Snap One gets sold off to Resideo. Bose buys out McIntosh Group and along with its namesake, snatches up Sonus faber. Daisy kicks off an acquisition spree across the industry, and everywhere in between, other distributors and dealers are making their own moves. This year provided a massive hotbed of activity in the merger and acquisition space for the custom integration industry, with 2024 representing a period of substantial consolidation within the space.
Historically, these moves have been rather sparse in the residential space, but it’s more than typical for many associated industries. Commercial AV and security see these types of moves all the time. Just last month, there were five total acquisitions in the security space as reported by our sister publication Security Sales & Integration. Still, this string of acquisitions in CE has many throughout it worrying as to what it means for the health of the industry at large.
Matt Bernath of Vital LLC, however, says that this type of action was largely expected, maybe not in 2024, but certainly in the future.
“This trend was inevitable as our industry grows in sophistication and attracts external attention,” he states.
A newcomer to the custom integration industry, Daisy conducted eight acquisitions this year alone, with industry veterans such as cyberManor and SaaviHome now calling themselves part of the Daisy team. Running on a franchise model, Daisy’s main value proposition is providing the resources to integrators that otherwise wouldn’t have the ability to scale their business further than their current point.
Lightapalooza took place in late February, and the growth of the event has mirrored the rapid ascension lighting fixtures and controls.
“The flurry of acquisitions in a single year signals a watershed moment for residential integration. Unlike commercial or security sectors, which matured into consolidated spaces years ago, residential integration has long been a fragmented, owner-operator market,” notes Bernath.
At the individual dealer level, veterans of the industry Audio Advice and Gramophone made similar moves this year, acquiring The Audio Lab and merging with World Wide Stereo, respectively, with the goals of improving service and showroom experiences at the firms.
“This wave of M&A marks the beginning of a shift towards greater maturity and possibly higher barriers to entry,” Bernath contends. “For independent integrators, this moment calls for reflection and action. Businesses with solid processes, financial discipline, and strong value propositions will find themselves better positioned to compete—or even become attractive acquisition targets themselves.”
But even with these moves highlighting a moment of opportunity for many, Bernath is quick to point out that not every evolution is without its growing pains.
“Those without these fundamentals may face difficulties,” he adds. “This evolution isn’t inherently bad. Increased competition drives improvement, and as the market grows, there’s potential for expanded consumer awareness and demand for our services. However, it does mean that sitting still isn’t an option. The market is changing, and the businesses that embrace change with a growth mindset will find themselves thriving in this new landscape.”
It isn’t just integrators that are getting into the mix of mergers. Manufacturers and distributors have also engaged in their fair share of business plays. Walmart picked up popular budget smart TV manufacturer Vizio, while ASSA ABLOY snatched Level Lock directly after its debut at CEDIA Expo 2024.
Snap One, a company that had previously made waves of its own through a series of acquisitions–like that of Access Networks–was acquired by Resideo in June. Following this, Bose announced it would be adding both McIntosh and Sonus faber brands to its portfolio following a sale by Highlander Partners last month.
As these businesses grow, however, it’s hard to ignore the concerns these colossal shifts raise. More than being an upending of the status quo, consolidation of an industry can create uncertainty over the quality of a product or service moving forward.
It’s a concern Bernath notes is especially pertinent in a service-based industry like custom integration.
“Scale can threaten the quality of service—a core pillar of our industry,” Bernath explains. “Many of these large players will struggle to maintain the boutique, client-first experiences that custom integration excels at delivering. Service in our space is personal, and relationships often underpin customer satisfaction and loyalty. The risk for large, consolidated entities is becoming too process-driven, losing the flexibility and responsiveness clients expect.”
But there is opportunity in the lumberings of giants that Bernath hints at.
“This is where independents can differentiate themselves. By staying agile, prioritizing customer relationships, and emphasizing high-touch service, smaller companies can thrive even as larger competitors enter the space. The key is to recognize where your strengths lie—relationships, trust, and expertise—and leverage them effectively.”
Experts like Bernath seem to broadly look at mergers and acquisitions with an air of optimism, their sheer number offering legitimacy and awareness to an industry that, in the sole case of the latter, has long been seeking it out.
“These moves mirror what we’ve seen in other home services and technology sectors, where institutional capital enters to professionalize operations, standardize processes, and achieve scalability,” Bernath summarizes.
“On one hand, it introduces a level of professionalization that can elevate the baseline of service and bring broader consumer awareness to what we offer. On the other hand, it challenges independents to either adapt or risk being outpaced. The presence of institutional players also highlights that our market holds untapped potential—an encouraging sign for those ready to step up their game.”
Back when smart home company Vivint was acquired by NRG, a utility company, a similar sentiment was echoed by then Editor-in-Chief Jason Knott in an article questioning the value of the custom integration space to outside industries. In it, Knott saw integration companies offering energy management as attractive acquisition targets of utility companies.
No such similar acquisitions have occurred since then, but the events of the past year still point to that intrinsic value being there, especially as more integrators become involved in these business plays. While Knott asked specifically whether or not utilities will be making more plays in the space, perhaps the greater question is: which industry will make the next play?
There’s also the question as to how integrators and businesses left out of these deals will differentiate themselves in the years to come. Will others seek to scale up to compete and grow? Or, as Bernath had mentioned, will more begin to lean into their agility and intimacy as a smaller business and take an entirely separate avenue of brand innovation?
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