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Thread: The "Chinese Connection"-Importing Ribbon Mics- by Lynn Fuston

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    Default The "Chinese Connection"-Importing Ribbon Mics- by Lynn Fuston

    Here's an article that I wrote for the March issue of EQ Magazine, titled "Chinese Connection." It's about importing mics from China, with this article specifically targeting Chinese ribbon mics. To view it from the EQ page, click here: (Edit: The EQ Magazine link is dead. So I'm posting the whole article in quotes below. 11-26-2014)

    The Chinese Connection
    (How to Import Ribbon Mics directly from China)

    Lynn Fuston
    2006

    The heat was rising up in waves off the pavement as I hustled down the crowded city street. There I was, minding my own business, when I see a guy wearing a trench coat making a beeline for me. Before I could decide where to run, he was right in front of me, stopped dead in his tracks. I was trembling as I noticed his hand slipping into his coat and I heard him say "Hey buddy, wanna buy a ribbon mic? Cheap?"

    Then I realized I was wearing my AEA T-shirt, with the RCA-styled logo and "ribbonmics.com" on the back. I might as well have had a bright red target painted on my chest. Before I could answer, he shot back "Two hundred bucks, no questions asked, you're good to go. I'll throw in this canvas mic bag for free. And just because you got an honest face, you buy it now and I'll give you this aluminum flight case too." He pulled out a shiny box the size of a pistol case.

    "Am I dreaming?" I thought to myself. “This guy's peddling ribbon mics off the street corner for $200? Somebody pinch me.” I don't usually fall for tricks like this. I pass up the $50 Rolexes when I go to New York City. I don't even buy the $30 Gucci bags for my wife. But a ribbon mic? For $200? What's the catch?

    I was so shocked I didn't even bother trying to bargain with him. I reached in my pocket and handed him two C-notes. You see, I've got a weakness for ribbon mics. As I walked away with my new microphone, I thought about what a deal I had made. The other ribbon mics in my collection cost me 10-15 C-notes each. (That's $1000 to $1500 if you didn't know.) I use them all the time. The vintage RCAs that I hunt for on Ebay can cost up to $3000. Did I mention my ribbon mic addiction? It's my "habit." Those Ribbonaholics Anonymous meetings have helped, but I still couldn't pass up an opportunity like this.

    Then it occurred to me. "Not only is this guy selling these for $200, but he's making money at that price. Who is HIS source?" That's what I had to find out. So as soon as I got back to the studio and put my new beauty on display for all to see, I got on the Internet to do a little research.

    ***********************************

    While this fictionalized account may seem a little far-fetched, the circumstances on which it is based are very real. There is currently a flood of Chinese import microphones on the market. Some are imported under Chinese brand names, but they are increasingly being sold by companies wanting to expand both A) their product lines and B) their profits. Cable makers, mic stand makers–even individuals–are getting into this seemingly lucrative business. If someone can buy a mic for under $100 and turn around and sell it for $200 with no development expense, why not? And with the prices that Chinese manufacturers are charging, there's plenty of room for markup. This isn't rocket science and it doesn't take an entrepreneurial wiz to figure this one out. I've been getting emails for the last five years from companies that say "We can put your logo on our mics and you can sell them and make lots of money." Obviously, I'm not the only one receiving those emails.

    So I decided to give it a shot. Not because I ever dreamed of becoming a mic importer, but because I'm curious just how difficult or easy it truly is. And the Chinese ribbons got my attention because I'm the world's biggest ribbon neo-fanatic. (I told you part of the story was real.) So here's the play-by-play story. Names have been changed to protect the innocent.

    June 7- I decided to try this out and see how hard or easy it is. So I go online and find a source for Chinese mics. That takes about 5 minutes.

    Next, I contact them via email. I'm not going to lie and pretend to be a bigshot. I'm just a guy, a nobody. I type a letter expressing interest in their products and request evaluation units and send it. That takes about 2 minutes.

