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by: Martha Entwistle - Wednesday, June 22, 2016

The "20 under 40" awards are one of our favorite projects here at SSN. And, no wonder, in the past nine years, we've honored some real superstars.

We need help finding the superstar integrators or end users for the Class of 2016. Don't delay: The July 1 deadline is around the corner.

Here's a link to the nomination form. It only takes a couple minutes to fill out.

A reminder: The "integrator" category included people who work for a security integration firm, alarm company or installing security dealer, or a monitoring company. The "end user" category is for security professionals who work for an end user. Sorry, manufacturers,consultants, bankers are not eligible. However, anyone can make a nomination.

Please make a nomination today.

Got questions? Call or email me.

 

by: Martha Entwistle - Wednesday, June 15, 2016

Electric Guard Dog, a manufacturer and installer of a solar-powered perimeter security system that is electrified and monitored by a central station, based in Columbia, S.C., has a new private equity owner as of June 14.

Snow Phipps, a PE private equity firm focused on middle-market control investments, targeting platform companies with enterprise values ranging from $100 million to $500 million, has purchased Electric Guard Dog from Ulysses Management for an undisclosed amount.

Raymond James & Associates advised to Electric Guard Dog on the deal.

“The company is poised for significant growth and we intend to meet growing demand by continuing to invest in sales, marketing, service technicians, compliance, and technology,” Sean Epps, partner at Snow Phipps, said in a statement.

Electric Guard Dog CEO Jack DeMao and the current management team will remain. In December, Electric Guard Dog CFO Nathan Leaphart answered an SSN News Poll about the benefits of being owned by private equity.

In 2014, Electric Guard Dog passed $2m in RMR.

Snow Phipps operating partner John Kenny will join Electric Guard Dog as the non-executive chairman of the Board of Directors.

by: Martha Entwistle - Tuesday, June 7, 2016

The Central Station Alarm Association name is on its way out. At the CSAA general membership meeting here at the ESX show here in Fort Worth, Texas, members voted to change the name to The Monitoring Association. Here's a story that Spencer wrote about the name change a couple weeks ago.

Jay Hauhn, CSAA executive director, told me that 90 percent of those voting were in favor of changing the name to The Monitoring Association, "and the other 10 percent wanted to change the name, the only discussion was about what exactly the new name should be." 

The new name signals a change in direction for the association, and is among a list of improvements and updates that Hauhn and CSAA president Pam Petrow have outlined over the past year or so.

Hauhn said the new name better reflects what professional monitoring companies do. "Central Station Alarm Association is an old school term that was driven by UL standards," he said.

Today's monitoring companies are monitoring "things that are mobile, people, and more. It's not just the monitoring of fixed assets anymore," Hauhn said.

Petrow said that there are some research and registration tasks that the association will have to complete before the name change is official.

The OpenXchange breakfast on Tuesday morning featured a panel discussion moderated by ESX chair George DeMarco with speakers Nate Williams of August Home and Tim Colleran of Qualcomm, and “special guest Alexa Amazon,” (played with perfect timing by Lauren De Marco.) Please see photo. Alexa was seated in the chair between George De Marco and Tim Colleran.

The theme that emerged was how “new players” such as Qualcomm and August can help foster innovation in the security industry by collaborating with traditional security companies—manufacturers and installers.

Nate Williams  said there are two reasons customers want a smart home: "to save money or for more security." However, the smarthome devices must make the homeowners life better. "No one wants to be CTO of their home," August said.

Tim Colleran predicted that voice will be "the next big thing in smart home," but, he cautioned that devices need a smart filter for anything that's' being stored in the cloud. He talked about smart home features helping raise the historic 20-percent penetration rate of residential security systems, but it's important for security companies to pay attention to demographic data. A smart home consumer in rural Colorado and the smart home consumer in Los Angeles have vastly different reasons for investing in a smart home, he said. 

On the show floor later in the afternoon, I spoke to many of the exhibiting companies including Axis Communications, where I had a chance to catch up with Jennifer Bruce, who's in charge of business develeopment for Axis cloud solutions. Bruce has agreed to be an advisor for Cloud+ and I'm looking forward to working with her on the 2016 educational program.
 

