What makes a $20,000 cd player cost 20,000?

Does a $20.00 quartz Timex keep better time than a $ 5,000 ''manual'' Rolex ? The answer is ''yes''. Is a Louis Vutton handbag worth $ 1,000.00 ? Can you really tell the diffence between a $ 20.00 wine and one that cost $ 200.00 a bottle (some do, most cannot). DOES A 1" THICK FACEPLATE ON AN AMP IMPROVES ON THE SOUND ? .Well maybe a bit (because of the sheer mass and resulting isolation from vibrations), but maybe not to the extent that it warrants paying for it. Is a $ 300,000 Ferrari faster than a Viper?

High-end audio is really a high-end hobby. As such, we pay for PERCEPTION OF EXCELLENCE and TRADITION, EXCLUSIVITY, AND SUPERLATIVE PRESTIGE.

If High-End audio was merely based on performance, no way many products would command such insanely high prices.

This is why we will NEVER see true blind testing of audio gear anytime soon, from professionnal reviewers, it would be just too risky and dangerous to admit that some ''budget'' gear sound as good and often much better, than much higher-priced, ''established'' big name gear. (Listen the small Cayin TA-30...a shocking example of this)

And this is why someone who spends $ 5,000.00 on a Rolex watch pretty much couldn't care less if it kept good time or not.

Marketing is much more about perception over product. And the ''high-end'' does not escape this fact. Of course there are true deserving high-pricer out there, but many do not justify their worth sonically speaking...but ahhh...that 2 foot thick CNC-machined faceplate sure looks good right? And don't get me started on $ 3,000.00 interconnects and $ 7,000.00 speaker cables. One last thing, is there any room left for the artist and his or her music in this madness, or are we just too busy showing how good-looking our Rolex is?

The cost of a product is basically determined by labor, material and overhead. Top-notch players will use parts that are more expensive (i.e., you can get caps at Radio Shack for 49 cents but an audio quality equivalent cap can cost 20 dollars let's say.) Then you have to add the cost of R&D, insurance, sales and marketing, distribution, cost of money (borrowing to get the factory ready), and company human resources (health care, bennies, perks, etc.) On top of that there are taxes. Once all that is figured, then the question becomes profit margin, which is the toughest to figure since you have to take in factors such as demand and competition. All in all, it's way more involved but the bottom line is the cost of the parts required usually plays the biggest role.

It is rare that a product will be priced in the stratosphere for no other reason than just to make audiophiles take it seriously. Some do put bells and whistles on products such as exotic wood, lacquer finishes, overbuilt casings, hand-made components, etc, to make them appear better than others for those more interested in appearances - but may do nothing for the sound quality. But then again, some people can't get past the fact that they're listening to a $500 cdp (like the Marantz CD-63SE) instead of excellent quality sound for the money and then some.

Would the answer to the original post change if the price was, say, $8,000? Still not an insignificant amount of money...

John (Stehno), my friend, the SHOOTOUT WE DID, will tell
you very clearly the SonyMdwright 9000es,is way much
more musical or equally better than the APL own by
a friend 711.I am willing to invite 711 in my place
this time with His upgrade APL 3910, this early summer.
This will be fun.IMO

There are 4 factors at play that make top-end audio gear very expensive.

1. Some fixed costs are higher in absolute terms, e.g. more extensive R&D to get the voicing right and achieve the desired balance of musical virtues... the last 10% of tweaking can take an infinite amount of time.

2. Fixed costs are spread out over a production run measured in the tens or hundreds.... as opposed to hundreds of thousands for mass market gear

2. Some variable costs are higher, e.g. high end capacitors vs generic stuff; more complex circuit designs may require more parts; small production runs may require manual assembly rather than machines

4. And, in some cases, because some people equate price with quality and some manufacturers find that they can afford to be less diligent while still charge more.

A high end manufacturer make several hundred or thousand dollars from selling a single item, but how many items to do they sell? I'd like to know about their total profits or, as a proxy, their lifestyle. I expect many are comfortable, but not extravagant, and that many are struggling.

I am not implying that all high end gear represents fair prices. Some items provide much better value than others. The burden is on us to listen and decide for ourselves. Don't get caught up in hype.