Along with bootlegging, the movie industry existed as one of the principle growth industries during the Great Depression. When sound came to movies, the need for sound projection was forced by the desire to sell more tickets in bigger houses. This resulted in hyper-efficient horn loudspeakers that could fill increasingly larger spaces with increasingly greater fidelity, even though the tube amplification of the day was limited to just a few watts. There was no stereo.
The greatest American speaker designer of all time, Harry Olson, created designs in those days which have never been exceeded.
The statement that more compact, less expensive speakers were developed for mass consumption is accurate. The comment about those speakers being superior is inaccurate. They did, however, sell better just as they were intended to do. They cost maybe $100 each and could be set up in small spaces. Their use would not have been possible were it not for solid state power. They provided difficult loads and demanded much more power than horns but the masses could afford to buy and house them. So they crept onto the scene.
Meanwhile, horns driven by these early solid state amplifiers were strident and coarse. Garbage in/garbage out!
Today, as we argue, we need to acknowledge that SS has come a very long way and that there are certainly dome tweet model speakers that
can play music very well. Not all horns are wonderful. However, when the discussion turns to ultimate superiority in the reproduction of a live musical event, when cost no object products are introduced, and when honesty overrides cloudy bias, horns prevail. Twas always thus.