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Day 1

Security Systems News editors have just arrived in Fort Worth to attend ESX 2016.

I'm looking forward to many of the "main stage events" and the exhibit hall, and I'm planning to check out a couple of educational sessions tomorrow including one on cloud technology. It's called "Making Sense of Cloud" and it's at 10 a.m. in room 202A. I'm doing some research as I plan the educational program for Cloud +. What's Cloud+? Here's a link to the website and here's a link to a story about Cloud+.

Even though it's at the same time, I'm also going to check out the "Risky Business" session, which will address what SMBs need to do to survive a cyberbreach. It's 10 a.m., next door in room 202B.

And, as I was winging my way out here today, I read an interesting story in the Atlanta Business Chronicle (from Monday) about AT&T expanding its 5G lab trial to Atlanta. According to the story AT&T's trial is already happening in Austin, Texas. In addition to Atlanta, the trial will also be expanded to Middletown, N.J. and San Ramon, Calif.

This shoud come as a reality check to security companies out there still dealing with 2G sunset. Here's a link to the story.

by: Martha Entwistle - Wednesday, June 1, 2016

SCHAUMBURG, Ill.—Convergint Technologies today made it five purchases in five months. And, there will be more, according to Dan Moceri, Convergint executive chairman and co-founder.

Convergint's fifth purchase of 2016 is: Corporate Security Services of Edison, N.J.

Moceri told me the deal expands Convergint’s geographic reach in the N.Y., N.J. and Philadelphia region, brings "really nice integration skills, product expertise across product lines we support, ... and a similar focus on the customer on the service side."  Corporate Security Services also has a "highly visible customer base with a strength in the financial and hospital verticals," according to a Convergint statement. Here's a story about CSS work at MetLife Stadium.

Bob McCabe, president of Corporate Security Services, and all of his 30 staffers are joining Convergint. “Convergint’s commitment to superior customer service was a driving factor in our decision to join their team," McCabe said in a prepared statement.

When will the acquistiions stop? Not in the foreseeable future, Moceri said.

Moceri expects Convergint's 2016 revenue to be about $600 million. He wants to continue to expand the company organically and through acquisitions, and he has the support of PE partner KRG Capital, which Convergint has been working with since September of 2012.

"We think by 2020 we can be a billion dollar organization," Moceri said.

Convergint purchased Dakota Security in January of this year. In April, Convergint acquired H&E Comfort Controls of Windsor, Ontario. and Enion, an integration firm based in Switzerland.  Last month, Convergint bought Total Recall of New York.

 

 

 

by: Martha Entwistle - Wednesday, May 25, 2016

When I looked at the SIA update this morning, I saw a headline about the cloud and cybersecurity concerns. Want to learn about cybersafety in the cloud? Come to Cloud+ in Austin in November!

Cloud+ is the only conference where you can learn how cloud technology is reshaping the security industry, what the potential is for your business and what steps you can take now to enhance your bottom line with cloud-based technology. Cybersecurity is on the agenda.

Sponsored by Security Systems News, the inaugural Cloud+ took place in Silicon Valley in December 2015. This year we’re thrilled to be holding the event in the high tech hub of Austin, Texas. Cloud+ 2016 will take place at the Lost Pines Resort in Austin on Nov. 29 and 30.

SSN launched this conference because we believe that cloud-based technology is the new frontier in physical security. Just as early adopters jumped on IP a decade ago, early adopters today are moving to the cloud.
We’re looking forward to building on the success of last year’s event, which featured speakers from Google and Microsoft.  

As usual, we'll take a TechSec-style approach to the educational program. Expect interactive educational sessions featuring cloud experts from inside and outside of the security industry.

I’m putting together the conference educational program right now. Have a great idea for a speaker or session topic? Call me.

One of the sessions that's already lined up will address central station capabilities in the cloud. It will include cloud providers and will be moderated by one of the country's leading integrators Jeffrey Nunberg of ISS in Miami. Nunberg will be asking the hard questions that all integrators want answered: How is it done? What are the options? Which integrators will benefit the most from moving monitoring to the cloud? What kind of the front-end investment is required and what kind of ROI should integrators and end users expect?.

Stay tuned for more on the educational program.

