The Rise and Fall of Onkyo

By listener request, we learn about the history of the Onkyo company and brand. From its humble beginnings in 1946 to the declaration of bankruptcy in 2022, we learn how this company fit into the hi-fi audio equipment landscape.

See omnystudio.com/listener for privacy information.

Episode Transcript

Speaker 1 (00:04):
Welcome to tech Stuff, a production from I Heart Radio.
Hey there, and welcome to tech Stuff. I'm your host,
Jonathan Strickland. I'm an executive producer with iHeart Radio. And
how the tech are you? You know? In a tech
News episode a few weeks ago, I mentioned that the
company on Chio, which created an audio equipment brand that

(00:27):
was well known and respected in the A V world,
was going out of business. I also mentioned that the
brand would actually live on because other companies had sort
of swooped in to purchase those assets before the demise
of on Chio, and it appears that the plan is
to continue producing equipment using those assets that will presumably

(00:50):
carry the Onchio brand names forward. Then I asked if
y'all wanted me to follow up on that and do
an episode on it, and y'all said, yeah, us at
least five of you did, So here we go. That's
that's a bar that I am happy to hit. Now,
before I really jump into things, let me give a
few caveats up front in this episode. First, there actually

(01:14):
are not a ton of great resources that chronicled the
history and evolution of on Kio, So there are going
to be some gaps in this episode. And we should
probably consider any dates I talk about beyond like really
formative ones like the founding of the company, to be
more or less approximate. Also, many of the resources I

(01:37):
uncovered were obviously originally written in a language other than English,
and the translations vary from pretty good to this is
unintentionally disturbing. For example, one source I came across described
a moment in an on Kio commercial that totally gave
me the creeps, and I'm gonna go ahead and read

(01:58):
what it said, because should I be the only one
to suffer? This is literally how it read. Quote Yoko
Mina Mino and Idol speaks in a moist voice. I
want you to like it slowly. This is a scene
from the commercial of Radian, a popular mini component system

(02:19):
of a Kyo In end quote, yeah, have fun getting
that out of your head, because it's been haunting me
for days. Anyway. My point is that the combination of
scant sources and questionable translations, also some sources contradicting facts
that other quote unquote facts that other sources are are listening.

(02:41):
All of this means that we could be jumping around
a little bit and taking everything with a grain of salt.
Beyond certain things that are pretty certain, I usually would
default to the company's own history sources over everything else,
thinking well, that's going to be the most reliable. But

(03:02):
there's at least one instance where I feel like that
was also incorrect, and we'll get to that all right,
back to a Kio. As we'll see, the story of
on Kio includes more than one moment where the entire
brand could have disappeared, and that only thanks to some
other companies was on Kio able to keep going. Sadly,

(03:23):
it's luck was bound to run out at some point,
and that seems to be what has happened now. But
our story begins back in the early nineteen hundreds, and
in fact involves not just on Kio's founder, who is
Takeshi Godae, but another really important person in Japanese tech
and business, Konosuke Matsushita, the founder of the company that

(03:46):
would ultimately become known as Pana Sonic. Konosuke Matsushida became
childhood friends with Takeshi Godai after taking a job at
the Goodai Bicycle company. Mattsushida would later moved to Osaka
take a job at the Osaka Electric Light Company. Work
his way up quickly in that business, and in nineteen seventeen,

(04:08):
Matt Sushida would leave to found his own electronics company,
initially focusing on stuff like bicycle lamps and light sockets.
This is the company that would ultimately become Panasonic, and
it would take a few years for that company to
find stability, but after that it grew pretty quickly, and
Matt Sushida would eventually bring over his childhood buddy Takeshi

(04:28):
Good Eye to oversee a manufacturing facility dedicated to making
speakers loud speakers. After World War Two, Matt Sushida's company
was actually in danger of being split up by the
occupying forces, primarily the United States in Japan. That was
something that was happening to a lot of Japanese companies

(04:49):
because Japanese companies had sort of a dynastic structure. There
was very much a kind of inherited structure for companies
where they would belonged to a family or maybe a
small group of families and um. The concern by the
occupying forces was that this was concentrating power in a

(05:10):
way that was harmful at least to United States interests.
So around that same time, Matt Sushida's company spun off
its audio production operations, which gave Takeshi the opportunity to
make his own decision to found a company of his
very own. So he did, and he called it Osaka didn'

(05:32):
ki a kyo kk on Kio means sound acoustics, and
Takesh's dream was to create a company that could produce
higher quality dynamic speakers than what was typically available on
the market in Japan, and he founded that company in
April of nineteen forty six. The next month, on Kio

(05:55):
introduced its very first product, but this was not a loudspeaker. Instead,
it was a cartridge pickup for record players. This is
the part of the record player that has the stylus
or needle inside of it. That needle will vibrate as
it moves through the grooves of a record, so the
needle kind of navigates this canal in the form of

(06:17):
this groove, and the variations in that canal cause vibrations
through the needle. Uh and a very small, very sensitive
electro magnet in the cartridge would convert the vibrations into
a weak electric signal, and then when amplified, that electric
signal would be able to drive speakers that could play

(06:39):
back the recorded sound represented by those grooves in the record.
Super cool technology. It's been around for more than a
hundred years now, according to one source, which was a
thorough source, but also impossible for me to verify because
I could not find any corroborating evidence. So again, take
this with a grain of salt. This original product sold
for a three yen in ninet. If that is indeed true,

(07:04):
it would have been incredibly expensive. But again, the source
I found was one that doesn't even exist online anymore.
Actually had to use archive dot org to even get
a copy of it. Like I found a link to
the source in a forum about on chio. I followed
the link and got a four oh four error. So
I went to archive and actually found a snapshot of

(07:27):
the uh the link from two thousand and twelve in
order to actually read this. And again, like I said,
I couldn't find any corroborating evidence. So we're just kind
of going to assume that the product was expensive. It
would have made sense. You know, electronics typically when they
first debut in a market, tend to be very very expensive.

