A statement was due to be released to consumers later this week, however as this information has leaked (in part) I am going to post to the BBS immediately. Please note that the text below may not exactly reflect the official statement, which will be posted at an official web site and through other communication channels. Therefore this should be considered an unofficial statement - but from the horses mouth as it were.

I will add a personal perspective to this in a separate post and answer specific concerns as they are posted.

SONICblue's Future Plans For Car Audio Developments

Following a reassessment of its technology and its primary business focus, SONICblue has decided to change its plans in the car audio market. SONICblue feels that the car audio market, being dominated by high volume production companies, will always be a difficult one to break into with leading edge products in the quantities that make such developments economically viable. Therefore, it has decided not to continue with plans to become a car audio aftermarket brand, other than developments that may grow from its portable-player base to be sold through its existing channels.

The Future

Despite its withdrawal from the aftermarket, SONICblue is now actively working with partners within the automotive industry - car manufacturers, audio component suppliers and existing aftermarket brands - to bring the advances made in SONICblue products such as the Rio car to the wider automotive market. SONICblue recognises that for compressed audio to be widely adopted within the automotive industry, car manufacturers will need to adopt technology which integrates fully into current and future car systems. SONICblue have already developed such a product in partnership with a major component supplier and will continue to push the boundaries of in-car music systems.

The Rio Car Player

SONICblue's current aftermarket product, the Rio Car, remains the most advanced car player available and will continue to be sold through their e-stores until inventory is exhausted. This is likely to be within the next 3 months.

Non USA: http://www.empeg.com/store/
USA: http://store.sonicblue.com/

All warranties and support will continue, as will the development of new software, which is important for SONICblue's goals of integrated products and its work with the automotive industry.

For further information, contact: carinfo@riohome.com

The first point I want to make is that software development for the car player is not going to be dropped. We are releasing 2.0 builds to the alpha team this week, and hope to get an early Beta out as soon as next week. After that we will continue to add features and fix bugs with small but frequent updates, just like the old days.

It has been suggested that the code should be open sourced - there's no chance of this happening, as the codebase is still of great value to SONICblue. It is crucial for both our automotive and home audio strategy.

Rob

Wow. This is very disappointing. My condolences to everyone in the empeg family. Any idea how many mk2s have been sold since release? All this after the tuner has just come out within the last month. Are there any plans to sell the hardware design to someone else? Are the plans for voice recognition going forward?

Best of luck to everyone that got laid off.

Sean

May I ask what does this exactly mean?
If I am not mistaken, this means:

1) Empeg no longer produced
2) Guarantee and support still valid and operating
3) Possible future restarting of the empeg project in partnership with other major aftermarkket car-stereo companies.

Right?

I am very disapponted with SonicBlue.

Taym
_________________________
MK II BLUE/RED 12GB #923

It's not "possible restarting", we've been working with other car audio manufacturers for a while. (1) and (2) are correct though, with the addendum that the empeg/rio-car software is still in active development, showcasing our IP and testing out new concepts.

It's unlikely that any major manufacturer would produce something as geek-friendly as the empeg/rio-car though - the market in general is simply not willing to pay for (for example) ethernet on a car stereo. This sort of thing usually never leaves the engineering department's workbench - however, in a freak accident involving slashdot, the empeg-car escaped :)

The empeg/rio-car as-is sells only to a small niche of the car audio market - where geeks and audiophiles intersect. The very fact it ever happened is because we (at empeg) wanted to make a cool toy - we only originally planned to make 100 of them.

If we'd been really commercially minded (as empeg) we would have made a rather boring, functional box that did the job and nothing else. We probably would have sold a pile more of them, but it would have been a lot less fun - both for us and our customers.

In the future, the freedom and flexibility you see in the empeg-car will just be taken for granted; it'll become a baseline feature of cars. You're just several years ahead of the game ;)

Hugo

I am speechless. Hugo, tahnk you for the high consideration you have all of us here. Non need to sat that it is definitely recirpocal.
Still, I can't help being sad for such a nice project to be even just partially shut down. Empeg will become a sort of collectible, and probably high priced in the secondary market.
Too good to be for everyone, it seems.

Well... Good luck to all of you, an thank you again for the great service you offered and are still offering to all of us.


Taym
_________________________
MK II BLUE/RED 12GB #923

Anyone who is "on the fence" about purchasing a player... I don't know what to tell you except that any player to be released by another company will most certainly NOT have the flexibility of the empeg/RioCar and will have MUCH stricter copy-protection. I am guessing that software updates will not be possible because USB will most likely be the only connection. (FWIW: As far as I know, Sony has only had ONE product in all its history - a high end home audio processor - that had a data port for software upgrades. Also, as far as I know, there have never been any software updates in the few years it was made.)

