Lantos Technologies Has A Working Demonstration Of World’s First Digital Ear Canal Scanner

Lantos Technologies, developer of a 3D digital ear canal scanner that could be a game changer for the hearing-aid industry and consumer audio business, has been demonstrating its technology at the Starkey Laboratories 2012 Hearing Innovation Expo in Las Vegas. Audiologists at the conference Tweeted about the “wow” effect of a product that’s slick, comfortable and easy to use. To see a demonstration, click on the video:

The Massachusetts company calls its product “the world’s first intra-aural 3D scanning device.” It is a direct, digital, 3D scanner capable of measuring ear canal shape and tissue compliance to produce a highly accurate map of the ear canal. It will eliminate the uncertainties associated with manual fits, greatly improving the performance of custom made ear products across a wide variety of markets ranging from hearing aids, to headsets and earphones for iPods, MP3 players and high-end audio applications, and industrial hearing protection.

On The Starkey Labs Drawing Boards: New Xperia Brand Of “Instant-Fit Custom” Hearing Aids Will Integrate Wireless Feature Set

Sources at the Starkey Laboratories 2012 Hearing Innovations Expo in Las Vegas report that company representatives today provided a glimpse of a new Xperia brand of “Instant-Fit Custom Hearing Aids” that will integrate Starkey’s popular Wi-Series wireless technologies featuring Bluetooth phone connectivity, TV audio and MP3 streaming, and other communication direct into the hearing aids.

The new hearing aids feature an innovative in-the-canal (ITC) design which has a removable earbud that fits in the ear canal, with a housing for the processor unit that sits in the concha of the outer ear.

The unit looks like a custom hearing aid but can be fitted for most ears. And, rather than an old-fashioned half-shell or full-shell design, it bears more of a resemblance to a contemporary Bluetooth earpiece or high-tech earphones.

A big selling point apparently will be the same Starkey wireless capabilities now found in company’s very popular open-fit on-the-ear Wi series, including pairing with the Starkey Surflink remote streamer for communication direct to the hearing aids with multiple peripheral devices and binaural wireless communication between the left and right hearing aids.

There was also talk of a broader line of in-the-ear products to come, including a completely-in-the-canal (CIC) SecretEar hearing aid with the same complete wireless feature set.

Starkey has raced to compete with other major manufacturers in delivering wireless functionality following major announcements over the past two years by Widex, ReSound, Oticon, Phonak and others. Starkey sources say the Wi Series wireless feature set has proven highly popular with audiologists, who have asked for the same functionality in more form factors, especially in-the-ear custom-style products.

Founding Member Of N.W.A. Rap Group To Move Sonomax Into Consumer Hearing Markets As Creative Director

Sonomax, once a somewhat staid manufacturer of ear plugs and hearing protection solutions for industrial users, has recently moved into the heart of the consumer audio business with its sculpted eers self-fitted custom earphones.

Now, the Canadian company is showing it’s all in to the consumer market with the appointment of K. R. Nazel–a.k.a. Arabian Prince, the West Coast music pioneer, DJ, producer and founding member of the groundbreaking rap group N.W.A. and Stones Throw label–as the new Sonomax Creative Director.

Sonomax is another example of a company with great hearing-enhancement technology that is figuring out how to reach a larger audience with products designed for a broader market of consumers. And Nazel isn’t just a figurehead. He has jumped right into both the marketing and product design:

“I listen and work on music everyday, so I wanted the sound and fit that I use on stage, and when I DJ to carry over to eers™. I have used custom in-ear monitors for years, but there has never been a cost effective solution for the general public until now. Custom in-ear monitors can take weeks to make and cost a thousand dollars or more, but with the SonoFit™ system and eers™ custom earbuds, the general public can get a one-of-a-kind custom fit in just 5 minutes right out of the box for less than 25% of the price.”

The SonoFit system enables you to create a custom set of ear buds at home, without going through an extensive process with an audiologist or ear mold maker.

