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Help the CSAA track trends in monitoring

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Wednesday, September 26, 2012

What are central stations doing to keep up with times—and the competition—when it comes to technology, reducing false alarms and other issues of importance to the industry?

The Central Station Alarm Association would like to know.

The CSAA is looking for help in tracking technology trends and investments in personnel at monitoring centers across the country. The goal is to establish a databank “that will be useful in benchmarking performance” in the industry, according to CSAA Executive Vice President Steve Doyle.

The topics range from the basics—the number of accounts that a central handles and the certifications it has—to specifics about advanced technologies and operational policies. PERS, GPS-assisted calls, UL2050 accounts, video monitoring, video-verified alarms, ASAP protocols and employee training procedures—it’s all covered.

It’s important information that will allow the CSAA to see where the monitoring industry is and where it’s heading. The 25-question survey is also easy to complete—I filled out a placebo version in five minutes, faster than the refs could sort out a holding call in the Pats-Ravens game.

To complete the survey, click here. Participants will receive an executive summary of the findings, which will be released publicly Nov. 11-13 at the CSAA Fall Operations Management Seminar in Fairfax, Va.
 

Designing security

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Wednesday, September 26, 2012

Every month I call Ray Coulombe at SecuritySpecifiers.com to get the name of a specifier/consultant for “Specifically Speaking,” a Q&A column we run in our monthly printed publication.

These conversations give me a chance to talk to security experts who have a much different perspective from the integrators, dealers and manufacturers that I spend the rest of the month talking to.

This morning I spoke to Jim Elder, owner of Secured Design. We started talking about something I wrote about several years ago, CPTED, which stands for Crime Prevention Through Environmental Design.

Elder advocates for security specifiers getting involved really early in the design process of a building. Where a parking lot is located, which way elevators face, etc. can greatly affect the physical security system needs of a building/organization. These things can be changed early in the process, it’s much more difficult, or impossible later on—generally about the time the security consultant is called in to make recommendations.

The environment also affects how people (including criminals of course) feel in a certain location—which is anoth

Often specifiers are brought in much later in the design cycle and told “there’s not much money for security.” If the needs are high, the cost of the system will naturally be high as well.

A building that’s properly designed can be artful and efficient and designed with security in mind, Elder said. Cameras, readers and guards can be eliminated when the design is not “porous.” And, Elder points out, that money can be spent on paintings, finish elements, or maybe on an upgraded security system.

Check out the November issue of Security Systems News for the Q&A with Jim Elder.

State of the cloud: Is it safer than you think?

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Wednesday, September 19, 2012

Is your cloud provider secure?

That question, the basis of a TechSec forum in February, came to mind again this week with the release of Alert Logic’s “State of Cloud Security Report—Fall 2012.” The company, a provider of security solutions for the cloud, issued the report after analyzing more than 70,000 security incidents among 1,600 business customers.

Among the key conclusions was that “on-premise IT infrastructure is more likely to be attacked, more often, and through a broader spectrum of attack vendors than cloud-based infrastructures.” The report also cited a higher incidence of “brute force attacks and reconnaissance attacks” in on-premise environments.

The findings echo one of the points made at TechSec: While many security companies don’t trust their data in the cloud, having it on-site doesn’t guarantee it’s going to be safe.

“[Cloud] security is far greater than open data systems,” said TechSec panelist Brian McIlravey, co-CEO of PPM 2000, a manufacturer of incident reporting and investigation management software. “The enterprise-class cloud is very secure. Third parties that hold data take it very seriously—we don’t want it accessed any more than you do.”

McIlravey stressed due diligence when selecting and moving data to a cloud provider, including asking for certification and knowing what is covered in the service-level agreement. He said the same scrutiny should occur internally in the company that is moving data off-site.

“The cloud provider must have certification, but you should be asking the same questions of your IT group,” McIlravey said, referring to data access, encryption and other safeguards.

Due diligence aside, skepticism could well linger in the security industry because of the “myth” that the cloud isn’t as secure as on-site environments, said Stephen Coty, research director at Alert Logic.

“[It] is a stereotype that has prevented the industry from focusing on the real issues impacting enterprise security,” he said in a news release announcing the fall 2012 report. “Rather than falling victim to perception-based beliefs, businesses should leverage factual data to evaluate their vulnerabilities and better plan their security posture.”

