the viability of hi end companies

Scale. my sense of the industry is in tough times the juggernauts have economies of scale and can manage cash flow if they're good to see thru the tough times. small businesses with 3 people to feed can do well if they sell 10 pieces of equipment all year for 50K each. net of parts, rent, labor, they can make it. its the mid-sized company that is neither big nor small enough to survive on 10 sales that has 20-50 guys on staff and needs a few million in revenue to make the numbers stack that is getting acquired by PE firms or merging, or just plain struggling.

I think about that often as well, and I imagine a lot of struggling, dedicated guys, working hard, hoping for the best, and living without health insurance.

Well, alot of the more established companies are hurting themselves because they stubbornly refuse to embrace the internet and accept that their business model must change. The companies continue to protect the brick and mortar dealers even though most of the dealers do not service the 2 channel audio community. The manufacturers should be selling direct via the internet and their prices should be greatly reduced to reflect the lack of dealer markup.

The biggest argument I hear against this is "how will you hear our products without dealers". This is laughable since the majority of audiophiles cannot hear the products now! The so called dealers rarely have demos setup. The majority at this point are home theater dealers and only order product for an existing job. Many don't even have store fronts anymore.

I suggested to several of the speaker manufacturers that they post high quality videos (done with high end mics) on youtube demo'ing their products and was scoffed at. Why? Guitars are sold this way, check it out. Sure, youtube might lose something in translation, but it would still be an excellent source for getting to know the products. Yet none of them do it. All the music we listen to is recorded and played back on our system, why can't the speakers and other components be marketed this way?

But no, most of the companies will have to be dragged kicking and screaming into this new business model.

I never figure out how they survive. I was just at a big audio banquet with about 400 people. This was for an audio club but most of the people there were manufacterers and distributors. When I asked a retailer at the show why doesn't he ever host the club. He said "These people never buy anything" So if the people from an audio club never buys anything, who is supporting all these people making product?

I also think about this often. Look at an Orion Blue Book or an old Audio Magazine Equiment Directory and see how many companies are still in business. Stereo companies have always come and gone. You can blame it on the economy, however, these companies are faced with an even bigger problem. We, stereo enthusiasts, are a dying breed.