As adoption of home technology increases among consumers, home technology professionals are anticipating a strong year in 2016, according to a new report issued today by CEDIA at its annual trade show, the global showcase of the biggest thinking, innovations and connections in home technology.

Each year CEDIA conducts its Size and Scope of the Residential Electronic Systems Industry Survey to analyze the size of the industry and identify market trends. In 2016, the average system integrator is projecting 17 percent growth with estimated revenues at $2.5 million; CEDIA and research partner Parks Associates takes a more conservative view, estimating a 7-10 percent rate of growth in 2016, equating to revenues of $2.3 million.

Dave Pedigo, Sr. Director of Emerging Technologies explains, “We are now seeing a stabilization of the marketplace; 2014 was an exceptional year with an unsustainable 56 percent year over year increase in annual gross revenue. This market explosion was due to years of pent up demand and a healthier economy. While 2015 continued to be a solid year, revenues leveled off slightly, but is still an impressive 48 percent increase in annual gross revenue from 2013. While 2015 revenues are 5 percent lower than 2014, CEDIA believes the numbers are accurate and should be viewed optimistically, as market conditions have returned to a state of normalcy. While most of that pent up demand was released by the end of 2014, CEDIA expects growth for home technology professional’s annual gross revenue in 2016.”

Other key findings include:

• Assuming 2016 dealer expectations are met, system integrators will have maintained or increased the number of average projects per year every year from 2014 to 2016. For 2015, the average number of residential installations projects for a system integrator/AV installer is 56 and is estimated to reach 63 in 2016.
• Control system installations are on the rise. Eighty-eight percent of system integrators/AV installers report installing whole-house controls. This same group reports an average of 25 whole-house control systems in 2015, and expectations for the full-year 2016 are 30 whole-house control installations.
• Annual home networking installations have increased over the last four years with system integrators/AV installers reporting an average of 30 completed projects in 2015 and an estimated 39 in 2016.
• Due to rapid innovation in home theater, such as 4K/Ultra HD and immersive video, the average and median prices of home theaters grew for the fifth consecutive year. The average total revenue year-over-year for a home theater was up 4% from 2014 to $35,233 while the median grew 17.5% to $19,582.
• An increase in median annual gross revenue of just over $13,500, a positive indicator for the smaller dealer.
• Categories most likely to be added to system integrator/AV installer portfolios over the next 24 months include voice control and IP monitoring. 47 percent of system integrators not currently offering voice control plan to add this capability and 42 percent plan to add IP remote monitoring.

CEDIA surveyed 653 respondents between June 22 and August 22, 2016 who qualified to participate because their firms install at least one of the relevant residential product categories including home theater/media rooms, distributed audio/video, systems integration/control, climate control and video surveillance.

The full report will be available in Q4 of 2016 and is $1,000 for non-members and free to members here.