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My thought is that there is tremendous market pressure toward making even high end headphones viable for portable use. Whether it means making small portable amps that can drive power-hungry headphones, or somehow making the higher end headphones less power hungry, the pressure is there.

I don't doubt that the absolute numbers are still there for desktop-only electrostatics and high end dynamics, but the numbers are going down as a percentage of the market, and the bean counters are very anal about that sort of thing. Not that they want to eliminate the niche product, or close the gap by reducing the quality and performance of the top end item. I think it's probably they're afraid of that huge gap between the $2k 'phones and that $8k or more 'phone and they want to fill in that gap some if they can, to lessen their risk if nothing else.

So exactly what Edifier will be able to accomplish I can't guess, but if they can make the high end electrostatic more relevant in the big picture, that will be a good thing. Relevant could mean a lot of things, but for me as an enthusiast who's willing to shell out even a few thousand dollars if the return is good enough, it boils down to "Can I ignore it and feel like I'm getting 99 percent of the best sound, or do I need to make the sacrifice and buy it because otherwise I'm a second-class headphone citizen?" (OK, so I may never be first class anyway, but you know, it's that nagging sensation that becomes more bothersome the more relevant those top end products become. So looking on the bright side, it'll be cheaper if they don't become relevant.)

I didn't really bother to read the entire "love letter" in Chinese but the a more accurate translation of the title would be "Stax-loving friends", it's a lot more logical and less ridiculous than the bad Google translation.

Continue manufacturing in high-cost Japan? Are you kidding me?

Edifier should:

1) Keep engineering in Japan but move manufacturing to China.

2) Get rid of those pitiful distributors they have today. Form strategic partnerships with strong regional companies who have skin in the game (the headphone marketplace). Embrace them, because the old middle-man distribution model is killing the audio industry (case in point: Yama's)

3) Develop a global pricing model that ices the gray market. Make pricing more competitive through lower manufacturing and distribution costs.

Edifier then stands a chance of increasing not only revenues but margins over the long term with this acquisition. Maintain the status quo - its going to be more of the same (a long slow death) for Stax.

Chinese ownership is irrelevant IMO. Its a global business and Stax was being run as if this was still 1980.

Extremely helpful, thorough and thoughtful.
Thanks, Tyll.
I'm an investment banker and the purchase price really is shockingly low.
I'll bet the Stax mafia could have raised more money to cut a deal.
But, the sellers probably wanted to find a value added partner.
Personally, I wouldn't have sold 100% but rather entered into a joint venture to be able to participate in some of the coming upside.
Can't wait to watch this one unfold.

... For letting me know in the hed that Edifier was famous for making speakers. Not that I have a pulse on the market, but who again are they? Are they an OEM, or do they manufacture for others, or design as well but don't sell under their nam in North America?

None of that actually matters to me, although seeing the name of a famous Japanese (did I at least get that part right? It's been many years since I was into this, sorry ...) headphone maker go to the Chinese does give me pause.

Thanks again for reporting this, Tyll --- company ownership and design pedigree/history are two of the most frequently left-out topics concerning consumer electronics, and IMO important ones.

People buy Stax *because* they are made in Japan -- because they are Stax and not some "global brand" with offices in one place and manufacturing in Asia. Move that to China and people will desert them.

Japanese people, in general, don't like the Chinese. The Chinese don't like the Japanese either. It's a hangover from the past. Regardless, Japanese people feel the same about manufacturing in China as many of us do.

Ideally the result will be that this will give Stax a buffer with which to develop new products without the "sleepless nights".

The 009s though - they don't wow you on first listen, they just simply, without drama, make every other kind of headphone on the planet seem incompetent IMO. The quality of their build is that far above everything else as well. Even the packaging is absolutely perfect, down to the plastic bag around the box, which is folded and taped *perfectly*.

A few companies in Japan, such as Stax, still hold the attitude that, even if, by our standards, they have reached perfection, there is still further to go. I think that, other than a few small manufacturers, only Apple have ever come close in maintaining such an attitude and producing a global company. I don't believe anyone else could pull it off, because it requires such an un-compromising dedication and focus that most people will give into diversions from it sooner or later.

I'm a native speaker.

Your interpretation of the google translation is pretty good.

The original per my translation:

(1) Technical Risk

Due to fierce competition in the headphones industry, even though Stax has greater technical advantage in electrostatic headphones, electrostatic technology might be replaced by more advanced technology. If the company cannot further invest and progress in the products' various technological developments, it could become obsolete in the market place.

