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Department of Redundancy Department: Five for COPS

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Wednesday, August 22, 2012

Make it five for COPS.

The wholesale monitoring company, headquartered in Williamstown, N.J., has opened its fifth central station, an 8,000-square-foot facility in Lewisville, Texas. The new center will share live alarm traffic with the company’s centrals in New Jersey, Florida, Arizona and Tennessee.  

Four-year COPS veteran Derek Kopko will manage the new facility, which has 26 employees. Kopko relocated to Texas from COPS’ headquarters in December 2011 and has been hiring and training new dispatchers for the past seven months, the company said in a prepared statement.

Gene Reed, an industry veteran and COPS’ newest account executive, will oversee sales in the region.

David Smith, director of marketing and communications for COPS, told Security Systems News that adding central stations benefits the company in two key ways.

“First, because all five of our central stations are hot-redundant and actively share the signal load of the entire company, each central station we bring online reduces the probability that adverse local conditions [such as weather] will affect our response times,” he said. “Second, we believe that each geographical region presents its own benefits and challenges to alarm dealers. By operating central stations and having employees in these different regions, we have the opportunity to become more involved with our dealers and better understand how we can support them and help grow their business.”

Smith said the commitment to redundancy proved its worth last August during Hurricane Irene.

“When (Irene) went up the East Coast and actually hit our New Jersey headquarters, it only added about a second to our response time because we were able to overstaff all our other central stations,” he said. “The more we do that, the more that we diversify our staff, the more stable and dependable our fast response times become.”

Cox to expand home security

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Wednesday, August 22, 2012

First, Cox Communications began trialing its new home security/home automation in Tucson, Ariz. last summer. Then, it expanded the service to customers in Phoenix this April. Now, the Atlanta-based cable company announced yesterday, the pilot project has been such a success that the company plans to launch Cox Home Security—which is professionally installed and monitored by a third-party provider the company has declined to name—to other markets later this year.

Where? That’s still anybody’s guess. Todd Smith, director of media relations for Cox, told SSN that the company "plans to expand its Home Security service to several additional markets later this year, following a successful pilot over the last 12 months in Arizona. We’ll announce specific markets as we get closer to launch.” The company also is not saying exactly when that will be.

But Cox did say that it has appointed a new general manager for this new growth area: Vince Groff, formerly the company’s director of video product development.

Here’s more from a company news release:

“Cox Home Security provides advanced features not found in most traditional alarm systems with time-saving, cost-saving, and worry-saving features to help customers manage their family’s safety. The reliable, 24/7 secure monitoring systems feature: intrusion and home safety monitoring (includes fire, gas and flood); remote access so the system can be controlled away from home via a secure online site or Smartphone app; email/text alerts to notify customers of occurrences at the home; safety sensors to detect hazardous conditions such as carbon monoxide and smoke; secure video monitoring available via smart phone or a web browse; [and] control of home functions such as lighting and temperature.

One of Cox’s competitive advantages with this product is the ability to offer to customers through a Cox bundle. With the addition of home security services, all of a customer’s Cox services will appear on one bill …
 
As Cox moves to the next stage of deployment, the company has appointed Vince Groff to the new role of general manager of this new business. Groff led the initial Cox Home Security development and trial execution and will now be responsible for the broader rollout and ongoing management of this new business.

Groff joined Cox in 2000 and was a director of video product development before his promotion to executive director of new growth and development. Vince began his career in systems engineering at Delta Air Lines, and also spent time in strategy consulting and venture capital before coming to Cox.

Cox’s launch in 2011 made it a leader among the telecoms and cablecos entering the security market. Check back here for more developments on this new industry player.

 

Second security lapse at JFK reported

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Monday, August 20, 2012

A few days after a jet skier swam to shore and breached the security perimeter of JFK airport here by climbing a fence, reports of another security lapse has been reported.

The New York Post on August 16 reported that it had obtained a secret memo describing an unsecured gate on the airport property. The gate protects a main jet fuel supply line into the airport, the report said.
The gate “was left vulnerable because a security camera was either malfunctioning or not designed to pick up the image,” according the New York Post report.

