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Security providers early winners in home automation/home security space

But telecoms and cable companies also are ‘in it to win’ and shouldn’t be discounted, an industry analyst says
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05/29/2012

DALLAS—Security providers have a “first mover” advantage in home automation/home security right now, but the big telecoms and cable companies entering the space are serious competitors who may be game-changers in the future, according to a market research company analyst.

'20 under 40' 2012 - Enrique Puig

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05/22/2012

Enrique Puig, 39
Senior director, field operations, Xfinity Home, Comcast
Philadelphia, Pa.

How did you get into the security industry?

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.

 

Comcast adds more markets across the country

In March, the telecom introduced its home automation/home security product in locations that included San Francisco, Connecticut and Utah, home of the summer-sales security companies
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04/23/2012

PHILADELPHIA—March was an active month for Comcast as it launched its new home automation/home security service in a number of additional major markets across the country. Xfinity Home is now being offered in Atlanta, the San Francisco Bay area and parts of Connecticut and Vermont—and Utah.

“The Trip to Bountiful”: Comcast now "at home" in Utah

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Wednesday, March 21, 2012

Comcast is now selling home security in Utah, right in the backyard of the major summer-model security companies.

When it comes to telecoms and cable companies getting into home security, I’ve written before about how Comcast has been in the forefront of that trend. It launched its Xfinity Home Security product in 2010.

It also recently renamed the product as just Xfinity Home to reflect the fact that the service includes many home automation features in addition to home security.  And Comcast has launched the product in numerous major markets around the country and continues to introduce Xfinity Home in even more places. For example, it had a Seattle launch in February and this month Comcast announced it’s now offering the service in Utah, home to residential security giants like Vivint and Pinnacle Security.

I’ll be talking to them about their take on this new player both in their home state and nationwide. Keep your eye on this site for more!

Comcast’s Xfinity gets new name and features

The telecom also adds Seattle to the markets in which it offers its home security/home automation service
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02/29/2012

PHILADELPHIA—Comcast has renamed its home security/home automation service, is about to add a new energy-management feature and has expanded the service to yet another market: Seattle.

Talk at Barnes Buchanan: Cable companies' motivation for entering security

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Wednesday, February 15, 2012

I am just back this week from our TechSec new technology conference.

Unable to make it? There’s lots of coverage of on the site about the various the educational sessions--Mobile Apps; Ensuring your cloud provider is secure; the keynote; Video analytics; and, Emerging technology. 

TechSec took place in Delray Beach, Fla. on Feb. 7 & 8, after which I headed up Route 1A to The Breakers in Palm Beach for the Barnes Buchanan Security Alarm conference which took place Feb. 9 and 10.

You may wonder how a hardy New Englander such as myself can stand so much warm weather. It’s not easy, but I’ve toughed out these back-to-back conferences for a few years running.

It’s at Barnes Buchanan that I get an overview of the capital and debt markets, hear from lenders, and attend panel discussions (often remarkably candid) featuring leaders of some of the industry’s  major alarm companies.

The focus of the conference tends to be more residential and small business, but as more and more integrators get into the RMR business, there’s more information about these companies at  Barnes Buchanan. According to Barnes, overall monitoring and service revenue was up 5 percent in 2011 to $18 billion from $17.2 billion in 2010 and $16.3 billion in 2009. There’s been a notable increase in the number of integrators who have an RMR component (not just maintenance contracts) in the past three years.  That sounds like good news to me.

That last tidbit is from Michael Barnes’ annual Industry and Market Overview--which features a feast of numbers on monitoring revenue, M&A activity sliced and diced and served up in a lively presentation.

Mike’s two-hour overview always includes a lot of back and forth with the audience and this year. This year,  there was a lot of talk about new entrants.

Many, many questions started out this way: “If Comcast acquires ADT ...” Barnes himself said he expects cable companies to do some acquiring soon and “ADT’s likely the first one to get picked off.”

The cable company that picks off ADT would instantly get 28 percent of the resi market share. Tied for No. 2, with 2 percent apiece are Monitronics, Vivint, Pro1 and Stanley.

