Alarm cos. join with cable, telcos
YARMOUTH, Maine--Since the last issue of Security Systems News, three home security giants--ADT, Brink's and Protection One--announced deals with telco and cable providers.
While the nature of the alliances differ slightly, some industry watchers detect a trend here.
"This may be the next stage in the evolving relationship between the telco/cable/utility companies and the alarm industry," said Jack Mallon, managing partner with Mallon Associates. The relationship goes back to the late '90s, when the Telecommunications Act of 1996 emboldened non-traditional firms to enter the security market.
The activity of companies like Ameritech, Western Resources, and Entergy buying into security, made it appear at the time, Mallon said, "that the alarm industry would be taken over by the telecomm, utilities and cable industries."
"But they got burned," he said.
Mallon said last month's rash of activity may signal a new model. "The telcos decided that the alarm business wasn't their game," he said, "and they've apparently decided that it would be better to partner with alarm companies, so they can bring their expertise, technology and link to the subscribers to the table."
John Mack, founder and chief executive officer of USBX Advisory Services, looked at the announcements as a "trend with a small T." Alarm companies have tried partnerships with "other large providers of services to the home with mixed to poor results in the past. The latest round of partnerships seems to be built on a more conservative foundation and in this context they will probably experience some success," he said.