What I'm worried about is if my faceplate cracks or chips, or if I want a second sled, or if my buttons wear out.... I'm toast.

32GB Mk. II in a WRX
Detroit, MI USA
www.PfeifferBeer.com

We sold about 1000 Mk.2 players (empeg branded) and rather fewer Mk.2A (Rio) players so far. We expect a final userbase of around 3000 Rio Car players, as it seems likely the remaining stock will be bought up very quickly following the EOL announcement.

Rob

Hi.

I'm really confused by this whole decision. I simply can't find the reasoning behind it. If it is true that the software development for the empeg/riocar is continueing (how long?), the only cost that is involved with selling the empeg is the cost of actually producing the units and the cost of the shop. Now if SonicBlue is not selling the empeg at a price below their own costs, further production of the unit and further selling of it would not lead to a loss but to a gain in revenue, not?
If I understand the whole process of producing and selling the empeg correctly, then there are the following five things involved:

1. Hardware development: Done, nothing to do anymore if not for a successor.


2. Software development: Not finished yet, but this will not be stopped anyway, as the statement stands


3. Production of the units: This is stopped


4. Selling of the units: This will be stopped as soon as they are out of stock


5. Costumer service: This is said to continue

Ok, what did I miss?

Anyhow: I'm really disappointed by this decission. The tuners just got available and the unavailability of those was a major drawback on empeg sales as far as my friends are concerned. Contracts with large distributors were just signed some months ago, obviously no large scale marketing efforts were made to introduce the empeg/riocar to the market. What did SonicBlue expect? Did they already plan to stop riocar production when purchasing empeg Ltd?
What bugs me most is that I just made some free time available to actually start the development of an empeg based navigation system, and thought that such a system would really make the empeg/riocar a killer device for everyones car. But now I really don't see any reason to develop such a system anymore, there just won't ever be a market for it, if riocar sales are stopped. Not that I wanted to make money by selling the system (it was going to be strictly open-source as far as possible), but if there are only 3000 or so riocars out there, how many of those owners would want a navigation system on it, or how many of those owners would help developing it?

frustrated,
sven

proud MkII owner (12GB blue/green/smoked, was #080000113 is #090001010)

There are a number of reasons behind the EOL. These include:

1. Very low margin (very high production costs)
2. Low level of sales, both online and in retail
3. Much of the tooling is now worn out (empeg could only afford soft tools) and retooling isn't cost effective given (1) and (2)

It has been our intention for ages to drop the Mk.2A after the current production batch, and we were some way into the design of the Mk.3. What became clear is that SONICblue don't have the production and marketing resources necessary for a consumer automotive product. What we DO have are some great designs and some great software - OEM arrangements are the obvious solution.

Rob

Well I definitely want a navigation system on mine!

(list 6284, Mk1 S/N 00299 4GB blue [for sale]. Mk2 S/N 080000094 26GB blue)

Yes, the Riocars are selling at a profit. However, there is a significant amount of capital investment in stock, and people's time in manufacturing to keep making these. None have in fact been made for several months.

The company has seen a lot of rationalisation, and part of this process is concentrating on products which offer the best return. Though good margins are made on the rio-car, the sales volume is very low, especially when compared to their other product lines.

A nav system would be very nice, and I would suspect that the several thousand owners would both appreciate it and also be the most likely people to help you developing it; the wider market just wants to buy working stuff, not self-assembly kits.

Looking into the future, aftermarket car audio is going to become a very hard sell as installation becomes a bigger and bigger issue with custom dashboards, close integration with car systems, etc. Getting the technology into the car as it leaves the factory is the best way to reach the market.

Hugo

Yep, makes sense. You guys have been telling us for a long time now how expensive the things are to produce.

Before everyone gets overly excited about the now still born Mk3, it was supposed to be a more a high volume oriented unit without all the cool geek bits that the Mk2 has wasn't it?

(list 6284, Mk1 S/N 00299 4GB blue [for sale]. Mk2 S/N 080000094 26GB blue)

The buttons are off-the-shelf items, and as for button caps... we have about 1000 spares here :)

We also have good stocks of faceplaces (including blue when they arrive from the coating company). Sleds are also coming into stock now, as you can see on the EU store.

Hugo

Well, needed some time to reply to this, even though I don't have much to say.

