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I thought you may be interested in the cost side of electronics design and manufacturing. This is a video made by the CEO of PS Audio, an American company in Colorado, who design and make stereo equipment for the audiophile market. Their products are expensive. I own their DirectStream DAC and love it (not used for my digital piano rig).
PS Audio is one of the few long-lasting audiophile companies... most audiophile companies come and go mostly because they are driven by passionate engineers and not accountants. PS Audio's CEO has said in another video, he was not good at accounting and ran into problems in his past and come to rely on a wizard accountant who co-runs PS Audio with him.
Anywho.... something you may find interesting. Paul McGowan is very open about their costs, investments, and profitability. Keep in mind the economics facing a large, high-volume producer such as Roland is the same, however, the investment and profit objectives are typically different as they are pure numbers driven as apposed to audiophile-driven companies who put sound quality and the top of the heap. IMO, these economic forces such as delivering to investors will result in pianos that just don't sound as good as the could. When your company is private, you can be free(er?) from hard-core economic objectives and strive for other, complimentary goals.
BTW.... when Paul notes that the investment into designing a product is not included in the price equation, he is parroting back somehting my finance professor taught us back in Business School... this concept of investment is what is called a "sunk cost". Money spent is money gone. Only emotions look back on that and try to "make it back". Even Pharmaceutical companies are evaluated on their current day.... TODAY... their costs compared to revenue giving profit. What they spent developing one of their drugs is not in that calculus. Now their stock price will reflect their current state and some guesswork about their future and for that, they look at how efficient their investments were at turning a profit..... but all investments are irrelevant, they are sunk... only "are that they making money now" given that their R&D is simply part of their current cost drain.
When I hear a politician say "I won't let that investment go to waste", I immediately vote for the other. The only thing that matters is what is to be spent is worth it .... look at it like it is a brand new investment.
In other words, if a sales person tells you it costs this much because of what it cost to develop.... hmmmm......
I hope he continues to resist the hucksters and shysters who undoubtedly hover over him, trying to scare, cajole, and persuade him to go public. Once he goes public, the company, itself, becomes the most important "commodity" and the shareholders become the "real" customers. The quality of his products and the needs of his audiophile customers will have to take the back seat.
I'm old enough to remember the day when most businesses were owned by their operators. They were successful at improving the lives of their customers because they loved what they were doing, and consequently, did it well. Now, it seems, very few businesses are run by persons who love what they are doing. This greatly diminishes the quality of life, and saddens me.
If ‘going public’ means hucksters and shysters then please tell us about the digital piano you play that comes from a company that is wholly owned by the inventor.
$30,000 for a speaker - yeah, that's totally the economics of the digital piano forums...
Yea, but I posted it thinking it would be an interesting read.
Having just wrote that, I do think there is some correlation. I wanted a digital piano with an acoustic grand action/feel and super samples/engine. I was surprised that, for example, Roland's RD 2000 (I purchased this), was only $2,500. I was shocked at this was the most expensive slab they sold. I actually wanted to pay more and get better. Further, I now use the Ravenscroft software on my computer to generate piano sound.... now why wasn't this quality on their most expensive of slabs? My old RD600 had a feel and sound that was only a tad under the RD2000 and that was what, twenty years of progress?
I believe the reason Roland does not make better, and more expensive products, it that they 1) Don't have to and 2) Does not fit into their profit model. These items are typical for a publicly traded company. Said another way, it is rare that a big publicly traded company produces the finest of anything. More money is made selling a trillion mediocre hamburgers a day than having one restaurant that makes the best hamburger.
Seems to me there is a gap in the market for a truly "best" unit. If someone were to do this, it would be very very expensive as it will not sell in the gazillion of units, and therefore won't have the economies of scale that cheaper product enjoy from high volume, mass production. But still, I think there are enough out there willing to pay the price. You may think $30,000 is nuts for speakers, but some folks who earned their money and love music are willing to spend. I have heard mega-buck systems and while I can't or won't spend that amount, they do sound amazingly real.
Regarding the "truly best" digital piano, sold in small quantities by a small private company ...
It's a stretch to thing that anyone at all would buy such a piano.
One of the principal benefits of the digital piano is its low cost compared to the traditional acoustic.
If someone were to build that top-notch digital and if its cost is sky high (higher than any Novus or Avant Grand), would there be ANY buyers at all?
Anyone with pockets deep enough might be better served with a proper acoustic grand piano.
And, if there were some few buyers then certainly the maker would have to recover his development costs quickly ... because a tiny market won't have a long-term future.
And that goes against the premise of your original post, and of that video.