    June 8-I expect it may take a while to hear from them but the response comes the next day, due to time zone differences. I receive a letter asking me to check out their online catalog and tell them what I want. I have already seen the catalog and know I want a ribbon mic, so I reply and wait another day. They respond with a quote for the "evaluation units" which is about $60 each. In our correspondence, I made my intentions clear, that this was a one-time order, these mics are for demo purposes and I would not be buying thousands of them. So I asked for pricing on 10 units with shipping straight to me in Nashville. Now I have to decide on how many to get.

    Later that day, I get an email saying that the shipping price for the 10 mics (weighing 3 kg each) is $315. That price will get them from China to my door in one week's time. It seems like a lot for $600 worth of mics, doesn't it? That may be a reasonable shipping price, but I've never done this before so I don't know. I do know that it adds 52% to the cost of each mic. That's a lot. So now they will cost me $91.50 each. Since I am bringing them in as "evaluation units" I won't have to deal with customs or pay import duties, I remind myself. I don't know how much that would be but it does add another layer of paperwork and cost to the deal.

    June 20-I wonder if I'll have trouble selling 8 mics, since I'd keep 2 for myself. Well, that worry disappears within 8 hours of mentioning it online. Even at $100, I have orders for 16 mics via email. Within another 8 hours, several friends hear about it and want some too. Everybody I mention it to wants one or two. So now I could sell 24 mics, even though I am only ordering 10. Nice problem to have. Of course everyone is excited because it seems like a deal. Well, it is. See, I'm doing all the work and they're reaping the rewards. Selling them at $100, I'm not making anything for my trouble. How much is my time worth? And what about warranties? What form of technical support do I provide? And branding? Do I just import them "as is," or do I put a logo on them and make a website and advertise? How do I let people know about them? Remember that these mics are virtually (maybe precisely) identical to four other branded mics on the market now. Those mics range in price from $199 to $399. Street price is typically $199. Should I do anything to make mine different, to set them apart from the others? Sure I could sell hundreds at $100 each, but what would I have to show for my efforts? Having the appreciation of my customers with no way to support myself is not my idea of good business.

    After several Internet searches I realize that other people are doing the same thing. Some groups or forums are doing group buys, and subsequently receiving "cease and desist" letters from lawyers of more established importers who consider the product line their property. Some individuals have even brought in hundreds of them, rebadging them with their own brand and selling them. I speak to one of these individuals who is selling quite a few mics. Interestingly enough, he is having the same thoughts I am having. "If all I'm doing is rebadging the same mics as everyone else and people are buying mine because they're cheaper and I'm not making any money, how long can I keep doing this?" His plan is to branch out and offer different units, built on recommendations he has given to the Chinese manufacturers. "So how will you keep them from taking your ideas and selling those mics to other people?" I ask, thinking that he is reaping from what other people have sown and the same will be true of the seeds he is sowing. He answers "That's just a risk you take." We talk at length about our dealing with the Chinese and how they do things. We have both had very good experiences. But it's a double-edged sword. On one hand, you can get manufacturing done for less than half of what it costs in other parts of the world, which is very good. On the other hand, your designs may possibly show up in other products that may be sold to your competition at the same price you are paying, except they don't have to recoup the R&D time and money you spent. That's bad. So you have to balance the good with the bad and decide whether you can take the risk of possibly giving away your investment. It's a tough call.

    July 10-After several weeks of debating about how many mics to order and whether to sell them, I place my order. I decide to purchase 8 mics, only for myself and friends. I get a final pro-forma invoice and arrange to have the funds transferred from my bank to the Chinese bank. The trip to the bank goes successfully with only minor confusion over account numbers. After paying a $35 fee for the wire transfer (didn't know about that one), I have my receipt proving funds are on the way. My contact in China assures me that as soon as they receive the funds, they will begin building my mics. They anticipate 15 days before shipment and another 4 days before they arrive at my address. I have decided against any customization: just quick and easy this time.

    July 18-The payment has arrived in their bank, minus an additional $28 transaction fee that was charged on their end.

