SonicBlue (Replay/Rio) Bought By D&M

An anonymous reader writes "Here's the announcement that many have been waiting for all week. Yesterday, the ReplayTV and Rio product lines of now-defunct SonicBlue were auctioned off in a bankruptcy court. Despite earlier negotiations failing to result in a deal, the Japanese holding company D&M, makers of high-end Denon and Marantz stereo gear, bought the product lines for $36.2 million. The big question is what about all of the "lifetime subscriptions" that people bought? No answers as of yet, but we can all be hopeful."

Comments

That's not much money

[Ignorant Aardvark]

Only $36.2 million? That's really not that much for an entire line of TiVO-like products. It sounds to me like D&M might make a killing off this investment, if they play their cards right.

Re:That's not much money

[levik]

Not neccesarily. Don't forget that SonicBlue already *HAD* these product lines, and still went under. These may not be all that commercially viable.

The PVR market is still high end, still small and already saturated.

Re:That's not much money

[Scyber]

Yes, but SB was already saddled with debt when they bought ReplayTV. Then they developed the newer 4k and 5k units. So they probably never got a chance to recoup there R& D costs

D&M already has a viable product design, they just need to keep the software updated.

Lifetime?

[Good Sumerian]

Lifetime support has always meant the lifetime of the company. They got what they paid for; it was a gamble, and, unfortunately, they lost.

Re:Lifetime?

[deanj]

Well, not necessarily. When ReplayTV got bought out, the company went away, and the assests went to SonicBlue. They honored the lifetime agreement for ReplayTV owners.

Re:Lifetime?

[Zathrus]

Well, not necessarily. When ReplayTV got bought out, the company went away, and the assests went to SonicBlue. They honored the lifetime agreement for ReplayTV owners.

Yes, but lifetime subscriptions are not an asset - they are a liability. The press release doesn't go into any detail, but I'd presume that D&M got saddled with the liabilities (court cases, outstanding debts, and lifetime subscriptions) as well as gaining the assets.

This is why $36.4M is not a "deal" by the way... and it's why they went under in the first place. They have far more liabilities than assets at this time.

This might hold an answer

[austinij]

Silicon Valley Biz Ink is indicating that all current customers will be retained. Hopefully, it works out that way.

-- I

Hi-fi buys lo-fi

[southpolesammy]

Interesting....this is a paradigm shift for D&M, as they've typically invested their R&D on the high-end of the audiophile spectrum. I'm somewhat perplexed by what they hope to accomplish with buying a line of low-end audio devices...

Re:Hi-fi buys lo-fi

[Drakino]

I'm somewhat perplexed by what they hope to accomplish with buying a line of low-end audio devices...

SonicBlue fired all the low end audio people a while back, leaving the audio engineers in the UK (The empeg folks). They are very capable of delivering quality high end devices if so requested. I believe the empeg sound system came close to any high end ($1000 and up) in dash stereo unit for potential audio output quality.

Hopefully this means the empeg Mark 3 might see the light of day.

Re:Hi-fi buys lo-fi

[fewnorms]

They can't be very high end if I've never heard of them. Kenwood, Sony, Pioneer... those are high end. D&M sounds like the Apex of the audio world. Dude, you are probably not an audiophile. Denon and Marantz are related to the likes of Kenwood, Sony and Pioneer like a ferrari to a volkswagen. You probably also never heard of Quad or Nakamichi? heh ... now that's an audio system.

Re:Hi-fi buys lo-fi

[Zathrus]

They can't be very high end if I've never heard of them. Kenwood, Sony, Pioneer... those are high end.

Congrats... you've just named all of the major low-fi vendors.

Would you like to play again? Maybe, this time, try something more simple. Like automobiles. Hint - Honda, Toyota, and Ford are not the top of the line, despite sales figures.

Re:Hi-fi buys lo-fi

[Surreal_Streaker]

You know stuff where each mono-block amp costs more than the most expensive D&M box. Or when your system has a phono cartridge that costs 5-15,000 bucks, that's high-end.

I'd argue that when your system sounds good it is high end. Thousand dollar phono cartridges only guarantee that your system is expensive. High end systems take more than just money.

