Mondo Audio--The X-Factor (by Ken Kessler) (March 1997)

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That bleary-eyed look you see on most hi-fi manufacturers' and retailers' faces is a result of sleep deprivation. Lately, far too many of them are lying awake at night, worrying about the future. No, make that the present. Hi-fi is just about holding its own, but only just.

Depending on whom you ask, the audio industry in the United States is recovering, and the United Kingdom's is just about stable. However, Hong Kong is a catastrophe, France is waiting for someone to inject the embalming fluid, Italy's a mess, Germany's paying the price of reunification, and Korea's overheated--ad nauseum. What's emerging, though, are leaner, fitter companies and, one hopes, fewer time-wasters or purveyors of (to be blunt) junk.

One has to be careful when criticizing the fringe companies that have the stability of leaky dynamite, because specialist hi-fi has its roots in bold, pioneering, cottage-industry-sized companies peopled by crazies. These firms go from one- or two-man operations to major players with alarming regularity, but there are also legions of sad bastards who'll never amount to anything more than space-wasting entries in CES catalogs or Audio's Annual Equipment Directory. The problem is that this industry seems to encourage the flaky types even more than it rewards the innovators. The best thing that could happen to specialist hi-fi would be the disappearance of at least half the brands, leaving the rest with much healthier market shares. The problem is: Which ones deserve the lifeline and which should be given euthanasia? As digital technology makes hi-fi increasingly the preserve of the Big Boys, it's fascinating to watch how the smaller companies deal with the current state of the market. Some have found solace in appealing to kit-builders, reviving that most ad venturous form of audiophilia; there hasn't been so much activity in the do-it-yourself field since the days of Heathkit, Lafayette, and the old Dynaco. And specialist magazines the world over, both newsstand and subscription-only, have helped. It's good news for the self-sufficient enthusiast, but it doesn't do much for impoverished audiophiles who lack soldering skills.

"Impoverished" is the key word here. The '80s, those days of the yup pie with a BMW before his 23rd birthday, are over; conspicuous consumption has reverted to the traditionally wealthy. We're looking at full-scale downsizing, in prices as much as in dimensions. (Back in 1989, Jason Bloom of Apogee Acoustics warned me that the days of gigantic loudspeakers with Mercedes price tags were coming to an end.

His company responded to the forthcoming global downsizing/downpricing by introducing the Centaurus models and, a bit later, the even smaller and more cost-effective Ribbon Monitors.) Look around if you don't believe me. One of the biggest success stories of 1996 was the launch of Krell's first integrated amplifier, in the same space that previously would have housed only a Krell preamp, and even then it probably would have had an outboard power supply. Classé Audio, GRAAF, and Audio Research followed suit with integrated amps of their own. Wilson Audio launched the CUB and the WITT, despite the phenomenal success of the 72-inch-tall SLAMM. Basis Audio finally unveiled a sub-$3,000 turntable. Audio Note countered its stratospherically priced Ongaku integrated tube amp with the relatively affordable Conquest mono tube power amp. Jadis followed its Eurythmie horn speaker with a two-thirds-scale version.

Theta Digital's hottest product is the high-value-for-money, ultra-compact Chroma D/A converter. Sonus Faber's latest speakers, the Concertino and Concerto, are mid-priced and compact. Martin-Logan's most appealing speaker designs are the Aerius i and reQuest. It goes on and on, and not a moment too soon.

Not that anyone wants to pander to peasants. (Even Microsoft now makes noise about no longer writing programs back ward-compatible with 15-year-old 8086 snails.) But it's true that the consumers who grumble the most and the loudest are those who spend the least (whether or not they can afford to spend more), and many a manufacturer has failed by listening too closely to the mal-contents. (If you want to see misery in action, latch onto any hi-fi forum on the Internet. Some of these guys redefine "penny-pinching.") So I can only commend the bravery of a company that is dealing with the closing years of this century by offering products that probably give too much away.

"Whoa!" you're thinking. Aren't hi-fi magazines supposed to help you find bar gains and squeeze the most out of each and every dollar? Yes, but only up to a point.

And that point, a line that is crossed all too often, is the one between financial health (for the manufacturers, distributors, and retailers) and bankruptcy. I mean, why has the real price of hi-fi plummeted over the past 20 years while every other mature market is, at the least, allowed to keep up with inflation? (Please, don't throw computers at me. This is a relatively new field that is still at the stage where it, almost alone, enjoys the continual trickle-down improvements and price cuts that come with improved manufacturing techniques.) You don't believe me? Compare the cost of an entry-level system (a cheap CD player, an inexpensive receiver or amp, and a pair of small two-way speakers from established hi-fi brands) with similar products from 1980. Go on: I dare you to dig out your October 1980 issue of Audio. What's terrified (and terrorized) the British, in particular, is that prices haven't changed at all, despite wages and the prices of everything else having increased-what, tenfold? Fact: An NAD 302 integrated amp, a pair of budget KEF or Celestion speakers, and a Dual turntable with cartridge cost $550 to $600 in 1980. Today, you can still buy an equivalent entry-level system, substituting a CD player for the turntable, for $600. Does any cur rent car have the same price as its 1980 equivalent? A chocolate bar? A burger? A newspaper? No. So how are hi-fi manufacturers and retailers supposed to survive with prices stagnating? Maybe my dream of a great culling of the industry will come as a result of hi-fi pricing itself out of existence, not because it's too expensive but because it's too cheap.