Starkey Laboratories Research Shows ‘Invisibility’ Is One Of Top Five Factors In Consumers’ Hearing Aid Choice

According to new market research, “invisibility” is one of the top five factors customers consider when buying a hearing aid, according to a presentation by a senior Starkey Laboratories executive yesterday at the 2012 Starkey Hearing Innovations Expo in Las Vegas. The research (Chart 1) reveals that consumers are less interested in what brand of hearing aid they are buying than other factors such as: 1) price; 2) sound quality; 3) form factor; 4) visibility/invisibility; and 5) customer service.

More than most other major global hearing aid manufacturers, Starkey Labs has focused development and marketing resources on the invisible hearing aid market over the past two years. Now the presentation by Dennis Van Vliet, Au.D., Starkey’s Senior Director of Professional Relations, explains why: the prized Baby Boomer market segment is far more receptive to “invisible” high-tech solutions than the previous generation of hearing aid users. In addition to the cosmetic appeal of a hearing aid no one knows you are wearing, today’s techno-savvy Boomers, who are attracted to high-tech gadgetry in general, are fascinated by the tiny new hearing systems that can pack more power and performance into a tiny package that sits deep within your ear canal than the huge behind-the-ear models that were the norm only a few years ago.

I’m not at the conference but received a copy of the presentation, which is packed with interesting new information, including a fascinating comparison (Chart 2) between consumers above 65 years old, who are generally averse to technology and less interested in fashion and an active lifestyle, versus Baby-Boom generation consumers aged 41 to 64 who are overwhelmingly interested in new tech solutions that fit in with an active lifestyle. My take on the data is that the Boomers are not put off by the “stigma” of being seen wearing hearing aids so much as attracted to slick new well-designed products that combine superior form with high-tech function.

Starkey’s “invisible” product line now includes the entry-level AMP hearing aids and its high-performance Soundlens products, both of which sit deep within the ear canal. Starkey’s Xino product family is a on open-fit, behind-the-ear, receiver in the canal (RIC) product that is so tiny it is also marketed in the “invisible” category. Starkey has marketed the AMP system aggressively as a first-time solution for users who would not otherwise want to wear hearing aids.

I’ve gotten comments on my previous posts about Starkey’s invisible hearing aid marketing campaigns from readers who say the company is playing into stereotypes about hearing aids as something to be ashamed of and something to hide from others. I’m sure there are plenty of consumers out there worried about the lingering stigma of having to use hearing aids, but I think something else is going on in the market as well. I like to think tech-savvy Baby-Boom consumers are attracted more to the positive aspects of well-designed hearing products that push the limits of miniaturization and performance than to the fact that they are afraid of being seen wearing hearing aids.

The Most Important Hidden Benefit Of Next-Generation Hearing Aids Is Noise Reduction, Not Amplification

It’s important to get the right levels of amplification in your hearing aids, especially in speech frequencies. Indeed, improved clarity of speech and high-frequency sounds is the first thing you notice when you are fitted with a good new pair of hearing aids. But an equally important feature–even if it’s one you never notice–is how well they reduce noise through digital (0r dynamic) noise reduction (DNR).

Everyone knows hearing aids amplify sound. But hearing-aid wearers also know that amplifying all sounds, including unwanted background noise, often makes it harder, not easier, to hear what people are saying. In fact, straining to understand amplified voices that compete with amplified background noise is one of the leading causes of hearing-related fatigue, which can be bad for your health.

The good news is that hearing-aid manufacturers have been steadily improving a combination of technologies over the past decade to deliver a big step increase in noise reduction. New sound processing software with sophisticated DNR algorithms are making full use of powerful digital signal processors (DSPs) to virtually eliminate background noise, such as air-conditioner fan noise in the conference room or road noise in the car, making it much easier to understand what people are saying. And much-improved directional microphones further shield you from unwanted noise while focusing on the voices of the people you are facing.

Taken together, these improved technologies make it much easier to understand speech in noise. That’s what I’m finding in my current search for a new set of hearing aids. I’ve recently been trying out two pairs from Liberty Hearing, a provider of hearing aids to Sam’s Clubs, and I’ve been wowed by the improvement in noise reduction over my previous four-year-old set of hearing aids.