One of the coolest things about Cloud+ is the exhibit hall: It’s solely focused on cloud-based technology and it’s the only place you can see physical security cloud technologies side-by-side in one room.

Steve Van Till, CEO of Brivo, and one of my Cloud+ advisors, had this to say about Austin: “Austin is perfect because it combines great accessibility for travelers, a very strong tech-focused business community, and lots of local culture for those who want to get out and do something memorable with colleagues or customers.”

Yes! Austin is not your old-school, typical-security-industry-style convention location. In addition to the fact that every important high-tech end user has an office here, I’m convinced you cannot find a bad musician in the town.

It’s also home to a first -class university, restaurant options galore, and there’s easy access to the great outdoors.

Mark your calendar for Cloud+, Nov. 29-30, 2016. Here's a link to the Cloud+ website.

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by: Martha Entwistle - Wednesday, May 11, 2016

There was not a free chair in the Lakehouse conference room here at PSA-TEC in Westminster, Colo. yesterday afternoon during two panel discussions that addressed topics such as: M&A, cybersecurity and managed services.

John Mack Imperial Capital said that there’s been “more significant M&A activity in the past year than in the previous 30 years.” He called that “generally good news” and predicted M&A activity will continue. He noted that new entrants into the security industry are not “taking share away” from others. Rather, new entrants are helping the security industry grow, and they’re bringing “new and interesting technology.”

NetOne’s Dave Carter said the flurry of M&A can be a concern to NetOne if a member company (there are 28) is acquired by an outsider (as happened when Safeguard Security was acquired by SAFE)  However, that is not normally the case. “For our companies, in the regions they operate, they are the acquirers," Carter said.

Brent Franklin of Unlimited Technologies looks at all of the M&A activity as an opportunity. “While the big guys are turning the battleship in the dock … [Unlimited can] pop up into that space and serve their customers,” he said.

Carey Boethel of Securadyne agreed: “When big companies are consolidating and merging they focus strategies internally. …They take their eye off the ball.”

Michael Meridith of SEi concurred,  “customers fall through the cracks,” he said. And, there's more good talent looking for jobs, he added.

Jeff Nunberg of ISS pointed out that many of the recent buyers are venture capitalist firms who “expect a return on investment in three- to five years.” As they build a business, he said, they also “suck the live out of it … which makes it hard to deliver service.” In terms of vendor M&A, Nunberg said: “We have zero control over that,” so he does not worry about it.

All of the panelist admitted concern about cybersecurity—keeping their own companies and customers as safe as possible from a breach. A couple speakers also noted that most security installation companies are not taking cybersecurity concerns seriously enough. Those companies likely will not take it seriously until there’s an incident.

Imperial Capital’s Mack and Michael Kaiser National Cyber Security Alliance talked about cybersecurity as a possible money maker for physical security integrators.

Mack said adding cybersecurity services is a “huge opportunity for people in this room.” Small and medium-sized businesses “have a lot to do to better protect their information, data, and networks.” He suggested that security integrators partner with cybersecurity experts. That would make them very valuable to customers.  “When you upgrade physical security systems [for a customer] at the same time talk to them about how to update their information security infrastructure.” Mack said if he were to get back into the operations side of security, this is where he’d focus.

Kaiser agreed that “one of the biggest gaps in cybersecurity right now is the SMB … they’re not making cybersecurity a priority,” he said. They need a provider to help them “secure their network and their security devices.”

How should you educate yourself on cybersecurity? Attend the RSA show in San Francisco, Mack said. Do your homework about companies attending RSA. Many of them really want to know about physical security. “I guarantee you there will be guys who will be incredibly interested in talking to you," Mack said.

PSA Security is also an excellent resource to educate yourself on cybersecurity he said, noting that Andrew Lanning would be presenting the initial PSA Cybersecurity playbook at PSA-TEC on May 12. Here’s information on that presentation.

“Be part of the solution,” Lanning said.

Managed services make your commercial companies more valuable, Mack said. In addition, he said that acquirers are losing their appetite for security companies that derive all of their RMR from residential accounts. Buyers don’t like the high creation costs on the resi side and the “commoditization of residential security."

“There is no question if you show up [to sell your company] with more RMR, you have a higher valuation,” Mack said. “Guys who show up with a mix of RMR with a commercial focused business will be higher valued than the gyu with the same about of RMR from a residential business,” he said.

