Core Brands to Launch SKAA-Based Personal Audio System At CE Week

Nortek’s SpeakerCraft brand, within the Core Brands group, had planned to launch a 2.4-GHz-based wireless audio system early this year, but those plans were scrapped and the product never delivered, Starkey said. Synergi, which was to follow the ill-fated Nirv multi-room system, was scheduled to come out at about the time the company was integrating SpeakerCraft with its other custom electronics brands including Niles Audio, Elan, Panamax/Furman and Gefen into Core Brands. The company halted Synergi development and “stopped for about 60 days to evaluate what we were going to in the wireless audio space,” Starkey said. The personal audio product that Core Brands will unveil next week is positioned as superior to Bluetooth, Sonos or Jambox because it’s based on the SKAA wireless music standard, which Starkey said was “beyond Bluetooth” in range, connectivity and multi-user capability.

On the multi-room audio side, where the company’s five Nortek brands have operated over the years, the multi-room solution will be more Wi-Fi based, Starkey said. Those products will come out in the near future with the strategy of leveraging a common platform over the company’s five audio brands. The line will be Wi-Fi based with uniquely-branded speakers, and applications can be built on the platform, he said. It’s an all-new platform, he said, and a public announcement will be made later in the year, likely the CEDIA timeframe, he said. The open-architecture platform will have API hooks for control and the platform will be shared by Core Brands for multi-brand use, he said. Products will be “very different by brand,” he said, but they will all have common connectivity.

Nortek disclosed a unified pricing and business program, effective July 1, which will allow dealers to buy on a common pricing level across all brands available to them. One purchase order can be combined among brands, with a single shipment and invoice, he said. As the company was bringing together the various brands in the past, dealers had to juggle different terms among brands, but under the restructured program, they'll be able to work under a single set of terms, credit policies and minimums across brands, he said. The new program “streamlines” the way dealers do business with the company, he said. Each dollar dealers buy under the combined program adds to their buying power, which translates to more benefits and more discounts, he said. “It will be an opportunity for dealers to improve margin and get high-quality product,” he said. Core Brands is part of PRO, HTSA and Azione Unlimited buying groups, he said.

The new dealer program is the latest in a series of restructuring efforts by the company, which disclosed plans to combine brands at CEDIA last fall. Earlier this month it severed ties with 16 manufacturers’ reps as part of a plan initiated in October to realign the sales field into more regions and “sell a branded set of products in a portfolio,” Starkey said. In the six months since the company realigned the sales force, conflicts of interests became apparent, he said. “Sometimes the rep firms didn’t always have our objectives in place,” he said. The new structure simplifies business for dealers and makes it easier for them “to have discussions on brands they don’t have and pick from the portfolio,” he said. In some cases, individual rep interests “were at odds with what we were trying to do for the dealer,” he said. In half the territories, Core Brands downsized to one rep and in the remainder there are two reps “where we thought the reps could work as one,” he said. Some brands had their reps for 20 years, he said, adding, “We believe we have the best team on the field.”

On whether any brands are under scrutiny as part of the ongoing streamlining of Core Brands, “It’s always something we're looking at, but because we've gained so many efficiencies and managed the brand, it’s less of an issue than if the brands had continued to stand alone,” Starkey said. There have been questions about continuing with smaller brands or making them product lines within a larger brand, but the Core Brand concept has simplified product positioning, he said. Some products will remain limited-distribution and should be helped by the new program that will enable dealers to purchase both limited and non-limited brands, he said.

When we asked about an update on Nortek’s projected path for recently purchased security company 2GIG, Starkey steered us to the “half a dozen smart home initiatives” currently under way within Nortek. 2GIG comes to home automation from the security side, while Elan and BlueBolt come from the home entertainment and power management side, he said. There will be a number of “different points of entry” to the smart home field under the Nortek umbrella that will address different segments of the market, he said.

On whether Core Brands feels the pressure of heavyweights AT&T, ADT and Comcast in the smart home market, Starkey said, “I think everybody does.” After being promised since the 1950s, “finally the great frontier of smart home is happening and in hundreds of thousands -- if not millions -- of homes,” he said. The push is being driven on three levels: custom, the “do-it-for-me” model such as AT&T Digital Home that’s installed in eight hours or less and the do-it-yourself market, he said. The “do-it-for-me” model is getting a lot of play now because of the attention the large companies have brought to the space and because the recurrent revenue model has lowered the entry point for smart technology for consumers, he said.

"At last there’s some collective momentum here,” he said, calling smart home technology one of the “best opportunities for the CE market in the next five years.” Smartphones and tablets have added executable focal points in the home, he said. “We're going to see millions of homes adopt technology because the price points are there where it isn’t just lifestyles of the rich and famous,” he said. Nortek has sights on all three segments, he said, while Core Brands will stick to its more custom roots.

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Onkyo, its parent company Gibson Guitar, Danish speaker brand DALI and Australian speaker brand Accent Digital have all joined the WiSA Association, the association announced Tuesday. Onkyo is working with WiSA to deliver “game-changing products that will finally give the consumer the high-definition wireless audio experience they want for their home theater,” Onkyo said in a statement. Gibson, which owns a majority of Onkyo, has expanded into the home theater market, and CEO Henry Juszkiewicz said providing a “high definition wireless audio solution is a strategic priority for Gibson.” Joining the association was a natural fit because “it is the only multi-channel wireless technology out there that is capable of delivering the HD audio experience that the broad market is demanding,” he said. The association announced last week it had opened its testing facility for certification at a Simplay Labs unit in Sunnyvale, Calif., and that three to five speaker systems were “queuing up” for tests (CED June 17 p1). The WiSA Association expects 15-20 WiSA-certified products to launch by CES next year. Klipsch, an early member of the association, has provided WiSA-enabled speakers for CES demos in the past. A spokeswoman told us Klipsch models are not among the speakers currently under testing in Sunnyvale, but “the brand does intend to have WiSA technology in its high-end speakers in 2014.” No further details were available.