Home Installation Insiders Lend Insights
Residential technology is ready. Delivery mechanisms are ready. Consumers are ready. The economy is ready. All systems are GO – are you? Get in line with expert analysis and advice from three leading connected home specialists.
On one hand, it seems like just yesterday when home automation was a futuristic concept deployed almost exclusively within extravagant domiciles owned by the rich and famous. On the other hand, during the past few years technological advancements have accelerated so quickly, broadband and mobile connectivity become so ubiquitous, and the consuming masses gotten so electronics focused that Joe Public is suddenly George Jetson. At the same time, equipment and systems have become more feature rich, more affordable and more reliable. Welcome to the connected smart home of the 21st century.
This means lots of opportunities (and challenges) for savvy residential electronic systems specialists that persevered the recession and bottoming out of the housing market, as well as newer entrants lured by the market’s renaissance and humungous upside. It also raises many questions. What are the leading product, system and service opportunities? How are installing companies adapting to these developments? How does security fit into the overall connected home approach? What is the ultimate potential of this market?
To get answers, SSI conducted a roundtable interview with three members of the Custom Electronic Design & Installation Association (CEDIA) Board of Directors. Participating in the discussion were CEDIA Chairman Federico Bausone (Multimedia, Mexico City), Secretary Buzz Delano (Delano Associates, San Clemente, Calif.) and Treasurer Gordon van Zuiden (cyberManor, Los Gatos, Calif.).
Founded in 1989, CEDIA’s more than 3,500 worldwide members specialize in designing and installing electronic systems for the home. Board members are not only tasked with guiding the strategic direction of the association, but also ensuring CEDIA’s defining principles remain relevant and adapt to members’ changing needs.
So who better to comprehensively assess the rapidly changing residential solutions marketplace? Among many more subjects, these three leaders talk about how their businesses are doing, the industry outlook overall, keeping up with new technologies and how to best deliver what customers want.
How has home automation evolved through the years to the point of being realized as the smart home of today?
Buzz Delano: The evolution has gone down two pathways. There has been the very sophisticated luxury market. Back to the late 1980s to early 1990s, this was when installation businesses worked with homeowners to integrate audio and video and early methods of control and telephony and intercom. It evolved into more companies making products controllable with two-way feedback on RS-232. That enabled a lot more functionality with different systems in homes. Eventually we started seeing more, faster technologies like IP networking, connecting devices as we have today.
At the same there was the low-cost home automation market available through mail order and the early days of online, where a do-it-yourselfer could rig an audio or video or networking system in their home. Those two areas, the low-cost DIY and luxury segments, have converged the past couple of years because of simplicity and applications and mobile devices. The good news for our trade is there’s so much more that can be experienced with a fully integrated home from a professional installer than what DIY brings.
Today’s home-technology professional can go to a homeowner and design a fairly elaborate system, pulling in networking, audio/video, lighting and climate, with lots of features that are easy to use. The simpler we can make it for the homeowner, regardless of how sophisticated the technology is behind it, that’s what’s really going to grow the business.
Gordon van Zuiden: There’s been two driving forces at play in the home the past several years. First was the advent of broadband Internet for the home, and later throughout the home over wired and wireless distribution methods. Today, almost three-quarters of the homes in the United States have a broadband-supported networking infrastructure. The other thing happened on April 3, 2010 when Apple introduced the iPad. That changed our industry forever, because we had an affordable, high-resolution tablet control interface we all knew how to use. Most of us have smaller iPhone versions in our pockets. To date, over 700 million iOS devices and almost a billion Android devices are in use around the world.
All the ingredients are there now. The control platform’s in their pocket, the network’s in their home, the interface is something they can understand, and we’re off to the races.
Federico Bausone: I used to think the only thing smart in an integrated home was a thermostat because it made decisions by itself. You would say, “I want this temperature,” and it controlled the rest. I think we’re going to see a lot more of that in the future, devices making decisions based on what you do in your house and how you do it. If you turn on the lights, the systems will learn and then make decisions by themselves.
Van Zuiden: We are now talking about the “Internet of Things,” which means we have a really inexpensive chipset that communicates the state and status of any product in the house through sensors. We’re going to have hundreds of IP-addressable devices in the house and they’re all going to be communicating and all letting us know what the state and status is. There will be predictive behavior and personalization as a result of that. Some of that work we used to do will be done by the device itself.
Now that we are up to date, how has 2013 panned out for your businesses; in the case of Buzz, those companies you consult for? Also compare it to the past few years and what you expect for 2014.
van Zuiden: We focus on residential and when the economy was down it was two-thirds retrofit, one-third new. Now it’s two-thirds new and one-third retrofit. This year has been far busier than any of our previous years. We’re a small company, only seven of us. We’ll do $1.5 million, $2 million in the next year. That’s about a 50%-75% increase from the previous year; larger than our largest year of 2007.
There are two primary factors leading to that. One, definitely the economic health in the San Francisco Bay Area improved dramatically with the gain in the health of the technology sector. Secondly, this area, Silicon Valley, is very accepting of smartphone- and tablet-enabled control solutions. This is really where a lot of that stuff was born. So we’re now at a point in our industry where there are a wide range of those solutions in the home, and there’s a much greater awareness that home control and automation can work from those devices than there was even three years ago.
Everybody comes in and says, “I saw this with Nest, I saw this with Sonos, I saw this with Lutron. Somebody was controlling it on their phone, in their home, around the world. That’s what I want to do.” To create the infrastructure behind it is still as time-consuming as it ever was, wired and wireless, so there’s a lot of work to make those wish lists happen.
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