There is technology out there now that makes managed services much easier, Mack said. And the financing model for managed services is easier to manage than the model on the resi side. “You don’t have to go upside down on the direct labor and materials,” he said. “But the selling proposition to the customer and how you define that customer and sell to them has to be different,” Mack said.

He said it is probably a good idea to create a new division, or even a new company, to do managed services. Other speakers agreed.  

Robots were another topic of discussion at PSA-TEC. Sharp announced its new SRBD. Here’s a link to this story. A key SRBD executive—Mike Kobelin—is well known to PSA Security members and PSA-TEC attendees, as he is a former PSA board president.

One of the first people in the security industry to talk to me about security robotics was Joe Lynch of Minuteman. Here’s a story I wrote a couple years ago where I spoke to 10 top integrators about tech trends.  Scroll to the end to read Lynch’s remarks. One year after I wrote that story, I asked Lynch about aerial drones and he said there were many questions about legislation and regulation, an obstacle that PSA Security CEO Bill Bozeman told me will hold back development of that technology for the short term. I ran into Lynch today and asked him about aerial drones. He said he’s been able to figure out the FAA regulations and is optimistic about the possibilities. Minuteman owns an aerial drone and is using it in beta projects currently.

Ray Dean of ASI  was at the Sharp robotics press conference and was eager to know when the company’s product would be available.

by: Martha Entwistle - Wednesday, May 4, 2016

The "New ADT" is here. As of May 2, the Protection 1/ADT deal is closed, and ADT is no longer trading on the New York Stock Exchange.

The deal, initially announced in February, was the third major security investment for Apollo Global, which announced it would buy ADT for $6.9 billion and merge it with Protection 1.

I tried to get a call scheduled with Tim Whall who is the CEO of the combined company or someone else at “The New ADT,” but have not heard back yet.

The official announcement had little new information, it mentioned that the headquarters of the combined company will be ADT’s headquarters in Boca Raton, Fla., and said that the company will “operate primarily under the ADT brand.”

Will the Protection 1 name go away completely? Who will run the resi business? What about ADT's nascnet commercial business? Is CMS staying or going? CMS has the opportunity to go after the cablecos/telecom business and DIY business that other wholesale monitoring companies are doing well with. Will it? As a non-public company, ADT can concentrate on slow smart growth--something observers say it has done well with, even under the constant scrutiny of the stock market. So many questions to ask.

Goldman, Sachs served as lead financial advisor to ADT and BofA Merrill Lynch also served as financial advisor to ADT.  Barclays, Deutsche Bank, Citigroup Global Markets Inc. and RBC Capital Markets, LLC served as financial advisors to Apollo and Protection 1 and provided debt financing.  PSP Investments Credit USA LLC also provided debt financing.

The deal also provided an entry for the Koch Brothers into physical security. An affiliate of Koch Equity Development LLC, the investment and acquisition subsidiary of Koch Industries, provided $750 million of preferred equity financing.

Simpson Thacher & Bartlett LLP served as legal advisor to ADT. Paul, Weiss, Rifkind, Wharton & Garrison LLP served as legal advisor to Protection 1 and Apollo.  Milbank, Tweed, Hadley & McCloy LLP served as legal advisor to Koch.

 

by: Martha Entwistle - Wednesday, April 27, 2016

A couple weeks ago I wrote about PSA-TEC, PSA Security’s annual training and education conference, which will take place in Westminster, Colo. May 9-13.

Kudos to PSA for being the first in the industry to take a close look at security robotics. PSA Security CEO Bill Bozeman is among those who believe security robotics will be “the next big thing” in security.

Courses at TEC will explore ground-based, aerial and marine robotics. You can check out the educational sessions here.

In many ways, this robotic technology is here. Drones are being used for surveillance by movie studios and on colleges campuses. And, systems integrator Northland Controls even has robots patrolling its parking lot in Fremont, Calif.  

However, security robotics is in its nascent stage though, and the security industry has to figure out how to harness the technology more broadly, and in a way that makes business sense for end users and integrators.

