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ADT adds another to management lineup

 - 
Tuesday, May 1, 2012

More post-split news from ADT: It recently made another management lineup announcement about a new chief marketing officer, Tony Wells. Wells doesn't have a security background—his previous experience has been at companies as diverse as 24 Hour Fitness and Nissan—but is skilled at marketing and communications, according to a news release. This latest ADT announcement follows on the heels of management changes it announced just three weeks ago.

Here’s more from the April 27 announcement, as reported by PRNewswire:

SCHAFFHAUSEN, Switzerland—Tyco International Ltd. today announced that Tony Wells will assume the role of chief marketing and customer officer of The ADT Corporation, to be created upon separation from Tyco later this year.

"Tony's hiring is another example of our commitment to bringing top-tier talent to our management team as ADT prepares to become an independent public company," said Naren Gursahaney, current president of Tyco's ADT North American residential and small business security segment and future chief executive officer of The ADT Corporation.  "Tony brings best-in-class marketing and digital expertise, strong customer engagement insight and a deep understanding of ADT's subscription-based business model. I am confident he will play an integral role in further enhancing our brand and driving our strategies for growth."

Mr. Wells, 47, joins ADT from 24 Hour Fitness, where he served as executive vice president and chief marketing officer since 2007. At 24 Hour Fitness, he was responsible for marketing communications, public relations, oversight of 24hourfitness.com, member services and retail products/services.  Previously, Mr. Wells served as vice president, client services for VISA USA, Inc., where he was directly responsible for global relationship management for HSBC and USAA Banks.  Wells joined VISA USA as vice president, partnership marketing, where he oversaw daily operations and management of Visa's sponsorship, event and alliance efforts. Mr. Wells also held a variety of marketing positions at other major brands, including General Motors R*Works, Mills Corporation, and Nissan North America, Inc.  A former Marine infantry officer, Mr. Wells received a B.S. degree from the United States Naval Academy and a management certificate from Johns Hopkins University.

Don Boerema, who had been serving as ADT's chief marketing officer, has assumed the new role of chief corporate development officer. In this role, Mr. Boerema will be responsible for corporate strategy, market development, business development, mergers and acquisitions and new business units.

Upon separation from Tyco International Ltd., The ADT Corporation will be a leading provider of electronic security, interactive automation and related monitoring services for residences and small businesses in North America. … Headquartered in Boca Raton, Florida, ADT employs 16,000 people at nearly 200 locations.

Getting home security from the cable guy: drawbacks along with benefits

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Wednesday, April 25, 2012

We’ve written a lot here at Security Systems News about more and more telecoms and cable companies getting into the security market. And now mainstream media is taking note. For example MSN Money had a recent post from its SmartMoney partner site, titled “Home security—from the cable guy.”

I read the post, thinking it would simply extol the convenience of bundling security with your cable. But it was actually a balanced piece that included the argument from professional security companies that the service they offer is safer. In fact, the subtitle of the piece was: “More cable TV companies are offering home-monitoring systems in their markets. Know the drawbacks before you sign.”

Here’s what the April 20 post had to say to consumers:
 

The same company that provides your home phone, Internet and television services now wants to offer some protection.

A growing number of telecom providers have added home security to their lineup of services. Their interactive systems use sensors and cameras to monitor the property, while apps let users check in remotely and receive alerts about trouble.

Comcast has expanded its Xfinity Home system to 65 percent of its markets since the 2010 pilot. In October, Verizon introduced Home Monitoring and Control in 12 states and Washington, D.C. Time Warner Cable launched IntelligentHome in markets including Los Angeles, Hawaii and upstate New York last summer. Cox Communications and AT&T are separately in the process of rolling out similar programs.

For the companies, the services are a way to "improve their revenue per user" by tapping into the $8 billion home security market, says Tom Kerber, research director for home controls and energy at Parks Associates, a research firm. Telecoms are worried about slowing broadband growth – 62 percent of households already have it, according to PewResearch –  as well as the rise in landline cord-cutting, he says.

