I think we are moving to a labor only model but there is also a secondary point to keep in mind. We are moving toward a new paradigm in content distribution. Where once you had to obtain content from an antenna, MSO or disc we are now moving toward a streaming model with heavy content protection. A lot of the solutions we will want to integrate will not be available to us because our channel cannot generate the income these source demand as the price of entry.

This is non-rational in many ways since this channel began as audiophile showrooms for residential and moved toward ever cooler forms of sub-system and device integration. But we are running into a commodity market where the sorts of solutions we sold get in the way of manufacturers moving boxes. Sonos wants to move boxes. They do not want to turn on lights or permit integration of pools. They are generally simple in install and integrate. They provide a defined feature set and clients are generally happy with the result.

What we do is far more complicated and typically involves individuals who will substitute effort for knowledge. They will force their way through to a solution with less than optimal products that clients are generally happy with but not ecstatic with the end result. It is easy to sell a box. It is time consuming to shoe horn that box into one of our systems. It may not take much effort to provide a discrete ir code or control protocol but lot of the products we sell do not have this. Control is the last item that manufacturers care about since 98% of their purchasers use the cable remote to turn the set on and off.

Where once we were responsible for selling highly profitable big screen tvs and displays now Best Buy and Walmart sell more in a month that this channel sells in 2 years. It's about money and we do not fit into their business models. We want to integrate their products and they have no desire to permit this since it does nothing to impact their bottom line.

More fascinating is that Directv is permitting--at last--more integration of their product precisely at the moment both of us are becoming less relevant. I can see IP control of a D* box on maybe 3% of this channels sales. If you look down the road 3-5 years content is going to come via ISP not the MSO. That is the next dog fight since that is that battle involves advertising dollars. Yet look at the threads here. When most of us ought to be selling fewer features we want to sell more. We think cool is good. We are in love with technology. The manufacturers get it. They want to move boxes. We don't.

Alan