The mood in the hotel courtyard could hardly be more upbeat. For the mix of musicians and businessmen standing around in the Austin sun, a huge milestone just happened: $2 million raised on Kickstarter in just over 24 hours. It's good news for Neil Young and the team behind his Pono digital music player. But their work is far from finished.
After three years of preparation, Young formally announced Pono during his keynote address at South By Southwest on Tuesday. The project aims to bring high-resolution digital music to the masses via an iTunes-like storefront and a triangular-shaped device for music storage and playback. Both products will ship in the fall.
Shortly after Young's keynote, the fledgling company went live on Kickstarter and more than doubled its $800,000 funding goal in less than one day. Sitting on a sofa outside his hotel room, Young is at once both elated and exhausted.
"We've had some pretty intense days," says Young. "The team has been working really hard on the website and making decisions for Kickstarter. We're also hoping to get the technical areas absolutely buttoned up. But it's been good. We've managed to reach the goals we wanted to reach."
For the rock legend turned startup founder, this week's announcement marks the culmination of years of planning and building—turning an impassioned gripe into an actual company with a business plan and a physical product.
"With MP3s, you have less than 5% of the data that could be in that song if it was recorded at a higher resolution," says Young. "And it was probably recorded at a much higher resolution that what you got. You've now purchased the right to recognize the song. But that's about it. What you're missing is the music."
This is a drum Young has been beating for quite some time. In his much-publicized view, the convenience of digital music has come at the expense of sound quality. This is certainly true, technically speaking. For an album to be easily transferred over broadband and cellular networks, it needs to be crunched down to a manageable file size, inevitably losing some detail. At 320kbps, the highest quality tracks available through Spotify are still only 22% of the resolution of a compact disc. The AAC compression standard, considered an improvement over MP3s, is still just that—a compressed audio file. While the sound quality status quo has come a long way since the days of Napster, Young and purists like him are far from satisfied.
Still, today's popular formats are clearly sufficient enough for the millions of music fans who purchase songs from iTunes and stream from services like Spotify. For audiophiles, lossless high-quality formats have long scratched the itch MP3s couldn't. What Young and his team hope to do is take high-res audio up a notch and then market it to a crowd beyond the audio codec nerds.
"Things ebb and flow between convenience and quality," says Pono CEO John Hamm, wielding a yellow prototype of the $400 device. "The laws of physics that kept us from quality in the early 2000s—bandwidth, capacity, memory, storage—we've solved those problems in the last 15 years. This is just another point on the convenience curve."
Hamm and his colleagues are quick to point out that they're not trying to start a format war. Nor are they getting into the streaming music subscription game. Instead, they want to offer consumers what Young repeatedly refers to as "freedom of choice." That is, the option to purchase music in a format that sounds as warm and high-fidelity as 180-gram vinyl, but with the convenience music fans have come to expect since Steve Jobs first held up Apple's little white gadget on stage in 2001.
To get superior sound, Hamm tells me that they "get the highest quality digital master possible" from the record labels. In many cases, that means they're getting an album at a higher quality than the CD version. But not always. The range of quality is "all over the place" but generally always better than the MP3s and streaming services. Whatever the purest available master happens to be is what they'll sell through the PonoMusic store.
The device itself is engineered to play back high-resolution audio, not unlike the bulkier home systems for which audio geeks pay top dollar. Built in conjunction with Ayre Acoustics, the player promises to recreate the original analog sound using state-of-the-art circuitry, and what the company says is the best digital audio converter (DAC) on the market.
Hamm declines to compare the hardware to the inner workings of Apple's iPod (about which he says he knows very little), but says that the Pono Player is the first device to include audiophile-grade engineering in a portable form factor.
At launch, the PonoMusic store will focus on selling albums rather than individual tracks like iTunes. Prices will vary depending on record label preferences, but on average they are expected to range from $15 to $24 per album. Once purchased, an album will download in lossless, DRM-free FLAC files. The player will support other filetypes like MP3, WAV, AIFF, ALAC and AAC as well.
Outside Young's hotel room is a conglomeration of people who would rarely otherwise hang out. Members of the press, record executives, technologists, and budding rock stars mill about and make small talk. In the context of this private courtyard, Hamm and his colleagues are eager to let others give the Pono player a spin. The device, still in alpha, isn't yet polished enough to let the public give it a whirl. But these guys, Hamm is confident, will "get it." Especially the musicians.