(07:48):
They're expensive to make, and so the manufacturer passes that
onto the customer, and thanks to you know, bleeding edge
early adopters who have a lot of disposable cash. Then
eventually the price comes down because manufacturing improves and you
start producing at scale well despite the cost. At least
according to this one source, the products sold well enough

(08:10):
for to Cache to mark those profits toward developing a
loudspeaker research and development division, as well as set money
aside to pay for the construction of a factory. That
part is absolutely true because by January, two years after
the company had been founded, the company had built its factory. Now,
one of the first things that that factory began to

(08:31):
produce were speaker cones, which means we should probably take
a quick moment to explain what speaker cones are and
what they are for. So briefly, a loud speaker or
just speaker for short, takes an incoming electric signal, feeds
that to an electro magnetic set up, and that in

(08:52):
turn drives a diaphragm or cone to move inward and outward,
which creates fluctuations and air pressure that we perceive as sound.
So inside a speaker you typically have a permanent magnet
that's attached to the chassis of the speaker itself and
suspended in the speaker is a coil of conductive wire,

(09:15):
and as electricity moves through the coil, it creates a
magnetic field, the magnetic field, and the coil interacts with
the magnetic field of the permanent magnet. And depending on
the direction of the current, because we are working with
alternating current here, the magnetic fields either repel one another,
which forces the coil outward from the speaker, or they

(09:37):
attract one another, which pulls the coil inward toward the
speaker or the back of the speaker. I guess well,
that coil in turn is attached to a cone or diaphragm.
Typically there's a connector sometimes it's a direct connection, but
usually there's a a component that serves to connect the
coil to the cone, and the cu own is secured

(10:01):
to the speaker at the wide end. So if you
think of a megaphone, the part where the sound comes
out is the bit where it would attach to the chassis,
and it's the narrow endo the cone that attaches to
the coil. So the movements of the coil push and
pull on this diaphragm. The stiffness of the material of
that diaphragm, as well as the size of the diaphragm,

(10:24):
will affect the quality of sound that comes out of it.
Larger diaphragms can be much louder than smaller ones and
generate lower frequencies of sound as well. Your basic subwhiffer
has a larger diaphragm than say, a tweeter speaker would,
and there's a real art and science to creating the
right cone shape and the right stiffness for speakers. Typically,

(10:47):
speakers have a range of frequencies and volumes that they're
very good at reproducing. But beyond that range, if you
try to go either higher frequency or lower frequency, or
turn up the volume more than the speaker can handle,
things start to get ugly. And a lot of those
factors depend upon the cones material and shape. On Kio,

(11:09):
like other companies in the loudspeaker business back in the
early days, was producing paper cones. Paper in this case
includes cones that have materials like wool or even synthetic
fibers interwoven into them, so it's not you know, it's
not like printer paper or notebook paper or anything like that.
It is a type of paper just as currency tends

(11:30):
to be a special type of paper that has various
fibers interwoven into it, so are speaker cones. And soon
the company had its first real hit. One early speaker
released by on Kio was the e D one hundred.
It had a driver measuring times or about ten inches across,

(11:51):
and it was also expensive, more expensive than its nearest
competitor according to a Kio itself. And yet despite that expense,
it sold well as reviewers praised it for the sound
replication capabilities that it had. And from what I can tell,
this was just the speaker itself, like just the actual

(12:13):
speaker part, not the cabinet that would house the speaker.
Now I could be wrong about that. Maybe they produced
an entire cabinet for this, but to me, it sounds
like it was more of an O e M product.
So O e M stands for original equipment manufacturer. It's
a common term in business. These are the companies that
make components that other companies used to put into their

(12:37):
own products. So a lot of those types of companies
have names that you probably aren't that familiar with because
we are not the customers for O e M s, right,
we don't go out and buy O E M products
for the most part. I mean, there are places that
will sell them, to sell the O e M components
where you can do things like do a repair or

(12:58):
something to a product, but typically we're more familiar with
the consumer companies that the consumer brand companies UM not
the O E M s, but other companies are the
customers for those O e M s. Uh. If you
think of it, Fox Con which is the company that
Apple relies on for a lot of the assembly, can

(13:18):
kind of fall into this business to business category. So anyway,
all of that would have been an irrelevant tangent if
in fact the E D one was a full cabinet
speaker product. But all the photos I saw of it
have been just for the speaker part itself, as if
you had taken a cabinet apart and pulled the speaker
part out and just had that. That's what all the

(13:40):
pictures show. So my guess is that's exactly what it
was when a Kia was selling them, and some other
company would do things like create the cabinets or chassiss
that would hold this loud speaker. Now, in nineteen fifty
on Kio filed for a patent on nonpressed cone drive
unit technology. All right, this brings us up to pressed

