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On the Editor's Desk

Go east, everyone?

by: 
Martha Entwistle
  - 
Monday, April 27, 2009
Riffing on some of the themes of John Honovich's trip to the Far East for SecuTech (this is a good discussion of OEM practices, and you'll see I chime in), I just got notice that MDI is now the exclusive master distributor in the U.S. for Truen, a Korean IP video company. IP video products are commoditizing quickly, and I think you'll see more Korean/Chinese/etc. companies making inroads into the North American market through well-known manufacturers and integrators. With all of the great reference designs being supplied by chip makers like Stretch and Texas Instruments, it wouldn't surprise me, really, if the big integrators just started contract manufacturing their own cameras and software. For mid-sized jobs that don't require the highest of high tech, why give up the margin on a camera and software to another company? Just keep it yourself. At this point, making a decent DVR is pretty easy, from what I can tell. Remember when your DVD player cost $200? Now I get one from Wal-Mart for $19.95. Sure, it breaks in six months, but who cares? It's $19.95. (This, of course, is the unethical non-Green me talking. In the real world, I feel guilty about doing something like that, and probably avoid doing it at all. But, hey, it's $19.95.) Mike Garcia says the NVR and VMS that Truen makes are good enough for mid-sized jobs, up to 128 cameras or so. Then, for the enterprise systems, the Truen cameras talk to ONSSI and Milestone, which are then unified into the MDI ONE platform (MDI's secret sauce). And you'll remember that MDI is selling direct to the end user pretty much all the time now, so, for all intents and purposes, they're an integrator just like you - the competition.
This Blog's on Fire (And Other Stuff)

ADT on the outside; Brink's inside. Just how many English majors does it take to pick a lock?

by: 
Tess Nacelewicz
  - 
Saturday, April 25, 2009
Afraid I've neglected my blogging duties recently. Just returned last night from a week's vacation with my family. We took a much-anticipated trip to Northern California to see our very good friends who moved cross country almost a year ago. We all had a blast, like we always do, hanging out with our friends. And how can you not have fun exploring San Francisco and the coast? What a cool part of the country. You might think all I want to do is have some fun on vacation. OK, that is true. But, it wasn't all cocktails on the patio and Bloody Marys on Tuesday mornings, however. No, no, no. I like a little security-related activity while on vacation, and this one didn't disappoint. Don't worry, there weren't any robbers involved or anything. (Not this time anyway.) Rest assured, our friends' house is well protected by ADT. This time it was security inside the house. You see, somehow, someone was able to lock the guest room door from the outside, so we had to break in. The latched-handle door was innocuous looking enough, but this was no ordinary lock. The dads started with miscellaneous keys, credit cards, coat hangers, and moved on to bobby pins, nail files, and shoulder-slams. All four kids (ages 8-14) got involved, as did Elise (the other mom) and I. We busted out wrenches and power tools. After breaking a drill bit inside the key hole, we called in reinforcements. Elise's dad, Ike, who lives nearby, has a well-stocked work bench and he kindly showed up with a small crowbar and--here's the key--vice grips. It took another 30 minutes or so, but Ike finally extracted the lock from the door. I was happy to have access to the guest room, but what I really wanted to know was the brand of the lock. Made by Brink's. It looks like your average interior lock, but it is not. I emailed Dave Simon at Brink's Home Security to see if they make these locks and he said they're from BHS's former parent company, The Brink's Company--you know, the armored car company. If you really want to fortify your house on the inside--I heartily recommend this as the lock for you. I have pictures documenting this, my very own Brink's job--but alas--our technical people have not yet figured out how to get me "permission" to upload photos on this here blog. I'll post them if I ever get permission. Another vacation, another home security adventure.
On the Editor's Desk

