Start with the room, not the gear
Every home theater decision gets easier once you answer three questions about the room. Can you make it dark? How far back will people sit? And is it a dedicated room or a space the family also lives in? I ask these on every walk-through before I recommend a single piece of equipment.
A dark basement room with seats 12 feet from the wall points you toward a projector and a 120 inch screen. A bright family room with an open kitchen behind it points you toward a large TV and in-wall speakers. Fighting the room is how people end up with expensive gear that looks and sounds average.
How to pick speakers for a home theater
Start with the three across the front: left, center, and right. The center carries nearly all the dialogue, so it's the last place to save money. Match all three from the same line so a sound moving across the screen stays the same sound. Then add the surrounds, which can be more modest because they mostly carry ambience and effects.
In-wall and in-ceiling speakers keep the room clean, and good ones sound close to freestanding speakers. Towers and bookshelf speakers still give you the most performance per dollar if you don't mind seeing them. For Dolby Atmos, the height speakers go in the ceiling, and four is the sweet spot for a room with two rows.
Don't skip the subwoofer, and if the budget allows, get two. One sub gives you strong bass in one seat and weak bass in another. Two, placed correctly, even it out across the whole row. As a guide, a real 5.1 system with in-wall speakers, a receiver, and a sub runs about $2,500 to $4,000 in equipment, and a 7.1 or Atmos system with dual subs runs about $5,000 to $9,000.
Why the screen choice matters
The screen is half of what you see, and it's the part people skip. Projecting on a painted wall works, but a wall isn't flat and isn't made to reflect light evenly. A proper screen is, and it's usually the cheapest big upgrade in the system. A good fixed 120 inch screen starts around $2,000.
The right screen depends on the light. In a dark, dedicated room, a matte white fixed-frame screen is the most accurate and the best value. In a room with some light, an ambient-light-rejecting screen keeps the picture from washing out, and it makes a bigger difference there than a more expensive projector would. If the theater shares a wall with a window or a TV, a motorized screen drops down when you need it. And if you want the speakers behind the screen like a commercial cinema, you need an acoustically transparent one.
Size comes from seating distance. Too small and it feels like a TV. Too big and the front row is turning their heads. For seats 11 to 14 feet back, 110 to 130 inches is usually right.
Projector or TV?
If you can control the light, get the projector. Nothing else gives you a 120 inch picture for the money: a projector and screen together run $2,500 to $15,000, and a laser model comes on instantly and holds its brightness for years.
If you can't control the light, get the TV. A quality 65 to 75 inch 4K set costs $800 to $3,000, looks great with the lights on, and needs no dark room. Put the money you saved into the sound, because that's what a big TV on its own is missing.
Where to spend first, and where to save
Spend on the things that are hard to change later: the wiring in the walls, the room layout, the screen size, and the front speakers. Save on the things that are easy to swap: the streaming box, the receiver, and to some extent the projector, since those get better and cheaper every couple of years.
If the room is still studs, run more wire than you think you need. Speaker wire for a 7.1.4 layout, conduit to the projector, and a network drop at the equipment location cost very little now and a lot after drywall. You can add speakers later. You can't cheaply add the wire.
What a complete theater costs in Utah
A living-room upgrade with a large TV, in-wall surround, and hidden wiring runs about $10,000 to $15,000. A dedicated basement theater with a laser projector, a 120 inch screen, Atmos sound, acoustic treatment, and two rows of recliners runs about $25,000 to $40,000. Fully custom rooms run $75,000 to $150,000 or more. My labor is $100 an hour and every quote is itemized.
If you want a second opinion on a plan or a parts list before you buy, send it over. I'd rather tell you now that the screen's too big for the room than fix it after it's on the wall.