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A Conversation with ELAN’s Paul Starkey

ELAN has been through a lot over the past year and a half. After weathering its parent company Nortek’s major financial reorganization in 2009, the manufacturer led one of its largest product launches in history with the introduction (still ongoing) of its g! line, while simultaneously relocating most of its operations

ELAN has been through a lot over the past year and a half. After weathering its parent company Nortek’s major financial reorganization in 2009, the manufacturer led one of its largest product launches in history with the introduction (still ongoing) of its g! line, while simultaneously relocating most of its operations from Lexington, Kentucky, to Carlsbad, California, at the end of the summer. One person has remained a consistent and reliable presence within the company, however, and he is company president Paul Starkey.

When I spoke with Starkey this week, we discussed the introduction of g! a little bit, home automation market trends in general, and the status of the company’s transition to California. With so much in flux right now, everywhere, I have to say that it was comforting just talking with someone whose name is practically synonymous with the ELAN brand and the multi-room audio category.

Paul Starkey

I have been following the steady progress of ELAN’s g! launch for a while now. I was sorry see the departure of Eric Harper in September, but his move had more to do with an unwillingness to move to California, than it was any kind of indictment of ELAN or the product line that he was instrumental in building. What Starkey told me was that the line has been a big hit with his company’s dealers because it offers so many choices for control of a whole-home system. In addition to a hi-res touchscreen and a new hybrid (touchscreen and hard button) remote control, g! also can be controlled through an onscreen display, or through an iPhone or an iPad.

The handheld remote actually is not shipping in large volume to dealers until early February, following extensive field tests by 40 ELAN dealers, but Starkey said that reviews already have been positive. So has his personal experience with it.

“Everyone really likes the rapid-connect capability, and the range is phenomenal,” Starkey said. “Just playing with it here at the office, I’ve been able to control the system from 100 feet away with now problem.”

Starkey believes the handheld remote is an important piece of the g! line, because “we’re basically still a TV culture,” and most consumers are simply more comfortable with the look and feel of a wand-style remote. The added benefit of this remote, of course, is that it can control the rest of the home, including lights, HVAC, plus run all of the movie content and display music metadata from the system’s music server.

“We have the iPhone and iPad capability, but we’ve found that while consumers gravitate toward this sort of control initially, after about 30 days of using those devices, the clients says, ‘Hey, do you have anything that looks just like a regular remote,” Starkey chuckled. “It’s a fun concept to think about, because everyone has these devices, but at the end of the day we’re used to picking up a handheld remote and channel up and channel down, mute, off, and kinda spoiled that way. That’s what’s great about this new remote. I say that it’s 90 percent TV remote, but it’s 120 percent a home control remote, meaning that it’s twice as good as what we’ve been using.”

ELAN’s g! Family

When then talked about how the industry, in general, had gotten a little too far away from making the remote control a practical piece of home automation. I asked Starkey why the industry had become so fixated on two-hand tablets and touchpanels over the years. His answer was that the industry had “created so much functionality on the wall with touchscreens, that it seemed like a natural thing to put that in somebody’s lap.” While in high-end home theaters, “people were OK with that,” Starkey says that in the TV room, the “default paradigm” is the “candy-bar-style” remote control. That’s what everyone relates to.

“The industry probably got a little too infatuated with the touchpanel, but now the combination of hard buttons and some touch capability is the hybrid answer.”

Driving New Sales
Despite the tough economic climate where even high-end clients have moved down market, Starkey is optimistic that more people than ever are exposed to electronics, especially smartphones and “smart TVs.”

“I think those things are helping our category, because there’s more content, where ‘on the cloud,’ or from ‘hard media,’” Starkey said. “People are wanting convenient ways to access that an enjoy it.”

And while high-end clients may not be overly concerned with being “green,” they are, Starkey believes, “peace of mind conscious.”

“Peace of mind means being able to check in on your home when you’re not there via cameras, or getting smart alerts back to you indicating the condition of the home, and I think those things are driving the interest in home automation and entertainment systems like what we’re doing a lot these days. People have accepted electronics as a core part of their lifestyle. There are fewer buyers in the market than three years ago, but the buyers who are in the market are expecting more capabilities.”

ELAN, Starkey said, has experienced month-to-month increases every month in 2010, as result of improving conditions for dealers. “It’s not the 20 percent growth per year kind of numbers of years past, but we certainly think that high single-digit growth is possible next year.”

Education Initiatives
ELAN has very noticeably redoubled its training initiatives as a complement to the amount of new technology and application changes that are occurring at a faster rate than ever before, Starkey said.

“The need to keep current on training is huge in our business,” he stated. “We’re using the online university. We have a g! School that we’ve introduced, which allows students to refresh their knowledge and train on the new products as the come out.”

ELAN will continue to focus on face-to-face, hands-on training in 2011 as well, having opened up three training centers around the country.

“Even with the trend toward online training, there’s still a need to do hands-on hook up of equipment, where dealers can test it, break it, troubleshoot it. That’s still in constant demand,” Starkey said.

The Transition
Our final topic of conversation was ELAN’s move out west.

Starkey’s personal experience with the transition was that the spirit of cooperation between the teams from the once separate, but now unified, ELAN (and Sunfire and Aton), Niles, and Xantech brands, has been “far better than expected.”

“Our consolidation was absolutely important,” Starkey said. “It’s been great for our dealers, because there’s now far less conflict of brands, we are better organized, and can provide extra value.”

And after what he calls “a pruning exercise” that took place during the move to California and consolidation of brands, the company is now hiring new, “very smart” people. The whole process, he said, has been “enlightening” in the way that three different corporate cultures have been intertwined, bring the best practices of each separate brand under one roof.

Although the warm and fuzzy aspects of the move can be heartening to ELAN dealers, the reality on the ground is that the economy is still struggling and products are selling like they used to. Starkey acknowledged this fact, saying that only because ELAN had a parent company with deep reserves after its restructuring, was it able to survive the downturn. That “war chest,” as he called it, along with the executive leadership of AVC Group president Mark Terry will continue to help ELAN and its sister brands to develop new products and support their dealers, until things really get rolling again.