Mcintosh Has Been Sold

[MORTIS]

I as well agree with both points here. Sure we don't necessarily 'need' huge horse power amps but it is fun to own such beasts, and it is needed in certain applications. On the other hand there are many of us who don't need 400hp under the hood and but still want the highest level of sound and build quality for which Mac is known. Smaller, lighter, and lower power gear would of course mean lower cost but this does not have to equate to a cheapening of product line. Mac has produced lower powered gear with top-tier quality in the past and I think they should again knowledge this market segment. I think there is still a very respectable market for amps in the 100, 150, and 200wpc range that use Mac's premium technology; it seems unreasonable that Mac today does not even sell a separate 200wpc channel amp, let alone anything smaller.

 

[MX117.MC7150]

I did ask Charlie Randall a couple of years ago (how many companies can you ask a question and get a response from the guy in charge?) if they were going to offer a solid-state stereo or mono-bloc amp in the 100-200wpc range at some point. His response was that the marginal manufacturing costs were so minimal that a 150wpc amp would cost just a few $hundred less than the 300wpc, or, if fully balanced, a few $hundred less than the 450wpc or 600wpc amps that the market would be very limited. I'll guess that McIntosh sells 5 of the MC452s for every MC302 they sell. I understand that as I would never purchase an MC302 with the MC452 being available.

 

[jlovda]

This may be a poor analogy but look at the restaurant business. The customer is supposed to be amazed and excited when continually the portions get 20% bigger but the price 10% higher. The portions may approach ridiculous but the restaurant is after increased revenue. Revenue will not go up selling a meal that is half as big as before even at 75% of the price unless they sell a lot more units.

I think lower prices on smaller gear would push more toward Magnolia because traditional dealers could not afford to carry it because of their overhead. The marketing and sales expenses are pretty fixed.

 

[c_dk]

"His response was that the marginal manufacturing costs were so minimal that a 150wpc amp would cost just a few $hundred less than the 300wpc, or, if fully balanced, a few $hundred less than the 450wpc or 600wpc amps that the market would be very limited."

Sounds so typical of the hubris of the current managemennt team. Let's build product 90% of our previous owners/potential customers do not want and therefore our local sales people can not sell. We can always make it up on smaller volume and higher wholesale prices.

McIntosh again has people problems that have led to product problems

 

[MORTIS]

I did ask Charlie Randall a couple of years ago (how many companies can you ask a question and get a response from the guy in charge?) if they were going to offer a solid-state stereo or mono-bloc amp in the 100-200wpc range at some point. His response was that the marginal manufacturing costs were so minimal that a 150wpc amp would cost just a few $hundred less than the 300wpc, or, if fully balanced, a few $hundred less than the 450wpc or 600wpc amps that the market would be very limited. I'll guess that McIntosh sells 5 of the MC452s for every MC302 they sell. I understand that as I would never purchase an MC302 with the MC452 being available.

This may be a poor analogy but look at the restaurant business. The customer is supposed to be amazed and excited when continually the portions get 20% bigger but the price 10% higher. The portions may approach ridiculous but the restaurant is after increased revenue. Revenue will not go up selling a meal that is half as big as before even at 75% of the price unless they sell a lot more units.

I think lower prices on smaller gear would push more toward Magnolia because traditional dealers could not afford to carry it because of their overhead. The marketing and sales expenses are pretty fixed.

Yes I remember reading about that before from Charlie; and I do understand the dilemma of marketing such a cost vs. size/power product. I'm not about to attempt a business proposal for solving the issue here in this thread but I do think that segment of audio enthusiasts wanting or needing a smaller system really needs to be addressed, even if it ultimately means less markup on the smaller units. There will always be that huge segment of guys wanting the bigger amps, yet there are also those very serious enthusiasts who who want the best and and are willing to pay serious bucks for it, but they also want the ability to fit it within a limited space and be able to move it without needing a 2nd person to help. They end up being forced to by older Macs... or dare I say - Accuphase?

 

[ssmith3046]

I bought a C29 from Tom Manley and a MC2105 from an audio dealer in Portland that had been restored and really love them. Just the cost of these two units wasn't cheap so I know I'll never own new McIntosh but that's OK with me. If this sale keeps McIntosh viable in the audio world then that's great.

 

[SoCal Sam]

Yes I remember reading about that before from Charlie; and I do understand the dilemma of marketing such a cost vs. size/power product. I'm not about to attempt a business proposal for solving the issue here in this thread but I do think that segment of audio enthusiasts wanting or needing a smaller system really needs to be addressed, even if it ultimately means less markup on the smaller units. There will always be that huge segment of guys wanting the bigger amps, yet there are also those very serious enthusiasts who who want the best and and are willing to pay serious bucks for it, but they also want the ability to fit it within a limited space and be able to move it without needing a 2nd person to help. They end up being forced to by older Macs... or dare I say - Accuphase?

We saw this trend before with Monster Receivers. IMO, anything over say 60 pounds becomes a hassle to move and to own. Getting your wife or your kids to help move your stereo will make them question your sanity and I think therein lies the problem for shifting greater numbers.

 

[SoCal Sam]

I as well agree with both points here. Sure we don't necessarily 'need' huge horse power amps but it is fun to own such beasts, and it is needed in certain applications. On the other hand there are many of us who don't need 400hp under the hood and but still want the highest level of sound and build quality for which Mac is known. Smaller, lighter, and lower power gear would of course mean lower cost but this does not have to equate to a cheapening of product line. Mac has produced lower powered gear with top-tier quality in the past and I think they should again knowledge this market segment. I think there is still a very respectable market for amps in the 100, 150, and 200wpc range that use Mac's premium technology; it seems unreasonable that Mac today does not even sell a separate 200wpc channel amp, let alone anything smaller.