My Fantasy digital piano, would be a slab (I will provide the speaker/amplifier arrays) that:
1- A keybed from an acoustic grand.. either via license or by copy. 2- A super cool library of sounds (like the RD2000) 3 - Configurable (like the RD2000) 4 - Have full MIDI controller capabilities 5 - Have a USB to PC hookup that + Provided a large-screen interface to piano controls (RD 2000 does not have this) + Full sound over USB (RD 2000 does have this) 6 - A processor and memory where you could: + load in a player like Kontact or UVI Workstation + load in third party sound banks like the Ravenscroft
The biggies for me is 1 and 6.
My RD 2000 can do most things, heck I have the Ravenscroft on a PC hooked to it, but the keybed is the biggest missing issue.
If you want to load UVI Workstation bank, you need to integrate the Windows part which is used by UVI Workstation : Screen and mouse interactions, but also the iLok drivers which is designed to be picky about its environment to avoid retro-engineering, and other attack attempts. Then you need a copy of Windows.
There was already an attempt to sell a Windows based keyboard : Open Labs Neko models, but they didn’t work well enough and I don’t think there are recent models.
On an other side, you have the Muse Research Receptors. Instead of Windows, you have Linux with a Windows emulation. But you had better to get VST from their catalog and I don’t think their was iLok protected contents. (Linux/Wine can do some Windows emulation but not down to the iLok driver). The receptors are not sold anymore too !
Last edited by Frédéric L; 09/30/2104:21 PM.
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My Fantasy digital piano, would be a slab (I will provide the speaker/amplifier arrays) that:
1- A keybed from an acoustic grand.. either via license or by copy.
I'm currently building this (Cybrid-like piano-conversion) but....
.... it's EXTREMELY far than a slab. The acoustic grand action is HUGE. In fact it's larger than all cabinet upright digital, and larger (but shorter and lighter) than many acoustic uprights.
So if you are strictly requesting a slab, you are asking the impossible, such a car that will fit in your pocket and that you can drive from NY to London in 1h (well, that's a bit of hyperbole on your desire, but impossible it remains)
Indeed. A slab with a grand action is not a slab. It's a console piano. And it aint portable.
Originally Posted by Del Vento
Originally Posted by Bruce In Philly
My Fantasy digital piano, would be a slab ... ... a keybed from an acoustic grand.
The acoustic grand action is HUGE. In fact it's larger than all cabinet upright digital, and larger (but shorter and lighter) than many acoustic uprights.
So if you are strictly requesting a slab, you are asking the impossible, such a car that will fit in your pocket and that you can drive from NY to London in 1h (well, that's a bit of hyperbole on your desire, but impossible it remains)
You may think $30,000 is nuts for speakers, but some folks who earned their money and love music are willing to spend.
As an audio engineer I know what kind of professional PA 30 grand gets you. I also know what gear is used in recording and production of music played back by audiophiles on those speakers (including what is used for monitoring the mix).
And knowing that I have a certain view on audiophile speakers billing 30 grand:
BTW.... when Paul notes that the investment into designing a product is not included in the price equation, he is parroting back somehting my finance professor taught us back in Business School... this concept of investment is what is called a "sunk cost". Money spent is money gone. Only emotions look back on that and try to "make it back". Even Pharmaceutical companies are evaluated on their current day.... TODAY... their costs compared to revenue giving profit. What they spent developing one of their drugs is not in that calculus. Now their stock price will reflect their current state and some guesswork about their future and for that, they look at how efficient their investments were at turning a profit..... but all investments are irrelevant, they are sunk... only "are that they making money now" given that their R&D is simply part of their current cost drain.
When I hear a politician say "I won't let that investment go to waste", I immediately vote for the other. The only thing that matters is what is to be spent is worth it .... look at it like it is a brand new investment.
In other words, if a sales person tells you it costs this much because of what it cost to develop.... hmmmm......
Peace Bruce in Philly
I will respectfully disagree with your portrayal of sunk costs here.
“they look at how efficient their investments were at turning a profit…..but all investments are irrelevant[.]” This statement is logically inconsistent. The amount of R and D investment is directly related to how much profit (sometimes reflected as net income) a company has made on a given product, which is hardly irrelevant. Yes, the cost is sunk, but if a company perpetually ignores its R and D costs and fails to recoup them via its prices, it will fail in the long term because it will never be profitable and its assets will dwindle to zero.
