Will West, Mark Morgan, and Eric Smith

NEW YORK (CNN/Money) - A tried and true path to business success is to transform a niche market into a mass market. Think Ford.

Will West, Eric Smith, and Mark Morgan, the founders of Control4, a Salt Lake City-based company that makes wireless home automation systems, are trying just that.

Home automation began decades ago, but did not take off until two late 1970s developments: the PC, as exemplified by the Apple II, and the X10 module, developed by a Scottish company in 1977, which enabled users to remotely control lighting and appliances.

As these devices grew in sophistication, more builders installed them in homes. Perhaps the most famous example is Bill Gates' $30 million shack, where guests get computer chips on entry that control lights, temperatures, and other settings as the visitors move thorough the house.

Historically this service was limited to the luxury market, for several reasons:

• All or nothing: Automating homes meant ripping open walls and floors to install wiring. It's a big job. The Gates house, for example, reportedly has miles of fiber optic cable. It was hard to sell the service in small bites.
• Expensive hardware: The tiny market meant that devices built for it were costly; economies of scale non-existent.
• Expensive software: Everyone's home and lifestyle is different, making each installation unique.

New homes and gut renovations only make up about one percent of the overall house market. And luxury homes, again, are about one percent of the market. Historically, total home-automation industry sales came to only about $400 million annually.

But, says West, the firm's CEO, "If you can make it retrofittable, the market is 100 times bigger. Make it affordable, it's another 100 times bigger."

Control4's founders say their system does both. Wireless, it installs anywhere, including existing homes. And parts are affordable and easy to add on. You can start for a just a few hundred dollars and tack on features starting at about a hundred dollars a pop.

To get customers up and running quickly, the company devised a software program that takes them through a series of questions that, when completed, configures the system to suit their needs.

"It works like TurboTax," says Smith, who is Control4's chief technical officer. "The tax code is infinitely complex and every person's financial life is complex, but TurboTax takes them through a series of questions and comes out with a solution. We do the same thing."

West and Smith have launched four companies in last 15 years, starting with one that provided media retrieval services for colleges. Next came a home automation company called Phast, which they sold to AMX. Then they started STSN in 1998, which provides broadband services to hotel guests.

How that happened was serendipitous.

"We thought we would automate hotel rooms," says West. "We invited Marriott execs to demo a system. They thought it was cool, but they all said, 'We have no idea how we'll pay for it,'" and turned us down.

The execs spotted one thing they did want, a high-speed Internet connection. Only thing though; the device was a fake, a prop, a small black box filled with lead.

"They saw the box and asked, 'Can you do that?'" says West. "We said, 'Of course.' Then we had to find a way to build it." They succeeded well enough that STSN is now the biggest name in that business.

The Control4 founders think the demand for home automation will be huge. "But it's like a microwave or TiVo," says Smith, "People didn't really know they needed them until they had them."

Control4 stresses the painless entry to the process. It can be done in small bites, starting, say, by making a home entertainment system, a plasma TV, DVD player and VCR, as well as a cable box and audio receiver, easier to use.

"People are buying cumbersome technologies," says Smith. "They wind up with a beautiful set-up with six remotes that they don't know how to use."

Control4 replaces that with one control system costing a few hundred dollars. With it, you hit a button and turn everything on. Hit another and view a menu of movie selections. Highlight one, hit a button, and watch the film.

You can add to this system ad infinitum. For $99, add a control that dims the lights to a pre-set level when you hit play. Another $200 or so to control the shades and the room temperature. Eventually, the system can control almost everything in your home.

Customers who don't want to do it piecemeal can get a soup-to-nuts installation for between $6,000 and $10,000 for a 2,500 square-foot house.

Security and safety are big parts of these systems. Control4 can turn on the lights if an intruder arrives and start the sound of dogs barking.

It can be especially useful in case of fire.

Morgan, who heads up the marketing team, explains, "A system can be programmed to respond when the smoke detector is triggered, activating low-level lighting to see through smoke, cutting off the HVAC so smoke isn't circulated throughout the home, flashing lights on the front porch to help firemen identify where the emergency is."

Home automation can also help aging relatives stay in their homes longer by keeping you informed that they're up and around.

Or maybe you want to know when the kids get home from school. The system can notify you when they walk in the door.

Smith reports that the reception to the system since its intro last year has been great. One of the things that dealers especially appreciate is that the system can be easily reprogrammed to reflect lifestyle changes. The dealer can even do the reprogramming online, without coming out to the house.

The founders of Control4 expect very swift expansion of this industry and they don't want to lose the first-mover advantage. They're seeking venture capital to enable them to expand quicker and adding retailers and running training seminars around the country.

If all goes as they envision, their system will become the Model T of home automation, the product development that takes the industry to a whole new level.

Wing Enterprises took a much lower tech path to success. For that story, click here.