When I stepped out into mid-day traffic in Manhattan, I switched on the “Noisy” program setting, and for once I didn’t feel assaulted by the traffic noise. When I took a ride on the Amtrak train, all the rumbling and track noise disappeared, and I could suddenly hear conversations of people three seats away. At home, a ventilation fan in the hood above our stove that usually drives me absolutely crazy seemed silent. And for the first time in years, I didn’t have to turn off my hearing aids when my wife and daughter turned on the blender to make smoothies.

And while the new hearing aids still don’t eliminate all the background chatter in a noisy restaurant, it’s easier to hear my dinner companions than with my previous hearing aids. Perhaps most important, I’ve been very aware of a reduction in the stress of wearing hearing aids. Because the new hearing aids are reducing the noises that I previously had to put up with to hear other people’s amplified voices, I am am experiencing far less hearing fatigue.

All the major hearing-aid manufacturers promote their digital noise reduction algorithms, and I hope to try out many of them. There’s an excellent review of the Starkey IQ sound processing software’s DNR feature on Steve Claridge’s HearingAidKnow site. Starkey IQ doesn’t just eliminate all the noise in gaps between a speaker’s words, but also reduces noise between syllables, which he is a big help in understanding speech. For more information, go to the Healthy Hearing overview of digital noise reduction authored by hearing-aid technology guru Mark Ross. He wrote it several years ago but it is still the best layman’s summary of DNR I’ve seen.

In the meantime, if you’re shopping for a new set of hearing aids, be sure to ask about their noise reduction feature. When you try them out, take a walk out on the street or through a crowded cafeteria. In addition to noticing all the new sounds you hear, you may also be pleasantly surprised at everything you don’t hear.

Panasonic Introduces New Receiver-In-The-Canal Hearing Aids Plus Wireless ‘Hearing Hub’

The Panasonic Healthcare Group has expanded its hearing-aid product line with the new R1-W Series of receiver-in-the-canal (RIC) hearing instruments that moves the company closer to the top ranks of global hearing-system manufacturers.

Among other things, the new product line features a Hearing Hub offering wireless connectivity with peripherals including Bluetooth phones and a transmitter that sends TV audio signals directly into the hearing aids.

Panasonic, which has been selling hearing aids in Japan for decades, only recently entered the North American market with its 4 Series and JZ Series open-fit and body-worn hearing aids. The new R1-W Series provides more power to address a broader range of users’ hearing problems including moderate-to-severe hearing loss. In addition to the wireless peripherals, other new features such include remote volume control and the ability to record voice memos such as personal reminders and phone numbers that can be played back through the hearing aids.

Although Panasonic is still playing catch-up to the world’s largest hearing-aid brands such as Phonak, Oticon, Widex, Starkey and ReSound, the new more powerful hearing aids plus wireless peripherals are a big step toward more parity with competitors who have made wireless communication a key selling point in their new products over the past year.

“With the new R1-W series, Panasonic has introduced a line of hearing instruments with sound quality design that equals or exceeds anything we have seen in the industry,” said Delain D. Wright, Director of Sales, Panasonic Healthcare Group, who called the R1-W series “the next phase” of Panasonic’s long-term plan to establish a major presence in the global hearing-aid market.

The Hearing Hub allows users to wirelessly connect the hearing instrument to Bluetooth®-compatible* mobile phones, landlines and a Panasonic Audio Transmitter, which plugs into a television’s audio-output port to transmit sound wirelessly into the R1-W Series hearing aids. And the remote control allows users to easily and discreetly adjust the volume level and programs of their hearing instruments.

“As a new player in the US hearing market and with our brand strength, we are finding that professionals are embracing our vision to deliver meaningful solutions to a broad segment of people who want to hear better,” Wright said.

New Etymotic Earphones For Kids Make It Safe To Listen To iPods, iPhones And Other Apple Products

There’s been a lot of publicity about the damage iPhones, iPods and other MP3 players can do to your kids’ hearing but less about the many solutions. So it’s good to see Etymotic, the Illinois maker of earphones, headsets, high-fidelity ear plugs and other hearing assistance technologies promoting its “Safe-Listening Earphones for Apple products” at the annual International Consumer Electronics Show (CES) this year.

