Galliardist
Major Contributor
It's worth looking at some of the problems inside Sound United and its divisions when considering what's happening here, as well as Masimo. I suspect that Sound United is a difficult one, and tough decisions have been put off that needed to be made.
The first thing to realise is that Sound United for a number of years has put limits around its divisions and brands. For each brand, there is a book that defines that brand in terms of its history, look, perceived sound, product range and some management guidance. Occasionally, it looks like senior management has stepped in with decisions, but much of the time the brands have stayed in their defined silos. Despite what the management claim, there's actually been little in terms of uniting the sound or anything else. HEOS, maybe, and possibly an underlying AVR platform for Denon and Marantz- but even then, HDAM is part of that Marantz story and is getting in the way.
This leads to what I find to be moments of stupidity and stilted brand development. Let's look at a couple of decisions that could only be Sound United, that appeared at around the same time as this takeover.
First, the Marantz Model 40. This is a real beauty of a bad product. Not because of what it is as much as what it represents. Marantz have built, in their more expensive two channel products, a new and modern platform. Hypex based amplification, a new and elegant DAC strategy, bringing in HEOS (another product that could be better, but still...), the Model 30 packaging, It looks modern and works well. Now, the advantage of something like this is that they should be able to bring much of it downmarket and make manufacturing of mass market stereo easier in the process. So what happens? The Model 40 is a bolt together of the old and the new that makes little sense. The porthole display makes no sense on an all in one, they've used their previous technology in the new case, and it's a poor "me too" when you look at the NAD M10 or the Naim Uniti products. My money is on a mix of minimal investment in the new products, alongside having to keep HDAM amplification because it's in the brand book. It could also be another result of infighting that sometimes seem to happen among the different bits of Marantz.
The second I'd point to is B&W's 700 series in Nautilus blue. Sorry, I should say "iconic:" Nautilus blue. Again, the most superficial history reference they could make and pure Sound United. Other companies do a lot of historical reference stuff, but not at the silly level Sound United seem to manage so often.
I suggest this is a result of the company treading water while the private investors were looking for a buyer - the brand books were a way of keeping the different parts of the company under control.
There were some references to revenue and so on in earlier posts. I'm not going to go too far into that, but I would point out that prior to the purchase of B&W, which probably made Sound United more attractive despite the Formation Audio miss, the main business of Sound United was almost certainly AVRs. By the time you negotiate the problems of continually having to license and implement more and more "standards" in AVRs, and having to add more channels every other year, the complexities of AVRs have to be added to the fact that whereas in stereo you can release premium products, the AVR market is cutthroat and buyers expect a lot of technology in a single box at a competitive price. You can see the result - few companies play in the multichannel audio market, and because some of the tech has to be updated every year, the underlying core gets little investment, explaining the slow development of Audyssey, the continuing use of class AB that can't be fully driven in all channesl, the continuing bugs and so on. I'd guess there is a lot of cost and little profit in AVRs and that might explain the lack of profit in the electronic brands. Dealing with that is going to be key to the future of Sound United. Maybe they should just take the Oppo approach and drop out, or look at what Samsung have done, cutting products and just implementing some of the codecs in others.
They can also, with loudspeakers, take a leaf out of the IAG book - keep the different brands and designs, but consolidate production.
Whatever approach they choose to take, they can't rest on a conservative approach much longer, and they are going to need a lot more investment and management time to reach a better place. I'm not sure that this particular deal will be good for them, but a new start may be just the thing.
My final point is to suggest that this is a bad fit management-wise, given that SoundUnited are a collection of legacy brands, and Masimo is a disruptor in its market. That might be too much of a jump at board level, but they can be disruptive inside their new acquisition. They can do that in two ways - either radically prune the company, or set up internal disruptive elements and see what happens. Both options carry a lot of risk.
The way forward I would suggest is to leave a lot of the company alone to start with, but to make a few major changes.
The first would be to seriously invest in software and software platforms. Some of this is already in place in that HEOS has spread into other products, and elements of firmware seem to be unified in different products and divisions. That really needs to be strengthened and expanded. The software can be a lot, lot better, there are clear synergies to be had across divisions without compromising brand identity (you can put a new skin or controller app on top to differentiate), and they can merge design platforms as well. I'm sure that there are applications and tools inside Masimo that can be put to use in audio design as well.
Secondly, I would pick on Marantz as the starting place for a 180 degree spin from legacy to future. I would stress the times when Marantz has been in the vanguard, from the last of the original products, to CD, SACD, the early AVRs, and the new Model 30 which shows that their new platform was ready for prime time. I'd drop that "Modern musical luxury" slogan, it means nothing - and replace it with a slogan that expresses the future. If they must use older design language, it's probably time to drop the porthole (except on reference amplifiers perhaps) and look to a different part of their history for inspiration. It's varied enough with all the changes the company has seen...
And (to stir up controversy) I would push multichannel music. As new delivery systems are arriving, I would work quickly on a new Marantz reference series centred on multichannel audio, with an improved HEOS designed for that, and have one of the speaker companies create reference wired and wireless speaker sets for the purpose. Like the current models, these would provide a test bed for new technologies and making them work in a traditional hi-fi guise.