Everyone wants something for nothing, and this industry has been forced to cater to such madness. Ask a British speaker manufacturer what its biggest problem is, and the reply will be the need to make speakers that can retail for less than $200 per pair. Charge any more, and competitors will suck up that market. If you ask the manufacturers why they don't simply agree to stop making loss-leaders, they'll all point to the illegality of cartels. And yet the retailers, who stand to make the biggest margins, still insist on products that, in real terms, aren't worth selling if they want to make sensible profits.

What Musical Fidelity has decided to do is to create its own market niche, a commendable venture when you're smaller and less influential than, say, Sony. Here's a company that made its mark with "afford able audiophile wares," such as a Class-A integrated amplifier for under $500, yet also offers what passes for British high-end equipment. But now Musical Fidelity has entered a market that blurs the line between separate components and accessories. And it's selling them in the U.S. through a mail order company, Audio Advisor (4649 Danvers Dr., S.E., Kentwood, Mich. 49512; 800/942-0220). The word to remember here is "volume," and I don't mean maxi mum SPLs.

Before I get all sorts of hate mail from ex Musical Fidelity distributors and retailers who have their own horror stories to re count, yeah, I know, it's a two-way street.

Yes, I've heard Musical Fidelity's Anthony Michaelson foaming at the mouth about the incompetence of everyone but himself; still, there's no denying that the guy comes up with brilliant ideas. His latest? A line of unusually styled components priced be tween $200 and $600 that have high perceived value, great performance, and--surprise, surprise--a sense of humor. These products all come in cylinders turned on their sides, aluminum extrusions painted black and capped with nicely machined aluminum lids. You'll want to own a bunch just because they look so cool, like those cans of designer water from Japan.

Out first was the X10-D, a tube buffer stage designed to fit between a CD player's or D/A converter's analog outputs and a preamp's inputs. Said to create a better match between the two, it also happens to add tube "warmth" as a result of the valves inside. Wishful thinking? No way. Musical Fidelity is selling thousands of units per month, and every reviewer has praised the X10-D to the hilt, with only one proviso:

The benefits diminish as you move up the system price scale. In other words, you don't need this $200 miracle cure if you live in Levinson/Wadia/Threshold land.

From the outset, Michaelson envisioned a whole system using this 71-inch-deep x 4-inch-diameter product. Next up is the X DAC, a solid-state D/A converter with Burr-Brown chips and HDCD decoding.

After that, look for the $199 X-CANS, an all-tube (two ECC88s) Class-A headphone amplifier designed to work with Grado RS1s "because they're revealing and a tricky load, too." Alongside this, Musical Fidelity intends to introduce the X-LP, a solid-state head amp with moving-magnet and moving-coil inputs, followed by the X-TONE, a solid-state tone-control system that will have adjustable rollover frequencies. All of these are designed to complement the X-PRE, an all-tube line-level preamp with four inputs, set to sell for around $300.

Since all of these X modules will use black-lump, stuff-'em-in-a-wall-socket AC adaptors, purists with more than one X module will welcome the X-PSU power supply, which will be able to feed four modules.

Then there'll be the X-ACT, a budget-priced D/A converter, which will drop HDCD from the X-DAC spec so it can sell for $300. Later on, there'll be solid-state power amps (yet to be named), and the line will be completed by a CD transport dubbed X-RAY.

It goes on and on. There's probably going to be a rack called the Six-Pack that will hold a half-dozen modules in wine-rack fashion, plus interconnects and other accessories. And already Those Who Would Be Audio Alchemy are looking at Musical Fidelity and the X-Series with dread.

For some, the success of the X-Series will mean that the entry-level ticket for real hi-fi has been lowered even further. But for others, it will mean that people who simply can't afford mid- or high-end components will be able to acquire rather cheaply some thing a lot more interesting than whatever else passes for budget equipment in the late 1990s. And however much you might fear the former, you can't help but admire the X-Series for the latter.

(adapted from Audio magazine, Mar. 1997)

Also see:

Mondo Audio (by Ken Kessler; Audio magazine, June 1997)

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Updated: Sunday, 2018-09-09 9:48 PST