Great article on what Inwall Speakers are and are not from Home Theater Review (excerpt from the original article here):
1.0 Overview About In-wall Speakers
In-wall speakers are core ingredient in the custom installer in more and more aspects of his or her projects. In-wall speakers are used in distributed audio systems for their stealth presentation of musical content without the need for bulky speakers. Its not uncommon to see an all in-wall speaker home theater or even in-wall audiophile speaker systems that have systems costing as much as $50,000 per pair and designed to be installed right in your drywall.
2.0 Types of In-wall Speakers
2.1 Traditional In-wall Speakers
Traditional in-wall speakers are designed to be cut into your drywall and fit into the space between the studs in your walls. In recent years, speaker designers have added pointable tweeters, equalizers and sound boxes that tune the audio performance of the speaker to a box that is designed to fit into the wall. This takes away the unpredictable audio environment in between someone’s studs in their walls and creates a much higher performance and audibly superior result. Traditional in-wall speakers come in sizes that are round, square, rectangular and other less traditional shapes.2.2 Rimless In-wall Speakers
One of the newest trends in in-wall loudspeakers was started by Sonance which is to engineer in-wall speakers that have no baffle thus sit absolutely flush to the dry wall. While on the surface, it seems like this would be a no-brainier, the engineering behind such a speaker is very sophisticated. Just ask any of the dozen companies trying to rip Sonance off for their very good idea. In a modern home installation, baffle-less or rim-less in-wall speakers look fantastic compared to in-wall speakers with baffles. These speakers also come with fabric grills and other out-of-the-box solutions that make in-wall speakers look less and less like actual speaker yet emit audiophile quality sound.2.3 In-wall Subwoofers
In-wall speakers tend to not have much bass because of the lack of cabinet volume and small woofer drivers. Because of this more and more in-wall speaker companies are making in-wall subwoofers that are designed to fit inside the space between two studs and use a sound box to make deeper audio signals to make for a more powerful in-wall speaker experience especially for in-wall home theater systems that don’t have room or the aesthetics for even a small traditional subwoofer.2.4 In-wall Speakers Behind Drywall
One of the newest trends in in-wall loudspeakers was started by Sonance which is to engineer in-wall speakers that have no baffle thus sit absolutely flush to the dry wall. While on the surface, it seems like this would be a no-brainier, the engineering behind such a speaker is very sophisticated. Just ask any of the dozen companies trying to rip Sonance off for their very good idea. In a modern home installation, baffle-less or rim-less in-wall speakers look fantastic compared to in-wall speakers with baffles. These speakers also come with fabric grills and other out-of-the-box solutions that make in-wall speakers look less and less like actual speaker yet emit audiophile quality sound.
3.0 Overview About On-wall Speakers
On-wall speakers are a relatively new category of loudspeakers, created due to the recently popularity of flat HDTV systems. For decades, a “good” speaker was a floor-standing rectangle powered by an AV receiver and positioned proudly in a room. With the massive, computer-like price drops in HDTVs over the past few years, it is now possible for mainstream customers to upgrade their televisions from physically deep CRT-based standard-definition sets to ultra-thin HDTVs that hang on walls like pieces of artwork.
While the appeal of a wall-mounted, flat HDTV is alluring to most consumers, the need to match HD speakers with your new flat HDTV set has created a new host of speaker design challenges. This is where on-wall speakers come in. There are all sorts of on-wall speaker designs. Some adjust to match the width of various HDTV sets. Other designs are round and narrow, thus creating a more modern, artistic look. Some on-walls come in custom finishes and other in various colors and grille options. One commonality with on-wall speakers is that they all are relatively physically narrow and tend to rely on a powered subwoofer of some sort to get their bass.
4.0 On-wall vs. In-wall and Sound Bar Solutions
On-wall speakers compete favorably with in-wall speakers in many installations. On-wall speakers are less invasive to install, as you can run cables up (or down) a wall and position on-walls across your front locations and/or for rear or side speakers. In-wall speakers tend to be flush with the wall, working with the thin installation motif, yet the grilles often have a dark tint to them from the perforations and therefore look best when covered by a fabric wall, which can be a significant additional cost.
Sound bars are the easiest solution, as one speaker (and often a subwoofer) can create much of the most important audio needed from DVD-Video, Blu-ray, HD DVR or even an iPod sources. Sound bars must have a subwoofer to give a full-bodied sound. On-wall speakers generally use much less DSP processing to create their discrete surround sound.

