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Bloomberg profiles Vivint

Tuesday, April 26, 2011

Vivint, the Provo, Utah-based home automation/security services company previously known as APX Alarm Security Solutions, made the Bloomberg business news this month.

The April 20 article, which profiled the company and CEO and co-founder Todd Pedersen, concluded that the 5,000-employee summer-sales-model company, which it said had $245 million in revenue last year, will need “some aggressiveness” to succeed in its push into the home automation market. Vivint rebranded from APX on Feb. 1 to underscore the expansion of its offerings from traditional home security products to home automation.

The article also contained some interesting tidbits about Pedersen’s plans for positioning Vivint in the new market.

“Pedersen is betting that home automation technology will increase his company’s customer base of 500,000 homes by 40 percent this year and a similar amount next year,” the article states. “While he expects revenue to increase by at least 25 percent this year and next, Pedersen says Vivint won’t be profitable for a few years because it subsidizes the automation equipment and installation. The starting price for a home automation package is $199, with a minimum 42-month “home monitoring” contract of $69 a month. Pedersen says Vivint doesn’t start making money on the packages until the third year.”

The article says that to pay for operations, the company plans to use a $690 million revolving credit line from Goldman Sachs. I just wrote this month about that recently completed new senior debt financing package, which included $125 million in new financing and is said to be the largest of its kind in the industry.


Personnel changes signal new direction for Honeywell’s First Alert, CSS dealer programs?

Thursday, April 21, 2011

Do personnel changes that took place in the last week at Honeywell signify a new direction for two major dealer programs—First Alert Professionals and Commercial Security Systems?

Based on a statement provided to Security Systems News that alludes to “the next stage in its evolution” it appears that Honeywell may intend to make some changes in the dealer programs, but the manufacturer has not publicly released information on any such plans to date.

According to several dealers who spoke to me this week, Honeywell on Monday began contacting dealers from its First Alert Professionals (FAP) dealer program and its Honeywell Commercial Security Systems (CSS) dealer programs to inform them that two longtime and well-known employees: Joe Sausa, president of FAP, and John Lorenty, head of CSS, were no longer employees of Honeywell as of last Friday, April 15.

Dealers told me that the message from Honeywell was essentially this: Honeywell is taking the dealer programs in a new direction with dealers’ needs in mind, and, there will likely be some restructuring of the programs. Dealers I spoke to were eager to hear more specifics of Honeywell’s plan.

I contacted Honeywell with several questions yesterday. Lourdes Pena, Honeywell’s business communications manager, provided the following information for my deadline today.

“Honeywell regularly evaluates its business to identify new opportunities and ensure that we remain competitive. Assessing our dealer programs for their sustained development is part of this ongoing process. We remain committed to the Honeywell’s First Alert Professional (FAP) and Commercial Security Systems (CSS) dealer programs. They deliver great advantages to our community of dealers and have brought continued success to our business. We look forward to the next stage in their evolution and to continue setting the standard in the industry. Dealers should continue contacting their current representatives for updates on our product offerings through FAP and CSS.”

Joe Sausa had served as president of First Alert since 2004. Sausa oversaw both FAP and CSS until last year. At ISC West in March 2010 Honeywell announced that John Lorenty, who previously had been in charge of access control, would take over as head of CSS, and Sausa would continue as president of FAP.


UTC Fire & Security has healthy parent

Wednesday, April 20, 2011

Business wires are abuzz today about the first quarter earnings reported by United Technologies Corp., parent company of UTC Fire & Security, up 19 percent over the quarter a year ago. Word is that the earnings beat estimates.

An April 20 release from Hartford, Conn.-based  UTC, a diversified company that provides high-tech products and services to the building and aerospace industries, said the company "reported first quarter 2011 earnings per share of $1.11 and net income attributable to common shareowners of $1.0 billion, up 19 percent and 17 percent, respectively, over the year ago quarter. Sales for the quarter increased 11 percent to $13.3 billion with 9 percent organic growth. Favorable foreign currency translation and net acquisitions each contributed 1 percent to the sales growth.”

The release continued: “Results for the current quarter include $0.02 per share in restructuring costs. Earnings per share in the year ago quarter included $0.05 in restructuring costs. Before these items, earnings per share increased 15 percent year over year. Foreign currency translation and currency hedges at Pratt & Whitney Canada accounted for $0.01 of the earnings per share increase.”