Self-monitoring on the down low

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Wednesday, September 19, 2012

I just saw an item that takes self-monitoring of a home security alarm system to new heights … or should I say to new lows?

It also falls under the category of: “Dude, wouldn’t it be easier (not to mention safer) to have your alarm system professionally monitored?”

What I saw was on a site called Hack A Day. The site is devoted to news about hacking, so I guess I shouldn’t be too surprised about the item, which describes how a hacker who wanted to cancel his monitoring contract decided to rig up a system in which he could monitor his security system himself.

Security Systems News has already written about the drawbacks of legitimate self-monitored systems like Lowe’s Iris home management system. Check out what my colleague Rich Miller wrote on that topic about how most homeowners really don’t want to function as their own central station, trying to decide when to call 911 or not.

In the case of this hacker … yeah, so after what looks like a lot of work he reportedly can now monitor his home security system himself. But to provide the service a central station does, he has to be keeping tabs on his home 24/7 and know how to respond appropriately to each emergency when it occurs. Those kinds of benefits can’t just be hacked into.

Kessler on the multiple paid for Vivint

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Wednesday, September 19, 2012

Whenever a big company in the industry sells, there’s interest in the specific metrics of the deal.

I called Jeff Kessler at Imperial Capital to talk about the pending sale of Vivint to the largest private equity group in the country, Blackstone and the numbers.

It’s not every day there’s a $2 billion deal in the security industry.

While Kessler has high praise for Vivint, he says that certain metrics are not as off-the-charts as one might think, at least according to his calculations.

Kessler pointed out that the sale of Vivint for north of $2 billion includes not only Vivint’s home security/automation business, but 2GIG (a manufacturer of alarm/home automations systems) and Vivint Solar.

So while the total enterprise value for the is “north of $2 billion”, the enterprise value for Vivint home security/automation is less than $2 billion, he said.

Which doesn’t mean the valuation is not impressive, it just means “the multiple of RMR, EBITDA or steady state cash flow will be less than the total amount given for the entire company,” he said.

In terms of a multiple of RMR, Vivint has said it has $30 million in RMR. Kessler said RMR will be higher by the time the sale closes at the end of the year. “If you assume that RMR will be higher, and you assume that [Blackstone will pay] something less than $2 billion for Vivint [home automation/security], the multiple of RMR paid would be in the 50s.”

However, Kessler doesn’t like to talk about multiples of RMR. He prefers to look at multiples of steady state cash flow, because that “really gets rid of the accounting variance that really riddles EBITDA,” he said.

Based on his estimates of Vivint’s [home automation/security’s] steady state cash flow, he said the multiple to be paid is actually “at lower end of the 10 to 13 times [steady state cash flow] range paid for larger, quality companies over the past 18 to 24 months.”

Kessler based his assumption on certain transactions such as Bain & Hellman buying Securitas Direct; Ascent Capital buying Monitronics, Summit buying Central Security Group and Oak Hill Capital buying Security Networks.

(I'm quite certain I'll hear from others who's assumptions and math differ from Kessler's. Please leave a comment on this blog or contact me.)

The important thing is that if you're trying to figure out a mulitple of RMR, steady state cash flow or EBITDA, you need to back Vivint Solar and 2GIG out of the equation.

And if you're trying to figure out if your company's ripe for a sale, take a good look at what Vivint's doing, Kessler said. 

Kessler called Vivint is a “model company” that’s taking advantage of new technology and providing  “a value-added proposition at a premium.” The company’s average RMR per new subscriber is the highest at over $50, and they’re doing good things such as moving away from all summer-sales and increasing in-house sales resources.”

The Blackstone deal “should allow Vivint a lot of growth [with the] forward-looking ideas it has on its platter. … This will allow capital runway for projects like increasing the size of their non-summer sales force, increasing their ability to move into new markets such as small and medium sized commercial security, and to fund the growth and development of new products in home and business services, some of which are not even on paper yet.”

There will be lots more deals done in the security industry in the next year. The capital players are interested, but Kessler said it’s the security companies, like Vivint, what he calls the “haves,” those that are taking advantage of new technology and which have a finely tuned sales and marketing efforts that will be the most sought after.