But Barnes asked an interesting question: Will big cable companies really be motivated by the economics of the security industry? The security industry, he said, is just not that big in comparison to the giant telco and cable industry.

He talked about visiting Comcast--a major enterprise—and noted that a cable company that decides to go into security has a lot of barriers to overcome.

But, say for argument’s sake, a cable company does a truly bang-up job and starts creating a large number of accounts. Say that cable company grows like Vivint, Barnes posited.

Vivint has gone from no accounts in 2006 to 600,000 accounts today. Most would agree it’s had remarkable growth and success in a short length of time in this industry. But, Barnes said, however impressive that is, will 600,000 accounts in five years really wow the board of a cable company that has 24 million subscribers?

One reason the Bell companies that got involved in security in the last decade left, he said, is “they can’t make [the security piece] big enough.”

We're putting final touches on the March printed issue of SSN today, but I'll have more on the Barnes Buchanan conference later this week and next.

 

 

iControl/Time Warner Cable sell home security/home automation together

iControl: Telecoms good partners because they are ‘very, very focused’ on the space
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01/10/2012

PALO ALTO, Calif.—Software provider iControl Networks this week announced a new partnership with Time Warner Cable, in which Time Warner’s IntelligentHome security and home automation solution is being powered by iControl software.

Comcast ahead of curve in security space

Telecom led others in launching a home security/home automation option and will add Tucson to its markets this year
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01/04/2012

PHILADELPHIA—Many telecoms decided that 2011 was the year to launch a home security/home automation offering—Verizon, Time Warner Cable, Frontier Communications, AT&T and Cox Communications among them.
But Comcast, based here, was ahead of the curve, launching Xfinity Home Security in Houston in June 2010. The company, with millions of customers nationwide, has so far made the product available in other major markets around the country, and plans to launch it in Tucson, Ariz. sometime this year.

The Cable Guy goes pro as telecoms enter security space

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Wednesday, January 4, 2012

Watch out security industry! Here comes the new version of the Cable Guy—one that’s more likely to wear a suit and have a computer science background than be a rube who’s always late.

As the telecoms enter the security space at a fast and furious pace—I’ve recently written about the new home security/home automation offerings of Verizon, Time Warner Cable, Frontier Communications, AT&T, Cox Communications, and Comcast—the security industry has expressed confidence that small, professional security companies will outperform those giant companies when it comes to service.

That’s because the archetypal Cable Guy in everyone’s mind is someone who’s always late and barely seems to know what he’s doing. But as the telecoms offer new products such as professionally installed and monitored home security systems, they’re also creating new teams of professional Cable Guys to install and service those products, according to a recent The New York Times article.

Here’s more from the article, entitled “Today’s Cable Guy, Upgraded and Better-Dressed:”
 

“Long depicted as slovenly cranks who dodged growling dogs and tracked mud on the living room carpet, cable guys (and gals) these days often have backgrounds in engineering and computer science. That kind of training is now required — along with a new dress code for some, calling for button-down dress shirts and slacks — as cable companies and their telephone rivals try to lure customers and increase revenue with a suite of [new] products. ... That means added pressure for installers and new requirements for a job that traditionally appealed to high-school graduates looking for reliable blue-collar work. …

… Robert Kolb, a 33-year-old installation and service supervisor for Comcast’s Xfinity television, phone and Internet service, has a one-year certification in network engineering. He wore pressed slacks and a sporty fleece jacket on an Internet upgrade job in the Philadelphia suburbs recently, where he worked on a company-issued MacBook laptop and had a waterproof hand-held computer that could withstand a five-foot drop.

… To make sure he stays up to date, Comcast requires him and other installers to take classes at an in-house training facility known as Comcast University.

OK, the advent of the upgraded Cable Guy doesn’t mean that small professional security companies won’t still have a service edge with customers who continue to view them as their trusted security provider.

But I do think it shows that no security company should be complacent about the telecoms entering the market this time around—and that having professional, well-trained staff that provides excellent customer service is a key to success, no matter what size your company is.

 

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