Ecotech Marine/ Aqua Illumination Merger
by Justin Hester
Two weeks ago we saw the two giants of the reef tank LED industry announce a merger. Like most mergers, it was announced that in the near term, there will be little change in either companies products, support, or sales models, but what will the future hold? How will they merge and enhance their future joint products? What will this mean for the hobby? Do our reef tanks win or lose in the long run?
Why Merge the two market leading brands?
Sometimes in the business world 1+1 =3, but is this the case for the AI, Ecotech merger? Mergers happen for a lot of different reasons including patent acquisition, strategic business alignment, and product dominance. Looking through that lens, there should be some sizable gains down the road for these two companies with regards to R&D, production, and their back office operations. They also have 2 of the best selling reef light products so having #1 and #2 under the same management can only strengthen their market position.
Win or Lose?
In the 2 weeks since the merger was announced we have seen mixed chatter in the reef inner web about what this will mean for hobbyists. There are the alarmist folks who assume consumers will see from this will be a monopoly that will drive up the already premium costs of these company’s offerings. Then there are those that think that the merger will lead to a world where all things light and flow are controlled separate from the rest of our reef tanks. The truth will most likely lie more towards the later initially, but I do think we will see some steering towards “total control” as the long term outcome. More on that in a minute, but both companies have stated that the product lines, prices, and support structure will remain unchanged for the foreseeable future.
We will start to see over the next 24 months whether we the users of this technology truly win or lose, but I tend to be an optimist that the reef market we all participate in will have a shaping effect on how Eco/AI runs their business and what product offerings they come out with in the future. I tend to think its a good thing that the Hydra 52 might some day soon have the same control interface as the Radion line. To then have both in tune with your water flow might also be a great future enhancement.
What does this mean for future LED technology?
After some time has passed, you would expect some of the business divisions of these two companies to begin acting as one. Typically marketing, accounting and other back office processes will begin to consolidate, while operations and product development typically take a bit longer to align. As this later alignment happens, we may see some of the reef control aspects Ecotech has perfected start to be standard for the AI product line. Personally, I wouldn’t be surprised if we saw a third leg to this new company start to focus solely on control. To date Ecotech has done a great job with the wireless connectivity of its products as well as making a nice easy to use mobile app, but in order to integrate this to your tank controller, you had to look at another module from say Neptune. Making this all one seamless user experience is where I see some things happening in the next year or two. Who knows, maybe we see these two companies come up with a product to challenge Neptune’s Apex. Maybe they buy Neptune and add them to their portfolio. Either way, its going to be exciting to see what comes of this new company and how they enhance and refine the technology we use with our reefs!
What do you think the future of this merger will hold?
For a FAQ regarding the merger you can look here.