Etymotic’s new ETY*Kids3 earphones, featuring three-button control and a mic designed for use with iPhone, iPod touch and iPad, will never exceed safe volumes. Even at the maximum setting on portable players, kids can listen safely for up to four hours per day. And because they provide high-definition sound quality while blocking environmental background noise with a set of snug, sound-blocking eartips, uses don’t complain that the volume is too low.

The new line of products will be available January 30 at BestBuy.com and select Best Buy stores, Amazon.com, Etymotic.com and authorized retailers worldwide. And visitors to CES in Las Vegas can try out the products at Etyotic’s Booth #4014.

ETY*Kids are available in two versions – the ETY*Kids3 headset that works with Apple products, with an MSRP of $79; and the ETY*Kids5 universal earphone that works with any portable device, with an MSRP of $49. The ETY*Kids3 headset will feature AWARENESS! for Etymotic, an app that “listens” to users’ surroundings and mixes any noise louder than normal background sounds directly into the earphones, so kids can hear traffic, announcements or any other important sounds while they are listening.

Hearing-Aid Industry Unbound: Ten Trends To Follow In 2012 That Could Help Drive Double-Digit Growth

Every January, I jot down ten trends I plan to watch that will provide insights about how, why and when innovative technologies and new business ventures might unleash growth in the hearing-aid industry. In 2011, the global hearing-aid industry experienced something on the order of two percent growth. That’s a disappointing performance in a year when millions of Baby-Boom-generation adults in America alone had already lost so much of their hearing that they should have been racing to buy their first set of hearing aids. Why didn’t the market boom materialize in 2011, and will 2012 be any different? Here are ten trends I will be writing about where significant progress might help break that logjam in competition, innovation and growth:

