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AT&T: 2017 end of the line for 2G

Cell carrier’s ‘sunset’ for GSM will force upgrade to 3G and 4G radios
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08/15/2012

YARMOUTH, Maine—AT&T will phase out its 2G networks by 2017, setting a long-anticipated timeline for the “sunset” of the technology and giving the alarm industry a target date to upgrade cellular equipment.

3G vs. 4G: AT&T’s ‘sunset’ fuels debate

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Wednesday, August 15, 2012

While AT&T has finally set a date and ended the discussion over when it will push 2G into the sunset, the points of contention grow sharper over 3G versus 4G and the merits of each for cellular alarm communication.

Boiling down the argument to its simplest terms, this much is clear: Technology touted as 4G is faster and more expensive. But is that extra speed worth the money, and more importantly for alarm dealers, will it contribute to longevity in the field? And what is “real” 4G anyway?

On Monday, I talked with two industry experts who couldn’t be further apart on the issue: Gordon Hope, general manager of AlarmNet at Honeywell, and Shawn Welsh, vice president of marketing and business development for Telguard. Both made what seemed to be valid arguments, although I confess I’m not qualified to comment on the technical merits of each. What I can do is define HSPA (High Speed Packet Access), HSPA+ (evolved HSPA), and LTE (Long Term Evolution), and offer a bit of what each man had to say:

Hope: “I don’t know whether it’s accidental or intentional, but it seems like our industry is mixing 3G and 4G together in one sentence. In reality, there’s clearly a difference—the carriers delineate it. HSPA+ and LTE from AT&T’s perspective are legitimate 4G technologies, and everything else isn’t.”

Welsh: “At a recent webinar, AT&T and Qualcomm both basically reiterated this statement: 4G is the same as 3G, it just costs more. To get down to the letter version of that, HSPA+ is the same thing as HSPA as it relates to longevity, it’s just that HSPA+ costs more.”

Hope: “We believe the best thing to do is to move up and provide a 4G radio, not stopping at 3G. HSPA+ is a 4G technology … it’s just plain faster. In AT&T’s announcement [about 2G], they even made statements that a third of their postpaid subscriber base is already using 4G technology, not 3G. That speaks to the fact that if you’re not thinking about 4G, you’re probably going to leave yourself shortchanged if you stopped at 3G network capability in the radio module you chose. We went through the additional expense to include HSPA+ 4G technology in our radio. We believe it’s going to directly translate into longevity on the wall.”

Welsh: “There’s a thought that 4G is somehow better than 3G and that somehow it will be around longer, because certainly each generation will be around longer than the previous generation. In this case it’s a misnomer, because 4G as it relates to HSPA+ is really a marketing trick, unfortunately. … What happened was that AT&T and Verizon both went out and bought up spectrum in order to deploy real 4G called LTE. And 4G LTE got a certain level of throughput—it was really fast. Well, T-Mobile did not get spectrum, so they were stuck having to advertise 3G when their major competitors were going to start advertising true 4G LTE. So they simply did what a marketing organization might do. They just said, ‘Hey, you know what? This new 3G HSPA+ is so fast it goes just as fast as that LTE they’re going to deploy, so you know what we’re going to do? Let’s just call ourselves 4G. All that really matters is the speed anyway.’ So overnight they rebranded themselves as 4G in order to compete with the marketing term of 4G LTE. And literally that’s what happened. AT&T was forced to start calling their HSPA+ network— which was really just a 3G network—a 4G network in order to compete with the marketing spin T-Mobile was putting on things. And that’s how we got 4G as it relates to HSPA+.”

Hope went on to say that while speed traditionally hasn’t been important to the alarm industry, it will play a bigger role in attracting future generations of consumers who will be loading their tablets and smartphones with security applications and a whole lot more. Welsh reiterated that longevity will remain the top priority for alarm dealers, and “from a cost standpoint, HSPA+ is a more expensive solution for the exact same longevity.”

For the record, the International Telecommunication Union states on its website that the only “true 4G technologies” are LTE Advanced and WirelessMAN Advanced, neither of which has been deployed on a large scale. The ITU goes on to say, however, that the term 4G may also be applied “to the forerunners of these technologies, LTE and WiMax, and to other evolved 3G technologies providing a substantial level of improvement in performance and capabilities with respect to the initial third-generation systems now deployed.”

That sounds like a gray area open to commercial and consumer interpretation, but there's no arguing this point: Alarm dealers with radios on AT&T’s 2G networks will have to upgrade by 2017 or they’ll be left in the dark. The fadeout due to spectrum harvesting will accelerate before then, so sooner is probably better than later. Then it's just a question of sorting out the Gs.