CTIA-The Wireless Association reports that roughly a third of households are wireless only, up from 11 percent in 2006. It helps that smart-home technology has also become cheaper and more widespread in recent years, as consumers get used to using their smartphones to control the thermostat or sync with the car's entertainment system.

These companies say their smart-security set-ups let consumers have more interaction with their home than simply arming an alarm when they leave home and disarming it when they get back. Window and door sensors and cameras interact with apps and a control panel, letting customers set rules about when the system reacts, and how.

For example, "when doors open, the system takes a video of whatever made that door open, and I get an alert on my phone," says Mitch Bowling, a senior vice president for Comcast Cable.

Users can also set alerts for things that don't happen, such as if the front door doesn't open by 3:30 p.m. when the kids should be home from school. As an added benefit, most systems can tie in technology to control home appliances such as the thermostat, lights and door locks from afar. So you could set the system to turn on the light when that front door opens, or turn on the air conditioning when you're on your way home from work, says Ann Shaub, director of product management for Verizon.

Cheaper -- but is it better?

The services are typically cheaper than going through a dedicated security firm -- $10 to $40 per month instead of $30 to $75. But experts warn that consumers are likely getting less protection. More elaborate home security systems can monitor for threats as diverse as carbon monoxide and rising water levels that smart systems can't detect.

In addition, some telecoms' monitoring services only alert solely to you, without relaying an alarm in a central monitoring station that would call the police or fire department, says James Orvis, a past executive vice president of the Electronic Security Association and owner of Security Solutions in Norwalk, Conn. Miss the text that the door sensor tripped, and the police may not arrive in time to catch the burglar.

It's also added risk if you're at home during a fire, break-in or other emergency where calling for help yourself isn't easy or safe, he says.

On the other hand, alerts that go only to you limits the number of false alarms, which some police departments add a fine for responding to, Orvis says. Verizon's Shaub says Home Monitoring and Control, which doesn't use a central monitoring station, still provides peace of mind and keeps consumers in tune with what's going on in the house. At the very least, it's a way homeowners can keep tabs on their kids and pets.

Shoppers should also be careful to dig into package details to determine the full cost before signing up, says Chris McGoey, a Los Angeles-based security consultant. Telecom companies' $70 to $500 one-time equipment charge is typically for a basic kit with a monitoring station and a few sensors; consumers with a large house will need to buy extra equipment for thorough coverage. So will those who want remote control over more home devices.

Services may also charge extra for connectivity to a cellular network so alarms will sound even if the power goes out. "By the time you get the system that you really want, it costs you a heck of a lot more than the promotional offer," he says.

Consumers may have little recourse to change their mind, either: Some offers require a two-year service contract.

 

Brivo's got a new deal for dealers

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Wednesday, April 25, 2012

In a video I posted on our site today, an interview with Tyco Integrated Security CTO Jay Hauhn  from ISC West, one of the topics we talked about is  the security industy’s journey to the cloud.

We’re not there yet with hosted video, he said, but the one product area where the industry is most comfortable in the cloud is access control.

And, Brivo Systems is certainly one of the leaders in this arena. Brivo CEO Steve Van Till wrote a guest commentary for us about the cloud confusion he saw on display at ISCWest. Check that out here.

But more on Brivo, I spoke yesterday to Lee Odess, Brivo’s director of sales operations, about the company’s new dealer program that it launched at ISC West. The company has existing dealers, of course, (about 300) but this is Brivo’s first formal dealer program.  

“The main thing is that it’s a partnership. We’re not dictating or demanding,” Odess said. “We’ll reward dealers based on commitment … and there’s a real focus on market development,” he added.

For committed dealers, Brivo will help “from a monetary side, to execution and support … or in other strategic ways,” Odess said. For example, if a dealers “wants to go after the retrofit and remodel remarket, we’ll work with you to put a program together.”

It’s a three-level program: Silver, Gold and Brivo Blue. Brivo Blue dealers “are the most committed”, Silver dealers are likely new dealers, and Gold dealers “work with us but there are certain things they don’t do on the commitment side,” Odess said.