“This was another solid quarter for UTC with broad-based acceleration in organic growth, as well as strong earnings momentum and cash generation,” Louis Chênevert, UTC chairman & chief executive officer, said in the release. “Nearly 20 percent growth in earnings per share reflects excellent conversion, especially as we continued to increase our investments in game changing products and technologies.”

The release also notes that UTC is now raising its 2011 profit forecast.

“Based on the strong start to the year, particularly in Carrier’s short cycle businesses, we are raising the full year earnings per share expectation to $5.25 to $5.40, from $5.20 to $5.35 previously. We now anticipate 2011 EPS growth to be 11 to 14 percent on sales growth of 5 percent,” Chênevert added in his statement. “The global economic recovery continues to gain traction as evidenced by the momentum of our end markets and we now expect 2011 sales of $57 billion, at the high end of our prior range of $56 billion to $57 billion.”

The AICC National Monitoring License Subcommittee needs your help!

Tuesday, April 19, 2011

So I'm looking at following up on the AICC National Monitoring License Subcommittee's work so far for a source book article. You'll recall that since the flap over Article 6-E proposed legislation in New York for licensing central stations, momentum has really shifted to a federal-level push.

I talked with AICC chairman Lou Fiore today about how things were going, where the committee was at, what work had been done and what remained.

First of all, Lou pointed me to the comment website that had been set up. This is the place you can--and should--go to read the proposed legislation, which is the proposal late Vector president John Murphy developed years ago, and offer your tweaks. The subcommittee hopes to get lots of feedback from all of you, so take some time, go to the site, download the proposal, read it, think about it and make some suggestions through the website's online form.

Also, I'd love to hear what you think about the proposal the way it stands. How do you feel about a national monitoring license? Drop me a line or give me a call (207-846-0600 ext. 254) and let me know.

Security in the doghouse

Monday, April 18, 2011

It’s not unusual for a homeowner to get a home security camera installed to keep at an eye on a pet while away from home. But here’s a new twist I read about in “Popular Science” magazine: installing a security camera in your dog’s doghouse so you can monitor your pet while it’s out there.

The article, written by John B. Carnett, begins like this:

“Pearl, my beloved labradoodle, dutifully watched me build myself a new house for the past three years. So when I was almost finished, I decided to build her a place of her own. A standard model just wouldn’t do, though, so I went a little overboard. After creating the design with CAD software, I added a solar hot-water radiant-heating system and made a green roof that retains rainwater, creates oxygen, and improves insulation. Then I decked it out with a few other touches, including some colored LED lights to brighten things up and a Web-enabled wireless video camera that lets me keep an eye on Pearl from my computer or phone.”

He said he put 70 hours into building the high-tech doghouse, at a cost of $1,500.

The article got me thinking: Is this a new market for dealers—selling homeowners security cameras for their doghouses?

Another reader of the article was thinking along similar lines. The reader wrote in the comment section: “This is very cool, is there a market for high end dog houses that could support a small business?”

But another reader’s comment immediately quashed that idea. “No thank you,” that person wrote. “I would never see my dog again if she had a house like this!”


One video monitoring company exec weighs in on municipal video surveillance

Thursday, April 14, 2011

Recently, I've been doing some thinking about, reporting on, and writing about municipal video surveillance. Our upcoming source book is all about video surveillance. Our most recent poll is all about video surveillance. People sure do have varying and strong opinions.

We here at SSN received a well-thought out answer to recent Chicago-focused criticisms of the ACLU’s Illinois chapter from Iverify’s Mike May. Mike sent us a letter, part of which I used in the sourcebook but his thoughts are so compelling, I thought I’d post them up here for everyone to read in their entirety.

From Mike:

I am writing to comment on the position adopted by the ACLU regarding the City of Chicago video surveillance system. As a career security and law enforcement professional I have a deep and abiding respect for the constitutional protections that we as Americans enjoy. The world is fraught with example after example of human rights being trampled when adequate protection of people are not embraced as foundational principles of society.