The report includes quotes from Port Authority executive director Patrick Foye and Paul Nunziato, president of the Port Authority Police Department labor union (the PBA) Port Authority Police Benevolent Association.

However, on Aug. 17, the labor union issued a statement clarifying Nunziato’s remarks.

In that statement, Nunziato called the New York Post report “inaccurate” and said “there has been some misunderstanding of the terms utilized in reports concerning a security gate at JFK which was noted in a report as being unsecured … the gate in question was NOT unlocked and was NOT reported to be unlocked. This same information was also conveyed to the Post by the Port Authority.”
“The Post’s portrayal that I was at odds with Executive Director Patrick Foye’s comment regarding the report is not correct,” the statement continued.

The statement said that PBA “has repeatedly raised concerns regarding the effectiveness of the Port Authority’s Perimeter Intrusion Detection System (PIDS), procured and installed under the previous administration of former executive director Christopher Ward. Despite concerns over the security determinations made by the prior administration, Nunziato stressed: “the Port Authority’s current leadership of Chairman David Sampson, Vice Chairman Scott Rechler, Executive Director Patrick Foye and Deputy Executive Director Bill Baroni are clearly dedicated to improving Port Authority policing and security issues and we look forward to continuing to work with them toward achieving those goals.”
The Post report says that since the jet skier breached the security perimeter, the Port Authority of New York and New Jersey has “beefed up patrols and added a round-the-clock officer to the room where the fence is monitored by security guards.

3G vs. 4G: AT&T’s ‘sunset’ fuels debate

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Wednesday, August 15, 2012

While AT&T has finally set a date and ended the discussion over when it will push 2G into the sunset, the points of contention grow sharper over 3G versus 4G and the merits of each for cellular alarm communication.

Boiling down the argument to its simplest terms, this much is clear: Technology touted as 4G is faster and more expensive. But is that extra speed worth the money, and more importantly for alarm dealers, will it contribute to longevity in the field? And what is “real” 4G anyway?

On Monday, I talked with two industry experts who couldn’t be further apart on the issue: Gordon Hope, general manager of AlarmNet at Honeywell, and Shawn Welsh, vice president of marketing and business development for Telguard. Both made what seemed to be valid arguments, although I confess I’m not qualified to comment on the technical merits of each. What I can do is define HSPA (High Speed Packet Access), HSPA+ (evolved HSPA), and LTE (Long Term Evolution), and offer a bit of what each man had to say:

Hope: “I don’t know whether it’s accidental or intentional, but it seems like our industry is mixing 3G and 4G together in one sentence. In reality, there’s clearly a difference—the carriers delineate it. HSPA+ and LTE from AT&T’s perspective are legitimate 4G technologies, and everything else isn’t.”

Welsh: “At a recent webinar, AT&T and Qualcomm both basically reiterated this statement: 4G is the same as 3G, it just costs more. To get down to the letter version of that, HSPA+ is the same thing as HSPA as it relates to longevity, it’s just that HSPA+ costs more.”

Hope: “We believe the best thing to do is to move up and provide a 4G radio, not stopping at 3G. HSPA+ is a 4G technology … it’s just plain faster. In AT&T’s announcement [about 2G], they even made statements that a third of their postpaid subscriber base is already using 4G technology, not 3G. That speaks to the fact that if you’re not thinking about 4G, you’re probably going to leave yourself shortchanged if you stopped at 3G network capability in the radio module you chose. We went through the additional expense to include HSPA+ 4G technology in our radio. We believe it’s going to directly translate into longevity on the wall.”

Welsh: “There’s a thought that 4G is somehow better than 3G and that somehow it will be around longer, because certainly each generation will be around longer than the previous generation. In this case it’s a misnomer, because 4G as it relates to HSPA+ is really a marketing trick, unfortunately. … What happened was that AT&T and Verizon both went out and bought up spectrum in order to deploy real 4G called LTE. And 4G LTE got a certain level of throughput—it was really fast. Well, T-Mobile did not get spectrum, so they were stuck having to advertise 3G when their major competitors were going to start advertising true 4G LTE. So they simply did what a marketing organization might do. They just said, ‘Hey, you know what? This new 3G HSPA+ is so fast it goes just as fast as that LTE they’re going to deploy, so you know what we’re going to do? Let’s just call ourselves 4G. All that really matters is the speed anyway.’ So overnight they rebranded themselves as 4G in order to compete with the marketing term of 4G LTE. And literally that’s what happened. AT&T was forced to start calling their HSPA+ network— which was really just a 3G network—a 4G network in order to compete with the marketing spin T-Mobile was putting on things. And that’s how we got 4G as it relates to HSPA+.”

