The consolidation trend among home systems manufacturers augurs well for home builders’ costs for home automation and home entertainment systems. The most recent integration of brands is Linear LLC, which combines whole-house automation, security, lighting, and HVAC control, with brands including Niles Audio, Xantech, and ELAN Home Systems, (ATON, Sunfire, and HomeLogic) into a single business unit. Other recent consolidations of brands include Extron’s buy of Electrosonic Group’s product development division and Russound’s acquisition of lighting and multiroom audio systems maker Colorado vNet.
The companies emphasize collaboration across brands and categories to develop more sophisticated products. But an equally important collateral benefit is likely to be downward movement on some product pricing thanks to new economies of scale, including enhanced efficiencies in manufacturing and supply chains. They will also
encourage more total-solution packages for builders to choose from (Niles Audio alone manufactures some 500 different products), expanding the good-better-best propositions builders have come to rely on.
“When the housing market does begin a sustained recovery, we believe that a new generation of home buyers raised on entertainment and integrated control devices, from video game controllers to iPhone, iPod, and iPad products, will absolutely require that their homes feature a whole-home automation control system,” says Linear Audio Video Control Group president Mark Terry.