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Friday, May 22, 2015

Why buy professional home security monitoring? Because you love Fido. Image: The Meta Picture

By Julie Jacobson

Consumers today have so many options for home security without professional monitoring. For instance, they can buy DIY products that blare upon an alarm event and allow for self-monitoring. Or they can train their dogs to ward off would-be intruders. Or they could just not care because, “By the time the police respond, the thief is already outta there.” Or this: “It’s just stuff. I don’t have anything valuable.”

Let’s put aside the fact that emergency responders increasingly are not responding to unverified break-ins.

What do you say to the prospect who tells you they have a dog and no stuff to steal in any case?

Putting aside the notion that the bad guys could silence Fido for good if they chose to, here’s the No. 1 reason why these reluctant customers need monitored security: Who is going to rescue Fido in the case of a fire?

“Don’t forget about fire,” says Steve Shapiro, VP industry relations for ADT.

Shapiro and I chatted during the recent Connections 2015 conference about the state of professional monitoring. Like many consumers, I too have failed to recognize the value of emergency response for fire and, for that matter, CO detection. How would you like to come home to a house filled with gas, and then set off the flames when static electricity generates a spark?

Shapiro is not terribly concerned about the demise of professional security monitoring. He says new business models are emerging that make the service appealing even to die-hard DIYs with “nothing to steal.”

For example, ADT recently announced aRead entry

Posted by Julie Jacobson on 05/22 at 06:43 AM
News, Blogs, Home Automation and Control, Security, (0) Comments, Permalink

Thursday, May 14, 2015

Vivint selling security and home automation door to door.

By Julie Jacobson

Every summer, companies like Vivint drop thousands of kids off in targeted locations around the country to sell security and home automation systems door-to-door, mostly smart-home products from UTC’s Interlogix and Nortek’s 2Gig Technologies with SHaaS (smart home as a service) from

These door-knockers – mostly Mormon students who are fresh off their missions and used to getting doors slammed in their faces – sell some 250,000 systems during the summer season alone.

The “summer sales model,” as it’s known, may have a shady reputation, but generally the larger companies like Vivint (ADT and Protection One dealers also do some door-knocking) are legitimate businesses acting legally in the neighborhoods they visit.

Many of them sell on sheer scare tactics alone, but the best of the lot sell the lifestyle benefits of home automation and remote home monitoring.

RELATED: A Failure to Communicate: How to Lose a Client

So, even if you as an integration company are not offering security (why?!) then you should still fear these firms for the smart-home systems they sell. They are targeting your existing customers and your prospects – especially those in affluent neighborhoods—and make no mistake, they will win them.

How so?

As for prospective customers who have never had home automation – the vast majority of the U.S. population, rich and poor – no one has ever talked to them about it before. Now someone is at the door talking about the technology and all the wondrous things it can…

Friday, May 08, 2015

Failed DIYers could be your best prospects.

By Julie Jacobson

There was a time when a person who bought a TV at Best Buy or a home automation hub at Radio Shack or loudspeakers through wasn’t your customer.

“Anyone who hires Geek Squad to mount a TV isn’t my customer,” you’d say. “I don’t do business with people who buy ‘security systems’ at Costco. … I have no time for hacks who shop office supply stores for home automation.”

While such sentiments rang true three or five or 10 years ago, they don’t necessarily apply today.

Remember when you used to insist, “Anyone who wants a Sonos system will never be my customer”?

First, a wide range of devices – TVs, speakers, mounts, door locks, security systems, home automation hubs, multiroom audio, smart bulbs, remote controls and so much more – are easier than ever to buy, install and configure.

Second, we’re dealing with a new generation of folks that grew up with technology and either want to get their hands dirty or don’t mind tinkering around. What they definitely do want is some degree of ownership of their technology – the ability to make changes to their systems without being beholden to a professional installer who may or may not be in business next year.

They want to understand how stuff works.

I guarantee a big chunk of DIYs stock up on gear, but never even open the boxes, much less install the products.

Third, home technology is made to look so simple today that “even your grandmother can do it,” when she simply cannot. Neither can many tech-savvy youngens. Most would-be do-it-yourselfers won’t get their devices installed in the promised three minutes,…

Posted by Julie Jacobson on 05/08 at 10:40 AM
News, Blogs, Business Resources, (20) Comments, Permalink


By Jason Knott

New Land Solutions in Portsmouth, England, might just have done the best motorization we have ever seen.

Watch this 90-second video to see the transformation of this living room into a dedicated home theater. Motorized acoustical panels cover the walls, a motorized screen drops down, the coffee table drops down through the floor, the giant Fortress Seating U-shaped couch moves forward toward the screen, a massive projector rotates 90 degrees out of the back wall, and then lastly a full row of five seats rises out of the floor.