Sure enough, after one of the young musicians puts on a pair of headphones, his face lights up.
"There it is!" Hamm shouts. "That's what I call the Pono face," referring to the expression made by most artists when they first hear the player. By now, dozens of other musicians have had a chance to listen to Pono—as evidenced by the star-studded promotional video posted to the project's Kickstarter page—and their reactions tend to be similar.
When you first listen to Pono, it's helpful to put on a familiar song. That way it's easier to pick up on the details you may not have heard before. The rhythmic tap of a tambourine. The subtle resonance of an acoustic guitar string between chords. It's these finer nuances that pop out, unencumbered by the digital compression. Even if they're audible on the MP3 version of the song, they're suddenly more noticeable. The details are crisp.
Picking these things out is also made easier by the fact that the mix of the song itself feels—at least in my brief testing—more spacious. Almost three-dimensional. Each instrument has more room to breathe. Some have commented that it sounds like you're standing in the recording studio with the musicians. That's a fair way to describe it.
For comparison's sake, I press pause on the Pono player in the middle of Neil Young's "Heart of Gold" and load up the same song on my iPhone, switching the headphones from jack to jack. Even at Spotify's "extreme" offline quality of 320kbps, the song suddenly feels one-dimensional. Instead of the finely separated mix, the instrumentation and vocals feel packed into a more finite space.
Here's the thing: The Spotify version doesn't sound bad. It's not like the early days of MP3s when the drums sounded warbly and certain tones would be notably absent from familiar songs. "Heart of Gold" on my iPhone sounds perfectly fine, as does the other music I download or stream at a high bit rate.
But Pono does sound different. It surfaces new things to the listener. As many have pointed out, the sound is "warm," not unlike the analog sound of high-quality vinyl. The results will undoubtedly vary from album to album and speaker to speaker, but on the whole it does sound fuller and more pure than the audio files we're used to.
"It's hard to take your vinyl on a trip to London," says Hamm. "So if you want the closest to the vinyl experience because you love something, it's like taking your 30 favorite records with you. Those weren't the ones you were listening to on Spotify."
It's worth noting that the majority of people who have heard Pono to date are musicians. It's no accident. Young and Hamm have opted to market this an "artist-driven movement." That's a smart strategy, since people who spend their days in recording studios are going to appreciate the nuance of what's different about Pono. It also helps to have rock stars enthusiastically praising the product you're trying to launch. But there's no money changing hands here. That perk is a natural by-product of who founded the company.
This also means that the product is virtually untested among non-musicians, so it's hard to gauge how wide its appeal might be until units start shipping in October.
Pono isn't without its detractors. The people trying to get the project off the ground face a constant barrage of naysaying: High-bit rate MP3s are fine, thank you very much. Or as some have argued, the push for 24-bit, 192kHz audio north of CD quality is unnecessary because CDs are as good as it gets.
Whether or not there's a big market for high-resolution digital audio among the general population remains to be seen. But the early crowdfunding results are a promising sign for those involved.
"Kickstarter is a phenomenal marketing tool," says Young. "And it can be a great financing tool. With us, it's turned out to be both."
For these guys, taking the crowdfunding route allows them to drum up grassroots support among music fans—armed with celebrity endorsements—before ever asking a VC for money. It's something Young admits would have been a challenge in these early days.
"No one was interested in rescuing an art form as far as something to invest in," he says. "Whereas people are very interested in reducing an art form that makes daily life more fun for them."
At the end of the day, this is a passion project. It's something Young feels strongly about and he's banking on the notion that others will feel the same way. It's a much easier pitch to make to thousands of passionate music fans than it would be to a Silicon Valley VC firm. That can always come later, provided the launch goes as planned.
Like any fledgling company, Pono has had it challenges. Some early ideas about how to encode the audio had to be scrapped. Early design prototypes envisioned a device that would attach to your phone, a concept that was abandoned in favor of the three-sided device with its own touch screen.
And while they haven't said anything about it publicly, there's no such thing as a digital music startup for which licensing content is not an ongoing challenge. Those deals with labels will undoubtedly continue to be negotiated over the next few months as the engineers fine-tune the hardware and coders build out the storefront.
"The most challenging part has been keeping the company together while we have no money for months," says Young. "But it's a startup. People do that when they believe in something."