Anyway, that's my wild. suggestive, and too long post for today. I'm off to listen to some Bach, that's how forward looking I am...
The first thing to realise is that Sound United for a number of years has put limits around its divisions and brands. For each brand, there is a book that defines that brand in terms of its history, look, perceived sound, product range and some management guidance. Occasionally, it looks like senior management has stepped in with decisions, but much of the time the brands have stayed in their defined silos. Despite what the management claim, there's actually been little in terms of uniting the sound or anything else. HEOS, maybe, and possibly an underlying AVR platform for Denon and Marantz- but even then, HDAM is part of that Marantz story and is getting in the way.
This leads to what I find to be moments of stupidity and stilted brand development. Let's look at a couple of decisions that could only be Sound United, that appeared at around the same time as this takeover.
First, the Marantz Model 40. This is a real beauty of a bad product. Not because of what it is as much as what it represents. Marantz have built, in their more expensive two channel products, a new and modern platform. Hypex based amplification, a new and elegant DAC strategy, bringing in HEOS (another product that could be better, but still...), the Model 30 packaging, It looks modern and works well. Now, the advantage of something like this is that they should be able to bring much of it downmarket and make manufacturing of mass market stereo easier in the process. So what happens? The Model 40 is a bolt together of the old and the new that makes little sense. The porthole display makes no sense on an all in one, they've used their previous technology in the new case, and it's a poor "me too" when you look at the NAD M10 or the Naim Uniti products. My money is on a mix of minimal investment in the new products, alongside having to keep HDAM amplification because it's in the brand book. It could also be another result of infighting that sometimes seem to happen among the different bits of Marantz.
The second I'd point to is B&W's 700 series in Nautilus blue. Sorry, I should say "iconic:" Nautilus blue. Again, the most superficial history reference they could make and pure Sound United. Other companies do a lot of historical reference stuff, but not at the silly level Sound United seem to manage so often.
I suggest this is a result of the company treading water while the private investors were looking for a buyer - the brand books were a way of keeping the different parts of the company under control.
There were some references to revenue and so on in earlier posts. I'm not going to go too far into that, but I would point out that prior to the purchase of B&W, which probably made Sound United more attractive despite the Formation Audio miss, the main business of Sound United was almost certainly AVRs. By the time you negotiate the problems of continually having to license and implement more and more "standards" in AVRs, and having to add more channels every other year, the complexities of AVRs have to be added to the fact that whereas in stereo you can release premium products, the AVR market is cutthroat and buyers expect a lot of technology in a single box at a competitive price. You can see the result - few companies play in the multichannel audio market, and because some of the tech has to be updated every year, the underlying core gets little investment, explaining the slow development of Audyssey, the continuing use of class AB that can't be fully driven in all channesl, the continuing bugs and so on. I'd guess there is a lot of cost and little profit in AVRs and that might explain the lack of profit in the electronic brands. Dealing with that is going to be key to the future of Sound United. Maybe they should just take the Oppo approach and drop out, or look at what Samsung have done, cutting products and just implementing some of the codecs in others.
They can also, with loudspeakers, take a leaf out of the IAG book - keep the different brands and designs, but consolidate production.
Whatever approach they choose to take, they can't rest on a conservative approach much longer, and they are going to need a lot more investment and management time to reach a better place. I'm not sure that this particular deal will be good for them, but a new start may be just the thing.
My final point is to suggest that this is a bad fit management-wise, given that SoundUnited are a collection of legacy brands, and Masimo is a disruptor in its market. That might be too much of a jump at board level, but they can be disruptive inside their new acquisition. They can do that in two ways - either radically prune the company, or set up internal disruptive elements and see what happens. Both options carry a lot of risk.
The way forward I would suggest is to leave a lot of the company alone to start with, but to make a few major changes.
The first would be to seriously invest in software and software platforms. Some of this is already in place in that HEOS has spread into other products, and elements of firmware seem to be unified in different products and divisions. That really needs to be strengthened and expanded. The software can be a lot, lot better, there are clear synergies to be had across divisions without compromising brand identity (you can put a new skin or controller app on top to differentiate), and they can merge design platforms as well. I'm sure that there are applications and tools inside Masimo that can be put to use in audio design as well.
Secondly, I would pick on Marantz as the starting place for a 180 degree spin from legacy to future. I would stress the times when Marantz has been in the vanguard, from the last of the original products, to CD, SACD, the early AVRs, and the new Model 30 which shows that their new platform was ready for prime time. I'd drop that "Modern musical luxury" slogan, it means nothing - and replace it with a slogan that expresses the future. If they must use older design language, it's probably time to drop the porthole (except on reference amplifiers perhaps) and look to a different part of their history for inspiration. It's varied enough with all the changes the company has seen...
And (to stir up controversy) I would push multichannel music. As new delivery systems are arriving, I would work quickly on a new Marantz reference series centred on multichannel audio, with an improved HEOS designed for that, and have one of the speaker companies create reference wired and wireless speaker sets for the purpose. Like the current models, these would provide a test bed for new technologies and making them work in a traditional hi-fi guise.
Anyway, that's my wild. suggestive, and too long post for today. I'm off to listen to some Bach, that's how forward looking I am...
