I work in real estate, and I asked the same question (to myself) about the use of escrow when I first thought about buying on Audiogon. Escrow protects both parties in the purchase and sale of real property, so why not audio equipment? However, before making my first purchase, I did a lot of reading of the forums, not only about equipment but also buying and selling. I learned that escrow could be a problem for both buyers and sellers. Buyers have been burned by outright scams, phony escrow companies that the seller requested be used. The transaction ended for the buyer when he sent his money to the escrow company. Sellers could also be victimized by being instructed by a phony escrow company to ship the equipment because the buyer had deposited its money with the non-existent company. Sellers also have to be sure that legitimate escrow companies don't instruct the seller to ship until the buyer's funds have cleared. Some escrow companies and sellers have been scammed by phony bank checks.
Even if sellers didnt lose their equipment, sometimes buyers used escrow to audition equipment and then refuse it when it didnt meet their expectations, simply by informing escrow that there was some damage or operational problem. As no doubt you are aware, not being satisfied with the sound is not a legitimate reason for a buyer terminating his purchase. The seller got his equipment back, but not only had to pay for a new ad on Audiogon and start the sales process all over again, he also was out his shipping costs because all the buyer's money was returned. For this reason, even a seller who would agree to an escrow might require the buyer to pay the shipping cost up front to the seller directly.
If you want more analytic reasons why escrow doesnt work as well for audio equipment as for real estate, consider the following differences.
1. Real estate escrow companies are usually recommended by a realtor, who knows the escrow companies and whose license is at risk if it suggests a scam outfit. In addition, the parties go to the escrow companys office to sign documents, which eliminates escrow companies that are nothing more than an internet address.
2. In a real estate purchase, the buyer examines the property before making an offer. After escrow is opened, the buyer has a short period of time to make have the property professionally inspected, at which times all issues about physical condition are resolved or the deal terminates. The buyer is entitled to a re-inspection just prior to the closing, but damage must be substantial to allow termination of the deal, and the seller (or its agent) can fairly easily verify or refute damage claims by their own examination. With audio equipment, the buyer doesn't examine the property until escrow has been opened and the equipment shipped to the buyer. The physical condition of the equipment is the last issue to be resolved and is difficult to do because the parties cant jointly examine the equipment.
3. In the sale of real estate, the buyer does not get possession of the property until the deal closes and the seller has been paid. In the personal property escrow, the equipment is delivered to the buyer after the money is deposited in escrow but before it is released to the seller. This difference doesnt matter much, if the sale goes through. However, there is a difference if there is a dispute. A stalemate will exist in an escrow for both real property and personal property, with the buyer unable to get its money back and the seller unable to re-sell the property. However, in the case of personal property. the buyer is in possession of the property, which makes the seller much less secure.
4. Yes, audio equipment often involves thousands of dollars. However, it is a fraction of the sales price of most houses in this country, even after the bubble collapse, not to mention commercial properties. In a real estate escrow, each party's escrow fee (not to be confused with title charges, transfer taxes, recording fees and other closing costs) is usually less than .3% of the purchase price. A comparable escrow fee for a $10,000 piece of audio equipment would be $30 per party, which is non-existent.
The bottom line is that escrow companies involve extra cost and delay and cant solve the major problem of parties dealing at a distance in the sale of audio equipment, which is issues involving the physical condition of the property.
In the case of really expensive equipment (and everyones definition is different), you might want to go to the seller to check out the equipment and take delivery. I also suggest you read lots of ads for the type of equipment you're interested and notice the different styles in which they are written. Some are bare bones and some are very informative, but many also convey a certain tone. Does the seller sound argumentative or helpful, dictatorial or flexible, abrupt or easy going? It's not an infallible guide, but it helps.