Sound United Grows Larger, Adding Onkyo to Its Arsenal

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(May 15, 2019) Sound United is set to acquire the consumer audio division of Onkyo Corporation. For those of you keeping track, that means Denon, Marantz, Pioneer, Pioneer Elite, Onkyo, and Integra brands will all reside under one umbrella.

According to a statement released by Sound United, a preliminary agreement has been established, which includes Sound United’s acquisition of all international third-party distribution arrangements for Onkyo, Pioneer, Elite, and Integra branded products. Onkyo Corporation is not relinquishing rights to Pioneer and Onkyo brands within its Digital Life and Embedded Audio businesses.

The entire transaction is expected to be completed at the end of next month.

“We are thrilled by the opportunity to add the venerable Onkyo and Pioneer brands to our portfolio. Sound United is one of the leading dedicated providers of premium audio/video products, and we believe the combined businesses will bring unrivaled innovation and sound performance to our consumers and channel partners,” said Kevin Duffy (CEO, Sound United). “Upon completion of the transaction, we will work tirelessly with the consumer audio division of Onkyo Corporation to ensure a seamless transition into the Sound United family so that all employees, customers and channel partners benefit from the enhanced breadth and depth of the new organization.”

According to Sound United, Duffy will preside as CEO over the expanded company.

Sound United now controls an incredible array of AV businesses, including Polk Audio, Definitive Technology, HEOS, Boston Acoustics, and Classé. Of course, that list includes the aforementioned Marantz, Denon, Onkyo, Integra, Pioneer, and Pioneer Elite brands. That’s quite a roll call of powerful names and associated product offerings.

Of course, the move raises quite a few questions about the separation of brands under the Sound United name, as both Denon and Marantz carry obvious similarities. It also raises concerns about the overall health of the industry’s more traditional AV Receiver offerings, which have met stiff competition due to consumer demand for portable wireless and soundbar products. It will be interesting to see if brand specific technologies (such as Onkyo’s AccuEQ and Pioneer’s MCACC room correction suites, along with Fireconnect) will survive, or if they’ll be eliminated in favor of Sound United’s HEOS platform and preference for Audyssey correction products.

As they say: “Stay Tuned.”
 
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bkeeler10

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There sure has been a lot of consolidation in the audio/video industry the past few years . . .
 

Todd Anderson

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It's concerning... the division of innovation is slowly being stripped away, it seems
 

t3t4

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Auah, this is sickening news at first glance. As a big Onkyo fan (owner) myself, this news is concerning. But, Harman Kardon, JBL, Crown, are they now better or worse then before? It might not be the end of competition so much as a new industry standard. Believe me, I'm worried, but not yet concerned. I'm more worried about the kids out there driving this industry vs the products available. We all watched what MP3 did to the world, and, well, kids!

I think teaching the kids in this case is more important then any one brand. Consumer demand and all that jazz. Just my $0.02

Cheers!
 

JimShaw

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Less competition means a rise in mediocrity and prices


.
 

tesseract

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I do not see an AVR monopoly on the horizon. Apple and Samsung have competition in the smartphone arena. I can buy a Honda truck over the monster Big 3. Laptops... how many brands are there, now?

Home media processors have become quite advanced, but even smaller companies like Emotiva and Outlaw have managed to keep a finger in the pie. Actually, they just jumped on board not too long ago and are doing well. JVC got cut out of the audio market, look what they did in video.

No worries. There will always be competition for your $$$$.
 

Todd Anderson

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I do not see an AVR monopoly on the horizon. Apple and Samsung have competition in the smartphone arena. I can buy a Honda truck over the monster Big 3. Laptops... how many brands are there, now?

Home media processors have become quite advanced, but even smaller companies like Emotiva and Outlaw have managed to keep a finger in the pie. Actually, they just jumped on board not too long ago and are doing well. JVC got cut out of the audio market, look what they did in video.

No worries. There will always be competition for your $$$$.
If you look at the "major" consumer-oriented brands in AVRs... Sony, Yamaha, Pioneer, Onkyo, Denon, Marantz... I find it a little disconcerting that 4 of the 6 are now under one roof. I guess the concern is a marriage of technologies that basically blend them into one operating unit.

Only time will tell.

The good news is that I'm not reporting that Onkyo and Pioneer were filing for Chapter 11!
 

JimShaw

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Another way to look at it is "legally stealing technology from your competition". The Car Manufacturers have been doing it for years now.
I don't think I would call it "stealing". Wouldn't they have purchased the rights to any technology that might be gleaned

.

.
 

Matthew J Poes

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If you look at the "major" consumer-oriented brands in AVRs... Sony, Yamaha, Pioneer, Onkyo, Denon, Marantz... I find it a little disconcerting that 4 of the 6 are now under one roof. I guess the concern is a marriage of technologies that basically blend them into one operating unit.

Only time will tell.

The good news is that I'm not reporting that Onkyo and Pioneer were filing for Chapter 11!
When this was first announced I was discussing it with an industry expert who pointed out that Yamaha had, until now, a dominant position in the market. They were by far the largest receiver manufacturer (I didn't realize that). As a result, it was reasonable for Sound United to purchase its smaller competition to better even the odds for them.

It also seems that whenever I express concern that this could lead to over-commoditization across 4 brands, nobody agrees. Many have suggested that Sound United is likely to leave them alone. That Pioneer has too much invested in their platform and it's too good a platform to ditch. So we might see Sound United just compete with themselves internally, with the brands actually devloping and operating mostly indepedently.

I will say, as much as I don't love HEOS over some of the comeptition, it's still a nice system and having it available on 4 different brands would be pretty huge. If a single HEOS/BlueSound/MusicCast, Sonos like protocol existed, that would be great. Obviously nobody has successfully done that because you really need to own the infrastructure to do it well. Here we have a scenario where Sound United does own the infrastructure, so it could be done and done well.

It's also worth noting that this has happened before and it is not uncommon for these big groups to break up over time. Klipsch, B&W, and tons of Sound United like brands have gone on buying sprees when the cash reserves are high and the market value of brands is low. Once that reverses you tend to see these brands either put to rest or spun off again.

I do think this is huge news and it will be interesting to see what happens.
 
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