(14:01):
versus nonpressed That refers to the process of making speaker cones.
Press cones typically have a more uniform density and stiffness,
but they also tend to have a smaller surface area
than non pressed cones. So nonpressed cones, while not being
quite as consistent and sometimes having some quality issues, are
able to move more air, and they could be louder

(14:23):
than a similarly sized pressed cone. At least that's what
I've come to understand on the matter. I started going
down the rabbit hole of this and quickly discovered that
speaker cone technology can be treated with a complexity and
reverence I would normally associate with quantum physics. Well, we've
got a lot more to say about on chio before
we get any further. Let's take a quick break, all right,

(14:52):
My understanding about pressed versus non press cones really, non
press cones, mostly we can just say, tend to be
more power efficient and can produce louder sounds than similar
sized pressed cones, But they also vary in quality, and
therefore you cannot be absolutely certain that you're going to
get the absolute best from a non pressed cone nt

(15:15):
This was also when on Kio introduced the on Kyo
o P six seventy, which was a high fidelity audio
system complete with four speed turntable. And if you're like
a lot of folks, you might be saying, wait, a
turntable with four speeds. I think most people who have
played with turntables they know that there are two standard

(15:36):
speeds that you pretty much find on every single turntable
slash record player that's out there. There's forty five rpm
r VM O course, stands for revolutions per minute, meaning
the turntable will turn forty five times every minute. This
is usually reserved for seven inch records. Typically they are singles,
which means you know, you have like a single song

(15:57):
per side of the disk of the wreck, and then
you have thirty three RPM, or really thirty three and
a third, and this is what we typically use for
long play albums or LPs, the larger records. Right, most
people are familiar with that. Now beyond that, there are
some folks who are probably aware that older turntables in

(16:18):
particular often had a seventy eight rpm setting, so it
would turn seventy eight times in a minute. Uh, that
has dated back to some of the earliest records. You
don't typically find seventy eight rpm records these days. I'm
not saying no one's making them, because I'm sure someone
out there is, but but these were the early early records. However,

(16:41):
did you know And some of you probably do, but
I doubt everyone does that. A few systems also included
a fourth speed, which was all the way down to
sixteen rpm. Technically it was actually sixteen and two thirds rpm,
half the speed of thirty three and one third. If
you're wondering why these odd speeds are hitting these these

(17:03):
seemingly arbitrary numbers, it actually has to do with the
gear ratios that were used in turntables, um, because it's
the it's the ratio of these gears that determine what
speeds you can have something turned to based upon the
speed that the motor works at. And it's really fascinating.

(17:24):
But the reason for of these these numbers, UH really
has to do with the capability of an electric motors
that turn at a very specific speed and thus, by
using gears, you can gear up or gear down that speed. Right.
So that's that's why they are all these weird ratios
of thirty three and a third or sixteen and two

(17:45):
thirds or seventy eight. Now, when I was a kid,
I was convinced that the purpose of these different speeds
on turntables was really so that you could turn up
any LP or thirty three rpm album into a Chipmunks album,
because if you play a thirty three rpm record at

(18:06):
forty five rpm speeds everything you know, speeds up and
all the sounds get pitched up, so it is hilarious
if you're you know, nine, or in my case, forty six. Conversely,
if you play a forty five rpm record at thirty
three rpm while then everything slows down and pitches down,

(18:28):
and I can tell you that the effect is often disturbing. Um.
I remember in college where my roommate made an entire
cassette tape where he he recorded songs played on albums
but at the wrong speed, because we had a turntable
in our dorm room and a cassette deck with it too,

(18:48):
and so one day he just spent he spent the
whole day converting thirty three rpm songs to forty five
and vice versa, and listening to that forty five rpm
recording of the BGS, Stay in Alive played at thirty
three rpm was really the stuff of nightmares. I'm amazed
that a horror movie hasn't done that, because it did
sound like it was coming from you know, like a

(19:11):
psychological thriller or something. Yeah, give it a try if
you want, um it's it's it's a juvenile way to
amuse yourself. Highly recommend it. Anyway. The whole thirty three
and a third versus RPM story is rooted in different
music labels attempting to set the standard and then eventually
meshing together so that one format, the forty five would

(19:33):
essentially be associated with singles, and the other, the thirty
three RPM, would be associated with long play albums. But
that speed really does impact other stuff. So naturally, the
faster the RPM, then the faster the turntables stylus makes
its way through the groove of a record, right, I mean,
it's turning faster, so the journey takes less time. That

(19:56):
also means that if you have two albums that are
the exact same ameter, but one is a thirty three
RPM and the other is a seventy eight RPM, well
the seventy rpm record is gonna play through much much faster,
assuming you've you're using the proper playback speed for each record.
Of course, the record spends faster, the stylist gets to
the end faster, which makes sense. Well. Another thing that

(20:17):
the faster speed tends to do is affect fidelity. Slowing
the speed down can impact the quality of the playback sound.
If you go slower than normal, then it's going to
start to sound worse. Slower speeds produce lower quality audio,
is one way to think about it. So that meant

(20:38):
that albums designed to be played at sixteen rpm had
limitations on sound quality. For that reason, most but not all,
of sixteen rpm records were spoken word pieces where the
audio quality wasn't as big of a deal. And I
know that was a tangent, but this is tech stuff,
and that's what I do. If I didn't described technology,