Hope went on to say that while speed traditionally hasn’t been important to the alarm industry, it will play a bigger role in attracting future generations of consumers who will be loading their tablets and smartphones with security applications and a whole lot more. Welsh reiterated that longevity will remain the top priority for alarm dealers, and “from a cost standpoint, HSPA+ is a more expensive solution for the exact same longevity.”

For the record, the International Telecommunication Union states on its website that the only “true 4G technologies” are LTE Advanced and WirelessMAN Advanced, neither of which has been deployed on a large scale. The ITU goes on to say, however, that the term 4G may also be applied “to the forerunners of these technologies, LTE and WiMax, and to other evolved 3G technologies providing a substantial level of improvement in performance and capabilities with respect to the initial third-generation systems now deployed.”

That sounds like a gray area open to commercial and consumer interpretation, but there's no arguing this point: Alarm dealers with radios on AT&T’s 2G networks will have to upgrade by 2017 or they’ll be left in the dark. The fadeout due to spectrum harvesting will accelerate before then, so sooner is probably better than later. Then it's just a question of sorting out the Gs.

ACA acquires in Alabama

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Wednesday, August 15, 2012

Smooth. That’s how Alarm Capital Alliance described a recent transaction that added more than 1,000 accounts to its existing account base in Alabama.

ACA, a Media, Pa.-based independently-owned company that acquires and manages security alarm contracts, acquired the accounts through an asset purchase transaction with Ultimate Security of Scottboro, Ala., according to a news release issued last week.

Ultimate Security will stay in business and continue to service ACA customers, according to the Aug. 7 release.

In the release, Kelly Bond, VP of sales and marketing for ACA, remarked, “This was one of the smoothest transactions that we’ve entered into.”

Ultimate President Richie Burns said in a prepared statement that this is a “tremendous transaction that allows us to remain in business, continue to sell accounts and provide service for all of our friends and customers.”

Bond said, “Richie has a great staff and quality accounts, and we’re looking forward to a prosperous relationship.”

Terms were not disclosed. Ron Davis, of Davis Mergers and Acquisitions Group, represented the seller.

Lowe’s Iris: Boon or bane in fight against false alarms?

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Wednesday, August 8, 2012

On one hand, it’s hard not to see the appeal of Lowe’s new Iris home management system. It’s do-it-yourself for those with the dexterity to install a thermostat, it’s cloud-based so homeowners can control and check on their properties remotely, and it’s inexpensive: starter kits range from $179 to $299, and there are no monthly fees for those who choose to do their own alarm monitoring.

On the other hand, how many homeowners are really prepared to be their own central station?

Sarah-Frances Wallace, a Lowe’s spokeswoman, recently touted the self-monitoring aspect of Iris in an interview with SSN's Tess Nacelewicz. Wallace said homeowners “can respond appropriately” when they receive a security alert, using an Iris camera to see “if there’s an intruder in your home that would require police response … or if it’s the dog knocking something over.”

Wallace said DIY monitoring helps avoid the problem of false alarms, for which many municipalities now charge homeowners a penalty. “This kind of gives the homeowner more control over triggered alarm events in the home,” she said.

But what happens when the homeowner decides the alarm is legit, they call 911, police respond and they find nothing amiss? What happens when the scenario gets played out three or four times in a month at the same residence? Do you think the municipality is going to continue to absorb the cost of dispatching officers and cruisers?

Ask any alarm company owner and I think you'll get a consistent response to that. Municipal budgets are tight and they're only going to get tighter. Just because a professional wasn't involved in the installation and monitoring of a system doesn't mean local officials are suddenly going to forgive and forget when it comes to false alarms.