I am very sad to hear these news, I must say that the Empeg was a product that just completely matched me. It was perfect, it had even more than I expected and imagined. With its open design, I thought this would be an item that would last for years to come, and this was one of the main reasons to buy it, in spite of its high price.

All I can say is that I seriously hope for other companies to go into a similar direction, even though there is probably no hope for it, given the fact that "open design" seems to be feared by all major manufacturers like the devil fears the church.

Till

I'd seriously want a navigation system, too! Having access to a GPS and having such a cool thing in my car, this would be the ultimate combo.

I'd help out if I could, but I don't have any experience in that field. I could do the user interface. :)

Sven, don't drop the project!

Till

yoiks. ah well, all good things must come to an end... or a slow crawl at least. ya know what's scary.... i'm SERIOUSLY considering buying a new one and storing it in my closet just to have a backup. Hugo, is VR still continuing in development? I didn't see an answer to that question.

sad sad day. I was sooo looking forward to a full color nav capable VR controlled mind melding MkIII.

PS, i'd definitely help on a nav project. Like tigloo said... i could help on the interface or web site or server space no problemo.


|| loren.cox ||

the Empeg was a product that just completely matched me. It was perfect

Max Headroom?

Peter

The VR project is continuing, however if we are to bring it to existing owners at a reasonable cost we are going to have to either find a major OEM customer to cover the licencing, or come to an arrangement with the vendor.

We'll cross that bridge when we come to it.

Rob

H-h-h-h-ow do you kn-n-n-ow?

tigl-l-l-loo

however if we are to bring it to existing owners at a reasonable cost we are going to have to either find a major OEM customer to cover the licencing, or come to an arrangement with the vendor

Sorry, but just to clarify... a reasonable cost for SonicBlue or a reasonable cost for the customer?


|| loren.cox ||

That will depend on the criteria that I raised in my earlier post. Right now there is no budget for voice recognition, so we hope to either attract an OEM client with a VR requirement or persuade a vendor to work with us for various benefits we may be able to bring to them.

This isn't an issue until later in the project - we're working with eval licences at the moment.

Rob

Rob, I don't know if this was covered, but I have a question about the tuner. I was planning on getting a bit more cash on hand before buying one, and Im worried that not enough have been made for those who want one. How many were made?

And to people ordering them, are they going through now? I was also skeptical about the ordering process.

DiGNAN
Ob-La-Di, Ob-La-Da, etc.

The first batch was 1000 units; I believe that if it looks like we'll be getting through these (and at the moment, it most definitely does) there are no issues with building more.

They are being shipped, though we don't have visibility on the US eStore stock levels. We've got plenty in the despatch room here though :)

Hugo

What about a "pre-purchase" contract for VR to fund 'custom' development.

i.e. 1000 of us pay $100 up front for VR development

john

I personally wouldn't be willing to pay that much for something that was promised as being included a LONG time ago. I don't mean to be all bitter about it, especially in light of the announcement, but it would suck to have to pay $100. I've sunk enough $ into this thing already! heheh.


|| loren.cox ||

Just a question, to reassure my mind. Suppose the customer base decide to try and get a GPS (or for that matter some other extention to the standard player software) package working, can they count on help from the Empeg people.

What I mean is this, at some point or another to make a NAV or any other software addition possible or should I say useable it will have to be integrated in some way with the player software. Even if it is only just so they look and feel as one program (the plugin idea that was discussed in the past).

With this EOL decission (snif snif) I would like to get some idea on wether this is still something that we will see at some time. Considering software development is continueing I would think so but then on the other hand I would also think that SonicBlue would limit such development to things it can use in the RioCar AND other products (as opposed to JUST the RioCar).

I think a lot of us would feel more comfortable knowing such a plugin system will be designed, this way consumers could go on should SonicBlue ever decide stop new developments on the software side too.

Mk2 - Blue & Red - 080000431

ya know what's scary.... i'm SERIOUSLY considering buying a new one and storing it in my closet just to have a backup

I know what you mean. I've only got mine since last thursday and I'm already head over heals in love with it. I hope it will last forever, but I shouldn't be that naive.
Damn. If I hadn't bought one just last week I would consider it.

Riocar 10gig (for now) S/N : 10101747 amber

Greetings!

I know what you mean. See here.

Paul G.
SN# 090000587 (96GB Smoke)

Rob, to clarify, do you mean just for 2.0 or are we still talking about 3.0 and beyond?

I'm just thinking about about the Vorbis/AAC/WMA/WAV support, etc, and the visualisation library, etc.

Paul.

Paul Haigh, Reg. 4120
(mk1) 6GB, Blue, 00254
(mk2) 12GB, Red, 00357