(21:01):
then I wouldn't really be doing the show, right. So anyway,
if you weren't familiar with four speed stereos, now you
know they could play albums at sixteen thirty three r
p M. I'm sure some of you out there have
had experience with these. I don't think I've ever seen
a four speed I have seen three speeds, but I
don't think I ever at least I definitely never owned

(21:23):
a four speed turntable. Now, on Kio was already off
to a fast start. By just four years after opening
its first factory, it was time to move into bigger digs.
The company expanded both its factory space and it's office space.
The next year, on Kio re released the e D

(21:44):
one hundred loudspeaker, but this time they changed out the
cone material. The loudspeaker had the non pressed cone design
in the new version. You know, the original e D
one hundred was a pressed cone one. But now on
Kio had filed for its patent for non pressed cone
technology and was able to incorporate that into the e

(22:05):
D one and the improvement and sound quality garnered more
positive reviews from critics, so on Kio's reputation in the
audio world in Japan was on the rise. Now this
next bit I have to take issue with. According to
on Kio's own website, the company introduced a transistor radio
in nineteen fifty three called the OS, complete with a

(22:29):
speaker cone measuring twenty centimeters across, which was a much
larger speaker cone than what you would typically find in
transistor radio's at the time. However, the issue I take
isn't with the speaker size. That's fine, that's with the
year nineteen fifty three. See the general agreement is that
the first commercially manufactured transistor radio was the Regency tr

(22:55):
one that didn't hit store shelves until the end of
nineteen fifty four, and I cannot find any corroborating evidence
that suggests the OS fifty five debuted in nineteen fifty three.
In fact, all other sources say that it came out
in nineteen fifty five. To keep in mind on Kio's
own sources, the one that says nineteen fifty three but

(23:16):
everyone else says no, it was nineteen five. Honestly, five
makes more sense. It would fall in line with the
fact that the Regency tr one is widely considered to
be the first transistor radio that was commercially produced. And
also it would make the OS fifty five name makes
sense right if the fifty five was in fact a
reference to the year in which it came out, nineteen

(23:38):
fifty five, and then you wouldn't contradict the earlier fact
about the Regency tr one. So my guess is that
the on Chio official website has an error on it
in this case, um, either that or everyone has been
wrong about what the first transistor radio actually was. Anyway,

(23:59):
transistors are super neat because they allowed for a miniaturization,
and I've talked a ton about that in past episodes.
So the too long didn't listen version is that older
radios relied on vacuum tubes to act as diodes and
to serve as amplifiers. A diode is an electric component

(24:19):
or electronic component I should say that allows a current
to flow in one direction but not to flow in
the reverse direction, and vacuum tubes were used for that,
and they were used for amplifying a signal, that is,
taking a week signal and then boosting that up to
a stronger signal. Vacuum tubes are large, and they're also delicate,

(24:40):
and they also generate a lot of heat. They're kind
of like light bulbs. Solid state transistors are much smaller
than vacuum tubes, and they allowed manufacturers to make stuff
like radio sets that were much smaller and lighter than
older versions. If you've ever seen like a really old
radio set, you know it's a piece of furniture, it's
a big, big thing. Typically it would have its own

(25:01):
set of legs, kind of like a table, and it
would be a standalone piece. Transistors allowed people to make
much smaller radios, eventually pocket size radios, and uh so
it was a a truly important development in electronics. It
is what allowed us to create manaturized components and have

(25:23):
things that didn't take up an entire section of the
floor like televisions and radios and later on computers. Now
I'm not gonna go through every product released with a company,
at least not in any detail, but the following years
saw on Chio expand into speaker chassis manufacturing, and they
also created a record player called the Kyo HP ten.

(25:46):
From what I understand, this is a record player that
has its own dedicated speaker, so you just you know,
to put a record on it, you plug it in
you that you can play the music straight from that.
It wasn't a component, in other words, it was its
own standal own product. The company also got involved in
TV set manufacturing around this time. Also, in nineteen fifty five,

(26:07):
the company settled on a logo just shy of a
decade of the company's founding I couldn't find any other
information suggesting that they had created a logo before nineteen
fifty five, which is funny. So from ninety five apparently
they didn't have an official logo type. Only a couple
of years later the company would actually refine that logo

(26:31):
type to quote suit the rapidly changing style of the
times end quote. And yeah, this does make sense. Like
the fifties and sixties, things were changing very quickly, especially
in the world of audio equipment, and you didn't want
to get associated with being left behind, right you didn't.
Your company did not want to have this stigma of

(26:53):
being stuck in the past because technology was evolving so
quickly that in order to remain relevant you needed to
change things up. And so it makes sense that even
just a couple of years after they first settled on
a logo type, they would change it. In ninety seven,
the Toshiba Corporation entered into an accepted capital participation with

(27:14):
on Kio. So you might say, well, what the heck
does an accepted capital participation mean? While further documentation reveals
that Toshiba brought up a lot of shares of on Kyo,
a ton of them, like sixty nine percent of the
ownership of on Kio went to the Toshiba Group, with
the bulk of the remainder left over going to on