    July 22-The package has shipped from China and is on its way. I am given a tracking number.

    July 24-I am given a new tracking number since the forwarder has changed shippers for safety purposes. I am contacted by UPS, since they need additional information. The package is stateside but it seems there is a catalog that was attached to the declaration but not assigned a value. You can't bring in something with no value assigned, so I tell them that it's worth $1. They assure me it will be delivered within two business days.

    July 27-Still no microphones.

    July 29-The microphones arrive. All are in good shape and as I expected.

    August 15-I receive an invoice for $23.76 from UPS for import duties. So after I total my expenses and divide by 8 mics, I spent about $98 per mic. And probably 8 to 10 hours of my time. All went well and as expected.

    So what did I learn?

    1) These mics look different but sound the same as the other "rebadged" ribbon mics being imported.

    2) They are a very good deal, considering the price of other ribbon mics.

    3) Comparing these mics to the other ribbon mics in my collection, my AEAs and Royers have nothing to worry about.

    4) If you order mics that you have not seen or heard, it may work out or you may get burned. Who eats the cost when you get what you ordered and it's not what you expected? It's you.

    5) These are indeed useful mics and sound like ribbons. They would make a good "ribbon primer" for people who have never owned one. Likely, they will make you want more better ribbons.

    6) Although ordering mics from China is not as easy as walking into a dealer, it is relatively painless and I didn't have any trouble with the language barrier or them being honest in their responses. It was a good transaction (A++ in Ebay speak).

    7) When I factor in my time, and the amount of time I gave up working on billable projects to pursue this, it is no bargain. If I charged my normal rate for my time (which is valid because I took time away from my schedule to do this), the cost per mic jumps up to almost $260. Considering that the street value of these mics is $199, these were no bargains.

    8) Would I do it again? As a learning experience, yes. As a bargain hunter, no. The other issues of warranty, ribbon replacement, and local support all factor into my decision. It was a valuable experience, but there's a reason you pay a little bit more for a company to handle import, QC, service and other things. In my opinion, their prices are fair. So, if you are willing to work for free, then it might be worth your while. If you are planning on making money doing it, by the time you have an outlet for selling them, advertising, shipping and warehousing facility, you would probably have to charge the same as everyone else to make any money.

    In summary, my advice is if you want an adventure, go for it. If you just want a ribbon microphone or two, go buy them and leave the headaches to someone else. If you want to go into business doing this, realize that you'll be just another face in the crowd unless you do something to differentiate your product from the others who are selling the same thing.
    I got an email yesterday from the sales manager at EQ Magazine, and in it was forwarded an email from John Nady, president of Nady Systems which is the company that sells the RSM-2 ribbon mic which we have talked about here. The letter was thoughtful in tone, but contained certain words such as "dismay," "unhappy," "interfering," "personally insulting" and "undermining." Needless to say, John was unhappy with the article. I have not asked permission to quote the letter here so I won't.

    I offered this public forum to him here so he could express his views. My initial response was this:

    John,

    Would you be interested in discussing this matter publicly on my forum?
    It's at

    http://www.3daudioinc.com/3db

    There has already been a lot of discussion of ribbon mics, Chinese and
    otherwise, and the people there are very interested and receptive to
    your perspective. If so, just let me know. But take a look at the forum
    first before you decide. You could do a search for the word "Nady" or
    "ribbon mic" or "chinese ribbon." There have been lots of discussions
    already.

    I seriously hope I did you no harm in my article. That's why the
    conclusion stated "If you're looking for a project, try buying from
    China. If you want a mic, just buy it from a dealer." That was my
    ending summary and an opinion I definitely stand by.

    Just so you know, I bought 10 ribbon mics from China, but I bought 12
    of the RSM-2 from Nady during the research for that article. You
    probably didn't know that.


    John wrote me back this afternoon, concerning the harm that my article did in cheapening Nady's contribution in making these mics possible in the first place. And that an e-mail to him prior to writing the article might have mitigated the potential damage and losses that Nady might suffer as a result of its publication.

