The ‘Home Automation Industry’ Is a Sham
Beware! Statistical data can be self-serving. The validity of the information is dependent on who’s doing the asking, the questions that are being asked, and whether the questions are being generated with a predetermined outcome in mind.
I believe that’s what we’re seeing in the “home automation industry.” In fact, I don’t think a true home automation industry actually exists—it’s too fragmented.
Here’s a little experiment. Try looking up “home automation,” or something similar, in the Yellow Pages. In most cases, it isn’t there! Typically, what you find are contractors from various industries crossing over and trying to cash in on this heavily hyped market. I’ve found that most electronic-related residential statistics are biased toward those who have the most to gain from it, with tremendous variance from one industry to another. In other words, it’s all over the map.
Let’s take a look and see just who’s offering this home automation.
—You have the retail home theater stores—usually the small, high-end audiophile companies will offer custom prewire and installation work that caters to those who can spend at least $10,000; otherwise, they won’t even give you the time of day!
—Then, you have the electrical contractors offering prewired structured cabling; however, according to the best data I can find, only 3 percent are doing it on the residential side. Very rarely will these folks actually trim out the job; it’s usually left up to the homeowner.
—Next, you have some specialty telephone and satellite TV companies offering structured wiring services. But, unless it’s new construction, the homeowner will discover their wires stapled to the baseboards!
—Lastly, you have the electronic security companies. Today, most residential security dealers are evolving into residential systems integrators or moving into commercial systems integration. Frankly, security professionals are the most qualified, not only to lay cable, but also to program the electronic equipment and trim out the job.
Think about it. What other construction trade carries around 6-foot drill bits to make sure the job is neatly done? What other trade has 30 years of experience sitting down at the kitchen table to sell something intangible to mom and pop?
What other trade is offering security, lighting, energy management, home computer networking and other lifestyle-enhancing amenities? What other trade has the advantage of being able to add to sales portfolios thanks to the influx of residential mass-marketed burglar alarms? The answer is none!
Many in our industry fear electrical contractors are going to steal away our business with what they refer to as the voice/data/video industry. I’m here to tell you that it’s not going to occur in a significant way.
An electrical trade journal is telling electrical contractors that 2001 sales for residential structured wiring totaled $300 million and that, with sales expected to exceed $2.1 billion in 2004, the opportunity is there for them to grab! Yeah, right; a little too pie in the sky if you ask me.
Years ago, electronic security manufacturers catered to the locksmith industry because they were going to take over the electronic security marketplace … never happened; same goes for the cable-TV companies and RBOCs.
We need to be aware of what I call statistical fear tactics. We must always consider the source before taking anything too seriously.
Most building contractors I know are hardworking, down-to-earth, realistic people. They aren’t swayed by hype or futuristic, “Jetsons”-like vaporware products pushed by manufacturers that are new to our field. We will eventually have true residential systems integration, but it will be a gradual process.
I once asked an executive of a major structured-wiring distribution panel manufacturer, “How large is your marketplace? Do you sell many systems?” His answer was, “It’s huge! We’ve tripled our sales from last year by selling more than 10,000 systems in the past nine months!” Gee, comparing that to our industry, some security manufacturers sell 10,000 control panels in a week! Enough said.
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