ESA of Florida to hold inaugural event

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Friday, September 14, 2012

I wrote this spring about the Irving, Texas-based Electronic Security Association launching a state-chartered chapter in Florida. Now ESA of Florida is about hold an inaugural event.

ESA created the new state chapter because Florida is home to so many security companies.

The Sept. 20 inaugural event, which will be a legislative dinner featuring the chairman of the Electrical Contractors' Licensing Board, Ken Hoffman, who will discuss licensing requirements in Florida and the function of the board, according to an ESA news release. Also, updates on ESA of Florida and the upcoming ESA Leadership Summit in Orlando (slated for this Feb. 18-21, 2013) will be shared.

Steve Paley, president of Rapid Security Solutions LLC and chairman of the ESA of Florida steering committee, said a prepared statement: “We're excited to kick off the activities of ESA of Florida with this legislative dinner. We're encouraging everyone interested in helping to grow the security integration and monitoring industry in Florida to attend.”

Hoffman also said in the news release: “The security industry in Florida is primed for growth, and I'm happy to be able to address companies looking to improve their businesses and serve their customers even better.”

The dinner will be held at 6 p.m. at
Ruth's Chris Steak House at 2525 North Federal Highway, Fort Lauderdale.

The event — which is sponsored by Interlogix, Honeywell, Telguard and Tri-Ed/Northern Video Distribution — is open to both ESA members and non-members. Registration for ESA members is free; non-member registration is $35.

For more information or to register, visit www.esaweb.org/event/ESAofFLDinner or call ESA's Member Service Center at (888) 447-1689.

Tweet smart: Cashing in on social media

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Wednesday, September 12, 2012

You don’t have to look very hard to find an alarm company that isn’t keeping pace with technology. It can be difficult to stay on top of the latest and greatest, and some people are reluctant—or even defiant—when it comes to saying goodbye to the tried and true in favor of the Next Big Thing.

That attitude often spills over to the world of social media. Facebook? Twitter? “Friends” and Tweets fly just fine for the junior set, but we’re adults here. Besides, who has that kind of time to throw around?

Maybe your competition.

Social media is rapidly becoming a must-have business tool, and companies that aren’t wielding it effectively risk selling themselves short in an increasingly aggressive marketplace. Exposure and name recognition can translate into accounts no matter where you’re based or how big you are.

That fact hasn’t been lost on the Central Station Alarm Association, which will host a webinar Nov. 7 on social media strategies and how they can affect your business. Teresa Brewer of System Sensor and Michael Kremer of Intertek/ETL will discuss how to use social media to acquire customers or get referrals, boost attendance at company-sponsored events, and increase inquiries via your website or over the phone.

For those who have a success story to pass along, email Brewer at Teresa.brewer@systemsensor.com or Kremer at Michael.kremer@intertek.com. Registration information for the webinar will be available soon on the CSAA’s website.

Welcome aboard: In other CSAA news, the group’s international board of directors has approved Jay Hauhn as first vice president of the Executive Committee and Peter Lowitt as secretary. Hauhn is CTO of Tyco Integrated Security; Lowitt is president of Hicksville, N.Y.-based Lowitt Alarms & Security.

“The CSAA Nominating Committee did an exceptional job in vetting these outstanding candidates, and the unanimous vote of the board of directors reflects the complete confidence of the board in both of these exceptional gentlemen,” CSAA Executive Vice President Steve Doyle said in a prepared statement.

ASIS 2012, Pro 1 buys again, mobility and the financial vertical

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Wednesday, September 12, 2012

It’s been a busy two days for Amy Canfield (the new lead editor for our sister publication Security Director News) and I here in Philly at the ASIS show.

Since Sept. 10, the first day of ASIS, was Amy’s fifth day on the job, she accompanied me to most of my appointments that day. She did have a chance to speak to a group of end users at the Honeywell booth. Here’s her update on that  and she was flying solo on Day 2--check out her blog  for highlights of her day, including a tour of the security operation of the Philadelphia Convention Center with integrator Schneider Electric.

Here are some highlights from my conversations on the show floor on Day 1 and Day 2. Check back tomorrow for Day 3.

DIEBOLD
At the Diebold booth I met with Tony Byerly, who’d just completed his first 90 days as head of security at Diebold, along with Diebold IT chief Jeremy Brecher and Felix Gonzalez, who earlier this summer left Stanley to join Byerly’s senior staff as the newly appointed VP for strategic initiatives and business development in electronic.security.

