Bang For the Buck: Quality vs Cost
It's ironic that as editor of a magazine that addresses one of my main leisure activities—listening to music—I only occasionally read magazines connected with another of my passions: driving. (Faced with a journey of less than 1000 miles, I'll fly only if there is no way to justify the extra time it takes to drive.) Other than fantasy coupes and roadsters, I find out about cars in the basic way—by driving them. Whenever I rent a car, I try to get a model I haven't driven before. Sometimes I end up with a dog, like that blue Pinto. Sometimes I am pleasantly surprised. But in the mid-'90s it struck me that the cars that barked were getting scarce on the ground and that the pleasant surprises were becoming the norm.
For reasons I can only guess at, there seems to have been a leveling-up of quality in the car industry. Whether it's a Ford Taurus, a Chrysler Cirrus, a Toyota Camry, or a Honda Accord, you get a low-maintenance, fuel-thrifty, adequate-performance family car that handles in a satisfactory manner. (Only the American General Motors cars I have tried still appear to be underachievers, though GM in Europe seems to be a different company altogether—a high-revving 1995 British Vauxhall was one the most fun cars I have driven!) Yes, the high-performance autos still offer more, but the price differential rapidly becomes enormous (footnote 1).
I was reminded of my experience with rental cars when I read a posting by Bob O'Neill on the rec.audio.high-end internet newsgroup in October (footnote 2). Commenting on "Recommended Components" in the October Stereophile, he wrote "What are we to make of an 'A' list of CD players and combinations which runs all the way from $3500 to $25,000? And please don't tell me Wes [Phillips] or John [Atkinson] can't hear the difference between the Meridian 508.24 and the [Mark Levinson] No.30.5/31.5....We'd all like to believe our Camrys and Accords are BMWs and Mercedes, but saying so won't get them there." Reader Doug Axelrod makes a similar point in this issue's "Letters" column (p.11): "[There seems] to be an upward shift into the Class A realm..." he notes, asking "Have components become really that good?"
No, I don't feel Wes and I are deaf to the improvements you can buy if you have the disposable income. As high-end digital companies prepare their product lines for the 96kHz/24-bit revolution, their top-of-the-line components become capable of extracting every last iota of music from the current 44.1kHz/16-bit CD standard. I still feel a Wadia 270/27i or a Mark Levinson No.31.5/30.5 combination sounds better than a Meridian 508.24, a Levinson No.39, an Audio Research CD2, or a Wadia 850, to name four players with which I am familiar. (Each was a contender for this issue's "Digital Product of the Year" award, with the ultimate accolade going to the Meridian.) However, as with the car market, the improvements in quality that differentiate the cost-no-object choices from the sensible-purchase options are getting smaller in absolute terms. I could happily live with the sound any of these four players extracts from CD.
At the time I was responding along these lines to Mr. O'Neill, I also was measuring the inexpensive Entech digital processors and the Arcam Alpha 10 integrated amplifier that are reviewed in this issue. When I auditioned these budget-priced components for myself, I was impressed by what good sound they offered. But I was even more impressed by their measured performance.
I know, it's how a component sounds that matters, not how it measures. But good measurements are indicative of good engineering, and the cheap Entechs offer measured performance that you would have had to pay several thousand dollars for just five years ago. And the Arcam amplifier, spiritual successor to the classic NAD 3020 from two decades ago, is capable of delivering scads of power into low-impedance loudspeakers, apparently without breaking a sweat.
Many industry commentators feel that high-end audio is going to reach the millennium in the depths of a recession. Certainly the early 1998 collapse of the Asian markets upon which so many high-end companies depend was a disaster, and the currently uncertain US stockmarket makes for consumer caution. But when those same commentators look back at the closing years of the 20th century, I am sure they'll regard it as a golden age when it comes to audio bang for the buck!
It's in that light that I view TAG McLaren Audio's entry into the High End with raised eyebrows. As Wes Phillips, Paul Messenger, and Larry Archibald report in this issue, the exotic-car manufacturer's goal is to reach $56 million in annual gross revenue from audio products within seven years. To put that goal in context, British loudspeaker manufacturer B&W, which is probably the major high-end player in the US speaker market, has reached approximately one and a half times that figure in 30 years, while Arcam, which dominates the UK market for reasonably priced separates, has taken 21 years to reach around $16 million annual revenue. (Note that almost all American high-end audio companies are smaller than Arcam, with only the Madrigals and Krells financially comparable, and the JBLs, Boston Acoustics, and Polks reaching toward B&W's figures.)
Everyone I have talked to about TMA's ambitious goals draws the analogy between its high-end audio products and the parent company's cost-no-object Formula 1 program. I suspect, however, that once they have established its top-of-the-line F1 range in the year 2000, the company will follow the lead set by Entech, Arcam, Musical Fidelity, and certain other farsighted electronics companies and make high-quality sound available at a price that will set new records for affordability. If they can do that without commoditizing the whole field of audio or producing the equivalent of the Ford Pinto, I will take my hat off to them!
It turned out that my pessimism concerning TMA's 1998 predictions was justified. After six years of interesting product development but what I understood to be lackluster business results, TAG McLaren's audio division was bought on March 25, 2004 by the Chinese-owned, UK-based International Audio Group (IAG), which owns and operates the Quad and Wharfedale brands. IAG purchased TAG McLaren Audio's intellectual property rights and the Audiolab brandname, but not TAG's production facilities or factories.
TAG McLaren had been talked into acquiring Audiolab by the optimistic Udo Zucker—see English journalist Malcolm Steward's 2003 interview with Dr. Zucker.—John Atkinson
Footnote 1: This increase in quality has not been without a price penalty. In 1969, the average base price for a car from the "Big Three" was around $3500; in 1994, it was $13,000; now it's around $19,000.
Footnote 2: Set your browser to groups.google.com and enter "Stereophile + componants" in the search field (with the misspelling, but without the quotes).