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Life In 2016

TWICE: Look out 10 years from now. What will the home audio industry look like?

Wellikoff: Ten years from now we may well see the following changes within our industry:

  • A weeding out of small manufacturers that don’t have access to advanced technology or sophisticated design.
  • A weeding out of retailers that haven’t successfully integrated their retail and custom operations and fully mastered all related technologies and business practices to support them.
  • Home audio systems will be just a small part of what we call a “smart home” and will be fully integrated into every other microprocessor in the home. We envision it being a standard feature in new home construction to the likes of central VAC and HVAC.

Fleming: Home audio has functioned as a stand-alone segment for many years, but the arrival of Internet Protocol technology and MP3 digital audio means that products will become more and more connected. In a decade, most every consumer is expected to have a wireless network at home. The new products of the future will need to respond to that network and use it as a source of audio and video content. Consumers will expect that the content they enjoy will travel with them wherever they go — from room to room or even across the country.

Baker: The home audio industry will continue to offer a range of products, some of which will allow for a greater level of utility and functionality than ever before as well as dramatically improve picture and sound quality. Consumers will have many more ways to access entertainment content, and advancements in utility will go hand in hand with superior performance, ease of use and functional flexibility.

The real winners will be the products that make all the different types of content delivery systems work together smoothly.

Gross: I believe we will have a much larger industry with fewer significant players. I believe that true specialty manufacturers are going to have to deliver truly superior products in terms of performance, styling and value if they want to prosper as the marketplace splits itself even more between commodity products and genuinely special products.

Deknatel: As more and more homes become equipped with broadband, home audio will evolve with it. Home audio will need to be wireless and multiroom to give consumers the freedom to enjoy music on their own terms. It will have one central access point in the home that in turn will stream content throughout the home. As online purchase and subscription programs continue to grow, more and more home audio units will be equipped to handle these formats as well.

Milks :I think we will see convergence products become the norm. Products that seamlessly integrate all aspects of home entertainment will become commonplace. I also think consumers will demand greater compatibility between products, and new wireless technologies that enable enhanced levels of automation will be available for the mainstream consumer.

Bales: Very different in some ways and very much the same in other ways.

Different in that a variety of audio solutions will be packaged with video displays creating complete one-brand A/V systems. Speakers will become more streamlined and cosmetically appealing in the home environment. IP-based and powerline solutions for signal distribution will be common. Packaged Blu-ray players and recorders and PC entertainment devices will become servers and clients with wireless Ethernet connectivity.

High definition will be the norm, screens will be larger, possibly in whole-wall sizes. Content will be king again with far more variety from cable, satellite, fiber based,and online services becoming common providers.

We’ll see seamless transport of content between devices. Digital amplification will allow for much smaller power supplies and thus smaller components. What we now know as “gaming” consoles will be a primary source of interactive entertainment … movies, television and video content will become interactive. Passive video merges with active gaming. The audience will be able to choose story lines or characters. Audio components will drive surround sound audio programs that create “virtual reality” sonic experiences utilizing upwards of one to 20 speakers. Who knows? Is Star Trek’s “holodeck” becoming a reality by the year 2016? “Audio” will evolve into “sensory.”

In other ways, the market will be the same. Audio components will continue to provide central control, switching, processing and amplification. Speakers will still need to “move air.” While form factors may change to more streamlined and flat appearances, the speakers’ basic function will remain the same with in-wall, on-wall, in-ceiling, in-floor and in-headphone applications. Levels of performance from commodity home theater to reference-level components will still differentiate and drive technology forward.

Custom installations will have new technologies for new-construction and retrofit installations. Those who can provide the consumer with the most value will thrive. Those who don’t adapt to new technologies will not.

Kroll: Ten years from now there will be further merging, or convergence, between the IT- and audio-installation industries. However this trend develops in its particulars, more audio systems will have embedded network devices, showing that true visionaries like Frox, an early computer-based home entertainment system, came to market 20 years too early.

TWICE: Will the custom install channel eventually become the sole distribution channel for all component audio products or for the vast majority of components?

Wellikoff: No. At the end of the day, we still believe that most luxury/performance consumers will prefer to look and listen at the premium products they are interested in. Even to those for whom money-is-no-object, there is a great percentage of people who want to see and hear what they are getting. A good A/V demo is often the close. It’s just like going out and buying a high-performance car. Yes, you could just have one delivered to your driveway, but test-driving a new BMW or Porsche is a much more rewarding purchase experience.

Baker: No, people will always go to retail stores, and while higher end value-added products will increasingly become the province of the custom-install market, it will always just be one segment in the overall distribution picture.

Gross: No, I don’t believe so. In fact we are seeing a new focus on high-quality audio components on the sales floors of retail-oriented dealers because it is the most effective route to improved profitability.

Milks: No, despite the fact that the custom-installation channel continues to show strength, I believe there will be a place in the foreseeable future for traditional component audio products.

Bales: The custom install channel is changing. Take the Geek Squad. So, yes, the custom channel will dominate the component audio market. The bigger phenomenon is the retailer/manufacturer business relationship.

Manufacturers are learning to build and distribute product with much more emphasis on “derivative strategies” or “limited distribution” models. Retailers have not been able to assort as many brands or models during this downtime in audio. Manufacturers must listen to their retail partners more than ever to better their chances of getting a model assorted. If there is no assurance that economies of scale can be reached with a particular model, manufacturers will simply cancel or severely limit the incoming quantities of that model from the factory. This climate has actually created better efficiency in the planning phase of product development and is placing more of the right product at the right retailer. In other cases, good technology is simply not given the chance to succeed.

Kroll: Virtually all retailers are becoming hybrid retailers/custom installers, and as the sophistication of home audio increases with multiple playback formats and digital media, virtually all component-based audio systems will eventually require some level of professional or custom installation. Boston is addressing this market with new component audio products that deliver the features consumers are interested in while remaining very installer-friendly.