    Here is the portion of his letter that he asked me to post. It was written by John Nady and reflects his opinion.

    Nady's Innovation of Value Priced Ribbon Mics.
    John Nady
    President
    Nady Systems, Inc.

    Over two years ago I saw the potential of value priced ribbon microphones broadening the use of this, up to then, somewhat esoteric and inaccessible technology too a much wider market. I researched the technology of the classic RCA and other vintage ribbon mics as well the some of the more modern brands such as the AEA and Royer. I approached Alctron in China with this idea and upon their agreement for our exclusivity under a written Purchase Agreement subject to jurisdiction under California law, sent them the necessary information and technology to proceed. Unfortunately, in violation of this agreement, they almost immediately started knocking off variations and selling to other US distributors, including Yorkville, SM Pro Audio, Shinybox, PPA, et al, as well as consortiums of end users willing to buy a few as 8 units, as outlined in your article. Since realistically it was difficult to enforce this agreement in China, with its self-protective legal system, we shifted our production to another factory and notified and legally went after some of the early distributors, including PPA and Yorkville. We reached a settlement with PPA, and the Yorkville litigation is ongoing, pending resolution. In the meantime, due to the Wild West, fast- and-loose nature of much of China production these days, several other traders have jumped in to this market with more knockoffs. This is not surprising considering that in China you can get counterfeit versions of just about any branded product, including Shure wireless and SM-58s, AKG and Sennheiser wireless mics, as well as numerous other branded audio products, including some Nady units. You could also get very accurate reproductions of Rolexes, Gucci bags, etc, etc, and there is always a market for such sham goods.

    With regards to the ribbon microphones now available, we hope potential customers would consider the following:

    1. Ethical issues and fairness in selecting products. I concede, however, that for a generation mostly raised on free downloading of copyrighted materials this might not resonate as much as I would hope.

    2. Ultimately you get what you pay for. As pointed out in your article conclusion, it really makes no sense to nickel-and-dime when prices are so low already, especially from Nady, considering the hassles and lack of service and support later. You didn't mention that the units you can buy direct are somewhat of a lottery ticket, since there is really no guarantee of quality and uniformity. This is true even of the units from other distributors, your so called "badgers", who have taken over some of our models, trying to cash in on someone else's idea. They have spent little or no effort, other than appearance items, on the development of this product, as we did, and thus have no input as to the final product they are selling in terms of quality, reliability etc. They are simply box movers in this regard on these units.

    3. Nady Systems continues to innovate this product line in its ongoing mission of bringing innovative, high quality ribbon mics to the masses. We offer five models currently, with a proprietary tube ribbon mic of our own design (only one on market at any price) shipping shortly. Unless they knock that off also, this will not be available from Alctron.

    We hope, therefore, that fair-minded and sensible ribbon mic aficionados will see that it is both to their advantage and the long-term advantage of this emerging technology to support Nady in our ongoing development of this product line. No other distributors currently offering knockoffs can make this claim.




    It was not my intention to discredit anyone with my story. I was simply researching what I have noticed as a popular trend. Neither is it my intention to discredit any product line or manufacturer in this thread.

    I will, however, point out that my article never mentioned the name of a single microphone company, Nady or otherwise, or any Chinese manufacturing concern. It did not mention any of Nady's competition that sells nearly identical products. It gave no contact info for how to get in touch with any Chinese manufacturer. And the summary suggestion from the story was to buy a ribbon mic from a dealer, unless you wanted an adventure more than just a microphone. In case you want adventure and to save a few (very few) bucks, "Go East, Young Man," and find your microphone.

    John Nady made it clear that he could see no ongoing value engaging in back and forth forum communications over these issues. So I do not expect him to respond. My purpose in posting this here is twofold.

    1) To let you know that all pro audio press is not tripe and regurgitation of press releases, and

    2) to open an honest and thoughtful (and respectful) discussion about the issues raised.

