I do not want to throw fuel on this fire, but I want to explain some things, now that the heat has come down a bit. This topic, and the options we have, are the next thing to existential to Antipodes, so if it is currently top of mind for you then we ought to explore it, now.
This is a long post, but to talk openly about this topic we need to explain some facts of life.
Motherboard Example
Lets take motherboards as the first example. In many cases when we select and work with a motherboard, the ongoing availability of that motherboard is dependent on the Intel chipset remaining available. By chipset we mean the CPU and the motherboard chips that support that CPU and manage the board. We are mainly talking about chips designed for industrial use rather than consumer use. In that respect, Intel usually offers us an option of CPUs. One option is often a relatively standard chipset that has guaranteed ongoing availability till some future date. Other options, in our experience, are cheaper, sound better, but there is no guaranteed ongoing availability. When you select one of these better sounding chips then Intel can ask for ‘last orders’ at any time. In some cases if you don’t get your last orders in quickly, then you may not get your order filled at all.
So when we design a product, we will typically use the board with the better performance. If the chipset gets pulled then we can fallback to the one with longevity guarantees without having to change anything else about the product.
But when the ‘last orders’ call happens, you typically find that a whole new chipset is launched a little later by Intel and it out-performs the old one. So we typically buy some in the ‘last orders’ phase and wait to see what becomes available, and we end up making a change in the product. We typically add a few other upgrades to the product at the same time, tell people the product has been upgraded and offer people the ability to have their existing products upgraded. For this reason, we also design our products to a template that enables likely future changes in parts. How long the product stays unchanged is kind of up to the winds of change. If the changes mean a significant performance improvement them we embrace that change. If there is not an improvement for customers then we take mitigation steps to keep the product stable for as long as we can. But there are some cases where it basically means a model has become unviable to continue with. The chip shortages during Covid caused much more of these problems than usual, so you have seen more forced changes in the last few years.
To keep the models stable for say 3 to 5 years, we have at these three alternative options instead:
- buy the poorer sounding chipsets, add about $1500-$2,000 to the retail price, and know we can keep the model utterly unchanged for the guaranteed supply period
- buy the better sounding chipsets, and when they cease those, fallback to the poorer ones, increase the price and try not to tell anyone the product has been changed, let alone degraded
- buy 3 to 5 years supply of the better sounding ones (we are talking millions of dollars of investment to do this), put the price up maybe $3,000 to $5,000 to deal with funding costs and a massive obsolescence risk, and keep the product constant for 3 to 5 years.
So it is pretty clear I think that under these options we would be more expensive and not sound so good and keep the product stable and become less and less competitive until the next release 3 to 5 years later.
Partners
Here is another example. One of our partners promised release of something and we beta tested it, revised our products to use it, produced the products for launch on the date the partner promised to supply. If they were late, then we could slip it a bit too. The week they were meant to supply, they simply said “oh, we decided not to do that”, and clearly they decided not to tell us either. What they did say was that the item would be supplied ‘soon’. Since this item was software we launched our new product without it - since we had already manufactured stock, and pushing the software out later would not be a problem. Several months later, the item was supplied, and was so different from what we had tested that it worked in our newly released products, but did not work very well. That model was updated around two years later.
There is a simple answer to that one too. Don’t trust your partners, wait till they supply, then design and put up with the customers’ constant and bitter complaints “why can I not have this new software?” for a year while we design the new product that will work well with the new software. We have been there.
Disruptive Technology
Here is another example. At a point in time in 2020 we found that we could very significantly beat the performance of USB by reclocking synchronous outputs, so we did. The kludgy ways that were available to try and improve USB were ‘one step forward and one step back’. They changed the sound, yes, but often only smoother at the expense of communicating the music. We preferred to do the USB once, as well as it could be done on the mainboard, and not go down the route of the available means of regenerating the signal (basically they use a USB hub chip, add a decent oscillator and a decent power supply, BUT all of that can be done on the main board).
Along comes a new IC that enables you to do the job very well and the samples we received early were very promising so we started designing around it and we came to the conclusion that this was ‘good enough’ to do. By the time we received a huge order of these chips their performance was now extremely good.
We knew many of our customers would prefer to have this rather than not have this. Given the overhead cost of upgrading, we took the opportunity to add further benefits to help justify the hassle and cost of having your unit upgraded. And here we all are.
Our policy has upset a significant number of customers, so lets look at the options where we keep the product stable for 3 to 5 years.
- The K Series is 3 years old, so lets put it in there, and with the other updates the K50 USB output will more than just threaten the sound of the Oladra USB output, but we won’t put it in the Oladra because it is only one year old, so those customers don’t want it. If we feel our top model has to have a great USB output, lets launch a second product in the Oladra range, differentiate it in a few ways, put the new USB in that, and then launch it without any upgrade path for existing Oladra owners other than selling their old (but stable for the next 3 to 5 years) Oladra for this other model. If we don’t feel our top model needs this new USB output, then lets simply not make it available to you for a couple more years.
- Put the USB output into the products anyway, not tell anyone at all, and owners of the existing Oladra and K Series will be blissfully ignorant of what they are missing. Eventually people will begin to realise that newer ones seem to sound better than early ones, but it will be less upsetting for early adopters.
- Lets forget about designing our products with an eye towards upgrades, make each model a dead-end, save come costs by way of that and thereby reduce the price. When we have a new innovation that delivers a very meaningful improvement, add a new model to the range and leave the old models in the range to remain stable, and just ‘wither on the vine’. Remove them after whatever number of years it takes for them to no longer be a meaningful seller, but be at least 3 to 5 years old.
- Lets not so much announce that the models have been revised, but offer the upgrades in a list of ‘options’. The ‘options’ are selectable at purchase time, or you can send it in for any set of ‘options’ to be installed. That way the underlying product seems not to change at all, and the growing list of ‘options’ is not so upsetting as finding your purchase is now an old model. It is a bit of a shell game, but from some specific comments made in this thread it does seem that at least some of you find that approach more attractive. One downside is that the distributors won’t be stocking all ‘options’, just a demo base model, you will have to guess what ‘option’ you should go for, and you will have to wait several weeks to get your custom order because we won’t be keeping any finished goods either.
Summary
What we do now, fits with what I feel is honest, ethical and customer-focused. For each of the alternative options I have set out above, I can name brands that I know take that approach. You will probably recognise some too. You are right. They seem to keep their models more stable.
We could change our approach if we discover customers value stability that much. But we do not have a crystal ball or magic wand that allows us to guarantee to you that the day you bought the product will miraculously be the day when no innovation of any kind will occur in the world until just before you feel like upgrading your system again.
We are being genuine when we say we are doing what we think is the right approach, not an approach designed by our non-existent marketing team. But if you really want us to change our approach, there are options, with trade-offs, and the point of this long post is to be very open with you about what the options really are, and get your thoughts.