1. Wireless Technologies: In 2011, all the major hearing-aid companies introduced one form or another of wireless communication between assistive listening devices and their hearing aids. Big announcements included streamers for broadcasting TV directly into receivers in your hearing aids, and synching Bluetooth receivers in your hearing aids with your cellphone. Wireless communication between your left and right hearing aids, to provide better stereophonic left-right balance and better location of sound, was also a big feature that the majors started to introduce. I’m expecting more of the same in 2012, along with the first reports of user experiences with these new technologies. Questions to be answered: Is their very high cost worth the benefit you get from them? Are they as easy to use as the manufacturers claim? Are they so much better than earlier, simpler, t-coil based solutions that they will find a big market in 2012?
2. Big Manufacturers Get Bigger: The big manufacturers–Sonova Group, William Demant Holdings, Siemens Hearing Instruments, GN Store Nord, and Starkey Laboratories–all seemed to be growing faster than the industry average in 2012. Those who were required to report their financial results were bullish about organic growth driven by new product introductions. In the global hearing industry we have a lot of vertical integration, with manufacturers controlling the design, development, manufacturing and distribution of their products, nearly to the point of sale, where they move their products mainly through networks of audiologists who usually resell no more than one or two brands, and who are very brand-loyal. The big players serve the top end of the market where customers can afford the multi-thousand-dollar price tag of a pair of hearing aids, and they are able to generate strong enough profits to continue funding development work that keeps them at the cutting edge of technology with leadership products. Expect more strengthening of the majors in 2012, with some interesting new high-end products and technologies.
3. Upstarts Challenge the Status Quo: While the big players at the high end of the market should continue to consolidate their positions, 2012 should also see many new upstarts with new technologies entering the mid- and entry-levels of the market with more affordable hearing-assistance products. Off-the-shelf DSPs (digital signal processors) and sound processing software are available, as are other components required to build hearing aids. In fact, the total cost of parts and basic software required to build a set of high-quality hearing aids runs into the hundreds, not thousands, of dollars. So there is room for new ventures with new product ideas to meet the huge unmet need for hearing assistance. I will be following and writing about as many of these interesting new ventures as I can.
4. Internet Hearing Aid Sales: There are already a number of companies selling programmable hearing aids direct from the manufacturer over the internet–Audicus, Audiotoniq, America Hears, HearSource, DIY Hearing Aids, hi HealthInnovations, and MD Hearing Aid are just a few. These vendors ask customers for a recent hearing test that will enable them to program the hearing aids to your profile before they ship them to you.  However, most consumers don’t already have a hearing test, and when they do get a hearing test it’s usually from an audiologist or dispenser ready to sell them a new set of hearing aids then and there. So the internet providers usually reach a small, discriminating market of experienced hearing-aid users who already have a copy of a recent hearing test, who know exactly what they want and, with the proper research, understand they can get quality hearing aids programmed and shipped directly from the manufacturer. But this small market segment may heat up in 2012. The reeason is that hi HealthInnovations, a subsidiary of UnitedHealth Group insurance company, is a new 800-pound gorilla in this marketplace who may change the competitive dynamics dramatically. Stay tuned.
5. Do-It-Yourself Hearing Tests: hi HealthInnovations asks consumers to take a web-based test that screens them for hearing loss. The test can show if some hearing assistance would be of help, and it also says it will let you know if your hearing is so bad you should head straight to an audiologist for a full personal workup. A number of other manufacturers provide hearing screening tests and there are even half a dozen hearing-test apps in the Apple iPhone store. But so far these are extremely rudimentary, and when asked, those offering the tests will tell you that if you suspect any serious issues with your hearing, you should schedule an appointment right away with a doctor, ENT, and/or audiologist. But there’s no reason that more sophisticated do-it-yourself hearing tests can’t be developed. Software on your personal computer is powerful enough and noise cancelling headphones can go a way toward replicating the silence of the padded booth in your audiologist’s office. I expect to see more sophisticated self-screening tests for hearing in 2012. While it will be many years before they can substitute for a full workup, I’m expecting they will help consumers know if any of the the growing number of off-the-shelf personal sound amplification products (PSAPs) now available on the market would provide the right level of amplification for their hearing loss. Which brings us to….