    Your thoughts?
    Lynn Fuston
    3D Audio

    Making beautiful music SEEM easy since 1979.

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    Quote Originally Posted by John Nady
    I approached Alctron in China with this idea and upon their agreement for our exclusivity under a written Purchase Agreement subject to jurisdiction under California law, sent them the necessary information and technology to proceed. Unfortunately, in violation of this agreement, they almost immediately started knocking off variations and selling to other US distributors, including Yorkville, SM Pro Audio, Shinybox, PPA, et al, as well as consortiums of end users willing to buy a few as 8 units, as outlined in your article. Since realistically it was difficult to enforce this agreement in China, with its self-protective legal system, we shifted our production to another factory and notified and legally went after some of the early distributors, including PPA and Yorkville. We reached a settlement with PPA, and the Yorkville litigation is ongoing, pending resolution. In the meantime, due to the Wild West, fast- and-loose nature of much of China production these days, several other traders have jumped in to this market with more knockoffs. This is not surprising considering that in China you can get counterfeit versions of just about any branded product, including Shure wireless and SM-58s, AKG and Sennheiser wireless mics, as well as numerous other branded audio products, including some Nady units. You could also get very accurate reproductions of Rolexes, Gucci bags, etc, etc, and there is always a market for such sham goods.

    This is an interesting point and one that I mentioned in my article. You can do the design and have it manufactured inexpensively in China, but at the risk of it showing up in your competition's catalog. I wasn't sharing any secrets there.


    Quote Originally Posted by John Nady

    With regards to the ribbon microphones now available, we hope potential customers would consider the following:

    1. Ethical issues and fairness in selecting products. I concede, however, that for a generation mostly raised on free downloading of copyrighted materials this might not resonate as much as I would hope.
    I was not raised on free downloading and issues of fairness and protecting intellectual property rights are very much my concern. Obviously the Chinese manufacturers are less concerned with it than even the manufacturers who offer clones of other people's mics.


    Quote Originally Posted by John Nady

    2. Ultimately you get what you pay for. As pointed out in your article conclusion, it really makes no sense to nickel-and-dime when prices are so low already, especially from Nady, considering the hassles and lack of service and support later. You didn't mention that the units you can buy direct are somewhat of a lottery ticket, since there is really no guarantee of quality and uniformity. This is true even of the units from other distributors, your so called "badgers", who have taken over some of our models, trying to cash in on someone else's idea. They have spent little or no effort, other than appearance items, on the development of this product, as we did, and thus have no input as to the final product they are selling in terms of quality, reliability etc. They are simply box movers in this regard on these units.
    I am aware of the "lottery ticket" phenomenon that John mentions. What he does not know is that I tested all 12 of the Nady mics that I bought from his company to see how closely matched the mics were. They were indeed very close. I also checked the 10 mics that came from China to see how consistent they were. They were also very close to each other. Close enough that I could have picked any two of the total of 22 Chinese ribbons and used them as a stereo pair without concern.

    Quote Originally Posted by John Nady

    3. Nady Systems continues to innovate this product line in its ongoing mission of bringing innovative, high quality ribbon mics to the masses. We offer five models currently, with a proprietary tube ribbon mic of our own design (only one on market at any price) shipping shortly. Unless they knock that off also, this will not be available from Alctron.

    We hope, therefore, that fair-minded and sensible ribbon mic aficionados will see that it is both to their advantage and the long-term advantage of this emerging technology to support Nady in our ongoing development of this product line. No other distributors currently offering knockoffs can make this claim.
    Royer showed me a tube ribbon mic at the AES show two years ago, and I believe they are shipping now. Although if the "(only one on market at any price)" refers solely to the "of our own design" portion of the statement, that statement is still true. But Nady claiming to have the only tube ribbon mic on the market is not correct.

