Michael Jones Posted May 4, 2001 Posted May 4, 2001 ...but have no pity for thee all the while. The failure of any company is very sad to say the least. Not only for the customers and dealers of their product line, but for the people who have worked to maintain the company and the families that are hurt by the fallout. Having said that let me get to the point. In today's marketplace there is no success in maintaining the status quo. You are either an innovator, a leader, or you are yesterday's news. The unfortunate part about Alesis lies in the fact that for the most part they are relying on "yesterday's" technology to sell today's product. Ain't gonna happen! ADATs are a dead issue. Hard disk recording (and cheaply at that!) is where the market has been headed for a long time. To be manufacturing and distributing ADATs in a marketplace that has moved on to a different venue is nothing less than financial suicide. And if you are going to manufacture quality hard disk recording systems you had damn well be able to do it better and cheaper than the competition if you want to stay alive in the hardware business. Where is the recent innovation from Alesis? The Andromeda? Too little, too late! Our world in the market is a very limited and exclusive one. The technology moves so incredibly fast that it is difficult to keep pace with it just from the standpoint of being able understand it. Just about the time you think you have a handle on a specific technology or platform, someone comes along and changes the rules. Players in the marketplace MUST BE cognizant of the this fact. Without being on the cutting edge of innovation you are basically toast. Unfortunately this is exactly what happened to Alesis. I know there will be people who read this post who will adamantly disagree with my position, and I wholeheartedly welcome you to do so. There are also those person(s) who are diehard ADAT users who will dispute my postion on ADATs. You are welcome as well. And there will also be the Alesis loyalists that regardless of any position will remain loyal to Alesis. You are my heroes! But the fact remains...regardless of where a company is positioned in the market, without very heavy dedication to research and development, and without a cutting edge product you are out of business. The unfortunate mistake Alesis made was holding onto old technology at a time when the industry was moving onto other avenues. And one other unfortunate misjudgment on Alesis' part was no hype. Here is an industry that thrives on the latest and greatest. However we require a lot of fanfare to accompany the pomp and circumstance that comes with the release of new products. The market will eventually bear the burden of success or failure of a given product or idea, but without a lot of yelling and shouting on the advertising end of the business we don't give it a second look. Think not?...remember Iacoacca's (forgive the spelling!) statement? "Lead, Follow, or get out of the way!" That advertising hype got people's attention. Never mind he completely restructured Chrysler and actually repaid money borrowed from the US Government earlier (much earlier if I recall correctly). Without the ad hype, fanfare, and hoopla it would not have happened. Off the subject...it is this same lack of ad genius that is the reason Chrysler is failing now!.... Moving right along..... I am fully convinced we are going to see more good companies come to naught in the near future if there isn't some good old barnstorming on their part to garner our attention and monies. This business has and continues to be a very competitive and vicious when it comes to influencing you the buyer to depart with your monies. Only those companies who realize that survival is a combination of cutting edge technology derived from exhaustive R&D, in tandem with a viable marketing plan and product availability will survive. While it is unfortunate for Alesis and those persons involved with company that they are forced to suffer the consequences of a Chapter 11, I have no sympathy for them. My money has no desire for second best! First Alesis....who is next? The K? Remember the Music! Michael This message has been edited by midirat on 05-03-2001 at 07:13 PM This message has been edited by midirat on 05-03-2001 at 07:16 PM This message has been edited by midirat on 05-03-2001 at 07:35 PM This message has been edited by midirat on 05-03-2001 at 07:37 PM "I may be a craven little coward, but I'm a greedy craven little coward." Daffy Duck
dansouth Posted May 4, 2001 Posted May 4, 2001 Few companies have been more innovative than Alesis. I can't think of a single American company that can compete with their track record. (Mackie may be the nearest.) Innovation is an issue, but cash management is the bigger problem. If you spend as though you're always going to have a hit, you'd better be producing a new hit product every year or two. Yamaha and Tascam have had some major successes over the years, and they've also gone through some long dry spells. They didn't collapse, though, because their respective business plans were frugal enough to get them through the rough years. I have not seen Alesis' books, obviously, but I suspect that they are cash poor. It's difficult to ship products if you can't get the suplies to build them, and you can build them if suppliers refuse to extend credit to you for the purchase of raw materials. Debt restructuring may resolve the bind and help Alesis to get the conveyor belts rolling again. Interest rates are very low right now. This seems like a good time to borrow for capital investment. If Alesis' management can reign in the spending and get some cash flowing, they will come out of this with flying colors. It doesn't sound as though they're putzing around over there.
Tusker Posted May 4, 2001 Posted May 4, 2001 Midirat: I have a different position. I feel sorry for Alesis and the familes affected, also. I believe that something good can come out of the re-organization despite the pain. And I hope it does. It's a wonderful company with some wonderful people in it. I wish the very the best to them and their families. But I feel very sorry this happened for a number of purely selfish reasons: - The A6 may be delayed (As a musician i'd like it to succeed so I can have it and it's descendants, someday) - Yet another american manufacturer is going to have less freedom to pursue innovations. I would expect a very 'disciplined' business plan, not an 'inovative' one. Expect less fun products. - It tells me something about our industry I don't like to hear. Our industry is punishing a company that took risks (the A6 was a huge one). This tells me that the market/industry does not support the kind of risk taking I would like to see. So I perhaps I should expect more boring devices in the future, all aimed at the same mass produced sweet spot in the market. Alesis was rewarded when they served the "average project studio" in a mass produced way. Expect less fun products. I suspect that it some ways the problem was one of revenue timing and estimation, but the "lessons learned" by manufacturers from this, may be broader and more unpleasant. The bell tolls for us. Respectfully, Jerry ------------------ www.tuskerfort.com
dansouth Posted May 4, 2001 Posted May 4, 2001 Tusker - good points. American companies spend very little on R&D. The pressure is always on quarterly results. If you have a few bad quarters, the board and stockholders call for your head. It's hard to push the technical envelope and still have a rosy bottom line, quarter after quarter. I don't want to see the A6 become a museum piece. There are already enough analog synths in museums.
Guest Room Warrior Posted May 5, 2001 Posted May 5, 2001 I don't think that Alesis is being punished for innovation (although they have certainly been a leader in that regard). I think it's simply a case of a company diversifying too far afield from their core business. If I ran Alesis (and I'd probably take the job, if asked http://www.musicplayer.com/ubb/smile.gif) I would ditch entire product categories, sell off the circuit designs for cash, and work to establish the ADAT brand in non-tape technologies and re-establish the synth line. Outboard gear, near-fields... you're only going to get killed in those categories. I think they just got spread too thin. They are far from dead. The established user base is huge, and LightPipe is everywhere. They'll find a white knight, and could come back stronger and more innovative than ever, if they concentrate on their core businesses. This message has been edited by Guest Room Warrior on 05-04-2001 at 05:32 PM Jim Bordner Gravity Music "Tunes so heavy, there oughta be a law."
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