CEDIA Roundtable: The Future of the Specialty CE and Integration Markets
Stein: There is a lot of talk about home health and energy management and green technologies, and they're all great. And I'm certainly not aware of what everyone's doing in the space. But I've seen little evidence thus far of significant revenue being generated from them. And it's back to the same thing. If we're talking about home health, that's a recurring-revenue business, and it takes a large number of customers. What percentage of CEDIA dealers are actually involved in any type of recurring revenue business like security? These numbers may be misremembered, but the order of magnitude is right: something like 65% of dealers say they are somehow involved in home security.
But in answering the next question about how much revenue is generated at that, with the overwhelming majority, the median was $5,000. That tells me that CEDIA integrators doing security are doing it as a convenience feature for their customers and not because they're in the security business like the security guy who only does security. That's a big difference, because it means that the number of customers they're exposed to in this recurring revenue model is relatively small. When we look at something like home health, if you have 20 trucks and can do 15 homes a week, then those are the types of numbers that start to add up to some real revenue in those spaces.
Regarding energy management, my personal opinion is that most people who are hiring a custom electronics dealer to install all these toys in their very large homes are putting energy management into them just to feel good. I used to do people's homes many years ago, some with utility bills of $25,000 a month, and it might shave 20 percent off that. It's just another feature, but that's not why they hired the integrator; they hired him because they wanted the home theater and the big-screen TV and the underwater speakers. So in terms of an opportunity for CEDIA dealers, sure, it's an additional revenue generator, but I don't know whether it's a lead-in on jobs.