The business relationship between audio brand Sennheiser and audio care conglomerate Sonova is a little confusing, but basically what you need to know is that Sonova finalised their purchase of Sennheiser's consumer division for €200 million back in March 2022. Sennheiser still makes their own studio kit for professionals, but amateur audiophiles are served by Sonova draped in Sennheiser's brand banner. To put it another way, when you pick up some Sennheiser branded headphones—like the HD 550 that Jacob just reviewed—they're actually made by Sonova.
What's far easier to understand is that Sennheiser and Sonova are being fined to a total of nearly €6 million for price fixing. The Bundeskartellamt—that's the federal cartel office in Germany—found that Sennheiser had been engaging in price fixing since at least 2015. What's more, Sonova continued the practice after its purchase of the brand, right up until the antitrust investigation began in September 2022.
According to the Bundeskartellamt's findings, this price fixing was a concerted, vertical effort between Sennheiser itself and merchants selling products to end-users, though interestingly the council isn't fining any of the involved retailers.
Sennheiser closely monitored consumer prices using both price comparison websites as well as more specialised software. If the company found consumer pricing was significantly below their MSRP, it would reach out to affected retailers directly. Following this intervention from Sennheiser, retailers would then frequently raise their price and the end consumer would ultimately pay for it.
The Bundeskartellamt describes a "code language" being used for internal conversations about price maintenance measures at Sennheiser, though that's far from the wildest detail. According to Bundeskartellamt president Andreas Mundt, "Sennheiser employees even underwent antitrust training but used that knowledge to cover up their price-fixing practices." He adds, "This illustrates that companies must not only adopt compliance measures but also put them into practice.”
The result is a fine in the millions that apparently takes into account the fact Sennheiser and Sonova co-operated fully with the Bundeskartellamt's investigation. Besides the audio giants at the centre of this case, three Sennheiser employees specifically are also being fined and, boy, would I hate to be any one of those guys.
Mundt also said, "When it comes to illegal cartels, what first comes to mind are agreements at the same market level, for example between manufacturers or between retailers. However, price competition is also significantly hindered to the detriment of consumers if manufacturers and their retailers conclude agreements on fixed retail prices. Over a long period of time, Sennheiser hampered the free pricing of premium headphones."
Perhaps €6 million is just a drop in the ocean for Sonova, but perhaps it's not naive to hope this federal fine sends a message. If nothing else, maybe my next headphone purchase will be slightly less dear—or maybe I shouldn't dare hope for premium audio at a slightly less than premium price. Ah well, back to the best audiophile headset guide for me, then.
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