The right to be free from unreasonable searches and seizures, the right to the quiet enjoyment of our lives and the freedom to exercise free  speech are all part of the bedrock of  American society. Those protections also extend to the rights of our citizens to live free of fear from crime, to  live their lives peacefully in their neighborhoods, and the right of our children to travel the streets of our cities without being victims of drug addicts, career criminals and predators.

We seem to have lost our way when it comes to the protection of individual freedoms. Our society has an obligation to provide a safe and secure community that is free of intimidation, where predation by criminals is prevented and where our families can go about their daily lives earning a living, gaining an education, participating in their community or enjoying their retirement without fear.

The ACLU has been a bright beacon for individual rights and the balance of governmental authority. I believe the ACLU needs to have its leadership walk the streets of Chicago, Detroit, Philadelphia, Cincinnati, and Columbus. Our core rustbelt cities are fighting a death struggle every day to maintain a semblance of freedom for its residents and its businesses. Our company works in the most challenged urban locations in the country and we see the impact every day to those folks who are working hard to make a living in the face of violent unconstrained crime.

The City of Chicago has established itself as a leader in the use of modern technology solutions in an effort to identify those involved in urban crime and terrorism. The ACLU should step back and thoughtfully look in the mirror and adopt a position that they are as concerned about the rights of the folks who strive to get by and make a living every day in our cities as they are about public positioning. Only then will they be living up to their name as the American Civil Liberties Union and could legitimately claim the moral high ground in this important dialogue.

Mike May

President and CEO


Check out the Video Surveillance Source Book for more on the civil rights story playing out in municipalities around the country.


Schneider bid $30b for Tyco? IControl raises $30m

Wednesday, April 13, 2011

Some say the leaking of the Tyco/Schneider news will not help the deal at all, but others clearly think the leaking–and rise in Tyco’s stock prices?—is applying the right pressure to the right people. I saw some interesting stuff last night on the potential Schneider/Tyco deal from the (UK) Daily Telegraph’s Ben Harrington, who is reporting that Schneider has made its bid, and has sent a letter of interest to Tyco’s US board. He says Schneider has been working with JP Morgan and Bank of America Merrill Lynch on the deal since September. Tyco, meanwhile, is working with GoldmanSachs, he said.

From the story: “JP Morgan, Bank of America Merrill Lynch and five French banks are said to be willing to provide a $13bn loan to Schneider to finance the transaction. The loan is likely to then be securitised. The banks are also willing to offer a $2.5bn bridge loan, which could be paid back at a later date with potential asset sales. Schneider has about $3bn cash on its balance sheet to contribute to the financing package.”

He says they’re sweetening the deal by offering Tyco chief Ed Breen a seat on the board of the combined companies. I just now learned that the WSJ and Reuters are reporting this as well. 

11 a.m. Here's an update to the Schnieder/Tyco story: Schneider says it’s not in discussions with Tyco

I’d reached out to Schneider’s press operation in France on Monday to see if they’d comment on the Bloomberg report, and hadn’t heard back until this morning, after I'd posted this blog. I received this press release from Anthime Capriol in their investor relations office.

“In response to market rumors, Schneider Electric announced today that it is not currently in discussion with Tyco International regarding a potential strategic transaction between the two companies. Schneider Electric stated that it would make no further comment regarding this matter.”

OK, I’m very curious now about how this is going to turn out ... Do you think it’s all a matter of how you define “currently”?

There's more financial news about iControl today. Our friends over at CEPro did some great reporting on fundraising efforts at iControl. Remember iControl? They’re the home security and management providers who merged with their competitors uControl in November. IControl has a partnership with ADT—which introduced its interactive Pulse product last fall, while new partner uControl has historically worked with broadband and telco providers. In a November interview, Paul Dawes and Jim Johnson told me that they’d be announcing a partnership “with a very large broadband provider” in the future. CEPro says the company is “gunning for the new Comcast Home Security business, which of course makes sense."

IControl is now seeking to raise $30 million. Of that, $28.5m has been raised, according to this April 8 SEC document, which CEPro kindly provides a link to in its story.

Further, CEPro points out that if you add this $30 million to the $45m they’ve already raised, you get $75m, which is roughly the same amount home automation company Control4 raised in 2010. Here's a link to the CEPro report. 


