Two insiders to bring 'undefeatable' door contact to alarm industry

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Monday, August 30, 2010

WAUKESHA, Wis.—Two former alarm company owners, Michael Keegan and Chris Utter, have teamed up with a company called Magnasphere to bring a new kind of door contact to the alarm industry, one that they believe will become the industry standard within five years.

“The reed switches are going to go the way of the photoelectric beam,” Keegan predicted.

Most alarm dealers know about the vulnerability of your garden-variety reed-switch door contact, Keegan said. “If you present a magnet to the outside of a door where the contact is, you can open the door and never set off the alarm.”

The Magnasphere switch, on the other hand, is a “magnetic sphere or ball contact,” which Keegan says cannot be defeated with a magnet without setting off the alarm. It is also made of metal, which makes it “virtually indestructible,” he said.

Ken Risk, CEO of GRI—the largest domestic manufacturer of reed switches—acknowledged that magnets can be used to defeat reed switches, but noted that it’s easier said than done. “You have to know exactly where the contact is located,” he said. He also noted that doors being defeated is not a big problem in the alarm industry and added that while it’s much harder to defeat the Magnasphere contact, it is not impossible.

Risk said he’s a huge fan of the Magnasphere products, however, and his company is a reseller of that product. Further, he believes the Magnasphere contacts could potentially exceed the sale of reed switch controls, but believes the price needs to come way down. “If they could get the price down to $1.50 or $2.00, sales would take off like a rocket,” he said.

Keegan said that dealers he spoke to mistakenly thought, before checking, that they spent about $1.50 per contact. They actually spend closer to $5, he said, which is comparable to the Magnasphere high security door contacts, which sell for just under $5, he said.

Two alarm dealers contacted by Security Systems News said they spend between $1 and $3 on reed switches currently; one dealer verified this with a purchasing manager.

They both, however, thought the Magnasphere product sounded interesting.

Keegan believes that once the word gets out about Magnasphere, alarm dealers will be eager to provide a higher level of security to their customers and gain an edge over competitors who sell reed switches.

Keegan said he’s “having conversations with some of the largest dealers and integrators in the country.” The contacts are being distributed by Alarm Products Distributors in Minneapolis currently and he’s in talks with others. “We hope to announce another major distributor here very soon,” he said.

Magnasphere introduced its contacts, which were designed for high security applications such as embassies and other government buildings, at ISC West in 2002. That year the contacts won awards at the show for best contact.

But its success in the government market has not been matched in the resi or commercial markets. Why? “They didn’t know how to present it to the industry,” Keegan said. “They’ve always had the message, but they didn’t have the messengers.”

Utter, who formerly owned Sentra Security, joined Magnasphere in December of 2009, with the goal of creating Magnasphere high security contacts and mounts designed for residential and commercial applications. Keegan, who recently sold his alarm company, Watchguard Security, ran into Utter at the ESX show and joined the company several weeks later.

The market for door contacts is large for security applications where “30 million reed switches sold last year,” and outside security as well. “One billion reed switches were sold to other industries last year,” Keegan said.