GE Security sells off a piece for $580m

by: 
Martha Entwistle
  - 
Friday, April 24, 2009
Remember when GE Security tried to sell off a piece of its Homeland Protection business in a merger with Smiths Detection? Remember how that fell through? Well, looks like GE was determined to get this Homeland Protection biz off its hands:
GE ANNOUNCES AGREEMENT WITH SAFRAN FOR SAFRAN TO ACQUIRE A MAJORITY STAKE IN GE SECURITY’S HOMELAND PROTECTION BUSINESS
They're so excited about it they put the headline in ALL CAPS. As in, HOLY CRAP THIS IS EXCITING! I'm too lazy to go looking around for the link, but here's the press release they emailed out at 1:30 a.m.:
Newark, CA, April 24, 2009 – GE (NYSE: GE) announced today that it has signed a definitive agreement with SAFRAN for SAFRAN to acquire 81% of GE Security’s Homeland Protection business for $580MM. Upon close, GE will own 19% and SAFRAN will have majority interest with 81%. The transaction has been approved by the Boards of both companies, and will be subject to customary regulatory approvals.
Just as a matter of thinking out loud, is it at all weird that this Homeland Protection business, which supplies all manner of puffer machines and shoe analyzers (maybe they're the same thing), is being sold to a French company? I guess not. But there might be a regulatory hurdle or two that's a pain to jump over.
The Homeland Protection business will become part of SAFRAN’s Defense Security division of Sagem Securite, led by Jean-Paul Jainsky, Chairman and CEO, Sagem Securite. Dennis Cooke, will continue as President & CEO, for the Homeland Protection business and headquarters will remain in Newark, CA. “This is a great move for our Homeland Protection business,” said Dennis Cooke, President & CEO, GE Security Homeland Protection. “Our business has a strong leadership team, dedicated and talented employees, innovative technology, a large installed base and a strong brand. This move aligns Homeland Protection with a business that is committed to globalization and further investment in new detection technologies and new products for the Homeland Security space.”
Also, GE just got $580 million bucks in a crap economy, which shouldn't hurt the flagging stock price of the parent company.
The combined company will focus on identification solutions and detection offerings globally and will benefit from continued access to technology advancements from GE’s Global Research Center and GE Healthcare. The combination of the complementary technology of both businesses will provide customers with the benefit of new technology solutions to keep ahead of the changing threats. SAFRAN and GE are expanding their already strong relationship as the companies have been working together for more than 35 years to deliver Aviation technology solutions. The new entity will feature SAFRAN’s industry-leading ID management, plus Homeland Protection’s world-class aviation safety, checked baggage screening, military & critical infrastructure protection together with new growth platforms in Chem/Bio, X-ray and Radiation/Nuclear detection.
This is actually the interesting part. SAFRAN becomes an interesting player in the security market, where they've already been growing and making noise. But don't take my word for it:
Jean-Paul Herteman, CEO of SAFRAN, said: “Following our 2008 acquisitions of SDU-Identification (a Dutch manufacturer of secure passports and ID documents) and Motorola’s biometrics business (Printrak brand), adding GE Homeland Protection will significantly bolster our Group’s third core business. This makes SAFRAN a pivotal player in the security market, a business that will generate 20% of the Group’s total revenues in the medium term, with double-digit profit perspectives and reducing exposure to aerospace cycles. Furthermore, this transaction is the latest step in our long-standing relationship of mutual trust and partnership with GE that reaches back some 35 years.”
This guy thinks so, too:
Jean-Paul Jainsky, Chairman and CEO of Sagem Sécurité, added “There is growing demand from both governments and private industry for cutting-edge security solutions, based on long-term projects anchored in advanced, very-high-reliability technologies. From this standpoint, the SAFRAN Group is in a perfect position to meet today’s most demanding public security requirements.”
But what does Dean Seavers have to say about it?
“This newly combined company is an excellent fit for our Homeland Protection team,” stated Dean Seavers, President & CEO, GE Security. “GE Security will continue to focus on our core security product portfolio with a strong commitment to delivering security innovations that bring value, quality and high performance to our customers and end users.”
I wonder if GE doesn't think they've already sold most of the big-ticket scanners and what-not they're going to sell for a while, and now it's time to focus on the smaller, incremental items that their dealers can push out there for them. Considering their recent releases aimed more toward the lower end of the market, it seems like they're trying to generate more smaller customers rather than cultivate those few very large customers.
Monitoring Matters