6. Over-the-Counter Hearing Aids/PSAPs: Since the FDA in the U.S. published guidelines for the sale of over-the-counter hearing aids that provide basic amplification, without requiring a hearing test, there have been a number of new entrants in the new market for Personal Sound Amplification Products (PSAPs). It’s been a slow build, because many of the new players are small and without any brand name recognition. Plus many of the products are built with inexpensive components and provide poor audio quality. But you can expect this picture to change in 2012, with the introduction of increasingly sophisticated PSAPs at a variety of price points. Look at my recent post on PSAP products introduced at the annual Consumer Electronics Show (CES) from big-name consumer audio companies like RCA and Acoustic Research, and you’ll get a glimpse of more to come.
7. Big-Box Retail: The “big box” stores such as Costco, Walmart, Sam’s Clubs, Sears and others have been selling hearing aids for quite a while. We didn’t see much news from this segment in the past year, and I suspect it’s because the product quality wasn’t superior. Very often the big box stores end up selling earlier generations of major manufacturers’ products, plus in the past support and fitting services could be spotty. I expect all this to continue changing for the better in 2012, as the stores upgrade their product lines and services, including in-house audiologists and/or more experienced dispenser/fitters, as well as the potential for private-label products that are just as good as the major hearing-aid brands, but at lower big-box-store prices. If Walmart, Costco and others get the product and service equation down correctly, they could bust open the mid-level of the market by providing excellent hearing aids for far less than the $2,000-3,000 per hearing aid price you often have to pay when you buy a major brand from an independent audiologist.
8. High-End Retail: When are we going to see hearing stores in high-end malls? Or name-brand hearing stores in downtown locations or small-town suburbs. There’s room for a retail option between the independent audiologist’s office and the big-box stores. I’d like to see an audiologist office with an attractive selection of hearing aids, headphones, assistive listening devices and other high-end hearing products under a glass counter in a store in the mall right next to my favorite supplier of eyeglasses. Will we see a major push into high-end retail in 2012? Don’t count on it. In 2010/2011 we saw HearUSA and the HearRX retail brand get swallowed up by Siemens Hearing Instruments when it failed to make timely payments on a line of credit. So the big money may stay on the sidelines when it comes to high-end hearing-aid retail ventures in 2012. But I’m leaving it on the list because, well, darn it, it’s an idea whose time has certainly come. So why not in 2012?
9. Induction Loops: 2012 may well be the Year of the Hearing Induction Loop. Or so thinks The New York Times. Its story last October on the proliferation of hearing loops in public auditoriums and other public spaces was definitive. Induction loop technology is based on the decades-old technology of induction through telecoils. It’s very simple and easy to install. However, while it’s cost-effective, it’s not inexpensive, and given that the hearing aid population is still smaller than it should be, and that not all hearing aids are equipped with telecoils, hearing loops haven’t yet taken the world by storm. There are a lot more of them in Europe than in the U.S., though, and according to the New York Times it’s only a matter of time before hearing loops become common throughout North America. So we can expect to hear more about this highly effective technology in 2012.
10. Invisible Hearing Aids: In 2010/2011 there was a lot of action in the “invisible hearing aid” market segment, and we’ll continue to see more. My personal feeling is, why make tradeoffs for the cosmetic appeal of hiding your hearing loss, when a visible open-fit BTE or other solution can do more and better for you? But it’s been so long since I worried about the cosmetics of the big hearing aids I use for my severe hearing loss that I’ve become somewhat insensitive to consumers’ concerns about the continuing stigma of wearing hearing aids. So I believe the manufacturers have been smart to market an “invisible” opiton to consumers who would not otherwise even consider hearing aids. At the same time, while I believe these invisible aids will grow into a strong market segment, I’m predicting you will see many consumers quickly get over the stigma of hearing assistance once they see what a positive difference it makes in their lives, and step up from invisible aids to open fit BTE’s that provide more functionality, such as wireless linking with their Bluetooth phones. So I’ll be writing more about “invisible hearing aids” in 2012.
11. Implants: Okay, this is an 11th bonus trend. Surgical hearing-assistance implants are becoming big business globally, and while they won’t replace hearing aids, they will certainly gain in the marketplace. Cochlear implant maker Applied Bionics had its share of problems in 2010/2011, with a broad product recall taking it out of the market for a time and reducing the number of global competitors in the cochlear implant market from three to two. But #2 AB is back, and following its acquisition by Sonova Group, it has the financial resources to compete toe-t0-toe with global leader Cochlear Limited. CI’s continue to improve, in the processing power of the behind-the-ear sound processors, in the software used to drive them, and in the number of electrodes stuffed into the implants themselves. So we can expect a lot of competition and innovation in this market in 2012. At the same time, we’ll see a lot of action in the bone-anchored hearing-aid (BAHA) market, to treat single-sided deafness. And we’ll see startups with unique middle-ear hearing-aid implants–including Envoy Medical’s Esteem implant and an interesting new implant on the wall of the cochlea from Otokinetics–continue to gain traction in the market.

