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Inside the Gibson/Onkyo Marriage

Partnership could produce headphone line, mobile drivers, high-bit streaming

February 20, 2012
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The first product dealers and consumers can expect from the recent marriage between Gibson and Onkyo will most likely be a headphone line, followed by a music-enhancement driver for mobile devices. After that, the sky's the limit.

"We have a lot of ideas," Henry Juszkiewicz, chairman and CEO of Gibson Guitar recently said during an interview, along with Munenori Otsuki, CEO and president of Onkyo. "At the end of the day, though, it's a skunkworks, so you don't really know what's going to come out of it."

Gibson recently became a majority stockholder in Onkyo and an owner of 51 percent of Onkyo's U.S. distribution. Onkyo also bought stock in Gibson, and the two companies have formed a joint R&D venture, "a type of skunkworks," Juszkiewicz explained, "to develop game-changing products."

The executives didn't give release dates for the new products, but they both said they are eager for development to begin.

"The point is that you're unleashing people from the day-to-day business. You're allowing them the freedom to pursue all sorts of whacky ideas," Juszkiewicz said. "Our expectation is that we're going to be funding game-changers; not incremental, a little louder, a little better, but game-changing ideas utilizing the futuristic trends of the industry."

Juszkiewicz has been interested for years in investing in an audio company, mainly as a way to expand the Gibson brand into the CE space, which is much larger than the MI (musical instrument) arena.

"There are 20 times as many consumers that would be able to get the benefit of our brand," he said. "It's a much bigger sandbox."

 On the flip side, Otsuki said Onkyo wants to tap into Gibson's marketing expertise in higher-end and specialty demographics. "Going upstream, we need some marketing know-how, then we can explore the product lineup," he said.

Under the new partnership, Otsuki is interested in developing drivers for the iOS and Android mobile platforms that will improve the playback bit rate and "change the consumer music experience," he said. The partners said they might also begin exploring the development of a high-bit music streaming service in the U.S. But that won't happen anytime soon.

"There's a music streaming service in Japan that streams in 24-bit 96 kHz; full professional quality that goes directly to receivers, so you get this incredible quality," Juszkiewicz said. "They have a bunch of stuff only in Japan that should really be everywhere. In order to do that, you have to have all these pieces in place. I think we'd be able to pull that off worldwide, although it would take awhile."

 

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