One of the foundations of the custom electronics industry, the dedicated home theater, appears to be back in full force. With today’s technologies like Dolby Atmos, High Dynamic Range, and 4K video, there’s plenty for consumers to be excited about.

The biggest surprise from this year’s CE Pro Home Entertainment Deep Dive survey is the return of dedicated home theater rooms when it looked like they were going the way of the dodo a few years ago. Now, indicators are pointing to not only private cinema’s comeback, but jobs are incorporating more loudspeakers and more projection systems.

It all adds up to an opportunity for which integrators raked in a median of $62,500 on a dedicated home theater project. That figure is way up from last year’s $43,750 median — a jump of 43%! 

Dealers are pretty optimistic that the home theater momentum will continue for the remainder of 2024, as they are collectively predicting a 3.5% increase in business this year.

Multipurpose Media Rooms Still Frequently Requested

Perhaps another signal that dedicated theaters are faring well is that integrators did fewer multipurpose media rooms last year to focus on the bigger-money work. 

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The median number of installations for dedicated vs. multipurpose home entertainment rooms was five apiece. That stayed status quo for private theaters but was two installs down from last year on the multipurpose side.

That’s not to say the multipurpose media room trend is sinking like a stone. Quite the opposite. The median cost per installation is a healthy $37,500, which represents a strong 20% gain from last year — again finding that dealers are landing larger jobs than a year ago.

Integrators reported they are installing home entertainment rooms as part of a whole-house AV and control system 71% of the time, with 40% of those dealers tying in at least half of such systems. 

On the flip side, 29% of dealers say their theaters are all standalone systems. 

Impressive Amount of Installations

The most common range of completed theater rooms for both multipurpose and dedicated rooms is 3 to 10. Virtually half of the survey takers (49%) noted that on the dedicated theater side, while 45% noted it for multipurpose media rooms.

When it comes to volume, a full quarter (25%) of integrators did 11 or more dedicated theaters. Only 5% noted not working any dedicated home theater jobs in 2023, which was a drop from 14% the previous year, another indicator the market is indeed returning.

Meanwhile, when asked about the location of home entertainment spaces, installers reported projects equally for dedicated rooms and multipurpose rooms (41%). Last year, integrators said only 27% of them were in dedicated rooms, another big leap. Basements were third at 16%.

When it comes to multipurpose media rooms, 20% of dealers did 11 or more jobs, while 16% did not do any last year.

Dedicated Home Theaters Outfitted with More Tech

Want more evidence of the dedicated theater room demand? 

Dealers outfitted 14% more theater rooms with 7 to 10 seats last year than in 2022. When you add up the 11+ seats responses it pretty much splits the projects in half — 51% with 7 or more and 49% with 6 or fewer, likely representing sofas and love seats than several rows of theater seating on risers.

When it comes to audio, the immersive surround-sound formats are providing more impetus for consumers to purchase more speakers, subwoofers, and higher-performing components. That shows in the whopping 90% of dealers that installed 6+ speakers into home entertainment spaces. That’s compared with 74% a year ago.

Taking it a step further, 49% of integrators installed 9 or more speakers, lending these systems to supporting Dolby Atmos, DTS:X, and Auro-3D. Indeed, survey takers said 88% of their installs featured immersive audio, a leap of 21% from last year.

Also on the audio side, the percentage of theater rooms incorporating architectural speakers rose from 71% to 88%, which makes sense considering the amount being installed for surround and height speakers.

On the video portion of the home entertainment equation, this year’s Deep Dive found that projection systems and large flat screens were installed equally (41%). While ultra short throw (UST) and brighter projectors can work well in rec rooms and such, the projection systems are more likely to be in the dedicated rooms. 

The discrepancy between displays and projectors was a very wide gap to close. Last year’s survey found displays were installed 58% of the time vs. 34% for projectors. Integrators aren’t quite sold on microLED yet, however, as only 5% of theater spaces included this pricier option to projection.

As far as automation and amenities go, integrated lighting control was way up, shooting from just 54% to 87%. The same percentage of theaters employ remotes and touchpanels for commanding all the tech.

Acoustical treatments remains the most requested amenity, with over one-third (36%) of projects including it.

Have you gone back to existing customers to upgrade their theaters? Are you proficient in balancing media systems with other features for a rockin’ home theater system? Now’s the time to capitalize on the surging home entertainment business.

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