Burkhardt of Origin Acoustics Returns to Architectural Speaker Roots

The onetime brain trust of SpeakerCraft, whose founders lay claim to having invented the in-wall speaker, is together again. Former SpeakerCraft CEO Jeremy Burkhardt and SpeakerCraft co-founders Ken Humphreys and Ed Haase reunited to form Origin Acoustics, with plans to “reinvent” the residential architectural speaker market beginning with an October product launch, Burkhardt, CEO of the new company, told Consumer Electronics Daily.

Burkhardt’s aggressive plans call for signing 300 dealers during the first year to sell Origin’s line of in-wall speakers ranging from $99 to more than $3,000 per pair. Burkhardt pegged the U.S. in-wall speaker market as a $500 million opportunity. The company is targeting distribution in 80 countries between September and January, but Burkhardt didn’t identify the worldwide market opportunity. Citing competitive concerns, Burkhardt would say only that pricing is designed to give dealers “the highest margin."

While the Origin executives’ experience with SpeakerCraft was largely in entry-level to mid-priced speakers, Burkhardt said the Origin lineup will have more speakers above $1,000 per pair than below. While the market has shifted from 70 percent driven by the new housing market to 30 percent, Burkhardt said that’s enough the support the fledgling company. One of the keys of the line is its ability to install easily into retrofit projects, he said.

On why the residential custom installation market needs another in-wall speaker line, Burkhardt said, “It absolutely doesn’t if we do it the same way everybody else did.” The industry has been doing in-wall speakers the same way “since we invented the first in-wall speaker for Sonance in 1983,” Burkhardt said, citing plastic baffles and metal grilles. After making “tens of millions of these products, we had to do it different, so we changed the aesthetics and the features you expect to get,” he said. The company is touting service and training -- the kind of support SpeakerCraft gave to dealers before the company’s purchase by Nortek, Burkhardt said.

The architectural speaker market has shifted to a “monoprice” model where dealers buy products online, quickly and conveniently, “and at a good price,” Burkhardt said. But the shift online, he said, means sound quality that’s “just good enough.” Origin’s new designs are “way easier to install” and don’t require a tool for mounting, he said.

Backing its sound quality claims, Burkhardt said the company is designing “every part of our speaker,” including drivers, basket, spider, cone and surround, with the parts produced in California before being assembled in China. He said SpeakerCraft at one time manufactured drivers and crossovers when it made speakers for companies including Bang & Olufsen, JBL, Niles, Polk Audio and Sonance. “That’s our lineage,” he said. “We're not going to China and just taking off-the-shelf product,” a practice that has become more commonplace in a “parts and pieces” business. Rather than using “run-of-the mill” factories, Origin has exclusive factories producing its woofers and patented tweeters, he said.

Origin is pitching its lineup on aesthetics, sound quality and ease of installation after a development cycle 18 months in the making, Burkhardt said. The company has patents for tweeters, woofers and installation design, he said. The speakers’ tool-less mounting systems are one feature that set the in-walls apart from the competition, and they allow installers to reduce installation time, he said.

Giving his perspective on the industry, Burkhardt said the housing boom in the early 2000s and the bust in the late 2000s were notable for the influx of lower priced single-family homes that could afford to have audio specified and installed at time of purchase. “That changed the distribution market quite a bit,” he said, but the way the category goes to market -- through specialized dealers -- hasn’t changed, remaining “quite small.” In a small channel, “you have the ability to provide a better product at a better price,” he said. Companies with a better feature set can “stand out and grab market share,” he said. That strategy helped build 65 percent market share at SpeakerCraft at one time, he said.

Origin won’t take on OEM or do-it-yourself businesses, Burkhardt said, calling the DIY market a “fallacy.” He cited in-wall speakers sold at Best Buy (ironically, the SpeakerCraft brand is sold through Best Buy’s Magnolia stores) and said “it’s a very slow selling market.” In mainstream Best Buy stores he identified architectural price points of $129-$149 and noted consumers can get wireless Bluetooth speakers for the same price.

Consumers understand the value of the streaming speaker, he said, but not the in-wall speaker, and he called that a failure on the part of the loudspeaker industry. “We haven’t educated consumers to the point where they desire an architectural speaker, yet you can take an inexpensive off-the-shelf speaker that plays Bluetooth and the consumer will want it in a moment because it’s easy to use,” he said. In-wall speakers are easy to use, too, “once they're hooked up, but it’s a big decision to get it to that point,” he said.

Origin plans to keep close to the custom market and is open to selling through adjacent channels such as security dealers, Burkhardt said. He recalled the Proficient brand that SpeakerCraft sold successfully through the security channel years ago and said if opportunities arose in that channel, “we would definitely examine them.”

While SpeakerCraft delved into other categories, including electronics, Origin will stick to its loudspeaker roots, Burkhardt said. “I'm an architectural speaker guy,” he said. “That’s our core and that’s what we do well.” Origin will offer accessories such as infrared devices, designed by former Xantech employees who have joined the new company, but it has no plans to get into categories such as control systems, he said.