Around £2500

Positives: incredible attention to detail and godlike sound from a compact package.

Negatives: choosing playlists on a computer or tablet isn't for everyone.

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In the 1970s the Swiss watch industry hit a crisis. New quartz technology allowed upstarts in the US and Japan to make watches as precise as their mechanical counterparts for a fraction of the price. In less than a decade 1000 Swiss watchmakers had closed down.

Today, aside from the cachet of a Patek Philippe or a Rolex, there's no functional difference between those timepieces and a £10 quartz watch – indeed, the latter is likely to keep more accurate time while offering a calculator, a calendar and a phone book.

For a while it seemed a similar fate might befall premium hi-fi makers. The craftsmanship that went into producing a high-end turntable or CD transport looked irrelevant in a world where digital files could provide bit-perfect reproduction from a £5 memory card. Indeed, the 30-year-old technology behind CDs seems second-rate compared to lossless digital formats that offer four times the fidelity of their disc-based counterparts.

Scottish premium hi-fi specialist Linn spotted this trend early and axed its range of CD players at the turn of the decade, focusing on getting the best quality from digital files. The result is DS, a range of digital streaming systems that allow you to play high-quality music collections around the home – or yacht or jet. The strategy has paid off, resulting in a 21% hike in pre-tax profits in the last financial year.

I tested the entry-level Linn Kiko. Available in a choice of six colours, the aluminium-clad Kiko houses a high-spec, four-channel amp and the firm's bespoke electronic brain. As for inputs, there are two for analogue and two digital, three HDMI sockets and a video passthrough, so you can feed your DVD or Blu-Ray through it.

The Kiko connects to your network router via an Ethernet cable. Hook up the speakers and you have a digital receiver capable of playing virtually any music source in the home. The system is controlled via Linn's Kinsky app for PC, Mac, iPhone and iPad. Choosing music, setting up playlists or tuning into an internet radio station is easy – though arguably still not as simple as dropping a CD into a conventional machine.

Sound quality from the Kiko is stunning. I've tested a number of high-end systems from the likes of B&W, Sonos and Naim, and the clearest point of difference with the Kiko is it feels effortless. Whatever the musical complexity or volume levels, the Kiko feels composed with power to spare.

A nice part of the Linn approach is that the core features are identical across the range. All DS systems share the same app, software and capabilities. Buy a higher-end system and you are buying better sound quality, nothing else.

There's no doubt the Kiko is a great piece of kit. If you have £2500 and value simplicity and quality there's perhaps no better way to spend it.