Odess listed eight benefits for Brivo Blue dealers:+
1.    Market Development Funds—which will be based on last year’s sales.
2.    Lead Sharing—“When we get contacted by end users, we’ll connect them with our most committed dealers.
3.    Dealer Council. “It’s a place for idea sharing and a forum for beta testing and showcasing our tools.” It’ll be a platform for feedback, positive and negative, he said
4.    Online web service, which is co-branded with the dealer’s name.
5.    A&E Specification include dealer training and certification levels.
6.    Search Engine Optimization—“We’ll help dealers position themselves better in the market.”
7.    Internal extranet “it’s like the forum, but it’s an online feature”
8.    Award program that’s based upon how closely the dealer works with Brivo instead of just “how much you purchase."

Pinnacle settles Missouri AG complaint

 - 
Monday, April 23, 2012

Pinnacle Security, an Orem, Utah-based summer-sales-model company, has reached a $76,000 settlement with the state of Missouri over a complaint filed last year regarding alleged deceptive sales practices from a few years back. As part of the consent agreement, Pinnacle has promised to monitor its door-to-door sales reps more closely, according to a recent news release from Missouri Attorney General Chris Koster.

I asked Pinnacle about the settlement, which the AG announced April 20 and here’s what the company had to say:

Pinnacle Security is very pleased that it has resolved the Missouri Attorney General's lawsuit to the parties' mutual satisfaction.  Over the last several months, Pinnacle worked cooperatively with the AG's office to address issues related to customer complaints regarding certain alleged sales practices that occurred primarily during the 2008 and 2009 summer sales seasons.
 
Since 2010, Pinnacle has implemented industry-leading compliance initiatives to help ensure that Pinnacle's customers are treated honestly and fairly.  As part of its agreement with the Attorney General's office, Pinnacle will continue to ensure that its Missouri customers receive superior customer care and service.  Pinnacle looks forward to continuing its relationship with the State and to protecting the security of Missouri's citizens.

Pinnacle, which sells nationwide and in Canada, said when the company settled a complaint with the Florida attorney general earlier this year that the company had some issues in past years with “rogue” door-knocking sales staff.  However, in 2010, Pinnacle made a company cultural shift to emphasize a code of ethics for employees and the implementation of new ways to monitor their behavior and enforce the code.

Here’s more from the AG’ release announcing the agreement:

Under the settlement, Pinnacle will provide $46,000 in refunds to customers in Missouri who were misled about Pinnacle’s relationship with other security companies, the cost of its services, or its cancelation policy. Pinnacle will also pay $12,500 to the Missouri Merchandising Practices Revolving Fund and $17,500 in civil penalties to the state.

Additionally, Pinnacle must reform its sales practices to ensure consumers understand the important terms of the contract before purchasing, including the company with which they are contracting, the monthly price for the service, the total duration of the contract, and any restrictions on cancelation. The settlement, embodied in a consent judgment filed today in St. Louis County Circuit Court, also obligates Pinnacle to monitor its sales representatives who conduct door-to-door sales more closely. ...

The settlement resolves a lawsuit filed in May 2011, in which the Attorney General’s Office alleged that Pinnacle induced consumers to purchase by misrepresenting that they were associated with the consumer’s current alarm company and that the consumer would receive free services when the services were not free. The suit also alleged that consumers were told they could cancel at any time when in fact consumers had to pay for the entire 39-month contract if they did not cancel within three days.

In addition to the $46,000 in restitution, Pinnacle will also pay refunds to any consumer who files a new complaint within the next four months and provides documentation showing they were induced to enter a contract with the defendant using unfair or deceptive practices.

 

Protect your customers from 'flood season'

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Friday, April 20, 2012

OK, up until now we’ve had kind of a drought this spring here in Maine, but normally this time of year is known as “mud season,” because of how wet the combination of melting snow and spring rain can make the ground. And lots of rain is in the forecast for the coming week, which is why a recent post about protecting homes from "flood season" on Honeywell’s The Security Channel Blog caught my eye.

Jason Lutz, district sales manager, Honeywell Security & Communications, wrote a piece titled, “Water Damage Prevention Is as Important as Security.” He said there’s a big market out there for water detection and flood protection that savvy security dealers should be taking advantage of. And the timing couldn't be better than right now.

