By Dave Jensen, W7DGJ

I was as shocked as everyone else when MFJ decided to pull the plug. I had known about Martin Jue's business being "for sale" for some months before that, but always assumed that the entrepreneur would find a ready and willing buyer for what was certainly a thriving brand. Everyone I know has had MFJ products in their shack and even if the company were sold in pieces (antennas to one buyer, tuners & amps to another) I expected it to be just a matter of negotiation. But no . . . instead, MFJ just closed the doors.

I have no inside information -- the local newspaper article linked above is the best I've found. I spoke to the mayor of Starkville (MS) and she had no behind-the-scenes info either. She indicated that she knew Martin had been talking to several companies but evidentally not one of those could step in to keep the business going. The mayor was happy that Martin closed with a great deal of respect paid to his employees as they left to find other work. The MFJ situation is old news to hams, of course, but I bring it up here in light of a topic I'd like to address this issue . . . the actual marketplace for ham gear.

Is there enough of a market in Amateur Radio to keep companies afloat?

The Ham Business is Very Small

Of course, the remaining MFJ inventory is still out there, some of it on dealer shelves and some circulating through the ham radio community in the used market. What will happen to those really unique MFJ gadgets, I don't know. As much as hams would complain about MFJ from time to time, the company had a unique spot in the market due to the creativity of its ham radio owner/operator. You should see the aisles that opened up on the floor of the Ham Radio Outlet near me! Who's going to take that space?

As I thought about this demise, I began to wonder how viable our pastime is for suppliers. How would you define the Amateur Radio market, worldwide? Is there really enough there for the existing supplier base, and is there room in the mix for new companies to enter, compete, and grow in the field? I'm starting to doubt that. Due to the (shrinking?) nature of the Amateur Radio Services, new companies would have to grow by eating business currently taken by other, existing suppliers. Either that or innovate and build new product categories through advancements in radio communications.

While we've had some of those, they've been very slow to market. Look at SDR and how much potential it has, and then examine the lineup of the big three. Another example is pure signal (predistortion) technology, which brings the capability to improve our signals dramatically and literally clean up the bands. We have all witnessed how no one is in a hurry to get this innovation to market (other than some very small suppliers that haven't yet reached primetime).

Do you think we'll ever see additional significant advancements in radio communication? (I'm not talking about having a "Field" and a "Desktop" version of the same transceiver. That's pure marketing horse manure.) Are we at the end of the creative horizon for our technology? My short answer is no - we are not at the end of creative advances in radio, but my guess is that these will never come from the existing radio suppliers. It is just too long between minor changes for them in today's radios. 

"Let's Sell What We've Got"

Here's an example. Recently, the head unit (control) of my IC-7100 was stolen from me. (Some yahoo thought it would be a great catch by itself). So, I tried to get ICOM to find me another control unit, and while they couldn't help me, I did learn something. I learned that this radio has been given an additional life extension and is now back in the lineup for ICOM. While I'd like to celebrate a classic "shack in the box" radio, my thoughts immediately went to the question of WHY. Why not come up with a new and better radio, one that would compete with the Yaesu FT-991 and own the market for all-in-one UHF-VHF-HF radios. Nope . . . instead of investing in R&D and design, ICOM simply said "We'll keep building what we've already got." That's what happens when you have a stagnant market and customers who will keep buying what they are already comfortable with.

I'd love to hear from current or former marketing executives in the Forum Discussion which follows this editorial. My experience in product management was from another business entirely (close -- possibly allied -- but really a much bigger business than radio.) I was engaged for a chunk of my career in the Microphone business but with a focus on music. My company worked hard upon entering the mic business, as there was one giant company (Shure) that had cornered the major market share for more than five decades.

It wasn't a field where amazing new technology could enter the scene and steal market share, as mics are simply magnetic transducers and nearly immune to drastic innovation. Instead, it was a business of knocking off Shure users one at a time by building a good product based on specific customer needs and having reliable service after the sale. In many ways, it was the same battle for customers that any new radio company would have to go through today if trying to knock off the "big 3" manufacturers. 

Yes, it could be done, but what an incredibly difficult thing that would be to accomplish. Certainly, FlexRadio and Elecraft have taken some market share, and will continue to do so. But those are not "everyman" radios (for the most part). Can you imagine the difficulty that an entrepreneur today would have to start up a company that intends to steal a certain amount of market share from Yaesu, ICOM, or Kenwood? What's the cost of running multiple full page ads in QST or attending Hamfests worldwide and building a reputation? Could someone really build a $1000 radio that is truly unique and capable of knocking off what you can buy now from one of these three? I don't see it happening . . . I think we're stuck with what we've got (going back to my example of the IC-7100) . . .  getting these organizations to innovate faster, bring new concepts and new radios to the marketplace sooner is just Dave's pipedream. That is, unless the market size changes for Amateur Radio.

So Will the Market Size Ever Change for the Better?

Future market size will not be determined by the existing major customers (older white guys in their 60's and 70's). For the ham radio business to innovate, our future market size will have to be much bigger. And that will only be determined by what happens when those existing users exit the scene and new hams fill out the roster.

Our problem remains that what attracts new hams to our pastime, people who see exciting new technologies all day long in their other electronic devices, is cool new stuff. And we're not really seeing that much of it now. It seems to me that we are stuck in a viscious circle. Our association in the USA, the ARRL, is doing its best to attract a new generation of hams (judging by the last few covers of QST). But they are also becoming more like a business, with books, antennas and gear taking up more importance to the bottom line. I expect we are going to see the ARRL gradually adopt a few more products into their mix, pushing against their major retailer advertisers in a risky gamble to keep revenue flowing. It's certainly a time of tumultuous change in the business of ham radio.

As always, more on innovation in future columns of Trials and Errors -- Ham Life with an Amateur.

73 for now,

Dave, W7DGJ

Have a comment or question? See what others are saying now in our Forum discussion!