SIGNALS

I hate Covid. You hate Covid. We all hate Covid. But we love home theater. That creates the circumstances for an interesting scenario that economists refer to as “revenge spending.”

In Pandemic Year One, you skipped your summer vacation entirely. In Pandemic Year Two you took a mini-vacation, vastly scaled back from your usual blow-out. Weekend getaways – not really. Dining out – either canceled or done sparingly. The reason, of course, is Covid and the infinite number of ways that it has locked us down, masked us up, disrupted supply chains, and caused all sorts of terrible grief.

You are understandably angry, that's for sure (but hopefully healthy). You also have all that unspent money, possibly including some government assistance cash, burning a hole in your pocket. And, the stock market has been unusually benevolent — so far. Since Covid prevented you from buying things you normally buy — you are feeling a sense of both anger and privation — you might get your revenge by spending your money on something else. Revenge spending.

So, what can we spend money on? How about home theater gear? From a technological standpoint, the products have never been better. Plus, prices are still moderate. Plus, we need something that lets us enjoy our new streaming subscriptions (movie theaters are another thing we've not been spending money on). Plus, altogether, we're just spending more time at home. All of these pluses add up to the potential for a healthy boom in home-theater sales.

For a time, the trend was toward living spaces that happened to have a TV and a soundbar. The screen was flat, the soundbar was unobtrusive, and tiny surround speakers could be wireless. All of the objections against putting a stereo with big speaker cabinets in a living room were gone. It made sense. Then Covid hit.

We still aren't going out as much. Cocooning is back into vogue. For better or worse, we are spending more time watching TV and playing video games. As the importance of audio-video grows, so does the case for a dedicated home-theater room. Throw in the fact that you might need a more private place for business Zoom calls, and a new trend is off and running.

It's also impossible to overestimate the importance of streaming in our new viewing habits and expectations. Formerly, the only way to get great quality content was via DVD or Blu-ray. But discs, as physical media, increasingly seem old fashioned in a world of vast movie-libraries-in-the-sky content. The DVD seems tied to LPs, CDs, and grandpa. Streaming changed all that, instantly updating the expectations of content, and replacing possibly hundreds of disc titles with a seemingly infinite number of streaming titles. More than anything, streaming rebooted our perception of home entertainment. Suddenly, home theater is cool again.

Another consideration: Formerly, home theaters could be intimidating. Thanks to feature-creep, gear was overcome by a plethora of switches and buttons, and that turned off a lot of people. But as software has replaced the buttons and improved usability, and as consumers become more tech-literate, increasingly home theaters seem manageable and even easy to use. Hence, they are more widely accepted.

How long will the trend last? No one knows. That's like asking how much longer will Covid cause grief, and how long-lasting will our new habits be after its major impact is gone? For now, streaming is in, dedicated home theater rooms are in, and many folks have pent-up cash to spend.

I don't really care whether or not you buy some home theater stuff. But seriously, whether its monetarily or otherwise, find a way to get some kind of revenge. We all hate Covid.