Here’s more from his April 4 post:
 

Spring is flood season. Are you talking to your customers about the damages floods can cause?

Since 1929, Alarm Device Manufacturing Company (ADEMCO) and Honeywell Security have designed and manufactured products that make our world safer and more secure.  While we typically focus on perimeter and fire protection, I’ve found there is a huge untapped market for water detection and flood prevention.

Recently, a rental property of mine became a victim of a water leak that caused more than $4,000 in damage. I decided to investigate water damage claims and other insurances statistics. According to the National Flood Insurance Program, the average annual U.S. flood losses from 2001-2010 were more than $2.7 billion. Our research suggests there are about 22 million residential systems installed in the U.S.; how many of those systems include water detection?

Water detection is a great add-on to new and existing security systems and it’s as easy as making homeowners aware of the potential hazard of water damage and how easily they can reduce their risk. Many claims adjusters will tell you, if the homeowner had only known sooner, they could have shut off the water and deployed water drying systems thereby reducing the damage to the home.

To meet this need, Honeywell Security offers low-cost 5821 and 470-12 wireless water sensors that can be monitored through the central station or through Honeywell Total Connect event notification. They’re easy to install and multiple units can be installed throughout the home. Honeywell suggests installing these devices behind the dishwasher, refrigerator, and washing machines. Other great locations include around HVAC drip pans and near hot water tanks.

Recently Honeywell created the video below to demonstrate to homeowners how a variety of sensors, including flood detection, can keep them informed about what’s going on at home when they’re not there. It’s a perfect way to begin the conversation with your customers. And to help them realize how much a flood can cost, use the powerful interactive tool on the Flood Smart website that dramatically calculates the costs by the flood level. Check it out here.

And to bring the message to an even larger group, talk with your insurance partners.  When you’re out speaking with agents about security and life safety protection, start the discussion about water and flood detection and how a referral program can really benefit them.  Many insurance agents receive a portion of their compensation based on Loss Ratio Bonuses.  If we can help them reduce their homeowners’ risk and lower claim amounts, everyone wins.

Are you promoting your security solution this flood season? Let us know.

 

No. 1 ADT dealer: Doing good is good for business

 - 
Wednesday, April 18, 2012

David Lindsey, the founder of Indianapolis-based Defender Direct, the nation’s No. 1 ADT dealer, recently stepped down from his position as CEO to focus on philanthropic mission work and encourage other companies to do the same. He said that will not only help companies do good—but it will do good for their business by increasing things like company dynamics and productivity.

Lindsey is one of the founders of Companies With A Mission, which its web site describes as “a movement dedicated to helping business leaders create opportunities for employees and their families to reap the rewards of service.”

At Defender, which he founded in 1998, Lindsey has had a more informal focus on mission work. Over the past five years, he said, Defender has sent several thousand people down to Mexico to help build 125 homes for the needy there.

Now Lindsey is formally devoting himself to philanthropy as Defender’s chief missions officer. “I look at much of what I’m doing as still an extension of the Defender story,” he told me. “We’ve always been a giving and a missional company and I’m trying to just continue to focus on that piece right now.”

He called Companies With A Mission a “ministry” and said, “We’re taking a lot of things that have been a blessing and powerful for our company and sharing them with other companies …right now our main focus is on U.S. companies [and some Canadian as well], but we do see it as a worldwide effort.”

One plan, he said, is to take as many as 100 business leaders and their families on mission trips to Mexico or the Dominican Republic by the end of the year, “so they can have a mission experience.”

A second objective, he said, is a “service challenge” the ministry is extending to companies. One challenge is in Indianapolis and another will be in New Orleans this fall, he said.

Companies are challenged to put teams together to go out and do community service work at nonprofits, then submit short videos of their work and answer three questions on the ministry’s web site to win prize money for their favorite charities.

In Indianapolis, Lindsey said he expects as many as 100 teams to compete for $100,000 in prize money.

Obviously the charities benefit, but how does that help the businesses?