Exactly. IMO, I think the Bryston business model is something the Italian MBA's should take a serious look at. Bryston's 20 year transferable warranty is a major selling point. Bryston sells solid state amps that are essentially re-packaged PA amps for 10x more so there is definitely opportunity for adding value in the 200 watt segment. MAC, stuff the non-transferable warranty. Second hand owners are enthusiasts and if they feel well taken care of, they will aspire to climb the ladder to new ownership...provided there is entry level product in the 200 wpc class.

 

[hwirt]

I think McIntosh's product line is just fine the way it is, and hope the new ownership doesn't try to change the design philosophy.

 

[CoolHomey501]

Hey Guys,

The Wall Street Journal is reporting that the transaction was priced at $50 million to $100 million. You never know how McIntosh was capitalized (they may have been overburdened with debt), but this is a pretty low price that would suggest McIntosh has not been making a ton of money lately. Using a normalized EBITDA multiple of 7-8x (standard valuation multiple used in banking) and backing into (estimating) some numbers, McIntosh may be making anywhere between $5 and $7 million/year in after tax profits (assuming normal financial conditions).

http://blogs.wsj.com/deals/2012/10/08/fine-sounds-to-buy-wall-of-sound-maker-mcintosh-laboratory/

 

[c_dk]

Sold millons of dollars worth of McIntosh systems over the years, can't ever remember using the "Wall of Sound" or Woodstock as a selling point.

Go figure

 

[Sundown44]

I'd be really concerned if I owned MAC gear. Just like car companies, being tossed around by different ownership doesn't bode well in the long run

 

[c_dk]

Having been in the trenches during the Clarion fiasco..... it was not so much Clarion's intentions but the tongue wagging and back stabbing from the local dealer competition and regional sales reptiles.

Instead of talking with potential clients about the positives of owning McIntosh we were continually having to defend their choice of who they sold out to.

 

[sKiZo]

One more thought on watts ... you can make a woof go boom at surprisingly low power levels. You need MUCH more power to damp the cone cleanly without ringing or distortion when said boom achieves perfection ... it's all about control.

And please don't trot out the white papers and graphs ... all I know is that's the way I hear it ... regularly ... courtesy of 500wpc instantaneous.

 

[mhardy6647]

I've always heard that effect tied to damping factor (amplifier output impedance) rather than output power.

 

[tubeboob]

Mac has been owned by others than the Mac family for quite a while.

I have been informed that no matter who owns Mac, they are required to keep production in the Upstate NY factory, as well as keep the decisions within a close knit group that have been with Mac for years. Otherwise, no sale.

I only hope that I have been informed correctly.

I don't have any Mac products, but would love to some day.

Cheers

 

[Classic_CJ]

Having been in the trenches during the Clarion fiasco..... it was not so much Clarion's intentions but the tongue wagging and back stabbing from the local dealer competition and regional sales reptiles.

Instead of talking with potential clients about the positives of owning McIntosh we were continually having to defend their choice of who they sold out to.

Just one reason why despite all the aggravation the repair business causes, I'm perfectly happy to not be involved in equipment sales these days. The market and I just do not get along philosophically any more. (And I'm not singling out Mac, BTW).

I'm already entering my declining years, external sources of decline are things I can do without. Life goes on, bra. :thmbsp:

 

[Classic_CJ]

I've always heard that effect tied to damping factor (amplifier output impedance) rather than output power.

You are right, but in practice they tend to go together. Large numbers of paralleled output devices inevitably tend to lower impedance and thus increase the damping factor.

But then, you can have large numbers of paralleled output devices that run at fairly low rail voltages. High current but low(er) power amps often sound as tight and well controlled as the big guys do.


Dividing and multiplying
Exchanging with ease
When times are mysterious
Serious numbers are easy to please

-- Paul Simon

 

[Brian]

Sometimes an entry level product introducing a new generation to a brand is more important than immediate profits. Bring back something like the MC250ans MC2100, simple circuits, simple to build and not expensive provided you do not start adding a lot of bells and whistles. Dust off a simple preamp design such as the C26 and update it, again not an expensive exercise.

What he stated was an excuse, not a reason.

 

[jlovda]

Sometimes an entry level product introducing a new generation to a brand is more important than immediate profits. Bring back something like the MC250ans MC2100, simple circuits, simple to build and not expensive provided you do not start adding a lot of bells and whistles. Dust off a simple preamp design such as the C26 and update it, again not an expensive exercise.

What he stated was an excuse, not a reason.

What is a "bell and whistle?" People associate Mac with 1) blue meters and 2) the 275 tube amp.

Time does move on. I was thinking of building a model train layout for my grandson. He has no interest compared to an X Box, Wii, etc mainly because it's boring. And a lot of 20-somethings would trade in one kidney if that's what it took to get an iPhone5. Stereo is not what it was like in the 60's and 70's at it's peak when about every guy on a college campus had at least a record player with two speakers..

I purchased an new MR-73 tuner in 1970. I never could afford another new piece since then. I have an all Mac system now but all the pieces are used off ebay and refurbished either by Terry Dewick or me.

My prediction is Mac won't change much in the short term.

Where is Ron_C in this discussion?