Diebold was the first of several integrators I spoke to who said that one focus for them will be the financial services vertical. It’s not a surprise for Diebold, who's parent company is the largest ATM provider.

Byerly touted Diebold’s long history, the company’s reputation for steady, high quality service and technology know-how as advantages in the marketplace. He also noted the shifting competitive landscape and said Diebold stands out for a variety of reasons including the fact that “we’re a strategic in the space—we’re not backed by private equity.” He called Diebold the “nation’s only pure-play integrator,” pointing out that “we don’t have an adjacent manufacturing arm.”

Brecher talked about being “in the value position” with service and technology. “We invest time and resources to create solutions instead of packaging solutions,” he said. Diebold works to leverage a customer’s existing infrastructure, and customers have a “single method to connect to Diebold … a single customer portal … the entire web experience is easy to manage.”  
 
PROTECTION 1
Protection 1 had some big news. Click here to see the story about a big acquisition Pro 1 made. It’s a systems integrator with staff that's experienced and certified to work on networks. With the new staff/capabilities, Jamie Haenggi told me, Pro 1 will be taking on jobs it would have walked away from in the past.

STANLEY CSS
Stanley announced that John Nemerofsky is the new VP of Global Solutions, and that there's a new phalanx of vertical market leaders. There’s other news as well. Stanley is bringing together three business units: the CSS team, the Mechanical Solutions team, and the Security and Automatic Door team.

The teams would work together in the past, but it “would happen more through accident,” Nemerovsky told me. Now, there’s a “process where we’ll work together to pull together the best possible solution for the client.”

And there are specific solutions for each vertical market. This infrastructure will be appreciated by global accounts customers who “are looking for consistency in deliverables … the same deliverables, billing, systems they have in Chile [for example], that they have in New York City, Barcelona, Tokyo and Paris.”

Here’s the list of vertical market leaders: Paul Retzbach – Commercial Leader, Government; Chris Hobbs– Commercial Leader, Retail; Tom Benson – Commercial Leader, Banking; Paul Baratta–Commercial Leader, Healthcare; Rebecca Durham–Commercial Leader, K-12 Education; Eric Rittenhouse–Commercial Leader, Higher Education; Jerry Walker–Global Strategic Account and SSS Solutions; Eddie Meltzer–Global Strategic Accounts and SSS Solutions; Bob Stockwell–Technology Leader; Lance Holloway–Technology Leader; Beth Tarnoff–Marketing Leader; Ryan Fritts–Vertical eServices Leader

Look for more on this story next week.

TYCO
I also spoke with Renae Leary, senior director of global accounts for Tyco. Click here to read that story.

JOHNSON CONTROLS
I spoke to Tammee Thompson at Johnson Controls, who told me that ASIS is the show where she and others "take a break from making the quarter" (but only briefly she emphasized) to check out technology. She had an army of employees out scouring the floor “looking for the latest and greatest to pull into our technology stack.” Specifically, JCI is looking for access control solutions, VMS, PSIM and ID management solutions.

RED HAWK
I also had a chance to chat with Mike Snyder of Red Hawk. He said that the company is finishing up “moving the infrastructure [network and IT systems] out of UTC,” and officially began its rebranding as Red Hawk in the past couple of weeks.

Snyder also talked about focusing on the financial vertical market, saying that the next wave of retail banking will not be branch operations, but ATMs. He believes Red Hawk will have a leg up on the competition because his staff has deep experience in the financial sector, some originally coming from Mosler. The company also has a partnership with ATM provider NCR.

AXIS COMMUNICATIONS
At this show, Axis Communications was showing many new products and solutions, many targeted toward the fewer-than-16 channel market. (Look for a story next week about a visit I made to Axis H.Q in Massachusetts a couple of weeks ago.) When I asked Fredrik Nilsson about all the talk I was hearing about the financial vertical, he noted that Axis had an ATM with four cameras in its booth. Nilsson said that banking is a conservative vertical that is finally making the leap from analog to IP. “Education was the first, then retail, and now it’s banking’s turn.”

He agreed with Snyder’s point that the new wave of retail banking is moving from the branch to ATMs. "When was the last time you went into a bank branch?," he asked. "I refinanced my house online."

