How Security Will Help Home Automation Thrive

Where the big security companies go, many rank-and-file alarm companies will follow.

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By Jason Knott
March 19, 2011
After all the uphill battles CE pros have conquered over the years, it will be the security industry that will make 2011 a breakout year for "the connected home."

Security companies are losing clients at a rapid rate as homeowners decide to dump their landline phones and go all cellular. Without a phone line, it also means the elimination of monthly alarm monitoring fees.

To combat that trend, security firms are rolling out "home automation" solutions to keep customers. It means that consumers are going to be inundated with marketing messages about home automation from new huge players in the market. The solutions piggyback on cellular-based security with lighting control and HVAC control.

ADT, the largest security company in the U.S. by far, rolled out its Pulse system in fall of 2010. The company is already all over the airwaves pitching its solution, which runs $249 installed and $58/month.

(Don’t forget ADT has a Custom Home Gold program in which it partners with CE pros to do more sophisticated install. I am sure many of those leads will be derived from homeowners who order Pulse.)

Likewise, the third largest alarm company, APX (now rebranded as Vivint), has also announced its home automation offering. The Utah-based company, which is well known in the security industry for aggressive door-knocking campaigns in the Western states using Mormons, has a $199 solution for $66/month.

Not to be forgotten is Comcast (aka Xfinity), which is rolling out a subsidized security-based solution that includes thermostat, wireless cameras and touchscreen to its cable subscribers. The base package is just $99 and the monthly service is $20 less per month than ADT. According to Christopher Albano, senior director of home networking at Comcast, the key for the provider’s strategy is to develop a solution for the masses. Incorporating the devices is the easy part, he says, but it becomes more of an “economic question” to create an adoptable system for the general public.

Where these big security companies go, many rank-and-file alarm companies will follow. In many cases, conservative owners of alarm companies will not venture into uncharted waters unless they are forced by market competition. Time after time, independent alarm dealers have followed the actions of the big companies. They will likely do the same in regards to home automation, which has been sitting on the fringes of security for many years. It means more new competition for you.

But low-cost home automation alternatives do not mean you need to slash your prices or fold up shop. Independent security dealers have continued to thrive for years in the face of low-cost competition.

What are you planning to do?


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