(27:37):
Kio's founder, Takesh a Go die Um, and some of
it going to some other executives and some members of
good Eyes family. See. While on Kio was introducing new
products and generally receiving a positive reception for them, the
cost of doing business was so high that the revenue
coming in wasn't keeping up. So in other words, like, yeah,

(28:01):
they had a great reputation in the market, but the
market wasn't big enough to support the expansion that on
Kio was doing, and so it was costing them more
to to do business than they were making in revenue.
So despite having huge success in the market, a Kia
was on the verge of bankruptcy and there was a
very real possibility that Takeshi would have to liquidate the

(28:23):
company and go out of business. So the Toshiba Group
represented a lifeline for on Kio, and Toshiba saw the
value of incorporating on Kio's reputation for high quality audio
components into Toshiba products. Plus, a Kio was already serving
as an O E m for Tashiba for television sets,

(28:43):
on Kio was manufacturing TV sets that would later be
sold under the Toshiba brand, so there was a chance
that if you went out and bought a Toshiba branded television,
the actual manufacturer of that TV was on Kio. Also,
a Kia was making its own TV sets the Onkio brand,
so there were both brands on the market in Japan

(29:04):
at the same time. Now, Toshiba is yet another company
that I need to do a full episode on in
the future, but I'm going to resist the urge to
do it right now because you're already gonna have to
put up a lot from me today. Anyway, on Kio's
relationship with Toshiba would end up becoming a bit of
an albatross thirty years later that, my friends, is foreshadowing.

(29:30):
And with that, we're going to take another quick break.
We're back now, getting back to on Kio's history. The
company kept introducing new products, mostly in the audio space.

(29:50):
Much of the work was in loud speakers, including bookshelf
type speakers, which were a fairly new thing at that point.
Now they are sort of a go to speaker style.
You can spend thousands and thousands of dollars getting high
end books shelf style speakers. I know because I've looked
at them. Didn't buy any, but I looked at them

(30:11):
and then ultimately said, you know what, I don't think
I even have a space that would accommodate the way
these speakers would need to be set up so that
I could get the benefit from that. And so I'd
be spending a lot of money on high end stuff
that I wouldn't be able to use properly, and I
talked to myself out of it. I'm proud of myself
for that. However, on Kio also began to produce full

(30:33):
audio systems. They've done a couple of those in the past,
but they really got into it uh in the late
fifties and early sixties. That included things like the on
Kyo ST four hundred d L stereophonic system in nineteen
sixty three and a standalone turntable component in nineteen sixty
six called the ST fifty five. The company even branched

(30:56):
into making radio transceivers, essentially Walkee to Hokey style radios,
and in sixty three, Onkyo manufactured a phonio cardiograph, which
is an actual medical instrument. So they were really diversifying here.
They weren't just making high end audio equipment. They were
making stuff that was related to audio still but had

(31:18):
uses apart from rocking out with the latest record. Now,
this was in the beginning of the real high fidelity craze,
where they started seeing audio files who would seek out
specific components in an effort to put together their ultimate
audio system. So instead of buying an all in one
stereo system, they were interested in buying the individual pieces

(31:41):
and connecting them together to create what they felt was
the perfect sound system. Now I should add that on
Chio had been making components since the late nineteen fifties,
but it was really in the sixties where we saw
the craze really take off. The goal was always to
create the best listening experience, but that's a subjective thing.

(32:01):
So I'm just here to tell you there is no
real right answer for which system or which uh collection
of pieces is the best. It depends on so many
different factors, like the kind of music you listen to.
Because some components are really good at representing or replicating
certain frequencies and volumes that are best for one genre music,

(32:25):
while others are better for a different genre. Plus, listening
is a a psychoacoustic phenomenon, and in that our brains
are interpreting the sound, so that means there is a
filter in our gray matter that affects how we experience sound.
And no two people are exactly the same, So the

(32:47):
perfect system for person A is not necessarily going to
be the perfect system for person B. You can always
hook up components to very sensitive equipment and say, hey,
the number on this piece of equipment is better than
the number on that piece of equipment, and that might
be correct, but doesn't necessarily mean that the experience of
listening to the different components is going to make a

(33:10):
huge difference. So I say that because audio files get
obsessive about the mathematical association of all the different components
from everything from the electrical side to the actual acoustic side,
and I get a little squirrel e when I go
into those discussions, because I feel like people obsess over

(33:34):
things that are largely ephemeral that that we don't necessarily
they don't necessarily translate into how we experience the actual output.
So that's a long way of me saying it's okay
if you go out there to build an audio system,
and you're not going with what someone else says is

(33:58):
the absolute best of the best, because it really depends
on how you perceive it that it's the system that
makes you happy that's the one that ends up being
the best, not the system that arbitrarily hits certain you know,
electronic metrics necessarily that can have an effect, but you
get what I'm saying, alright, So on chios standalone turntable

(34:21):
means that you would actually need to connect this turntable
to other components like an amplifier for example, to boost
the signal, and then speakers to play back the sound,
and on Kio standalone record player, this s T fifty
five would be part of the initial audio file craze

(34:42):
in Japan. UM At this point, on Kio is still
very much a Japanese focused company. They had not really
started massive exports to other parts of the world yet,
so the st fifty five was valued for its performance
as well as it's simplified, no frills aesthetic. The company

