Truth, Lies, and OPRA

Just when you thought he had finally gotten fired for trying to steal Gene's speakers, Clint's projector, or J's… um Mac? OPRA is back with a load of… advice? As always, keep a large grain of salt on hand as he dispenses "wisdom" as only he can. Read on… if you dare!

OPRA, what is in store for audiophiles in the future?

The forums are abuzz with new technologies… Blu-ray, HD-DVD, 1080p, Xbox 360, Playstation 3, Nintendo Wii... there is so much new stuff out there and only so high a limit on my mom's credit card. I stood in line for, like, three days for a new Playstation but it turned out I was inline for Cher tickets. I guess I should have suspected something was wrong when all the guys in line with me were well groomed and drinking hot tea out of their Bang & Olufsen thermoses (they were really cool looking but kinda thin - only held a sip and a half).

Anyhow, that is now, what we are really worried about is later. What will be the new "big thing"? Well, just in case you've been living in a hole the last few years, video sales have been driving audio sales. People go into the store looking for a big TV and then decide that maybe they should pick up some new speakers to go with that. I mean, really, what's the point of having a screen the size of your wall if you are just going to use the craptacular speakers that are included with the display? Or so the sideshow tattoo guy at the Best Ultimate City store tells them. So off they go to the forums of your friendly neighborhood AV website looking for advice. Did they look for advice when they were looking for the TV? No, why would they. They can clearly see the differences in the TV quality. See, this one costs $5000 and this one costs $5500. Clearly the second is better.

You'll know this frugal shopper by his carefully worded and well thought out question: "I just spent the GNP of a small European country on a new display that I could have gotten for a fraction of the cost online. But I have big stacks of cash piled up behind the couch and the dog kept getting lost in it so I thought I'd pay the ridiculous markup at the brick'n'mortar store cause that kid looks like he might need the cash to have a couple of those tattoos removed and to rebuild his nipple after an unfortunate diving accident involving the edge of the diving board and a freakishly strong piercing. I need to get a receiver, DVD player, and a full 9.2 set of speakers (or so that kid said through the tears of pain). I've got about $200 left (I would have more to spend but I got the 35-year extended warranty on the TV). I'm not an audiophile or anything so it doesn't need to sound that good. What do you suggest?"

Oh, I'm SO glad that you specified that you weren't an audiophile. I don't think I could have figured that out by your spending priorities. Well, let's see… for $200 you should probably think about limiting the number of speakers you intend on buying… from 11 to about, um, 1. Considering that you probably already have a DVD player somewhere in your house, you should go ahead and use that. As for a receiver, I'd suggest hanging out behind the Rat Shack and hope that something gets accidentally thrown away. So, with a bit of luck, the best you can hope for is an old mono Tandy receiver powering a single speaker all driven by a CD/DVD combo you heisted out of a pimped out Escalade.

OR… you could bump your display size down an inch and buy a REAL system. Now that's just crazy talk.

Wait, what was the question again?

OPRA, how is the MSRP of a speaker derived?

OK, now this was a hard one. I actually had to break out the old slide rule for this question. Well, from what I can tell from my exhaustive research of the Interweb, the cost of a piece of equipment is determined by three things - the cost of the parts, the cost of the labor, and the cost of the research that goes into it. Now, the cost of the parts generally goes up over time as does the cost of the labor (unless you're smart and have your speakers built in a country with rampant poverty, an oppressive communist regime, flexible child labor laws, or some combination of the three). The only "cost" that decreases is the cost of research. As you continue to build the same speaker year after year without making any improvements, you spread the expenditure of money you spent on research over time. So, let's look at this logically:

Speaker Company A is an online-only vender. They do extensive research but have been selling the same (or similar) product lines for a while. These products are regularly updated but rarely significantly changed. They will occasionally come out with a new product line. Speaker Company B has been selling the same core products for decades. The products haven't changed significantly except when introducing progressively cheaper materials. They will occasionally come out with a new product line but it is generally one of their other products just re-badged and re-marketed. So, let's see how these two companies line up (these numbers are approximate and are representative of one of their "flagship" speakers):

Well, obviously, these speakers must have the same retail price point and be of the same quality because they cost the same, correct? Not so. See, there is that "Other" column that is equaling out the total cost of these two "flagship" speakers. Let OPRA break that down for you. "Other" consists of all the different profits made on the speaker so, as you can see, the $550 profit made on the speaker sold by Company A (the Internet-only company) is all pocketed by the company. This is the worst kind of capitalism and really highlights what is wrong with the USA specifically and Western Society in general. Lord knows what Company A is doing with all that money - probably spending it on hookers and booze. Maybe they are pouring that back into research or providing healthcare to their employees, but more likely it's hookers and booze.

Poor little Company B has to markup their products in order to pay the cost of overseas freight, the 15 different middle men and distributors, advertising ( real advertising not just silly old banner ads and the occasional review to promote their products), in-store displays and more. They're lucky if they can get by with a mere $9 profit on each speaker they make. The only way they can make this business model work is to make their speakers so small that you can literally put them in a manila envelope and ship them via USPS. Now, in order to continue to be a viable business, they'll need to pour even more money into marketing like buying stadiums and infomercials and stuff. They'll have to pay to have little nearfield displays in bulk discount stores, big box stores, and Circle L's all over the country. And after all that, they'll only have about $ 0.50 per speaker profit with which to line the walls of their Bentleys and Ferraris (how can they afford Bentleys and Ferraris? Read on). Oh, poor Company B.

But that is not all. No. If your sense of social justice is not enough reason for you to buy Company B's speakers, there's the boner factor. Now, "boner factor" refers to the amount of name recognition the speakers have. If, when you mention the brand, random people on the street stop, look at you with admiration, and nod approvingly, your speakers have a high boner factor. If they have to be a member of some obscure web magazine with over 1,000,000 unique visitors a month and voted Forbes Favorite Home Theater Website in order to even know about their existence, then your speakers have a low boner factor. This factor takes the form of a multiplier. The multiplier is used to calculate the real value of a speaker (and hence its price point).

* As an aside, the boner factor should be considered highly with any purchase. Usually, by definition, a high boner product will cost more but in the rare case that it doesn't, you should probably just overpay anyways to keep the universe in balance.

So, now it becomes clear, doesn't it? It doesn't? OK, I'll recap… no there is too much, let me sum up:

1. More expensive speakers are better than less expensive speakers
2. Internet-direct companies are, by definition, evil because they try to make money by selling directly to the consumer
3. Non-Internet-direct companies are good because they are not Internet-direct companies (see #2)
4. Non-Internet-direct companies have to rely on a boner to make a profit
5. All things being equal, a high boner product will cost you more than a low boner product
6. All things being unequal, go for the boner - and if your Internet-savvy friends try to teach you the error of your ways, let your eyes gloss over and think of puppies and stuff.

- OPRA