Whatever Happened to Counterpoint?

For the last few months, random postings kept appearing on internet newsgroups and in my e-mail box: "Anybody know what happened to Counterpoint?" At last count there were 10,000 Counterpoint preamps, power amps, and loudspeakers fanned out across the planet, some dating back to 1977, when the company launched its first product: the SA-1 tube preamp, designed by Ed Semanko.

Michael Elliott joined Counterpoint in 1979 to design a vacuum-tube moving-coil head amp; this became the SA-2, the company's second product. In 1980 he and his now ex-wife, Laura Hendershot, purchased the company and moved it to San Diego from Beverly Hills and began manufacturing more SA-1s and the new SA-2s. While at Counterpoint, Elliott went on to design nearly 40 more products--- the most popular "by far" being the legendary SA-5000 preamp, with its all-tube power supply and internal suspension.

But as with many high-end audio enterprises, the past couple of years have not been sympathetic to Counterpoint. In September 1996 the company filed Chapter 11 bankruptcy protection, in part to stave off a commercial bank that sought to place the company in receivership. (Keep in mind that Chapter 11 is designed to help companies through tight times, not put them out of business.)

While all that was going on, Elliott states: "I had designed two great preamps under the Elliott Audio Science & Engineering brand name, and we had manufactured a few of each. They were phenomenally good-sounding preamps, ground-breaking performance. I had a completed design for a new power amplifier that would have set new standards in sound quality. Unfortunately, we didn't have the cash to make more of the preamps, and certainly not enough to get the power amp into manufacture. I was pretty discouraged.

"We tried to continue operations, but it is extremely difficult to operate a business that is in Chapter 11." (Anytime the B-word---bankruptcy---gets attached to an enterprise, market perception inevitably suffers.) "Morale suffered. On February 19, 1998, the US Trustee moved to convert Counterpoint's case to Chapter 7 of the US Bankruptcy Code. This was not a voluntary move by me or anyone associated with Counterpoint. Counterpoint was out of business."

Elliott still feels the company had a chance, but that their bank decided to pull the plug for still unclear reasons. As of April 13th of this year, "the assets, everything at the factory---the fixtures, raw goods, tools, test equipment, finished product, work in progress, shipping boxes, office equipment---was sold at a public auction." A few weeks after the auction, the Counterpoint and Elliott brand names were put up for bid and someone purchased them, but Elliott doesn't know who.

Elliott explains that "in November of 1997 it became apparent to me that Counterpoint was having great difficulty servicing customer's equipment. Equipment was being sold at great discounts just to keep cash coming in, and yet we were having a hard time buying parts. The few workers left at the factory were so busy trying to make a few Elliott pieces that there was no time to repair products. I didn't like this situation; I didn't like it that people who had purchased Counterpoint equipment were unable to get it repaired."

So in December '97, using the name "Counterpoint Repair Center," he decided to start repairing the gear himself in a shop that "looked amazingly like a small garage." With the aid of chief technician Dai Phan, Elliott took over all servicing of Counterpoint equipment, and began to take care of the backlog of repairs.

Elliott may have lost his former company, but design ideas for Counterpoint upgrades keep popping into his head. As a result, he started up a new business, Alta Vista Audio, to help former customers with service, repairs, custom work, and updates. "You see, the brand names Counterpoint and Elliott Audio Science and Engineering are no longer mine, but I created the circuit concepts, and that knowledge does belong to me.

"There's something about being a manufacturer that needs to be acknowledged," says Elliott. "One cannot ever go backwards---one must move forward always with new designs. With Counterpoint gone, I am no longer involved in manufacturing, so the pressure to create new products is removed. And since I have always been more a designer and a tinkerer than a businessman, I realized that I have an ideal opportunity to see what could be done to my old designs to improve their performance."

Necessity is the mother of invention: the worldwide supply of the special MOSFETs used in the popular Counterpoint SA-20 and SA-220 amplifiers had essentially dried up. As of January, none were available from any source. Elliott states, "I couldn't imagine telling owners of these amplifiers that their equipment was unrepairable---these people had spent a lot of money buying products that I designed."

He needed to come up with a solution free of the problematic MOSFETs. His design work on the Natural Progression amplifiers in 1993 at Counterpoint demonstrated how to couple simple tube circuits to output stages consisting of bipolar transistors---which can be more rugged than MOSFETs---while getting better performance at the same time.

According to Elliott, "I decided to design a wholly new output stage for the SA-20 and SA-220, re-work the tube circuit to cut the number of tube stages from three to one per channel, eliminate 20dB of feedback, and set up the amp so it can take balanced inputs. I was able to not only offer people a means to keep their favorite old amplifiers, but give them much improved sound at a far, far lower price than they could get by buying a new amp at retail. I put that upgrade on the market in February, and I've been unable to keep up with demand."

Requests for the same type of improvement for the smaller Counterpoint amps, the SA-12 and SA-100, spawned a new upgrade that became available last month. "It's actually more of a total upgrade than what I do for the SA-20/220. Instead of reworking the main audio board, I replace it with a new one that has the new power supplies and tube circuits on it," says Elliott. "People are buying used SA-12s and SA-100s for a song and having me upgrade them and convert them to bridged mono. They sound great."

Counter to what one might expect, Michael Elliott feels that the more recent preamps---like the SA-1000, -2000, -3000, and -5000---actually benefit more from upgrading than do the older designs.

"This is not really the kind of stuff you can talk about when you're a manufacturer. Car manufacturers don't say, 'Sure, last year's model was really good, but today we know how to do it much better.' A manufacturer can only acknowledge the past as heritage, not admit that it is part of a learning process. Well, I'm now an individual, not a spokesman for a corporation, and I have learned a lot about sound since I made my '80s designs.

"I'm enjoying the opportunity to upgrade people's products, but I must admit that I'd like to get back into designing, though on a much smaller scale. The two new preamps and the new power amp are wonderful, and I have this silly idea for a vacuum-tube tone control . . . "