UK smart home market worth £2.2bn says CEDIA

New research reveals optimism across the UK custom installation market, with 67 per cent of firms expecting revenues to increase, while skilled labour remains the industry's biggest challenge.

CEDIA has estimated the UK professional smart home market to be worth £2.2 billion, with the association's latest research revealing a largely optimistic outlook among integrators despite continuing concerns over skilled labour, rising costs and the changing nature of the market.

The figure was unveiled by CEDIA Director of Research Ryan Bardach during a presentation of the organisation's new 2026 UK Professional Smart Home Market Analysis.

According to Bardach, the decision to create a dedicated research department came from a recognition that reliable market data was becoming increasingly important to the industry.

He explained that CEDIA had made a strategic decision to become a leading source of market intelligence for the smart home industry, with research previously handled by different teams now being centralised under one department.

The UK study is one of the first major projects to emerge from that investment.

A £2.2bn market, but a new starting point

The £2.2bn figure represents a recalibration of previous estimates rather than a contraction in the market.

Bardach explained that CEDIA had used a broader range of data sources for the latest study, including survey responses, CEDIA's membership database and information supplied by manufacturers and distributors.

“We came to the conclusion that the previous estimates were likely inflated,” he told the audience.

“The market didn't collapse on itself; it didn't lose all the money. We just recalibrated how we determine the size, and we feel like this is far more accurate.”

The new methodology means that CEDIA is treating the 2026 study as a new baseline.

“This is kind of our first line in the sand,” he said. “We're going to start tracking trends long term, starting from here.”

CEDIA plans to repeat the market-sizing study every two years, allowing the new methodology to provide a consistent basis for tracking changes in the market.

Integrators expecting growth

Despite the economic pressures facing the industry, the research paints an encouraging picture of business confidence.

Sixty-seven per cent of UK firms expect their revenue to increase over the coming year, while just 6 per cent expect revenue to decline.
Bardach said the expected growth is primarily being driven by increasing customer demand, with some integrators reporting that the additional demand is already happening rather than simply being anticipated.

“There's a lot of optimism,” he said.

The research also found that mid-sized firms account for the largest share of UK market revenue; a contrast with the US, where larger businesses account for a disproportionately large share of revenue.

Lighting identified as the biggest opportunity

When asked where they see the biggest opportunities over the next year, lighting came out on top, followed by home automation, networking and AI integration.

The result was broadly consistent with CEDIA's US research, where lighting was also identified as the leading opportunity, although AI integration ranked particularly strongly in the US market.

The research also highlights the continuing importance of networking to the integrator business.

Media rooms, home networking and integrated control systems were identified among the most frequently installed residential technology solutions.

For whole-house integration projects, home networking was the system most likely to be included, with a significant gap between networking and the next category, audio.

Skilled labour remains the biggest challenge

While the revenue outlook is positive, finding suitably skilled people remains the industry's biggest concern.

Almost a quarter of firms identified skilled labour availability as their biggest current challenge, closely followed by increasing costs.

AI is already changing the industry

Perhaps one of the most significant findings from the new study is the speed at which AI is entering the professional installation business.
A whopping 83 per cent of respondents said they had increased their use of AI within their own businesses, while 51 per cent reported an increase in customer requests for AI-related products.

Despite the growing interest in AI and specialist software, one of the more surprising findings was that Microsoft Excel remains the most widely used tool for quotes and sales management.

WeQuote followed with a 30 per cent response, ahead of Visio and various in-house solutions.

Ubiquiti, Lutron and Sonos lead brand preferences

The research also provides a detailed look at brand preferences across the UK CI market.

Ubiquiti was identified as the leading networking brand, followed by Ruckus.

For lighting fixtures, Orluna was identified as the leading brand, followed by Arc LED and Collingwood, while Sonos led the in-room speaker category, followed by Monitor Audio and Bowers & Wilkins.

The wider results included Control4 and Crestron in integrated control, Lutron in lighting control and shading, Denon and Anthem in AV processing, Blustream and Control4 in AV distribution, Sonos in multi-room audio, and Sony, Samsung and LG among display brands.
Sony and JVC were identified among the leading front-projector brands.

Should cinemas and media rooms be one category?

The presentation also prompted an interesting debate over how the CI industry itself should be measured.

One attendee at the event, questioned CEDIA's decision to separate dedicated cinemas and media rooms within the research.
“I think that hides the scale of the category,” he argued.

“The product set is largely the same, the skill set is largely the same, and actually customers… have no idea what the difference is between a dedicated room and a media room.”

He suggested that combining the categories would make them the largest category within the study. Bardach acknowledged the point, explaining that CEDIA had consulted with industry members when developing the categories, but that decisions had ultimately needed to be made.

Is it time to include light commercial?

Another question highlighted the changing nature of the integrator's role, given that many companies operating within the residential CI sector are also working on projects involving bars, restaurants, clubs and hospitality.

“For the moment we're only focused on residential,” Bardach explained, while adding that commercial was not necessarily ruled out for the future.

The longer-term ambition for CEDIA's research programme is considerably bigger than the UK study.

The US and UK research has been carried out using the new methodology, with India next in line, followed by a Europe-wide study planned for 2027 and Canada expected in late 2027 or early 2028.

The objective is eventually to be able to compare markets using the same methodology.

“Once we have that, then we can really do some exciting stuff comparing and contrasting markets,” said Bardach.

“The end goal” is a worldwide comparative view of the professional smart home industry, with the same questions, scales and methodology used across territories wherever possible.

The full report can be downloaded from CEDIA’s website here.