Coincidentally, Axis is also in the process of hiring a business development specialist for the financial vertical, he said.

AVIGILON
At the Avigilon press conference, the company introduced the new version of its software. Keith Maret said Avigilon took inspiration from Google, Apple and Facebook in the development of this software. The cool thing is that the software can respond to voice commands and body movements. COO Andrew Martz demoed this capability and it was like watching a command center staffer play squash on a Nintendo Wii. The command center screens zoomed and focused in response to voice commands and hand gestures. This feature is in the alpha phase. “We’re gauging the interest in it,” he said.

Maret summarized the features thus: crash-proof enterprise server management, where all servers are grouped together; a “collaborative mode” where more than one person can log into video feed and manipulate the video in real time; and intelligent virtual matrix that “allows you to turn video walls to life.”

HONEYWELL

At Honeywell, in addition to talking to the end user committee, I spoke with Scott Harkins about Honeywell’s emphasis on the “connected business," where the access, video and intrusion systems are tied into other systems such as: HR systems, radars [in super high-end port applications] POS for example. The emphasis of course, as we heard from nearly every manufacturer at the show, is on mobility. Honeywell’s newest ProWatch 4.0 access control has a new mobile offering that enables remote access from iPads,  phones and other devices. It’s also integrated with wireless locks, something Harkins is very excited about, because it’s so much cheaper to install, maintain and manage.

FOOTBALL

The traffic on Day 1 was the lightest I’ve seen in a while at an ASIS show. It picked up considerably on Day 2, but it was still moderate traffic to my eye.

Why? Well, there’s the economy of course. Things may be looking up, but one manufacturer told me that people who’ve got money in the bank are keeping it there. They’re still cutting corners on travel—making this a one- or two-day show, rather than three.

I also heard that having the show in Philly meant that tri-staters could take the train in for Day 2 and 3.

And, I understand there may have been some football-related reasons that folks weren’t here on Monday.

Football.

I can think of about 80 things I’d rather do [including laundry] than watch football on a gorgeous fall day, but if football will help roll back the expectation that people should travel to work events on Sundays, count me in.

Go Pats. Woo.
 

Virginia security provider having ‘best year ever’

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Wednesday, September 12, 2012

When I wrote about Richmond Alarm last summer, it was having a good year. The Richmond, Va.-based, family-owned, full-service security company had grown its footprint into Eastern Virginia with a new acquisition, making that company the largest locally-owned security provider in the state.

But 2012 is turning out to be an even better year for Richmond Alarm. Not only did the company celebrate its 65th anniversary this year, but it also won Chesterfield County’s business of the year award this summer.

Also, according to the story this week in the Richmond Times-Dispatch newspaper, revenues are climbing since they flattened out during the recession. “The calendar year 2012 will be the best year ever,” company president Wayne Boggs is quoted as saying.

Richmond Alarm, a Honeywell First Alert dealer, was awarded the 2012 First Choice Business of the Year Award in July, according to its website. It says the award “recognizes companies that consistently contribute to Chesterfield County through community service, innovative products and services, job creation, tax revenue and ethical business standards.”

Vivint blows (hurricane) competition away, website says

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Monday, September 10, 2012

We’re now in hurricane season, which began in the Atlantic Ocean in June and won’t end until the last day of November. And, according to a website that does annual reviews of home security companies, the company that stands out during such bad weather is Vivint.

6Webs.com selected Utah-based home automation/home security company as the “Best Home Security Company during Hurricane Season,” according to a news release from that website, http://www.6webs.com.

The company says it does independent reviews of home security systems and “conducts an annual review of the leading home security providers and ranks them based on several categories that are important to consumers.”

In awarding the recognition to Vivint – which is reportedly considering a sale – 6Webs.com cites the features the company offers including its Go! Control panel weather alerts, with inclement weather notifications via an iPhone, iPad or Android device; the back-up batteries it provides for all the home security systems it installs, which help ensure protection if the power goes out; its 24-hour customer service; and the fact that it provides cellular monitoring.

“In the case of a natural disaster not only could power be lost, but phone line service could be interrupted for a long period of time leaving your home less secure. This is also the case with Internet-based systems when power is lost, the connection to the monitoring center will be lost as well. Vivint’s cellular security system is the most reliable way to ensure the connections with the monitoring center is not interrupted,” the news release said.

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