Re:Hi-fi buys lo-fi

[ePhil_One]

Denon and Marantz are related to the likes of Kenwood, Sony and Pioneer like a ferrari to a volkswagen

More like middle range, say more like a Volkswagen to a Jaguar. What the average joe thinks of as high end, but folks who are really dedicated to it know there's lots of stuff even higher and/or more specialized. Carver would more closely map to Ferrari, perhaps McIntosh to Lamborgini. And there are more out there that map to even more exotic stuff, like McLaren's, Liegnfeter(sp?), Vector, Shelby, Panos, ... (Ok, so I'm more into cars than audio) Probably maps pretty well in terms of volumes, etc.

I'm still cursing my freind for getting me hooked on the idea of getting a Carver Sunfire (http://www.sunfire.com/)

Lifetime Activation

[Christopher_G_Lewis]

INAL, but if D&M continues the ReplayTV "Name" (ie, they purchased the name, not just the products) then they should have to honor the agreement. If the company all of a sudden become "D & M R-TV", or even "ReplayTV+" then the current owners might be screwed. Hopefully, they'll honor the current agreement, or only charge a small "transfer" fee.

From the service agreement...
SonicBlue

REPLAYTV Digital Video Recorder

Activation and Service Agreement

This Agreement applies to your use of the ReplayTV Service and is a legally binding agreement between you, SONICblue Incorporated and its wholly owned subsidiary, ReplayTV Inc. (collectively "ReplayTV"). By clicking the button marked "I Agree" below or by otherwise communicating your acceptance to ReplayTV or by using the ReplayTV Service, you agree to all the terms and conditions in this Agreement. IMPORTANT NOTE: Your ReplayTV digital video recorder works only by activating and receiving the ReplayTV Service offered and provided by ReplayTV. If you do not agree with all the terms and conditions of this Agreement, you are not authorized to use the ReplayTV Service, and you may return the ReplayTV unit to ReplayTV or the authorized retailer from whom you purchased the product for a full refund within one (1) month of the original purchase date.

lifetime

[ih8apple]

I've been a replaytv user for 3+ years and considering how much effort it takes to support the subscriptions, I'm assuming they will honor the lifetime subscriptions to keep customers loyal.

I mean, how much effort could it take to download a bunch of schedules from tvguide or whoever, encrypt them into the proprietary replaytv format, and put them on an FTP site. For the broadband users, they're done. For dialup, they need a simple agreement with a national ISP to support a few thousand 5 minute calls every night.

Doesn't any one RTA? Subscription info...

[splatter]

"D&M Holdings intends to keep all ReplayTV
customers and will design, manufacture and distribute a line of ReplayTV and
Rio products."

Sounds like they plan on continuing as normal. Hopefully D&M won't be buryied like Sonic Blue.

Philips and Marantz

[Anonymous Coward]

Philips owns a significant part of Marantz, you know.

http://www.twice.com/index.asp?layout=story_stocks &articleid=CA66618

Re:Philips and Marantz

[Anonymous Coward]

"&M Holdings Inc. will establish a new head office in Sagamihara City, Japan, with Kabumoto as the new president and CEO of the company. Sakamoto will be installed as the new president and CEO of Denon, and Takashi Sato will serve as the new president and CEO of Marantz. All shares of Marantz and Denon will be transferred to D&M Holdings, making Denon and Marantz wholly owned subsidiaries. Marantz shareholders will receive one share of D&M Holdings per share of Marantz stock, and Denon shareholders will get 0.4416 shares for every share of Denon stock. Ownership by Marantz shareholders and Denon shareholders in D&M Holdings will be 30 percent and 70 percent respectively, which means Philips and Ripplewood will have stakes of 14.7 percent and 68.6 percent in the new company."

As of Apr02...

Re:Too bad

[jackalope]

The ReplayTV OS is a modified version of VxWorks from WinRiver.

One shouldn't immediately assume that there are only 2 operating systems in the world. There are a slew more than that, especially in the embedded device arena.

This is what scares me about these services....

[Flabby Boohoo]

"....what about all of the "lifetime subscriptions" that people bought?"

That is exactly why I have never taken the plunge. I don't want to invest in hardware that (more or less) requires the company to be around for it to work properly. For example, the only broadband options in my area are fixed point wireless. The problem is that I have to invest $500 in the hardware. What happens when they disappear in a year or two? I am stuck with useless hardware (unless someone else offers the service).

