The ongoing consolidation of the audio business took another giant step forward in June when Yamaha announced that it had established a joint venture with French line array and live sound technology developer NEXO. The agreement calls for the two companies to join forces in future product development and gives NEXO's line arrays and other high-end PS products a much deeper reach in the critical American and Asian markets via Yamaha's distribution and marketing capabilities. Good for NEXO, which has long made what many in the industry feel is a quality, competitive product that has been hamstrung by a marketing culture out of its depth here. Good for Yamaha too, as that company apparently seeks to give the Harman International a run for its money as the big turnkey solutions provider to the live sound and installed audio businesses. Yamaha has always had a foot in both the MI and pro audio domains–the convergence of those two over the last decade was a blessing for Yamaha, enhancing what was already good synergy. At many music technology retailers, there's an ongoing debate about whether the new generation of keyboard-based digital audio workstations are synthesizers or studios-in-abox. That kind of blurring of the line works in Yamaha's favor.
The Japanese company also embedded itself more deeply in the changing pro audio landscape with its acquisition last December of Steinberg, maker of softwarebased recording system Nuendo, the only significant challenger to the hegemony of the ubiquitous Pro Tools. A few months later, AVID acquired Pinnacle, former owner of Steinberg. It's this kind of large-scale corporate chessboard that the industry is morphing into–AVID/Digidesign enters the live sound sector via their wellreceived VENUE touring console; any number of other company product lines, from Mbox to Pro Tools, help support that move; Yamaha, already a major force in live sound with its PM series consoles, among other products, fills in a key hole in its lineup with a top-tier live sound speaker maker.
(Ironically, Yamaha, whose NS-10 was arguably the most widely-used two-way speaker in recording studio history, never was able to follow up on that success in the professional transducer domain. But the current paradigm in global industry is if you can't develop what you need yourself, then you buy someone who can.)
Then there's Harman Pro, whose brand family, with few exceptions, has been the gold standard in live and installed sound. Harman's HiQnet inter-brand operational protocol is as much a perceptual coup as a technological one. It's one further step along a path that they, Yamaha, AVID/Digidesign and to a lesser extent, other companies, including the Telex Group (E-V, Klark-Technik, Midas) and Peavey (MediaMatrix, Crest), have embarked down–to become single-source systems providers.
It's worth noting that another couple of major pro audio moves lie outside these particular boundaries. Solid State Logic (SSL) has been plucked from the brink by two investors, recording/performing artist Peter Gabriel and broadcast audio entrepreneur David Engelke, and AMS-Neve has been acquired by Tom Misner, the owner of multinational multimedia education conglomerate SAE. There had been plenty of speculation that either company (or both of them) would have fit nicely into one of these same turnkey conglomerates. Both have top-tier technology and world-class brand names. What neither has is a major live sound product. You couldn't ask for a more stark delineation between the fortunes of the studio and live sound sectors of the music business.
You could, however, ask for a few more companies, and that's likely what you'll get. This kind of industry-scaled consolidation is classic regardless of which industry it's taking place in, and it creates voids in the middle of markets. Historically, that's a good thing; the start-ups that fill the market gaps left in the wake of consolidations often grow into much larger companies themselves, renewing the creative and financial landscape. That said, there's never been a landscape quite like this one before–just ask Alan Greenspan, who readily admits he can't account for the continuing gap between the 10-year Treasury note and mortgage rates.
The real 600-pound gorilla in this room is China, which is, when you factor in all global transducer manufacturing, the world's largest manufacturer of speakers. It already makes the chips that power most of the world's pro audio mixers and DSP boxes. In case you wondered why the cost of trusses has gone up in the last 18 months, it's because more of the steel has been bought by China for other products. By the time you read this, it's possible China may already own Chevron's oil assets.
The Yamaha/NEXO deal is significant, but it takes on greater significance when seen in the context of a changing global economy. But for the consumers, two or more conglomerates is always better than one in the end. Between Harman and Yamaha, and USA, Inc. and China, Ltd., there'll be enough innovation at affordable prices to continue to drive an industry.