I'm still confused by the purchase price. I mean, jesus, that's the average cost of a Manhattan apartment. The real estate alone must be worth that, right? Either I'm just completely naive, or we are missing major details with respect to this transaction (e.g., how much of Stax's debt Edifier assumed, which is usually included in the purchase price). If I'd known it was on the market at that price....

Thanks Tyll for going the extra yard beyond mere speculation that's both rife and understandable. Whatever the future holds for Stax and the products that it makes, I can't help feeling a tad melancholic about this development.

I actually own the first headphone amp Edifier made back in late '90s. It is probably the worst headphone amp I have. Regardless, I have seen Edifier trying very hard to break into the headphone market since then without much success. Edifier probably see Stax as the one real chance they have to finally get into the higher end of the headphone market.

BTW, in the love letter Edifier CEO doesn't say they will 'produce diaphragm material for Stax'. Instead, he says the new brand will use 100% Stax produced electrostatic speaker unit while Edifier will produce the rest of the parts - in order to create more affordable, easier-to-use electrostatic headphone.

This brings to mind the acquisition of Ultimate Ears by corporate giant Logitech a few years back (for $34 million if I recall correctly). Obviously a very different situation in many aspects.... but still - it's the closest example of a giant company buying small specialty headphone or earphone firm.

In some ways, UE has remained true to its roots. The UE Reference Monitor is widely accepted as a quality product, the UE18pro slightly less so. Still, UE generally remained the same as far as custom IEMs go. Their universal models are a different story though - it appears that the Logitech ownership has stopped them from competing at a high level in the universal arena. Maybe that's just not where they think the profit is right now.

I'd like to see the Edifier-owned Stax continue with their flagship products while running in a more efficient way (as many have said). I would also like to see an expansion in the low end of the market (think SR-001MKII and such), so that more folks can experience the Stax sound. Hook people with the entry level stuff and they will be more likely to want the higher models in the future.

Wow, what a polemic subject.

Thanks for the thorough report Tyll, very insightful.

I want to add my voice to the many others who praised Tyll's work on this article. It is clear to me that this was a big and time-consuming job. Thanks, Tyll, you have our best interests at heart.

...namely, Quad.

Near as I recall, after Quad was purchased by Verity Group, the entirety of its entire manufacturing facilities were moved to China. From a quality standpoint, it appears the transition went without a hitch. Don't know how (or if) Quad has dealt with any perceptual issues on this front.

I ultimately see a situation where Stax' manufacturing will be split between Japan (the ES headphones themselves) and China (electronics). This could also be a route to Stax re-entering the more moderately-priced (relatively speaking ES/electret 'phone market. The one thing for certain is that this won't be a boring ride.

Tyll, BIG thanks for your detective work on this!

Originally posted by Dalethorn:
"My thought is that there is tremendous market pressure toward making even high end headphones viable for portable use. Whether it means making small portable amps that can drive power-hungry headphones, or somehow making the higher end headphones less power hungry, the pressure is there."
Agreed, not that my measly opinion means anything..
I'd love to see few lower end models put out that are more easily affordable by more people. I don't mind forking over $ for higher end but not everyone has these priorities, or something like that. You know what I'm getting at anyhow. Maybe a larger diaphragm electret terminated in a commonplace TRS plug to tap the stat-curious bass oriented folks and avoid the whole speaker terminal adapter box thing which limits their application and probably puts a few folks off. With all the reasonably priced portable amps around these days no issues.
I've certainly taken a few full-sized electrets out for a walk. It's great.
Properly designed it could prove a serious contender. There have been a few examples of this in the past but only a few that hit up the bass decently. Just imagine what a TRS terminated closed back SR-50 would do to the market(anyone else own/tried one or am I alone there?) however they decided to deal with the transformers, but a larger driver with circumaural pads. No die-hard bass-heads need complain there! It's enough as it is. Bass machine.

Daydreaming again about classy chrome and matte black audio bits.

Too bad someone this side of the water didn't know about the sale previously.

Appreciate the article.
Made me sign up just to spill my dreams all over the page here in my first post...

don't worry guys

if stax ends we'll still have wachara from head fi :)

Edifier is a multinational company, with offices in Beijing, Shenzhen, Hong Kong, Canada, Australia and Argentina, with manufacturing facilities in Beijing and Dong Guan, China.Quality Inspection India

As a fan of Stax electrostatic cans, this is good news to me. The Chinese, culturally as a whole, are serious about high-end audio. This is opposed to countries such as the US and Japan, where true audiophilia has become more and more a niche/boutique concept in the past few decades. Stax products have been developed at a snail's pace for a long time, and they cost an arm and a leg (by headphone price standards, at least). Hopefully this will accelerate new product development, and thus drive refinement, advancement, and exposure in the electrostatic headphone arena.