What Nest's Acquisition and InfoComm Appearance by Top IT Brands Mean for Integrators

Jan 15

Written by: Brendan Morrissey
1/15/2014 6:51 AM  RssIcon

This year may be remembered as the year that AV and IT accelerated its convergence and home automation became a household term.

It may seem a touch early in 2014 to make such bold predictions, but as I saw the custom AV industry roaring back to life last year, it was no surprise this week to see Google and Microsoft (two of the world's biggest IT brands) making waves in our industry.

I’d like to make a case for why this week's headlines means big opportunities may be ahead for custom integrators in the coming months.

Microsoft Headlines InfoComm 2014

First, Microsoft. The king of operating systems has been making serious hardware plays with the Xbox One, a remarkable piece of hardware that it hopes will be the true center of the home media experience. The Kinect sensor adds Skype to the mix, giving consumers a taste of fully integrated video conferencing.

Add in the Surface tablet and Nokia Lumia smartphone, and Microsoft has the hardware to reach into homes to power serious automation and rich media experiences.

This week, Microsoft announced that it will be exhibiting at InfoComm 2014 in June. It wasn't lost on anyone that it now joins Crestron — a Microsoft partner — as the pair of Platinum Sponsors for the event.

In the press release announcing the move, InfoComm executive director and CEO David Labuskes called the addition of Microsoft "an important milestone in InfoComm’s history.... The decade-long conversation about the convergence of AV and IT technology has been realized."

Convergence is the big watchword here; more on that in a minute.

Together, the most well-known brands in control and automation systems (Crestron) and IT (Microsoft) will no doubt have some interesting new and existing product enhancements for integrators in the near future.

Google Buys Nest, the Smart Thermostat Company

Even more interesting is Google's purchase of Nest for a cool $3.2 billion. It's the latest example of the internet giant looking to leverage its internet "big data" expertise within real-world devices (think self-driving cars and now smart home devices.)

Tony Fadell, CEO of Nest, gave the keynote at CEDIA last year in Denver. To the relief of many in the crowd, he announced that the company was opening up its API (programming interface) to the industry with Control4 as its first partner, and offered product development highlights while reiterating Nest’s commitment to the custom installation channel.

In recent years, Nest’s new owner, Google, has taken its intelligent search advertising technology that my company leverages for custom integrators and applied it to artificial intelligence, developing what Slate's Will Oremus calls machine-learning.

He writes: "[Google's] goal is to imbue machines with the ability to respond and adapt themselves to human behaviors and environments, so that machines become not only more personalized, but fundamentally more human-like… The acquisition of Nest implies that Google sees the home, along with the car and the smartphone, as one of the primary frontiers for this project."

"The end goal," continues Oremus, "would be a home that gets to know you better the more you use it—not entirely unlike the vision of the automated home that you saw in The Jetsons." The Nest is Google's first shot across the bow, with Google Now smartphone app integration the next logical step.

What It Means for Integrators
This week's announcements have set the internet and AV industry at large abuzz, with reactions ranging from “no surprise” to “convergence is finally at hand.” For years, integrators have looked for the perfect set of network-connected products that make it easy for clients to automate control of their homes, while delivering a healthy profit margin and opportunity for recurring revenue to maintain and support the products. This necessitates the coming together (convergence) of AV and IT, and there's no doubt that Google and Microsoft are potentially the brands most well-positioned to pull it off.

With the proliferation of smartphones and tablets, consumers at all levels of income are becoming comfortable with sophisticated technologies that give them access to and control of their homes. Home automation is the next natural step.

The opportunity for integrators is clear. In 2013, 1.8 million home automation systems were installed in the United States. Twelve million new systems may be installed by 2016 (SecurityInfowatch.com). While integrators wait for new products powered by Google and Microsoft innovations, this month's headlines also means there's heightened awareness of home automation itself by consumers hungry to learn more.

As 2013 came to a close, Google's local search data shows that internet searches related to home automation products increased more than 11 percent in Q3, with clicks growing 16 percent in October, November, and December. Of particular interest was mobile and tablet searches growing 46 percent and 54 percent respectively in recent months.

The bottom line is that it's never been more important for integrators to be found in their local market during every research cycle for home automation and related services. We encourage all custom integrators to be assertive locally with their marketing. Take a stand for your market online in 2014 and beyond as the convergence of AV and IT occurs with the help of Microsoft and Google, leading to new installation opportunities for your business.

Brendan Morrissey is CEO of Netsertive (www.netsertive.com), a Google Premier SMB Partner that provides assertive, local online advertising for custom integrators to take the lead in their market to be found and install more.

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