For homeowners who want a little help when it comes to dealing with alerts from their Iris system, Lowe's offers a self-monitoring service for $9.99 a month. "You can set it up so if there's a triggered event in your home, it would email [or text or call] your neighbor … [or a] small network of people you'd want to receive notification of events," Wallace told SSN.

The service is ideal "if you're on vacation and you receive a notification that there is an event in your home," she said. "You could contact your neighbor—because they've also received [the notification]—and they could look into it for you."In a perfect world, it all ends well. If a pet triggered the alarm and the neighbor happens to be around to make that determination, everyone sleeps easy that night. But what if it wasn't Fido who did the deed and it's an intruder instead? What happens when the neighbor walks headlong into that situation?

Hello, Ken Kirschenbaum.

The point is, there are times when it pays to do things yourself and times when it pays to let professionals handle it. Again, it's hard to dispute the appeal of Lowe's Iris system for many people and for many applications. But should home security be one of them? Let the buyer beware.

Devcon’s new operations center to shut its doors in September

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Wednesday, August 8, 2012

I reported this summer that Devcon Security, a Hollywood, Fla.-based super-regional, was planning to shut down its new 23,000-square-foot national operations center in Irving, Texas by the end of the year.

Now it appears the closing will take place next month. Devcon plans to close the facility Sept. 5, laying off 197 employees, according to a report this week by the Dallas Business Journal. The facility opened in February 2011.

CEO Steve Hafen previously told me that closing the center was part of a company plan to reduce expenses and strengthen the company’s finances for future profitability and growth.

The company also is closing branches nationwide, a reversal of a rapid expansion it had recently undergone. In the past 18 months, Devcon, acquired by San Francisco-based Golden Gate Capital in 2009, transformed itself into a national player with more than 50 branches around the nation.

Hafen previously told me: “Devcon has experienced many changes over the past 18 months, including an aggressive growth initiative and subsequent streamlining of some branch operations.” He said then a reduction in the company’s workforce was anticipated.

The business journal reported that Devcon issued a statement saying that it “has aimed to, and has already made progress on, helping displaced employees transition into new opportunities through job fairs and résumé assistance programs. Devcon Security believes that these changes, while challenging, will strengthen the company and enable more opportunities for those in the industry long term.”

Who will buy AlarmForce?

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Tuesday, August 7, 2012

AlarmForce, a super-regional security company based in Toronto, announced that its board of directors is taking a look at selling the company. The company has hired Imperial Capital to help it with a possible sale.

The company's market cap value today is listed as $135m and its enterprise value is $119m.

I asked Richard Ginsburg, former CEO of Protection One who is now managing partner at G3 Capital Partners, what he thought about the sale of AlarmForce. He said he thought the company is well run and that CEO Joel Matlin "has done a fabulous job of identifying a segment of the market open to value-oriented products (like their new video offering) at prices that are at or lower in comparison to traditional systems with basic offerings."

Ginsburg also said he believes "a company like AlarmForce is in a great position to compete with the likes of industry leader ADT and the emerging cable and telecom companies because of [AlarmForce's] single-minded focus on enhanced services like two-way voice and now video services." He added that he believes "some of the traditional companies are in a weaker position to compete in comparison."

Ginsburg predicted the company will get "good interest"  and said Imperial Capital has "formed a great niche in the M&A sector so they are a good choice [to help out with a sale.]"

The last time I spoke to CEO Joel Matlin was back in the winter of 2010 when he was opening a fourth office in Minneapolis/St. Paul.It has offices in North Carolina (opened in 2005), Ohio (opened in January 2006)  and it opened an office in Georgia in 2007.

AlarmForce does security alarm monitoring, personal emergency response monitoring, video surveillance for resi and commercial customers. Something that’s unique about AlarmForce is that it manufactures and installs its own two-way voice home alarm systems. When I did that interview, AlarmForce had 103,000 accounts in Canada and the U.S., which Matlin told me was up from 56,700 accounts in 2006. Today the number of accounts is closer to 125,000.

“Canada is a tough country to do business in. It’s got a population the same as the state of the California, but it’s spread out over a country that’s much larger than the U.S.,” Matlin said. In addition to dense population centers that are easier to penetrate, “the perception of crime is stronger in the U.S. than it is in Canada.”