(35:06):
continued producing stereo systems as well, adding in new features
and refining designs with every passing year. No big shock there,
and it got into making headphones in nineteen seventy Most
of Onkyo's fame came from its full stereo systems and
the individual audio components such as loudspeakers and receivers, turntables, amplifiers,

(35:29):
and such. In nineteen seventy one, the company changed its
name from Osaka on Kyo k K to simply on
Kio Corporation. Then we get up to nineteen seventy two.
A few things happened that year that were really important.
For one thing, Akio established the Onkio Germany Facility, which
primarily focused on research and development and acoustics, and also

(35:52):
served as a base of operations for marketing and distributing
on Kio products to Europe. So the Japanese facilities would
export products to Germany, which would then be able to
distribute those two retailers in the Europe region. The company
also introduced loudspeakers that used titanium instead of paper for

(36:14):
the speaker diaphragm, and on Kio got out of the
television set business in around nineteen seventy two. This will
also be important when we come back to Toshiba more foreshadowing.
At that stage, an Kio was ready to focus completely
on producing just audio equipment, its dependence on Toshiba had declined,

(36:34):
although Toshiba still owned nearly seventy of on Kio, so
between nineteen fifty seven and seventy two, a Kia was
kind of acting like a subsidiary to Toshiba, but really
starting in nineteen seventy two, an Kio was operating as
an independent company. Yes to Toshiba had ownership interest in
on Kio, but was not directing the company. So this

(36:57):
would be a key argument that on Kio would make
in nineteen seven. Yet more foreshadowing, nineteen seventy two was
also when on Kio introduced the INTEGRAE power amplifier, so
Integra is another brand name under on Kio. People probably
heard of Integral products that came from on Kio. Uh
I also recommend that you Google image the Integra ninety

(37:22):
one power amplifier because it looks unlike anything else that
was on the market at that time. On Kio described
it as having a steam locomotive like design, and I
can see that. On Kio continued to expand and opened
up manufacturing facilities in Korea, so it started to build
out its manufacturing capabilities and in nineteen seventy three, the

(37:45):
company debuted the Intech four oh five stereo system, which
supported quadraphonic sound. I've talked a bit about quadraphonics before. Uh.
Quadraphonics are essentially a surround sound system that used for
or used is four channels, and typically the way you
would set up a quadraphonic listening area is you would

(38:06):
have speakers at your front left, your front right, your
back left, and your back right, and you would be
in the middle and each of those speakers would play
back a distinct channel of audio. There were several different
quadraphonic formats, which probably impeded widespread adoption of quadrophonic sound
because people were using different ways of producing quadrophonic sounds

(38:30):
and they weren't all cross compatible. So I'll have to
do a full episode on quadrophonics in the future, and
maybe I'll even try to record it in a style
that mimics quadrophonic sound, if I'm being cheeky. We'll see.
In nine, on Chio established the Onkyo USA Corporation. That
subsidiary would serve as a foothold for on Chio sales

(38:51):
in North and South America. So, again like the German version,
the USA version would import products from Japan and then
distribute those to US stores and US retailers at least
for several decades now. In nineteen seventy seven, on Kio
once again refreshed its logo. The company also introduced the

(39:12):
Scepter Speaker system, which I thought was super cool. Uh,
this was really for the serious audio file. So the
company offered customers the chance to customize their speakers, and
I'm talking like crazy levels of customization. According to a Kio,
there were one hundred seventy three different combinations possible. If

(39:35):
you had your own idea of what combination you wanted
of speaker drivers, enclosure setups, and more, then you could
do that through the Scepter Speaker system. On Kio even
provided a helpful handbook to guide those who weren't already
obsessively detailed in their approach speeding onward. In nineteen eight one,

(39:56):
on Kio introduced the first consumer high speed dual dubbing
cassette deck, meaning it had to cassette decks and you
could put a you know, a tape that had stuff
on it in one, a blank tape in the other,
and very quickly dub and and copy tape one to
tape two. I'm guessing that that probably set the music

(40:18):
industry into a bit of a tizzy, because the introduction
of any technology that makes it remotely easier to copy
media tends to put music studios on tilt. In a
Kio offered a CD player called the C seven hundred
in some markets, so five still pretty early for CD players.
It was also called the d X seven hundred and

(40:41):
other markets. It featured optical fiber connections between the digital
components and the digital to analog converter. UH. The sales
pitch for that was that it would cut down on
signal degradation between going from digital to analog. You have
to go to analog in order to power analog speakers.
So the idea here was that, oh, we're gonna make

(41:03):
this pathway as clean as possible so that you get
the full benefit of the digital recording UH process. Now
we're up to nine, so we could finally find out
what all that foreshadowing was about. In the summer of
the U S government was proposing a ban on the

(41:24):
sale of all Tashiba products in the United States. Why, well,
have you seen a little movie called The Hunt for
at October or you know, read the book that the
movie was based off of. See in the film, a
Russian submarine commander wishes to defect to the United States.
This was back in the Soviet Union days, mind you,

(41:47):
and the commander is aboard a prototype Russian submarine with
a propulsion system that can operate in near silence, which
makes the submarine very difficult to detect. Well. The US government, meant,
was miffed at Toshiba's subsidiary, the Toshiba Machine Company, for
essentially supplying technology to the Soviet Union that would allow