Lindsey said he knows philanthropy helps companies because Defender tested the service challenge among its own employees before taking it citywide.

“It was a huge success,” he told me. “We worried that during the time we had everyone out doing projects, we’d have our sales go down but actually we’ve had six record months since we started the contest, the two months that we were in the contest, and then the four after.”

He added: “What we attribute that to is we just changed the water cooler conversion at our office. Everybody was buzzing and talking about their service project” [and what other teams were doing] … There’s nothing like the workplace going out and serving together—what that does for the work dynamic is really almost unbelievable.”

He said about half Defender’s teams are continuing to do community service on a regular basis. “It just brings a life and a spirit into our company that’s making a difference, and we want to share that with more companies and help them see that increased productivity, as well as the retention, recruiting and loyalty … that has been enhanced by this,” Lindsey said.

Bonifas heading home after being stranded on remote island

 - 
Tuesday, April 17, 2012

Talk about overages.

Stranded on a remote island in the South Atlantic with more than 70 other travelers, Bob Bonifas had the distinction of being the only person with a satellite phone. That meant using a lot of minutes: about 1,500 as of Wednesday, with five or six more days of dialing ahead until the group finally gets back to the mainland.

Bonifas, president and CEO of Aurora, Ill.-based Alarm Detection Systems, is among 73 passengers who were diverted to South Georgia Island last week aboard Plancius, a 293-foot polar cruise ship. The vessel was en route from Argentina to Ascension Island on a 31-day sightseeing tour, but engine problems brought the trip to an early end. That resulted in nine-day stay on South Georgia, a desolate former whaling outpost near Antarctica that doesn’t have much to offer beyond gulls and grass.

The layover wasn't easy for Bonifas.

“He’s not a guy who sits around a lot,” said Connie Busby, Bonifas' daughter, who told Security Systems News on Tuesday that she had talked to her father every day of his layover via his satellite phone. “On the nice days like yesterday—he said it was 45 and sunny—they did get out and do some hiking. There’s a chapel on the island that’s not inhabited, and they went to that on Sunday and just kind of hung out for awhile.”

A chartered relief ship picked up Bonifas and his fellow passengers Wednesday and is bringing them to Uruguay. They are expected to arrive on April 24.

Bonifas isn’t a stranger to spending time in remote places. He is ranked No. 3 on MostTraveledPeople.com, a website that tracks adventurers trying to become the first to visit 872 global destinations. South Georgia Island was the 800th destination for Bonifas, but his quest is on hold while he bides his time and tacks on phone minutes.

“When you’re an extreme world traveler, I guess sooner or later it kind of catches up to you, and I guess it did this time,” Busby said.  

ADT announces new management line-up

 - 
Wednesday, April 11, 2012

Taking another step toward independence, ADT on April 10 announced the post-split management line-up, highlighting the appointment of Kathryn Mikells and laying out ADT North America’s financials, key performance metrics, strategic priorities and more in a Form 10 registration with the Securities and Exchange Commission.

The form says that Tyco, ADT’s parent company, “does not intend to comment publicly on ADT Form 10.” Tyco announced in September 2011 that it would split into three separate, publicly traded entities: Flow Control; the The ADT Corporation; and Tyco International (comprised of Tyco Integrated Security and Fire).

In addition to Mikells, the management team reporting to Naren Gursahaney—current president of Tyco’s ADT North American residential and small business security segment and future CEO of The ADT Corporation—will include David Bleisch, legal; Anita Graham, HR; Don Boerema, corporate development; Mark Edoff, Business Optimization; Steve Gribbon, sales; Shawn Lucht operations. The eighth member of the team, in charge of marketing will be announced in the future.

Not listed on the managemtnt roster is John Koch, current president of ADT, who plans to leave ADT, sources told Security Systems News.

According to the filing, ADT had 2011 operating income of $693 million and revenue of $3.1 billion, with 89 percent of that revenue being recurring. It has 6.4 million customers and estimates that it owns 25 percent of the $12.5 billion residential and small business security market in the U.S. and Canada. A chart says ADT and IMS Research estimate that Protection 1 has 4 percent of that market, Monitronics has 3 percent and Vivint has 2 percent. “Thousands of others” share the remaining 66 percent of the market.