New York Merchants Protective Co. renews CSAA Five Diamond Cert

by: 
Daniel Gelinas
  - 
Thursday, April 23, 2009
NYMPC Monitoring Center has renewed it's Five Diamond Certification through the Central Station Alarm Association. The CSAA is a non-profit trade association representing the major burglar and fire alarm central monitoring stations. The CSAA's Five Diamond Certification program is designed to create standards of excellence for the industry. In order for a central station to earn its Five Diamond Certification, all its operators must undergo the online training course and pass a test, demonstrating proficiency in: alarm verification (reduction of false alarms); communications with public service answering points such as 911; electronic communications equipment; the codes and practices of such standards organizations as Underwriters Laboratories, Factory Mutual, and the National Fire Protection Association; the handling of a wide scenario of emergency preparedness situations. According to the CSAA, there are over 2,700 central stations in the United States, and of this group fewer than 100 (less than 3%) central stations have undergone the process and achieved certification. According to NYMPC president Wayne Wahrsager, achieving Five Diamond status is something his employees cherish. "The CSAA Five Diamond Certification is one of our proudest achievements," Wahrsager said in a press release. "Only a select few central stations are honored with this prestigious award, and we're proud to be able to be certified, year after year, assuring our customers of the high standards we uphold." Celia Besore, CSAA director of marketing and communications, said that Five Diamond companies have demonstrated an exceptionally high degree of responsibility to their local community and their customers through the investment of time, money and commitment to 100 percent quality operator training. “Five Diamond Certification guarantees to the customer that this is a company that meets the highest standards designed by their peers,” Besore said. “We’ve had people say to us, `Since we became Five Diamond, we’ve doubled our business.’”
On the Editor's Desk

Go east, young man

by: 
Martha Entwistle
  - 
Thursday, April 23, 2009
The hardest-working man in security, John Honovich, reports from the SecuTech show, held in Taipei. (Although he's closer than most of us, being based in Hawaii.) Seven hundred booths, 20,000 people, maybe 350 video vendors - that's a substantial show by any measure. He also touches on one of the least-understood pieces of the industry: Who exactly makes what parts of which cameras, and how similar/unique are your average cameras and DVRs? Edit: As I think about it, John actually traveled West to get to the Far East, so my headline is more than a little East Coast-centric, but I'm going to leave it as is and wallow in my wrongness.
On the Editor's Desk

iPhone storage calculator

by: 
Martha Entwistle
  - 
Thursday, April 23, 2009
You remember SightMind and Steve Weller? Well, that blog doesn't seem to be coming along much, but Weller's been busy on other stuff, too. He sent me a link today to a new iPhone/iPod app he's created that's a storage calculator for IP video installations. Check it out. Called the IPVS Calc, it does basically what you would expect: It figures out how much storage you'll need for whatever amount of cameras at whatever frame rate and image quality you need. Looks pretty handy, actually. And, of course, it looks slick, too. I think this would be particularly useful in the initial consulting stage where you can set expectations quickly for the customer. If he's talking about a thousand cameras recording 24/7, you can quickly figure out the size of the server farm he's going to need to invest in. Actually, maybe that's a bad idea. As soon as the end user sees he'll need a petabyte, he might reconsider buying those 1000 cameras... Anyway, it's available at the App store for $34.99, which is pretty reasonable, actually. Just search IPVS in iTunes and it's the only thing that comes up. Of course, all the analytics vendors will tell you this isn't necessary anymore because they're handy-dandy analytics will make it so you store way, way less and you can manage your storage, etc. But that's a different conversation.
On the Editor's Desk

Help wanted

by: 
Martha Entwistle
  - 
Thursday, April 23, 2009
I'm supposed to lead two panels at ESX in June. One of them, focusing on succession planning for installation companies, is all set. However, the other, focusing on recruiting young and new talent into installation companies, is as yet not full. Seriously, why is it so hard to find someone who's relatively new to the security industry and isn't a field tech. Isn't there a single executive in the installation/integration community who didn't start out plugging stuff in when he was 15? If anyone is relatively new to the industry, works for an installer/integrator, and would be interested in talking about how you were recruited into the industry (or how you came to security in general), drop me a line. I'm struggling.
On the Editor's Desk