(42:09):
for the near silent operation of submarines. So kind of
the same as the Hunt for October, right, They were saying, Hey,
you're not supposed to do that. You're not supposed to
supply high tech tools to the Soviet Union. We have
very strong feelings about that. So the US government proposed
a multi year ban on the sale of all Tashiba

(42:32):
products in the United States as a result, which is
pretty wild, right mighty was the missage thereof the actual
sales happened in the early nineteen eighties. Uh So, Toshiba
Machine Company was responsible for that around the early to
mid eighties, and then it was uncovered in the late eighties,
and that was in violation of this policy the United

(42:54):
States had, and that represented a pretty tough choice for
the US government. So, on the one hand, the Soviet
Union was the hated rival of the United States. The
two countries have been in a Cold war for decades.
On the other hand, this was Ronald Reagan's America, and
the general philosophy of Ronald Reagan was that government should

(43:15):
stay the heck out of the way of business. So
you're in a real quandary, right, like, what do you do?
You you hate the Soviet Union, but you've also been saying, hey,
government should not get in the way of business. And
there's a lot more to this story, and maybe one
day if I do a Toshiba episode, I'll certainly go
into more detail about all of that. But the part

(43:37):
that concerns us is that because Toshiba still maintained a
majority stake in on Kio, like it still had that
massive amount of ownership of on Kio stock, that put
on Kio's business in jeopardy as well, because to the
US government, on Kio looked like a Toshiba subsidiary, so
it would also get covered by this ban. On Kio

(43:58):
hired lawyers who filed a mess with the US government,
and those lawyers argued that a Kia was, and always
that mattered, an independent company. Yeah, Tashiba maintained a stake
in on Kio. The Akio no longer made televisions for Toshiba.
It had stopped doing that in the seventies, and on
Kio's products were actually competing against Toshiba products that were

(44:19):
on the market. So a Kia was arguing for the
survival of its business and pleading with the US government
not to lump it in with Toshiba's own operations. An
Kia was able to mitigate the impact of the political
scandal on its own business, so it was able to
remain afloat. In nineteen nine, an Kio got a new president,
takeshe Go Die had led the company from nineteen forty

(44:41):
six to nineteen nine. Now I'm not certain if he
stepped down, if you retired, if he passed away. I
couldn't find any definitive information on that. But the new
president was Sunio Otso, who would hold that position until
nineteen so only from nineteen ninety ton. At that point,

(45:02):
Naoto Atsuki would take over and he would actually stay
on until two thousand nine, so to two tho nine,
and then Munnan Nori Otsuki took on the reins, and
I wanted to get all of that out of the
way to illustrate how one man to Keshi go Die
led on Kio for almost forty five years, and then
the next three leaders in charge were leading it for

(45:26):
the next thirty years, and some for very few, like
four years for the first one. Now we have a
few more things we got to cover with on Kio
before we wrap things up. In two thousand and twelve,
on Kio got another capital partner. This time it was
Gibson Guitar Corporation. Now back in eighteen, I did some
episodes about Gibson Guitars. In the nineteen eighties, Gibson was

(45:49):
in danger of going out of business itself, but then
some entrepreneurs bought the company, reportedly for like five million dollars,
and Gibson began to climb out of the hole in
a found itself in and in the process began to
acquire other companies. So the thought was that diversification was
a great idea. It would help Gibson remain relevant even
as tastes were changing in the music industry and people

(46:13):
were kind of migrating away from guitar driven music at
that point. An Kio was one of the investments that
Gibson made around this time. Well, that would end up
being a bad move, and I'll explain why in just
a moment, but first let's take one last break al

(46:38):
right before the break, I said that Gibson would make
an investment into a Kio and that would end up
being a bad move. What did I mean by that? Well, Gibson,
for many reasons, was again finding itself in financial trouble
a few years further in the line, So in two
thousand eighteen, the historic guitar company, which had been in

(47:00):
operation for more than a century, had to declare bankruptcy.
Gibson would refocus on making musical instruments once it emerged
from bankruptcy, and it had to liquidate other assets that
had not been profitable and had been outside of that
that laser focus, and that meant that, uh, you know,
Gibson would actually emerge from Chapter eleven bankruptcy in two

(47:22):
thousand eighteen, but in the process, the relationship between Gibson
and on Kio was severed, so it only lasted from
two thousand twelve to two thousand eighteen, But that also
meant once Gibson went away that on Kio was finding
itself in uncertain financial territory. It was really dependent upon

(47:45):
UH these relationships it had with Tashiba and with Gibson.
So the company made the tough decision to sell off
its European operations, the ones that were centered in Germany.
They sold it to an Austrian company called a Kipa
a q I p A. Akipa is best known for
selling accessories for various electronics. Now, between the time that

(48:08):
Gibson purchased a steake in on Kio and the time
where Gibson went bankrupt, so two thousand twelve to two eighteen,
on Kio also made an investment. On Kio purchased Pioneer
Home Entertainment. Pioneer is another famous name in the a
VY equipment industry. Pioneer would actually take a nearly fifteen

(48:30):
percent steak in on Kio in return. It is customary,
or at least it used to be. I'm not certain
if it still is, but it was customary with Japanese
acquisitions for each company in a merger to purchase shares
in the other company. That's kind of how Japanese mergers work.
It's a little different than what we typically see in