    CORRECTION-3/17/06: I just spoke with John Jennings at Royer and he told me even though they have taken advance orders for several of their tube ribbon mics, they just decided to redesign the power supply and make it smaller based on early tester's feedback. They expect to be shipping final product within a few months. By the way, the Royer design dates back to 2000 according to John Jennings.
    Lynn Fuston
    3D Audio

    Making beautiful music SEEM easy since 1979.

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    Lynn--

    I enjoyed the story. It's one of the reasons I keep coming here. You actually think about this stuff. I appreciate your efforts. I also want to thank you for posting up John Nady's comments.

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    Lynn,

    Weren't you basically supporting companies like Nady by saying that it'd be better to leave the headaches to others
    rather than going the route you did and doing all the work yourself and realizing that you weren't breaking even?

    That's what I got from reading your article. Maybe I missed something...

    One thing I've learned about the internet and email since I began using them, is how easy it is for us to
    misunderstand each other through just reading the printed word, and reading what we want into those words.
    (or even our eyes skipping lines without realizing it and the result giving the messsage a totally new meaning!)
    I've done it, and had people do it to my words as well. Hopefully in the future we (myself included)
    take the time to read a little more carefully, and ask to clarify with each other when we suspect something amiss.

    ~ mike

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    Man! Talk about opening up an entire CASE of worms...

    1. Superlative article...informative, touch of humor (intended or otherwise )...yet gets to the meat in a hurry....and I found nothing offensive, nothing of questionable ethics by the author, or nothing that was out of line...

    2. Nady's reaction: I think was to be expected...I do not know for sure (no pun intended) but I believe that Nady's approach to the audio world is to offer inexpensive versions of what us end consumers want...they are making a little of everything, none of which (that I have encountered) is considered as "hi end", "audiophile", etc... and this is fine. It is unfortunate their ribbon mic design was made available to other badgers (we dun't neeed no steenking badgers......) and I understand their angst....but it was not the author's fault for reporting what is somewhat common knowledge, nor was it the magazine's fault for carrying the story. I don't think Nady and Co were "outted" to the high end crowd...maybe they wanted to keep this kind of information rather low key....(sidebar: rebadging is not a new phenomenon: Norelco C12s, for example...Altec badged EV RE16s for another...)

    3. This kind of activity (I believe) has been the business model for many companies...how many times have Samson, Behringer, etc, been sued for reverse engineering a product, and reselling it as their design, sometimes without nary a change to the product other than less expensive components and labor?

    4. Seeings how Nady is is direct competiton with the other ChiCom mics mentioned, I can see how they might feel...don't agree with it, but can at least understand it...now, if they (Nady or any of the otherwise mentioned rebadged versions) were competing against AEA or Royer, I would really have to question their business approach...reality check, anyone? (Yes, I have demo'd the mic in question, and put it back in its box and took it back to the store within 2 hours - it wasn't bad, just not what I was looking for)....

    5. There is room for everyone with legitamate business motivations, niche or high end...

    6. Wonderful piece...touchy spot you seem to be in, Lynn...folks wanting to blame the messenger and all...
    Ken Morgan
    2010 3d VIP

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    Quote Originally Posted by Wireline
    6. Wonderful piece...touchy spot you seem to be in, Lynn...folks wanting to blame the messenger and all...
    It does seem to me that there is an underlying "read between the lines" frustration at the way the Chinese have handled it. And that he is venting at me. I mention it in the article and he mentions it to me. Is it my fault that the problem exists because I wrote a story exposing it?

    I don't know how much design time was spent on engineering the RSM-2 and I don't have reason to doubt that John Nady did make a contribution to the Chinese development of that mic. I almost hate to bring this up, but several people have commented to me (other ribbon mic manufacturers included) that the RSM-2 is a "cloned AEA R-84." The motor assemblies of the two are nearly identical. I was reluctant to believe it until I saw pictures of the insides of the two. (I've never opened up either of mine.) If that is the case (with the emphasis on the word IF), then it seems disingenuous of a company that copied an existing product to be upset over the fact that other people are selling the "copies" it commissioned. It would be like "cloning clones."