Also, it’s not clear at all how the government is going to regulate security robotics in general, and drones in particular. There’s a bill in the U.S. Senate right now that would make drone regulation a federal responsibility. One thing for sure is that security robotics will be regulated. And, that makes sense. While drones may be safely used for surveillance in some areas, drones and other robotics may pose a risk in certain locations, such as airports. Questions of privacy will need to be addressed as well. Like it or not, some degree of regulation is inevitable and advisable.

The Security Industry Association is keeping an eye on this issue, and you should too. Jake Parker of SIA told me the “FAA is in the process of finalizing regulations that [drone] operators must follow and chances are this will evolve in the future.” He also noted that there are “significantly different requirements for law enforcement use versus private/commercial security.” He added that this topic will be discussed at SIA’s June 17 Government Summit.

I’m looking forward to the security robotics educational sessions at PSA-TEC, and I’m also looking forward to seeing the robots and drones in Colorado. Bozeman says they’ll be there.

by: Martha Entwistle - Wednesday, April 20, 2016

China-based camera manufacturer Dahua this week took a major step to expand its presence in North America: ADI Global Distribution will now carry Dahua products in its 103 store locations in the U.S. and Canada.

Dahua has plans to grow its presence in North America in a big way, Tim Shen, Dahua Technology marketing director, told me at ISC West.

The China-based camera manufacturer established its North American office in Irvine, Calif. in 2014. At ISC West this year, Dahua invested in one of the biggest booths at the show. It was 3,600 square feet, double the size of its 2015 ISC West booth.
 
I requested an interview with Shen or another Dahua executive to discuss the announcement. None were immediately available, but Raleigh Gerber, Dahua's newly hired communications manager, sent me some background information. She said that in addtiion to making the product more readily available to North American integrators, working with ADI "gives Dahua an opportunity to listen and learn more about the fast-moving video surveillance market, to gain insights about systems integrators’ needs and better help them."

She added that the partnership with ADI "supports Dahua’s open platform solutions, allowing us to provide seamless and flexible integration with our software and hardware partners, and system integrators."

 Dahua's products include its 1.3-4MP IP cameras, 8 and 16 channel POE NVRS, 1080p HDCVI cameras and tri-brid HCVRs.
 

by: Martha Entwistle - Wednesday, April 13, 2016

PSA-TEC will have some new attendees this year: Robots.

There will be drones and ground-based robots at PSA Security’s annual education and training event PSA-TEC, which will takes place May 8-13 in Westminster, Colo.

Bill Bozeman, PSA Security CEO, believes security robotics is the next big opportunity—and challenge—for the security industry.

“We’ll have three sessions [related to robotics] at TEC,” Bozeman said. He noted that PSA Security led the industry on the cybersecurity front, holding its Cyber Security Congress early in 2015.

“We like to start the conversation at TEC about what the future will look like [in terms of technology],” he said.

In the days leading up to PSA-TEC, Bozeman will be attending a drone conference in New Orleans, where he’ll get a close look at aerial, ground and marine-based drones.

Bozeman said that he expects Security Robotics to be the next committee created by PSA Security.

PSA currently has five committees, relatively recently created, that explore topics of interest to security integrators. The committees are tasked with sharing information at PSA-TEC, through the PSA website and elsewhere, coming up “playbooks” for integrators and developing best practices and standards to save integrators time, money and resources.

The five committees are: Project Management Committee, Sales & Marketing Committee, Technical Committee, Leadership Committee, and the  Cyber Committee.

It seemed like everyone was talking about cybersecurity at ISC West. I had a chance to speak to Andrew Lanning, co-founder of integration firm IST, and chairman of the PSA Security Cyber Committee, at the show. Lanning’s group plans to share its preliminary cybersecurity playbook with integrators at PSA-TEC in May.

Lanning’s group is looking at processes and products with the goal of helping integrators, from the super IT-savvy integrators, to those who are just starting to educate themselves about IT best practices and cybersecurity, he said.

Anthony Berticelli, PSA director of education, oversees all of the committees. “There will be nine committee-led session at TEC,” Berticelli said. “There will be peer-to-peer sessions and roundtable sessions and several of the sessions will overlap [committee jurisdiction],” he said. 

PSA-TEC is open to everyone in the security industry. One does not have to be a PSA member to attend PSA-TEC. Here’s a link to information about the conference.

 

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