Wonder who some potential buyers might be? One possiblitiy, in my opinion would be Stanley, which expanded its resi business in Canada last summer with the purchase of Microtec Security Systems. It got 80,000 accounts and additional bi-lingual monitoring capability out of the deal.

Or I suppose AlarmForce could be a bolt-on for a telecom that’s getting into the security business. Rogers Communications maybe? Here’s a video from the summer of 2011 where we talk about Rogers Communications working (in secret!) with iControl to get into the security industry.  And here’s a story about the deal.

AlarmForce board of directors has formed a committee of independent directors to supervise the strategic review.

 

Battered but unbowed

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Tuesday, August 7, 2012

Wayne Wahrsager’s New York Merchants Protective Co. Inc.—an alarm company in existence for more than 100 years—is no more as the result of a $20 million breach-of contract lawsuit filed against the company and Wahrsager last year by Bank of America.

But Wahrsager tells me he is still very much a player in the security industry—and planning to launch a new alarm company in October with $50 million in funding behind it.

“You just brush yourself off and start all over,” he told me this week.

It seems that what Wahrsager experienced over the past year and half would have had most people down for the count.

First, in January 2011, came the Bank of America lawsuit contending it was owed more than $19.2 million for the default of a loan.

Then, four months later, Wahrsager got fired from his job as president of NYMP and pretty much literally got thrown out of the company’s Freeport, N.Y.-based office by the receiver a judge appointed to run the company. The receiver changed the locks at the office to keep Wahrsager out but he just took his office door off its hinges and continued coming to work until a judge ordered him gone that May.

Then, last October, the judge approved the sale of NYMP’s assets to pay off creditors. The sale to Professional Security Technologies of New Jersey was completed earlier this year, Wahrsager told me.

He’d been involved NYMP since 1988, but the previous owners were cousins so it was a family business that turned 100 years old in 2010, he said.

Wahrsager contends that the company went for far less than it was worth, and that if Bank of America had been willing to work with him, he would have repaid the loan “100 cents on the dollar.” He said he’s still a named defendant in the lawsuit, which is still pending.

But Wahrsager said he’s working as a consultant for Bellmore, N.Y.-based Commercial Fire & Security, which he said was formed about a year ago.

And he’s involved in the start up of a new company that he said has a group of investors behind it and is expected to launch by the end of October if all goes as planned. The company may be called Commercial Fire & Security—the new company may acquire the existing one—or take on a new name, he said. It will be based somewhere on Long Island, Wahrsager said.

Stay tuned—it looks like another round for Wayne Wahrsager.

Industry veteran mourned

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Monday, August 6, 2012

We at Security Systems News were very saddened to learn about the sudden passing of David Merrick, marketing director for Pittsburgh-based Vector Security. A veteran of the industry, he was a member of our Editorial Advisory Board, a great source of knowledge, and also just an all-around nice guy. He’ll be missed.

David, 60, a Pennsylvania resident, died July 31 at a local hospital. Here’s more about his career of more than three decades, provided by Vector Security:

David began his career in the electronic security industry during 1979. Since that time he has held various sales and marketing management positions, first with Automatic Detection Systems and then Triple A Protection, a Pennsylvania-based regional supplier of residential and commercial electronic security and uniformed guard services.

In 1999, David became part of Vector Security, holding the position of Director of Marketing for Vector Security's National Accounts Division.

Active in the security industry, David served as a board member of the Pennsylvania Burglar & Fire Alarm Association, and was the recipient of the NBFAA 2002 President’s Award. He authored a variety of sales and marketing-related articles in a number of industry magazines, and was an editorial board member of Security Systems News.

David’s work has been featured in various industry magazine articles, merited three SAMMY nominations, and captured the honor twice. He was also the author of the National Burglar & Fire Alarm Association’s (NBFAA) Reassuring America Program.

An obituary from the Sheldon-Kukuchka Funeral Home said David is survived by his wife Nina Mowry Merrick; a stepson and stepdaughter; a brother; a granddaughter and a goddaughter.

Online condolences may be sent to the family at www.sheldonkukuchkafuneralhome.com

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