twice connect
careers

Custom Suppliers Target Growth Segments

1/08/2007 02:00:00 AM Eastern

Custom-install growth will moderate in 2007, given the downturn in new-home construction, but most product segments will nonetheless continue to post healthy growth, many suppliers say.

They cite continued strength in the upper end custom-home segment, the baby-boom generation entering its peak earning years, an expanding high-end MDU market, relatively low penetration rates, and increased promotion by builders to maintain a competitive advantage. (See roundtable discussion, p. 134.)

Product segments that continue to post strong growth through custom channels include satellite radio, HD Radio, multiroom-audio systems, HDD music servers, systems that integrate multiple-home subsystems, wireless home-control systems, in-ceiling speakers, and multizone receivers, suppliers said. Sales of HDD A/V servers have great potential because multiple flat-panel HDTVs are going into homes, they added.

Said AVAD president Bob Gartland, "Our multiroom business has grown nicely this year, and we expect that trend to continue in 2007.'' He forecasts "continued growth in multiroom distributed audio as more builders offer the technology in new home construction,'' and he sees increased adoption of low-speed wireless-control technologies, such as Zig-Bee.

In 2006, said Crestron EVP Randy Klein, "multiroom audio, lighting and wireless solutions experienced the greatest increases.''

Russound strategic development VP Jeff Kussard noted that although the industry is experiencing "solid acceptance of newer digital and convergence-type products, like satellite radio and hard drive media servers, we continue to experience meaningful growth in our legacy product categories, like simple volume controls and speaker switchers.''

Among architectural speakers, Kussard said, in-ceiling models continue to dominate sales "due to the ease in locating them without need to worry about conflicts with the things we like to hang on our walls.''

Paul Starkey, Elan's sales and marketing EVP, agreed that "in-ceiling models lead the way,'' but he noted that ``the high 15-20 percent growth rates we have seen the last three years have declined.''

Other strong sellers include multizone receivers and HDD music servers. He also called multiroom video, including HDD A/V servers, "a huge growth area as multiple HDTVs go into homes. We expect this to continue.''

XM, Sirius and HD Radio are all gaining momentum, Starkey added "There will be more integrated products in the near future, and the radio is again becoming the content [source] of choice in multi-source systems.''

Starkey also saw growing demand for wireless control systems, but he noted that "wireless distribution of content is just not making much progress,'' in large part because of reliability.

As for integrated systems that control audio, video, lighting, security, and other home systems, he said ''installers and their clients alike are showing interest in inte-grating three or more subsystems.''

To tap into these and other growth areas, suppliers here at CES are introducing multiple products. (See product listing, right.)