UEI Targets Smart Home With Ecolink Buyout

UEI wants a bigger presence in the smart home.

Known for its wireless remote control technology, Universal Electronics Inc. has now announced that it intends to acquire smart home solution provider Ecolink Intelligent Technology in a deal expected to be worth about $12.4 million over the next five years. Ecolink, which sells wireless security and automation components, will operate as a wholly-owned subsidiary of UEI and will continue to sell products and services under the Ecolink brand.

UEI brought universal remote controls to life when it invented the universal remote control database of manufacturer codes. But the company has expanded beyond that claim to fame to become a leader in low-cost, low-power RF technologies. Today, UEI includes some of the world's top television and service provider brands on its customer roster, including Samsung Electronics Co. Ltd. (Korea: SEC), TiVo Inc. (Nasdaq: TIVO) and Comcast Corp. (Nasdaq: CMCSA, CMCSK).

In one of its highest-profile success stories, UEI worked with Comcast to help develop the company's voice remote for its X1 IP video services. Initially, UEI wasn't sure it would be able to work with the low-cost RF technology that Comcast had in place because the MSO needed to be able to stream voice commands from its remotes to X1 set-tops. However, thanks to the development of new compression technology, UEI was able to make voice streaming over RF feasible. That compression software from UEI now operates on Comcast X1 remotes, while UEI's decompression software runs on X1 cable boxes.

The voice remote was a big hit at the Internet & Television Expo in the spring. UEI Director of Product Management for the Americas Jeff Kohanic confirms that UEI's underlying technology "was of interest to just about every single operator we talked to at the show." (See Cable's Cloud-Based UI Makeover.)

Beyond TV remotes, UEI emphasizes the value of voice control for smart home functions like security and home automation. Voice commands can be used to add new functions to a remote without introducing complex menus or adding new physical buttons. "We don't want to add buttons to the remote to dim the lights, but we can certainly support the remote streaming 'dim lights' as a [voice] command," notes Kohanic.

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The ability to support voice control is where UEI should marry well with Ecolink's smart home portfolio. Ecolink's engineers have helped develop smart home products for a long list of companies, including General Electric Co. (NYSE: GE), Honeywell International Inc. (NYSE: HON) and Tyco Electronics Ltd. (NYSE: TEL). Its current products include door/window sensors, garage tilt sensors, motion detectors and more.

The timing also looks good for merging UEI and Ecolink. According to ABI Research , the market for sensors and other devices supporting home security and automation is expected to almost triple from $1.4 billion in 2015 to $4 billion in 2019.

— Mari Silbey, Senior Editor, Cable/Video, Light Reading