A better description of sunk costs and how they should be thought of is that money previously spent which cannot be “unspent” (or refunded) should not influence future strategic decisions; instead, firms should always make the decision that maximizes utility even if it means a prior investment is “wasted.” For instance, say that a company spends $30,000 developing a new piano, and if it chooses to produce this product, it can sell 100 units at $1,900 apiece. Alternatively, the company can continue selling a current model, which it also expects to be able to sell 100 units at $2,000 apiece. Assume the two models cost the same to make, not including R and D costs. If the company can only choose one option, they should make the old model and disregard the fact that they are “wasting” the $30,000 investment. Many companies would be tempted to sell the new piano to “recoup” the investment, even though this will leave the company worse off than if they just disregarded this “sunk” cost and sold the old model. Here you are correct in thinking that the investment cost is irrelevant as far as this one decision is concerned.
However, in the broader scheme of things, the fact that the company sunk $30,000 into a product that wasn’t even as good as an existing model is extremely important. Investors should view this as a poor decision by the company, and will adjust its valuation of the company accordingly. Additionally, the manager in charge of leading the project may need to be fired, since the company cannot continue to sink costs into unprofitable ventures.
So, while I think you are on the right track here as far as sunk costs, the reality is a bit more nuanced. Companies cannot just consider all R and D investment as irrelevant for all decisions, even though they may be irrelevant for certain strategic decisions.
Last edited by TylerMorgan1; 10/01/2102:44 AM. Reason: Quick grammar fix
Future allocation of capital shouldn’t be based on sunk costs
The amount you sell an item for is based on the market
If you don’t recoup your Costs (including R&D) you will go out of business
I do agree it is somewhat surprising that we don’t have a more open system for downloading sound and instruments in to digital keyboards.
I’m not sure why there aren’t hdmi ports and additional USB ports for a mouse or keyboard or even over Bluetooth.
When you look at the cost of a raspberry pi and its capability which is I believe essentially what dexibell has embedded into their keyboards, I wonder why we don’t see these features.
I see Korg and Roland moving into the virtual instrument side of things. And Roland cloud and there zencore is just the beginning of moving to more downloadable sounds.
Roland showed a concept facet grand piano a couple of years ago that was interesting.
I have to say, as an audiophile on the cheap, I really admire those who have the money to dress up their sound system. However, I'm satisfied with the rig I have. I'm mainly an active / powered speakers guy, and I want simplicity and practicality, so when I've found my sound, I stick to it. I'm sure that audiophile companies will be hard to make any money off me!
Audiophile stuff is being sold in shops for 5-7 times their production costs. Besides 30k+ speakers, which are (and have to be) considered as luxury goods (therefore no usual economics rules should be applied), some of them really costs not lot less to produce, e.g. Wilson or Magico stuff costs at least few k$ just to manufacture. They are made for big saloons (50+ sq meters), and to provide ultimate fidelity.
While I agree that for casual listening music, especially as background in hour home, any reputable received like Yamaha, Onkyo plus speakers costing approx. 1000 USD will give you even more than you need, but if you want to push it and get what was really recorded things are getting more complicated.
There is difference between audiophools and audio science. While selling power cord for 10k if obivious rip-off and almost rape in white gloves, there are things for which manufacturing costs the same. I know personally local amplifier manufacturer, who makes radiators from one big block of aluminium and they costs 1.5k$ just to purchase the material and CNC with good quality and properly paint afterwards.
However, up to 10k (in case of speakers and amplifiers) with each 1k you get decent uplift in quality. If you can't hear it's good, but the quality is there. It is really very very hard to make a good transducer, and top quality 4 inch midrange costs anything 130-300 USD, depending on material used and country of manufacturing. I am talking about DIY market, I know that manufacturers can purchase them for far far less.
There's a lot of ripoff in that area, but also a lot of real advancement and competition, especially in budget area (200-2000 USD) spekaers, and new companies are arising. If you will read stories of audio manufactuers, you will understand how extremely volatile and dangerous it is. There are only very few manufacturers who didn't change ownership during the years. Dynaudio, Scan-Speak, B&W, and list goes on and on, all were on the verge of bankruptcy and hopefully survived.
So there are two sides in that industry, not everyone having good speakers and amplifier is phool. Top studio monitors costs 10000k per piece and mastering studios are using Pass Labs amplifiers and B&W speakers costing 20k$, and I doubt that mastering and recording professionals in top studios are deaf and they paid they hard money only for fancy look and sticker.
Just keep in mind that audiophiles who buy $20K speakers/monitors spend at least another $20K on room acoustics (and studios spend hundreds of thousands).
Last edited by VladK; 10/04/2102:40 PM.
Wise men speak because they have something to say; Fools because they have to say something. (falsely attributed to Plato) Vlad, Adult beginner
