unless the manufacturer is willing to completely give up retail outlet sales, he can't really get rid of the middleman profits, even if he sells it himself, since then almost no one would buy it from the middleman, and therefore the middleman would not bother selling it. Any company that deals both with resellers and end users knows what a quagmire this situation can be. My company has definitely suffered from it.

If people still come to you, all the better since you get the middleman's profits as well, but it means you can't lower the price THAT much, else the reseller's margins can't be sustained.

Dean Roddey
Chairman/CTO, Charmed Quark Systems
www.charmedquark.com
#89
The Maillard Reaction
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Re:Is outboard gear still viable? 2012/01/04 20:31:39 (permalink)
Yes, I thought that was obvious.

M.S.R.P. has to reflect all the middlemen's profits.

Not every manufacturer aspires to make so many units that the distribution requires middlemen that do nothing more than facilitate escrow and stocking depth through the mechanism of finance so that occasional bumps in demand can be met with rapid delivery.

Some middlemen do nothing but service the interest on the outstanding debt associated with the "stock"

The small fabrication shop guys can eliminate several layers of middleman simply by choosing to never get into the high volume distribution.

Some small fabrication shops are inherently using streamlined methods of distribution because it just makes good sense and stripping away layers of distribution allows them to spend a higher proportion of the M.S.R.P. on quality components.



It should also be sort of obvious that any time you import stuff you are adding one or two layers to your local M.S.R.P. If you buy domestic you'll often times get the most for your money, no matter how much money that is.


all the best,
mike


#90
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