All the while, automated lighting control scenes are also activating. Impressive!

New Land Solutions also has a sped-up version of the video that launches automatically on its company website that includes other angles of the motorization.

Posted by Jason Knott on 05/08 at 09:07 AM
Blogs, Slideshow, Videos, Displays, Furniture, Home Theater, Mounts and Lifts, (14) Comments, Permalink

Thursday, April 23, 2015

Rather than going in so many different directions, what if there were more standard procedures for how CI companies manage their businesses?

By Steve Firszt

A reader recently took issue with my assertion that the CI industry is made up of 10,000 different companies doing the same thing 10,000 different ways. The response was, “I believe the analogy of 10,000 custom integrators doing the same work is false.… I have only done 2 installs that were exactly alike in over 20 years…”

Sorry. I must have been unclear.

This is not about one-offs vs. repeatable installations – or brands, or control systems, or price points. I’m talking about the business of CI and how there is not a single standard for how CI companies manage their businesses. They do not recognize revenues the same way, they do not calculate gross profits the same way, they do not define labor costs the same way. Mainly because, there isn’t a standard “way.”

The three issues just mentioned are part a management fundamental I call “counting the money.” This is the starting point for companies being able to report results in a way that is truly comparable. If we could do that, we could then look at how the companies with the best results, do what they do. Then, we could adopt their practices and measure our improvement, always being able to reference where we succeed, and where we still fall short.

The entire industry would be stronger as a result.

Related: The Evolution of Custom – 30 Years Later, Still No Scale

Consider labor cost. Is it the wages you pay a tech while s/he is working on a project, with non-billable hours being charged to overhead? Or is…

Posted by Steve Firszt on 04/23 at 09:33 AM
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Wednesday, April 08, 2015

Smart home technology was examined in a recent ABC ‘Nightline’ segment

By Jason Knott

[Updated to reflect the fact that the homeowner is former Gigaom IoT reporter Stacey Higginbotham ... and again to indicate that Nightline is doing the bashing, not Higginbotham. - Julie Jacobson]

It’s tough to swim upstream. Now that the custom electronics industry and smart home technology are gaining momentum and recognition, it is time to spring out the negative press in the general media.

A recent ABC Nightline segment might be the first salvo. In the eight-minute piece, reporter Neal Karlinsky visited a smart home in Austin, Texas and ran it through its paces with the homeowner—Stacey Higginbotham, the preeminent IoT reporter for the now-defunct Website Gigaom.

Oddly, she wears a sweatshirt emblazoned with the GigaOm logo and has a GigaOm mouse pad strategically placed on the kitchen counter, suggesting the segment was filmed before the abrupt closure of that esteemed media company. (Higginbotham continues her able smart-home reporting for Fortune.)

The home has a Roomba, smart bulbs, voice control, automatic locks, touchscreen control, motorized shades and more. Not surprisingly, several of the items don’t seem to work properly—most notably the not-ready-for-primetime devices that have only just launched. Among them, Ubi and Amazon’s Echo for voice control, and Ringly for control via a smart ring, which isn’t so smart in the Nightline segment,.

The report uses terms like “weird,” “rude awakening,” and “requires patience” in describing having a smart home. The homeowner, who is called “abnormally patient,” even admits she spends one hour per week doing nothing but troubleshooting problems. Ugh!

Meanwhile, every time Higginbotham shows off a piece of technology, a giant price tag zooms into the screen,…

Monday, April 06, 2015

How do you think industry standards can impact businesses? Share in the comments below.

By Steve Firszt

Last week we brought you Part I: The Evolution of Custom – 30 Years Later, Still No Scale. Part II examines factors that could hinder custom installation’s growth prospects and the need for industry standards.

Absent a change to a more scalable CI model and the emergence of branded national distribution, most customers will have no known options beyond the low-cost and/or DIY offerings of non-CI companies such as Apple, ADT, Xfinity, and Sonos (to name just a few).

Standards go far beyond how an installation is performed or a control system programmed. In fact, it is my view that one of the most significant missing standards is how CI companies are organized.

What does a project manager do, exactly? Ask this question of 10 CE pros and you’ll get 10 different answers. Even bigger questions are, ‘What’s it take to become a PM?’ And, ‘What is the next level of advancement beyond project manager?’

The challenge of finding and developing good people has been sited frequently of late, as the smart home market enters what looks to be a boom era over the next five-to-six years. But until our industry begins to define the roles in its organizations, it will continue to be difficult to attract and develop employees.

Likewise, there are no financial standards. Company-to-company differences in revenue recognition, inventory accounting, labor productivity measures, and customer deposit accounting (to name a few) stand as huge barriers to a consistent view of financial health among CIs.