(48:50):
other markets. So on Kio and Pioneer plan to keep
both brands alive. It weren't going to have Pioneer just
get folded into on Kio and everything be cave on
Kio products. You would have both on Kio and Pioneer
on the market. Now, I'm not sure if this would
be the right place to say that this was the
beginning of the end for on Chio because on Kio

(49:12):
was struggling with something that was affecting the entire audio
equipment industry. It wasn't just unique to on Kio's situation.
That thing was more and more people were starting to
migrate away from stereo systems and stereo system components as
they were listening to music because the way they listened

(49:33):
to music was changing. Digital music and streaming were completely
transforming the way music works. Uh. Over time, things like
smart speakers were taking the place of high end audio
systems for pretty much everyone except audio files. Audio files
obviously they're obsessed with getting that perfect sound, so a

(49:56):
smart speaker is not gonna cut it. Like even the
best smart speaker on the market can't even can't even
remotely compare to a well put together music system. But
for the mainstream, for the majority of people, that wasn't
the case. It was convenience and accessibility and connectivity. Those

(50:16):
were the things that were really important, and a lot
of companies in the A V industry were struggling to
deal with that. You saw companies rushed to try and
incorporate various new components in their systems, like Bluetooth connectivity capability,
but they were they were trying to catch up. They

(50:38):
weren't staying ahead of the changes in ways we access music,
and the problem was that, you know, they couldn't really
catch up at that point. There was there were already
alternatives on the market that people were gravitating towards. So
companies like a Kio, we're really struggling to stay relevant.
It wasn't just on Kio that this was affecting. A

(50:58):
lot of a V company were seeing massive drops in revenue.
In twenty the rug was pulled out from under on
Kio once again. So in the spring of twenty nineteen,
there was a company called sound United. Uh. Sound United
is kind of like a holding company for several notable
audio brands, including Polk Audio. I would argue Polk Audio

(51:21):
is probably the most famous of the brands that Sound
United owns, and so sound United was wanting to expand
its portfolio of high end, well known a V brands,
and it announced its intention to acquire on Kio, and
that would include brands like Pioneer and Integram, so all

(51:42):
of these were kind of under the Onchio umbrella. Many
news outlets actually just went ahead and reported that the
deal was essentially done and that was just a matter
of time for the deal to close officially. But this
story is one that reminds us that just because something
is announced, like an acquisition or a merger is announced,
doesn't necessarily mean it's going to go through. Because come October,

(52:04):
all of that changed. Sound United abruptly pulled out of
the deal, and in a statement, the Sound United Company
essentially said that the two parties were unable to satisfy
all of the requirements that were necessary for a deal
to go through and ultimately decided to terminate the proposed acquisition.
The Pandemics certainly made things even more complicated. It shut

(52:26):
down show rooms and stores so revenue took yet another hit,
and in twenty Chio made the decision to shut down
on Chio USA. If you remember, that's the division responsible
for distributing on Kio products in North and South America.
So instead, on Kio would outsource that job to Vox
International Corporation, which is the parent company of Clips k

(52:50):
l I p s H. It's a company famous for
speakers in Vox International and Sharp Corporation created a joint
venture named Premium Audio Company or p a C. Now,
through that joint venture, Sharp and Vox acquired sev of
on Kio's home audio video business, and that meant the brands,

(53:12):
including a Kio and Integra would end up changing ownership
to p a C. P a C also negotiated with
the Pioneer Corporation for the right to produce a V
equipment under the Pioneer brand as well, so at that
point on Kio equipment was actually being under the ownership

(53:32):
of p a C, not on Kio itself. Then this
year two on Kio Home Entertainment Corporation, which was really
the last surviving component of the company that takesh A.
Godai founded back in declared bankruptcy. Now this does not
impact the Onkio brand, because again P a C now

(53:55):
has ownership of that. In fact, p a C released
a statement saying that at the time on Kio went bankrupt,
it was essentially performing only as a licensing company, that
it was licensing the I P two p a C.
And and other than that, it really wasn't doing anything.
Well now it's not doing anything, or it won't be
doing anything at all because it's declared bankruptcy and I

(54:17):
do not expect it to emerge from bankruptcy. I expected
to essentially have liquidated all assets to pay off as
much debt as possible. And that's it. So the Onkio
brand lives on, but the company that spawned the brand
is no more. So here's to you on Chio and
your contributions to making audio equipment that raises the performance

(54:39):
bar we hardly knew ye, And that's it for this
extra long episode of tech Stuff. Actually debated at one
point of dividing this into two episodes, and I wait
to hear from my producer Tari about whether or not
she's going to make me do that. So if you've
listened to all of this in one go, Tari did
not make me do that if you have suggestions for

(54:59):
future episodes of tech Stuff. There are two ways that
you can get in touch with me. One is you
go you download the i Heart Radio app. You navigate
to the tech Stuff podcast page of the iHeart Radio app.
There's a little microphone icon on there that if you
if you tap on that, you can leave a thirty
second voice message and you can give me a suggestion

(55:22):
for a show, or comments or anything. If you want
me to include the audio into an episode, just say so.
I prefer opt in. So if you say that you're
cool with us using it, then I will use it.
And if you don't, then I'm gonna assume you would
rather I not. The other way to get in touch,
of course, is over on Twitter. The handle for the
show is tech Stuff H s W and I'll talk

(55:43):
to you again really soon. Tech Stuff is an i
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