So, who are the installers?
There are, by most estimates, about 1,000 home automation and home cinema installation companies in Australia. They range from backyarders and one-man bands to specialists that might put in systems worth $100,000 and more.
They also include large retailers like Harvey Norman and its Domayne division, which sell integrated home entertainment systems of increasing sophistication and also offer installation services.
At the lower end many electricians are moving in to distributed audio and video. Even TV aerial technicians are dabbling in the area, setting up home cinemas and installing the necessary cabling.
One distinction is whether they are ‘custom’ installers. A custom installer is one that typically designs and builds a one-off installation, often incorporating a home cinema and some aspect of home automation, such as smart lighting. But even this distinction is increasingly difficult to make, as home cinemas are incorporated into project homes and vendors blur the distinctions between componentry and furniture.
With retailers muscling in at the lower end of the market, the increased convergence of consumer electronics with computer networking and PC-based media centres and energy conservation becoming an important factor in home automation, the installation market is difficult to categorise and measure.
For many years Australia’s custom installers have been represented by industry body CEDIA, the Custom Electronic Design and Installation Association. CEDIA Australia, the local arm of an international organisation with thousands of members, has a hundred or so installers as members and also many suppliers, distributors and manufacturers.
But many large installers are not CEDIA members. CEDIA has recently appointed a ‘membership concierge’ to help boost its numbers and fight off the challenge from installers that are less well credentialed.
Connection Research has surveyed Australia’s custom installers. We drew up a list of companies in the area, based on CEDIA’s membership list, the published lists of installers for suppliers like Clipsal and from a range of other sources. Once we eliminated duplication, we were left with a little over 1,000 organisations. We surveyed them by post and email and received exactly 100 replies, a response rate of just under 10%.
The results confirmed that installers are indeed a motley crew. Nearly 20% of respondents are CEDIA members, but a higher proportion belong to other bodies like NECA (National Electrical and Communications Association – for the electrical industry) and ASIAL (Australian Security Industry Association Limited – for the security industry). Many of them don’t belong to a professional body.
More than three-quarters have a cabling licence, and more than half an electrician’s licence. Most of their work is residential, though many do some commercial work. The most common areas of specialisation are lighting control and home automation.
A quarter have annual revenue of more than $1 million, but that is not a lot of money nowadays. It indicates just how many small players there are in the market – 20% or so are one-man bands. Most individuals have been in the industry 10 years or more, but most of the companies they work for are newer than that.
Most of their residential work is in new homes. It is much easier and less expensive to install entertainment and home automation infrastructure when the house is being built. The most common technology they install in new homes is networking and cabling, and the most common services they install in existing homes are data and communications, upgraded TV equipment and home theatres and cinemas – see Figure 1.
As a group, the installers’ biggest concern is finding and retaining good staff. They are worried about skills shortages in their industry, particularly in the areas of design, home automation, lighting control and audio-visual. They are much less concerned about shortages in data communications and electrical areas – see Figure 2.
Installers believe the biggest opportunity facing the industry is increased consumer awareness of digital and home automation technology and what it can do. Conversely, they believe that a lack of consumer awareness is the biggest potential inhibitor to the growth of the market.
These findings tally with Connection Research consumer surveys, which measure installation rates of various technologies in the home and consumer awareness levels. Many consumers in Australia have never even heard the term ‘home automation’, and many who have heard it don’t have much idea about what it means.
Things are improving quickly, but consumer education remains one of the industry’s greatest challenges.
Consumer expectations are changing. Yesterday’s luxury is tomorrow’s necessity. Home theatres are now commonplace, and there are signs that the home automation market is finally taking off. Australia will need many more installers of this equipment.
Specialist installers will co-exist with backyarders and the mass retailers, but it will remain a bit of “a jungle” for the consumer, still confronted with a multiplicity of products and technologies.
It is up to installers to educate consumers and educate themselves. The market is continuing to evolve, and the technology is becoming more complex. The custom installation industry faces many challenges, but these are exceeded by the opportunities afforded by the enormous growth in