Axsys update

by: 
Martha Entwistle
  - 
Thursday, April 23, 2009
Just wanted to give people a quick update on Axsys, which is potentially for sale. Since I wrote the initial story, the stock price has remained right in the $40 range, where it jumped on news of the potential sale. However, that's still well below December's high near $75. The price hasn't really gone up this week, either, despite strong Q1 numbers (warning: that's a pdf): Period comparisons vs. the first quarter of 2008. • Sales increased 18% to $66.6 million; • Gross margin was 33.1% compared to 34.0%; • Operating margin improved to 16.4% from 14.2%; • Net income increased 37% to $7.0 million; • Backlog increased 3% year over year to $162.1 million. A 10.5 percent net margin's not bad at all. But it would still take about $500 million (guessing that $45 a share would do it) to acquire a $275 million (+/-) manufacturer. Not totally a bargain.
Monitoring Matters

SentryNet to hold annual dealer conference

by: 
Daniel Gelinas
  - 
Wednesday, April 22, 2009
Greenville, Miss.-based monitoring company, SentryNet, is holding it's annual dealer conference next week. I had a chance to message back and forth with SentryNet VP, Operations Michael J. Joseph recenlty about ISC West and the upcoming dealer conference. While the SentryNet dealer conference may not be as big as ISC West, it certainly sounds like a fun and informative couple of days. Best wishes to all attendees. I look forward to chatting with Mike again after the dealer conference is over and finding out how it went.
On the Editor's Desk

Shake-up in the retail world

by: 
Martha Entwistle
  - 
Wednesday, April 22, 2009
The nation's two big industry associations serving the retail community have decided to merge. It's kind of a big deal since both run loss-prevention conferences and put out data that influence how the security industry interacts with what is a large (if recently shrinking) business opportunity. I don't have a link, but here's the release:
RILA and NRF Agree to Merge New Merged Association to Provide a Single Retail Voice in Washington, DC WASHINGTON, DC -- The National Retail Federation (NRF) and the Retail Industry Leaders Association (RILA) today announced that the executive committees of both associations have unanimously agreed in principle to a merger that will create a single trade association representing retail interests in the nation’s capital. The new organization will provide enhanced value to both RILA and NRF’s members and help to ensure that the retail industry speaks with a one voice to advance the industry and its more than 15 million workers.
The cynic in me says that retailers are getting hammered right now and no one's paying their dues, and this is a way to keep both organizations afloat. But maybe it's because they want to provide enhanced value to their members. That's totally possible.
“This is an historic time for our industry. The challenges and opportunities before our members are unprecedented. Now is the right time to bring these associations together,” said RILA Chairman, Robert A. Niblock, Chairman & Chief Executive Officer of Lowe's Companies, Inc. and NRF Chairman Myron E. (Mike) Ullman, III, Chairman and CEO of J.C. Penney Company, Inc. in a joint statement.
Gosh I hate it when people use "an" in front of "historic." That goes back to when people pronounced the word "istoric" and it made sense. But now pretty much everyone pronounces the "h," yes? Unless you live in Boston, maybe, where they pronounce "huge" as "yuge." But I digress.
According to Niblock and Ullman, in addition to enhancing member value, the new (and as yet unnamed) association will accrue substantial benefits to all members collectively, small and large, including: • A unified and stronger voice on policy, communications, and public affairs issues in Washington, DC • A host of exciting member events and conferences open to the combined membership of NRF and RILA and, including NRF’s “Big Show” and RILA’s annual Logistics Conference scheduled for January and February, 2010 • Focused educational offerings and operational services for independent retailers • A single point of integration and dialogue with state retail associations and business groups in state capitals across the United States; and • A fully-integrated staff.
Potential names for the organization: The National Retail Industry Leaders Foundation Association; The National We Wish the Internet Had Never Happened Association; The Organization that Used to Include Book Stores and Records Stores But there Aren't Any More of Them; The Soon there Will Just Be Wal-Mart Association; The Okay, Maybe there Will Also Be Target and JC Penney or Something Federation Association Foundation. It's hard to pick just one, really.
Completion of the merger requires that both NRF and RILA submit to a thorough due diligence process. The details of the merger are being developed by representatives from RILA and NRF. Both associations’ boards of directors must recommend the merger, and both memberships must approve it. Both RILA and NRF expect the process to be completed by this summer.
In all seriousness, this new group will represent a powerful lobbying body and a group that could definitely sway the security industry's direction. They've already been involved in analytics standards development (not sure how that turned out, really) and I think you can expect more attempts to make the security industry more aware of retailers' pain points.

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