I could easily add another 10 or 20 more items to this list of trends, but taken together, the 11 I’ve covered here will be enough to generate some real excitement in the global hearing-technology business in 2012. And with luck, we’ll see one or more hit the jackpot and start to find some big user acceptance and drive some substantial growth in the industry in 2012.

Private Equity Investment Positions Westone Labs To Drive Growth In Consumer Hearing Device Markets

Now that private equity firm CID Capital has made a major investment in Westone Laboratories, watch for the Colorado company turn on the burners with a further expansion of its hearing-assistance products into new consumer markets beyond the hearing-aid industry.

Not that long ago, Westone was little more than a staid maker of ugly but essential custom ear molds for hearing aids.  But in recent years the company has introduced a slew of new products including earpieces for professional musicians, custom earplugs for swimmers, hearing-protection technologies for military and industrial applications, assistive listening products for hard-of-hearing consumers, and more. If you’ve been to AudiologyNOW or one of the other big hearing-aid conventions, you’ve probably enjoyed Westone’s product demonstrations where you can hear live musicians perform as you listen through the same kinds of headphones and custom earpieces professionals use on stage.

Westone CEO Lynn Kehler says the private equity investment will enable the current management team “to rapidly accelerate new product development, aggressively expand distribution and pursue potential acquisition opportunities. We also have a unique opportunity to leverage our extensive hearing healthcare and professional audio music background to offer the same premium quality products and listening experience to the broader consumer earphone market.”

All of which is music to my ears, as I continue to look for examples of companies born in the hearing aid business that are willing to commit management energy and financial capital to delivering great technology and products to a much broader base of consumers. Westone was founded in 1959 and prospered under several generations of Morgan family leadership. But several years ago the family owners named Kehler CEO. A professional manager who had previously been CFO of Westone, Kehler led the expansion drive while seeking a way to provide liquidity for the family. According to the news release from Westone and CID Capital, the investment “will allow the Westone management team to continue to build the company with a new investment partner while allowing members of the family that founded Westone to diversify and pursue personal interests.”

An Indianapolis investment firm with deep Midwest roots, CID Capital takes majority positions in small firms and often helps family-owned companies transition to professional management while providing the financial backing management needs to invest in growth over the long term. While the parties didn’t disclose the size of the investment, the Westone deal appears to be a great marriage of an investor with deep pockets and staying power with a management team committed to a long-term strategy to create new markets with new products and technologies.

Rather than trying to go public or being acquired by a much larger company, staying independent with the backing of an equity partner is a great strategy for success in the hearing-technology business. More innovation is needed and markets need to be created and given time to build, and patient capital is just what the doctor would prescribe for a management team that’s on a roll and only in need of some financial backing to move ahead with its long-term strategy.

All too often a private equity investment foreshadows major negative changes. When the equity firm finances its investment with debt to be repaid through the company’s current cash flow, management often needs to cut overhead dramatically, selling off lower-profit lines of business, and milking the cash-cow profit lines to pay off the debt. With short-term increases in profit margins, the company may increase in value, and the equity firm can make a quick killing by taking the company public or selling off what’s left. But if the company fails to increase in value quickly, the venture can lose market share and gradually waste away. In either case, lines of business with great long-term prospects but low current profits are often simply shuttered and employees with irreplaceable experience cast aside.

But CID Capital appears to be anything but a Wall Street slash-and-burn private equity player. It’s nice to see a private equity deal that rewards family owners for their years of hard work, leaves a strong current management team in place, and provides incentives for a good company to make an even bigger mark on a business that is positioned to drive positive change for an entire industry. Especially when it’s a company doing interesting new things in the hearing assistance business. Let’s keep an eye on Westone Laboratories.

CES Preview: Will 2012 Be The Year Of The Personal Sound Amplification Product (PSAP)?

As hearing-aid technologies go mainstream, more traditional niche manufacturers are making a leap and attending the Consumer Electronics Show (CES), the monster trade show held in Las Vegas every January that displays the wares of thousands of consumer brands. In 2012, I’ll be looking for examples of new Personal Sound Amplification Products (PSAPs), which are just like hearing aids, but sold over the counter without a prescription.

In January 2011 we saw a range of hearing-related companies at the show, including VOXX International (formerly Audiovox) subsidiaries RCA and Acoustic Research, which introduced their own new PSAPs. Hamilton CapTel and TV Ears also got together at CES 2011 to offer a range of assistive listening devices for hard-of-hearing consumers. Traditional hearing-aid manufacturers Starkey Laboratories and Beltone earned CES Innovation Honors for their new products. And Etymotic Research won a 2011 CES Innovation award for new high-tech ear plugs that protect soldiers’ hearing in war zones.

At the January 2012 CES show I am betting we will see more PSAPs. It’s simply too easy a market to enter for mainstream consumer electronics companies. And even if the PSAP remains a niche or specialty product, I expect to see more of them in the big consumer electronics retail chains in 2012, with more news like the October 26 announcement by RCA that its Symphonix PSAP will be available in more than 2,000 Radio Shack stores. So I’d love to hear from any readers who hear about other PSAPs that will be introduced or demonstrated at CES 2012.

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