Smith & Wesson likes security—on the perimeter

Tuesday, April 12, 2011

Here’s an interesting new development from gun manufacturer Smith & Wesson: After just severing its ties March 31 with the Smith & Wesson Security Services dealer program, the company has announced that it has “rebranded its wholly-owned perimeter security division, formerly known as Universal Safety Response.”

The division’s new name is Smith & Wesson Security Solutions.

That announcement was made April 4 by Smith & Wesson Holding Corp., the parent company of Smith & Wesson Corp., a 159-year old company in the global business of safety, security, protection and sport. “The new name more accurately reflects the company's long-term heritage and leadership in security and protection,” the company said.

The rebranding announcement came just five days after the revelation that Smith & Wesson had severed its nearly three-year relationship with NationWide Digital Monitoring Co. effective March 31. The partnership had allowed NationWide to sell Smith & Wesson-branded security products, and NationWide contends the agreement was ended against its wishes and very abruptly by new management at Smith & Wesson.

The dissolution of the partnership has left the 70 dealers in NationWide’s dealer program with a short grace period—until April 30—to strip away the Smith & Wesson name from their security products such as advertising, trucks, uniforms, doorknob hangers and lawn signs, in which they have invested hundreds of thousands of dollars.

Is there a connection between Smith & Wesson’s ending of one security relationship and the rebranding of its perimeter security division?

Liz Sharp, Smith & Wesson VP investor relations, told me, “No.” She said the timing of the two developments is coincidental and unrelated. The two businesses are completely separate, she said.

Smith & Wesson has said little about the ending of its relationship with NationWide. Sharp has said only that Smith & Wesson wanted to protect its brand after the agreement failed to perform as expected.

The company strongly endorsed its perimeter security division in last week’s announcement.

In a statement, Michael Golden, president and CEO of Smith & Wesson Holding Corp., said, “We are excited about the opportunity to leverage our strong Smith & Wesson brand name in the perimeter security market. For nearly 160 years, our firearm products have come to represent safety, security and protection for law enforcement and security professionals, military organizations, and consumers both in the United States and abroad. Having a single, globally-recognized brand name allows us to extend that proposition to commercial and government clients seeking a trusted source for their perimeter security needs."

Barry Willingham, president of Franklin, Tenn.-based Smith & Wesson Security Solutions, said in a statement: “Our unique products have already earned a tremendous reputation with our existing customers.  We expect this rebranding to provide us new opportunities by differentiating Smith & Wesson Security Solutions in the competitive arena and better positioning our business to play a significant role in the global security marketplace.”


“Crash & Smash” burglary makes it to ISC West

Monday, April 11, 2011

The burglar probably had no idea he was going to get caught breaking into a Michigan home, let alone become a feature at ISC West in Las Vegas last week.

But because the home had a “Crash & Smash Protection” enabled alarm system, that’s exactly what happened. Pinnacle Security and touted the recent incident at the ISC West show as a real-life example of the effectiveness of the technology.

Pinnacle Security provides’s “Crash & Smash Protection” through a partnership between the two companies, Pinnacle said in a press statement about the capture, which it released at ISC West. The exclusive detection technology is a system option, the company said.

Both Jay Kenny, VP marketing for, a technology provider of interactive security solutions based in Vienna, Va., and Stuart Dean, VP corporate communications for Pinnacle, an Orem, Utah-based summer-sales model security company, spoke to me at ISC West about the incident. They said it illustrates how well “Crash & Smash Protection” can go from alert to capture. “We’re going to do a case study on it,” Dean said.

Pinnacle in its April 7 release announced that Pinnacle’s “systems facilitated the capture of a home intruder in Benton Harbor, Michigan.”

It said the home’s “Crash & Smash Protection” enabled alarm system “notified Pinnacle Security’s triple-redundant monitoring facility of a potential incident in the home of Pearl Lewis. Police were contacted, and 12 minutes after the individual tried to enter the Lewis home, he was in custody.”

Kelly Walker, Pinnacle CEO, said in a statement: “This incident demonstrates why we are so passionate about what we do. Our mission is to help our customers secure the things that matter most, and this is a perfect example of that mission in action. Right now, an individual, a home and a community are safer because these technologies work.”

The term “crash and smash” refers to an attempt to disable the security system by damaging the panel itself, Pinnacle said.