Even the widely-accepted standard of $200,000 annual revenue-per-employee is subject to differences in how revenue is recognized and…

Posted by Steve Firszt on 04/06 at 08:00 AM
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Friday, April 03, 2015

Can you create a “robust production engine” with factory-programmed home automation systems, sold for self-installation?

By Julie Jacobson

There’s an emerging business model in the security industry that is starting to pay big dividends: Systems that are DIY-installed and professionally monitored.

It goes like this: A consumer wants a “real” security system that is monitored by a legitimate central station, but they can’t be bothered to let a security dealer in the home and they’re savvy enough to stick a few sensors on the wall and call it a day.

So they go online to a hybrid DIY/Pro service provider, answer a few questions like how many doors they have and what those doors should be called (front, rear, garage, etc.). They leave a credit card and a few days letter the system arrives, completely pre-programmed and ready for installation.

They take the door contact marked “front door” and install it at the … front door. They take the motion sensor and sticky-tape it high up in family room. They place the flood detector on the floor by the washing machine. And so on and so on. They give the service provider a call. The provider goes, “Yup, we’re seeing the system and all the sensors,” and then the provider collects $20 or $30 or $65 per month for professional security monitoring and interactive home automation services.

LiveWatch Fetches 74x RMR

One company that does this very thing, LiveWatch, was just acquired by the giant central monitoring station Monitronics, a subsidiary of Ascent Capital Group, for $67 million. With $900,000 in recurring monthly revenue (RMR), that puts the valuation of LiveWatch at 74x RMR, which is a huge multiple in the traditional security business. Typically,…

Posted by Julie Jacobson on 04/03 at 12:03 PM
Blogs, Business Resources, Permalink

Thursday, April 02, 2015

CI companies today face an evolutionary challenge.

By Steve Firszt

You can trace the evolution of the custom integration industry back to the “hi-fi shops” of the 1970s. Having flirted with quadrophonic surround sound in the mid-70s (a bust), these stereo-centric retailers went on to add car audio, video (TVs, VCRs, camcorders, LD players), portable audio, digital audio, digital satellite, and digital video. Out of this polyglot grew a thing called “home theater.” Many added a “custom installation” department.

Along the way competitors such as Circuit City and Best Buy commoditized many of the specialty offerings, lowering price points and margins in the process. Specialty retailers responded by enhancing services, dropping categories that were no longer profitable and adding new categories until those, too, became prey to the big box competition.

As one of those retailers, I regarded this evolution as “scrambling to higher ground.” It was challenging to learn and sell the new categories, but that was the only way to stay ahead of the profit erosion of the old categories.

“The harder it is, the better,” I used to tell my team. “As soon as it’s easy, we’re done.”

Of course, most all the electronics retailers are done now. If they haven’t yet evolved to Internet sales and/or CI, the remaining few wait futilely for customers to visit their stores.

Related: Choosing Not to Grow Your Custom Business Is a Bad Option

CI companies today face a similar evolutionary challenge, one that began to take shape soon after HDTV became mainstream. Many CI disciplines (see: home theater, multi-room audio, touchpanel control) have been commoditized and are now available from numerous non-CI sources. Savvy…

Posted by Steve Firszt on 04/02 at 07:44 AM
Blogs, Business Resources, Permalink

Tuesday, March 31, 2015

CEDIA: ‘The association does not support discrimination of any kind’

By Julie Jacobson

Indiana governor Mike Pence signed the “Religious Freedom Restoration Act” (RFRA) into law last week, igniting a firestorm of criticism over a law that could potentially allow business owners to discriminate against LGBT customers and other groups on religious grounds.

The law was not lost on CE Pros, as the industry trade association CEDIA is headquartered in Indianapolis and often holds the annual Expo there.

An industry friend posted on my Facebook timeline: “Hey Julie Jacobson, I think you should do a column on what the implication of legalized LGBT discrimination on CEDIA expo will be if they schedule it in Indy again.”

CEDIA beat me to the punch with this memo they sent out yesterday:

As some CEDIA members have become aware, on March 26, 2015 Mike Pence, Governor of Indiana, signed Indiana’s Religious Freedom Restoration Act into a law.

We would like to take the opportunity to say CEDIA is sincerely committed to providing an inclusive environment for all of our encounters with members, customers, attendees, and industry professionals through all of our events and offerings both within the state of Indiana and beyond.

The association does not support discrimination of any kind and will take care going forward to ensure our members and customers are not negatively impacted by Indiana’s Religious Freedom Restoration Act.

We appreciate your continued support of CEDIA.

Posted by Julie Jacobson on 03/31 at 09:42 AM
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