I guess the dot com mess is still fresh in my mind...

Re:dial up for replaytv - not a few thousand

[ih8apple]

yeah, but how many of those are dial-up and how many are broadband?

Consider this:

1. When broadband support was first announced 3 years ago (after replaytv had been in business 2 years), the reasoning behind it was that over 85% of replaytv customers had broadband access at home (cable/dsl/isdn)

2. All of the devices since then have focused on broadband (any model 4000+)

I'm assuming that, at most, the dial up need is in the low 10's of thousands, not in the 100's of thousands

D&M made a good purchase

[steelerguy]

Both Denon and Marantz make pretty high quality products and some nice higher end audio and video equipment. This looks a nice aquisition for them so they can expand their product line in a nice progressive way. They already make good DVD players and receivers, now they can add a media center device that will allow DVR capabilities and MP3 music libraries.

I do have a feeling that they will somewhat support the Replay TV customers, but they will no do any additional development. My guess is they will come out with their own unit and offer Replay TV owners deep discounts if they trade in. They are not going to want to support someone else's service.

D&M will be fine

[WIAKywbfatw]

Denon and Marantz has a very solid core business - home audio entertainment. It's a well-respected, much-loved brand.

The likelyhood of D&M running into financial difficulties is slim, simply because their traditional businesses are cash cows. Even if the SonicBlue division (whatever it ends up being called) makes a loss, D&M will be fine (short of some vey serious mismanagement).

It's like Microsoft and Hotmail - even if Hotmail was to sink like lead, the money that Microsoft makes from its other businesses would more than keep it afloat.

As someone else has said, $36.2 million to buy yourself a major slice of the PVR market (not to mention portable digital music players) is a steal.

Hi-fi elitism

[theLOUDroom]

I've already see a few posts on this topic that just made my stomach turn. Here's an example:

D&M isn't high end. It's more of a high-end of the low-end. Rotel, Krell, Sunfir, Mark Levinson, anything with vaccum tubes and the list goes on are more towards the middle and hugh end of the audiophile spectrum. You know stuff where each mono-block amp costs more than the most expensive D&M box. Or when your system has a phono cartridge that costs 5-15,000 bucks, that's high-end. But me, I'm happy with my Denon AVR-3803

Here's another one:

Dude, you are probably not an audiophile. Denon and Marantz are related to the likes of Kenwood, Sony and Pioneer like a ferrari to a volkswagen. You probably also never heard of Quad or Nakamichi? heh ... now that's an audio system.

I'm not an "audiophile" if by audiophile you mean "sucker." People who spend a ton of money on this stuff are buying some VERY overpriced equipment. Just because something is the most expensive in the world doesn't make it the best. And tubes? Yeah, you can make a good amp with tubes, but you can make just as good or better of and amp with transistors. (Guitar amps are a slightly different story.) Saying something has tubes, doesn't necessarily make it good.

I've decided to stick to pro-audio gear for all new audio purchases. There's just something stupid about spending $200 on unbalanced phono cables, but "audiophilies" have no problem with that. Nor do they seem to have a problem with $1000 speaker cables, etc.

If you're going to spend a ton of money on your audio system, I suggest you buy the same things a recording studio buys.

Just to show you guys are being a pompus asses, here's a brochure from quad:
here
check out those power amp specs: 108 db SNR

Now lets go look at some pro gear:
Check out the specs. page for this Crown amplifier.
SNR 120dB

People "in the know" don't buy that ridiculously overpriced "high end" stuff, they buy pro grear. It performs wonderfully, takes abuse, and costs less.

Re:Hi-fi elitism

[mkldev]

Exactly. The definition of high-end depends on who you are.

For average audio users, companies like Kenwood and Pioneer are seen as (relatively) high-end.

For audio engineers and other people with discerning ears, Denon, Marantz, Nakamichi, etc. are seen as high-end.

For the folks who blindly believe that they can hear the difference between 48 KHz and 96 KHz audio or between a $5 cable and a $1500 cable, there are plenty of even more expensive brands that are considered high-end....

For people with good ears, Denon and Marantz are high-end. For the rest of you, there's Mastercard.