Among ADT’s stated strategies is growing its small business segment. ADT said it will expand its  “small business field sales force, which currently represents only about one-third of our overall direct sales force. We plan to provide strengthened small business marketing support to this enhanced sales force, including by building a larger, more robust partner network to improve our lead generation capabilities and by assisting in marketing additional value-added services, including ADT Pulse,” according to the Form 10 statement.

ADT intends to continue to “explore opportunities to provide ADT-branded solutions through additional channels, including telecommunications companies, broadband and cable companies, retailers and public and private utilities.”

“In addition, through our efficient operating model we believe we can significantly reduce the cost of basic security installation and services, opening up the potential for a much larger portion of households to purchase monitored security,” the form says.

Metrics noted on the filing include the following: The company’s attrition rate dropped from 14.3 percent in 2009 to 13.3 percent in 2010 to 13 percent in 2011, while ARPU (average revenue per user) went from $35.92 in 2009 to $36.10 in 2010 to $37.24 in 2011.

On the appointment of Mikells, Gursahaney  said in a prepared statement: “Kathryn brings impressive financial leadership expertise and a proven track record of managing transformation while driving financial discipline,”

Mikells, joins ADT from Nalco, a water treatment and energy technology company, where she was CFO. Previously, she worked for 16 years for UAL Corporation, the parent company of United Airlines, where she was EVP and CFO.

Can Tweets hurt your central?

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Wednesday, April 11, 2012

Social networking is a double-edged sword. It can be a boon to communication, but an ill-advised post can rebound to haunt you—and maybe your central—even if it’s quickly deleted.

So how do you manage the use of these sites and actually get them to help your business?

A CSAA webinar, “Social Media in the Central Station,” will take on the topic from 1 to 2 p.m. EDT on Wednesday, April 18. The session will be presented by Annie Roderick, monitoring center manager for Wayne Alarm Systems of Lynn, Mass., and Melissa Courville, a marketing executive with DICE Corp. and chairwoman of the CSAA Social Media Committee.

“Networking sites like Facebook and Twitter … give way to fast blurb results that can be easily found over the Internet at any time, sometimes linking to your business,” Courville said. “Not only are these social media outlets quick and easy to use, but they offer both helpful and hurtful connotations to business reputations.”

The webinar, adapted from material shared at the 2011 CSAA Fall Operations Management Seminar, will teach attendees how to harness the power of networking sites and how to address central station staff about their use. Case studies will be shared to illustrate the do’s and don’ts.

Space for the session is limited. To reserve a seat, go to the CSAA registration site.

Technology pays off in hands of techs, sales reps

 - 
Wednesday, April 11, 2012

There’s a growing trend in the security industry of companies leveraging the latest technology by putting it in the hands of their frontline employees out in the field. A recent story I wrote about ADT putting iPads in the hands of its 4,000 sales reps to help boost sales is a good example.

Here’s another example, announced today by Vivint, the Provo, Utah-based home automation/home security giant. The company says it has developed a new app for field service technicians that makes them more productive.

Here’s more from Vivint’s April 11 news release:
 

The app was developed completely in-house, and was designed specifically to address the needs of Vivint service technicians, who are stationed throughout Vivint’s service area. By using the app, technicians can receive schedules, manage inventory and interact with the customer service center remotely – spending less time in planning and logistics and more time working with customers. Built using HTML5, the web-based application enables technicians to access the information they need to do their jobs quickly and efficiently from wherever they are on any internet-enabled mobile devices.

“What we’ve developed with this Vivint app has really increased the functionality of what we had been using before, and we couldn’t be happier with the results so far,” said Scott Taylor, director of field services. “This app will really help us give our customers the high level of service they have come to expect from Vivint. We’ve already seen response time increase by 20 percent.”

Since rolling out the new app, the first-time fix rate average for Vivint customers has increased to 95 percent. Other features that increase productivity and efficiency include a mapping option that provides the best route to get to a job and a tech-locating element that helps Vivint technicians connect with other technicians in the area.

 

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