    Has anyone seen the new RSM-3? Take a look. http://www.nady.com/products/product...m3mics_pg.html
    Does it bear any resemblance to any other popular ribbon mics that are on the market right now? Do you think that this is coincidental? You may notice that the mic pictured has no microphone element in it, but is just an empty shell.


    My perspective may be unique in that I have friends at four different ribbon mic companies that share information with me that is not available to the general public. Much of this is not information that I can ever share publicly. I will say that only one of those four companies imports mics from China. The other three are major players whose original design mics are made here in the US. Not that I'm taking sides, just wanting to make sure that readers realize that I'm not dreaming this stuff up or reading it on the internet ("It must be true. I read it on the internet!")
    Lynn Fuston
    3D Audio

    Making beautiful music SEEM easy since 1979.

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    Default "Stuck in the middle with you" from a song by Stealer's Wheel

    Now I have heard from the Chinese manufacturer who has heard from one of his large US customers who is upset about the story and its implication that these mics can be bought in quantities less than thousands.
    Lynn Fuston
    3D Audio

    Making beautiful music SEEM easy since 1979.

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    It certainly looks like a case of "shoot the messenger".

    For a start, I can't see anything in the article that should make his hackles rise. The article is well written and entertaining, not to mention most informative.

    And while I may feel a degree of sympathy for Mr Nady, perhaps he is now discovering the down-side to dealing with a country that has given him the opportunity to manufacture cheaply.

    The playing field is possibly not as level as he first thought. Dealing with China etc can sometimes be a two-edged sword. (Yes, I've worked there).

    Contracts: The large print giveth, the small print taketh away.

    Haigbabe
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    A certain innovative mic manufacturer has a capsule with some very unique tweaks that they are having made in China. I asked the designer about the dangers of showing these modifications to the Chinese, since with the way they do business, there is no guarantee at all that those capsules won't start showing up in other people's mics. The response was that they were fully aware of the dangers, but to compete on price, they had no choice.

    It's a very difficult situation, where manufacturers are forced to look to China for manufacturing in order to compete in the marketplace, yet they risk losing their intellectual property in the process. China really has become the 400 lb. gorilla in the world economy, and I'm not sure the West has any power (or even strong enough interest) to take them on in terms of intellectual property laws, artificial fixing of currency exchange rates, etc. Where it will get really interesting (and it has already begun) is when the Chinese workers decide they would really like to own some of the kinds of things they are making and exporting...

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    Quote Originally Posted by David Klausner
    A certain innovative mic manufacturer has a capsule with some very unique tweaks that they are having made in China. I asked the designer about the dangers of showing these modifications to the Chinese, since with the way they do business, there is no guarantee at all that those capsules won't start showing up in other people's mics. The response was that they were fully aware of the dangers, but to compete on price, they had no choice.

    I think that's a very unfortunate perspective. It's like selling your land so you can afford to buy seeds to plant on the land you sold. What good does possibly sacrificing your original design do if you are marketing it based on its uniqueness, but by the time you get it to market you may only have months to recoup your investment of time and energy before your competition is selling the same product for the same price or usually less?

    It's a very dangerous business model and one that has little chance of success. The old saying "cutting off your nose to spite your face" comes to mind.

    Other manufacturers have considered doing the same in order to "compete" financially in the marketplace. But in the end, keeping their proprietary designs in house and made in America are the ways that they have kept their customers happy and kept them "their" customers. Would they have sold more if they were offering them at half price after making them overseas? Sure. Would they be ahead for a few months? Maybe. But what is the ultimate outcome of outsourcing the manufacturing when their same product will end up being sold by dozens of other "badgers?" Will it ultimately increase or decrease their company's strength, sales and stability? I honestly doubt it would be to their benefit.

    I have spoken to several manufacturers/designers about this. We discussed it amongst ourselves at the Preamp Designer's Summit. Even George Massenburg considered it briefly. And he discussed it with us all.
    Lynn Fuston
    3D Audio

    Making beautiful music SEEM easy since 1979.

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