The Home Theater Company Collusion Theory

You can buy a power amp rated at 150 watts  2 channels driven into 8 ohms with a power bandwidth from 20 -20000 and 300 at 4 ohms ( no power bandwidth listed but probably at 1,000.)  A preamp can be had for $400 to $500 that will include 3 or more line level ins, a Coax in, a Optical in, A USB In , a phono in, DAC , etc.  The typical home theatre receiver under $1000 will have more stuff to be sure.  Lots of HDMI ins and outs, 5 to 9 channels of powered outputs + sun outputs (Spend more and you can go up to 16 channels), processors to manage all of this and a host of other features along with a instruction manual of 600 to 900 pages.  Most non-audiophile folks will be happy with the sound using very inexpensive speakers. Many are perfectly happy with a 4 inch, 10 watt bluetooth speaker fed my a cell phone loaded with MP3 files. A better question  here is why a component that sells for ....lets say.....$10000.... includes parts that an individual can buy for around $500 and a large corporation can actually manufacture, market and ship for 500 bucks.  If some folks want to spend $2000 for a piece of wire, some one will be willing to sell them that wire at that price. [Smelling massive profits, Yamaha is going to produce a series of exotic, super ultra sonic audio components for thousands of bucks for each piece. The turntable will be $8000 I understand.) If someone with lots of available cash, wants to spend  $200,000 on a system, they are free to do so in a free market  economy.  If the system delivers the audio joy they are looking to experience, that's all that matters. I guess???  For folks with incomes south of 6 or 7 figures, I offer this bit of advice, BUYER BEWARE!

Andy-

Everything you say would make sense if it weren't for the fact your underlying assumption is unfounded. Unwritten and unsaid is the assumption this stuff is all the same. That all they're doing is putting the same stuff in different boxes.

Not even close. The people shopping for separates are doing so based on their assumption that they will sound better. They may or may not take the time to compare, and they may or may not be good enough listeners to hear the differences even if they do, but this hardly matters. The fact is manufacturers design and build on the basis of improved sound quality, this costs more, and so they have to charge more. For the most part they do make gear that sounds a lot better than anything you can get in a receiver. 

Which isn't hard. Receivers are the absolute dregs at the bottom of the barrel, SQ-wise.

Another conspiracy that doesn't exist but is a lot more believable is the way the Home Theater industry pushes multi-channel on everyone. 

The answer to all these problems is simply to go and listen and compare and then once you have a handle on how things actually perform budget and plan and then and only then start building your system.

That's what I did. Started out trying to build a classic surround HT system based on a receiver. But they all sounded like absolute crap. So then, separates. They all sounded like crap, not absolute crap, but crap nonetheless. Really expensive crap too, I might add. So you got that part right. 

Go and listen. If you can live with the crappy receiver quality sound then go for it. If the level of crap separates attain is worth it to you then go with that. But really your best bet is to not waste your time on HT at all. A two-channel integrated with a distributed bass array is totally the way to go.

+1 @millercarbon.  If u want a receiver experience, have a receiver experience.  The “box” is one of the highest cost components in electronics, so why would you bother putting crap electronics from a receiver into another box?  Makes sense they step it up and make it worth the extra box by putting higher-quality components into it.  Otherwise, just buy a receiver. 

Even if they try and build a better receiver using better parts you still wind up with crap. Because, a receiver must by definition have a tuner, pre-amp, and amp, minimum. This would be bad enough but A/V receivers must also have a surround processor and multiple channels. Each and every one of these requires its own power supply, one of the most crucial elements of every component. Power supply quality is so important merely changing the diodes has a huge and easily audible impact on sound quality. 

Now how many manufacturers do you think are going to put ten or more high quality power supplies in their receiver? None. Because before doing this they would ask, How many people are going to buy this two foot square 100 lb monstrosity? Answer comes back: zero. Which is why there are none.

But lets say someone is stubborn or nutty enough to try. Then they run into the next problem, which is shielding all those circuits from each other. Especially the chip-based ones that generate a lot of really bad noise. Now the box is so big and massive, well maybe the Mark Levinson crowd is getting a little chub on but that's about it. 

Because then the next thing that happens, the few people who might be in the market for the world's biggest heaviest most expensive receiver are gonna look at it and say, "But I want a sub out." Or pre-out. Or 150 wpc. Or 300 wpc. Or.... anything but the exact combination of features the one you made has.

No. Sorry. Receivers are the Swiss Army Knife of audio. Crappy little piece of plastic that cuts nowhere as good as a real knife, clips nowhere near as good as real clippers, basically just gives you the false sense of having something useful when in reality its a red key fob with a white cross on it. Which I guess come to think of it makes it actually better than a receiver.