Colin Murray,’s manager of strategic accounts, explained in a statement: “When the intruder entered the home, he attempted to disable the system by smashing the panel. With any other system this would destroy the panel’s ability to communicate with the monitoring centers, but with the ‘Crash & Smash Protection’ service, the event is recognized and a signal is sent, alerting the monitoring station immediately.”

Dean said the technology even won the praise of law enforcement, which he said is unusual because authorities don’t want to appear to be endorsing one product over another.

“It’s a great example of the public assisting law enforcement to keep township residents safe,” Brian Smit, detective sergeant for the Benton Township Police Department, said in a statement in the Pinnacle press release. “Twelve minutes after the initial alert, we had the individual in custody. The monitoring system alerted us the panel had just been disabled so we knew the suspect was likely still close. We responded, and an arrest was made swiftly.”



ISC West Day 2: Security 5K, more PSIM and a lawsuit

Friday, April 8, 2011

The day started bright and early with a 3.1 mile run with 400 others in the second annual Security 5K. Nice weather, considering it’s the desert, and awesome energy at this event. And the event raised $92,000 for Mission 500, enough money to food, clothe and house for 240 kids for a year. How about that! This event gets bigger and better every year.

I’ve got lots to report from Day 1 and Day 2 of ISC West, including more PSIM- and PSIM-type news.

Honeywell called a press conference yesterday to announce a deal with Boeing where it will provide a PSIM-type solution to its HIS dealers—the Honeywell’s 160 certified Pro-Watch dealers. Honeywell is going to integrate Boeing’s “VSOC”—Boeing’s PSIM—with its security and building management platform. Honeywell’s Scott Harkins said Honeywell likes the 3-D and geospatial information provided by the Boeing solution, and said this deal will help its certified systems integrator (HIS) dealers expand into more complex jobs and provide more customized solutions to their customers. Honeywell has previously announced integration capabilities with Allerton and Notifier (both Honeywell companies) and it has more underway, he said.

I also spoke to ADT’s John Kenning and Proximex’s Jack Smith about the acquisition of Proximex, announced on Monday by ADT, which Kenning said is part of ADT Commercial’s evolution and “stated goal becoming a leader in the managed services space. Of particular interest to me was a discussion about how ADT will own, but not operate Proximex. “Proximex will remain agnostic and independent.” Kenning and Smith both emphasized that “the proper firewalls will be put in place” to ensure that there’s no channel conflict. “Competitive information will not be passed back to our ADT sales organization. That’s Jack and my credibility at stake...We’re not going to do that.”

I had a number of other interesting meetings—details later—including a great meeting with Dave Fowler and Kelly Fiedler of Vidsys, where they gave me their take on all the talk of PSIM at the show: (PSIM-Light, PSIM-Like and other variations on the PSIM theme.) 

OK, there was no press conference on this announcement, but there were some off-the-record chatting about Object Video suing Bosch, Sony Samsung over alleged patent infringement on OV’s analytics.

OV announced the lawsuit, which it filed in the U.S. District Court of Reston, Va Reston, on April 7.

The suit names “Robert Bosch GmbH; Bosch Security Systems, Inc.; Samsung Group; Samsung Techwin Co., Ltd.; Samsung Techwin America; Sony Corporation; and Sony Electronics, Inc.”

From the announcement: “The complaint seeks damages as well as injunctive relief against the defendants for the sale of products that contain software features and functions which infringe certain ObjectVideo patents.
‘With the strong increase of video analytics offerings over the past few years, we've seen a similar increase in the number of companies using ObjectVideo's patented technologies without paying for them,’ said Bill Marino, chief intellectual property officer for ObjectVideo. ‘We need to ensure our existing IP and software partners are not unfairly disadvantaged in the marketplace by competitors whose products use the same or similar functionality to innovations that are ours.’
World-class research and development, dating from early 1998 when ObjectVideo was founded, has resulted in the company's seminal video analytics patent portfolio. To date, ObjectVideo holds 37 United States Patent and Trademark Office (USPTO) and International patents, along with 46 USPTO and International patents pending, all in the field of computer vision.”

I’ve got request for comments into Bosch, Sony and Samsung and will let you know what I find out.