ACA acquires in Alabama

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Wednesday, August 15, 2012

Smooth. That’s how Alarm Capital Alliance described a recent transaction that added more than 1,000 accounts to its existing account base in Alabama.

ACA, a Media, Pa.-based independently-owned company that acquires and manages security alarm contracts, acquired the accounts through an asset purchase transaction with Ultimate Security of Scottboro, Ala., according to a news release issued last week.

Ultimate Security will stay in business and continue to service ACA customers, according to the Aug. 7 release.

In the release, Kelly Bond, VP of sales and marketing for ACA, remarked, “This was one of the smoothest transactions that we’ve entered into.”

Ultimate President Richie Burns said in a prepared statement that this is a “tremendous transaction that allows us to remain in business, continue to sell accounts and provide service for all of our friends and customers.”

Bond said, “Richie has a great staff and quality accounts, and we’re looking forward to a prosperous relationship.”

Terms were not disclosed. Ron Davis, of Davis Mergers and Acquisitions Group, represented the seller.

Capital Alarm scores with install at stadium

Fire system at New Hampshire Fisher Cats ballpark performing well
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08/14/2012

PENACOOK, N.H.—Capital Alarm Systems, a fire and security integrator based here, already had a relationship with the New Hampshire Fisher Cats, doing such things as advertising the minor league baseball team on its website in exchange for free tickets it offers to its clients as promotions. But that relationship wasn’t the only reason Capital Alarm was called in to replace the damaged fire alarm system at the home stadium of the Toronto Blue Jays’ Double-A affiliate.

Bill to deregulate telecoms in Pa. concerns industry

AICC says legislation would give telecoms like Verizon unfair advantage over security company competitors, but Verizon denies that
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08/08/2012

HARRISBURG, Pa.—Proposed legislation in Pennsylvania to deregulate the telecommunications industry in the state would give an unfair advantage to telecom providers of home security services, according to an attorney with the Alarm Industry Communications Committee (AICC).

Security 101 touts franchise model

Looks to national accounts for growth
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08/08/2012

WEST PALM BEACH, Fla.—Since launching as a franchise-model commercial security company here in 2007, Security 101 has grown to include 26 locations today.

Vivint takes door-knocking rival to court

Vivint contends a competitor used deception to steal Vivint customers
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08/08/2012

PROVO, Utah—Vivint is suing another door-knocking company, alleging it has been using false and misleading statements to “slam” or take over Vivint customers.

Devcon’s new operations center to shut its doors in September

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Wednesday, August 8, 2012

I reported this summer that Devcon Security, a Hollywood, Fla.-based super-regional, was planning to shut down its new 23,000-square-foot national operations center in Irving, Texas by the end of the year.

Now it appears the closing will take place next month. Devcon plans to close the facility Sept. 5, laying off 197 employees, according to a report this week by the Dallas Business Journal. The facility opened in February 2011.

CEO Steve Hafen previously told me that closing the center was part of a company plan to reduce expenses and strengthen the company’s finances for future profitability and growth.

The company also is closing branches nationwide, a reversal of a rapid expansion it had recently undergone. In the past 18 months, Devcon, acquired by San Francisco-based Golden Gate Capital in 2009, transformed itself into a national player with more than 50 branches around the nation.

Hafen previously told me: “Devcon has experienced many changes over the past 18 months, including an aggressive growth initiative and subsequent streamlining of some branch operations.” He said then a reduction in the company’s workforce was anticipated.

The business journal reported that Devcon issued a statement saying that it “has aimed to, and has already made progress on, helping displaced employees transition into new opportunities through job fairs and résumé assistance programs. Devcon Security believes that these changes, while challenging, will strengthen the company and enable more opportunities for those in the industry long term.”

Lowe’s Iris: Boon or bane in fight against false alarms?

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Wednesday, August 8, 2012

On one hand, it’s hard not to see the appeal of Lowe’s new Iris home management system. It’s do-it-yourself for those with the dexterity to install a thermostat, it’s cloud-based so homeowners can control and check on their properties remotely, and it’s inexpensive: starter kits range from $179 to $299, and there are no monthly fees for those who choose to do their own alarm monitoring.

On the other hand, how many homeowners are really prepared to be their own central station?

Sarah-Frances Wallace, a Lowe’s spokeswoman, recently touted the self-monitoring aspect of Iris in an interview with SSN's Tess Nacelewicz. Wallace said homeowners “can respond appropriately” when they receive a security alert, using an Iris camera to see “if there’s an intruder in your home that would require police response … or if it’s the dog knocking something over.”

Wallace said DIY monitoring helps avoid the problem of false alarms, for which many municipalities now charge homeowners a penalty. “This kind of gives the homeowner more control over triggered alarm events in the home,” she said.

But what happens when the homeowner decides the alarm is legit, they call 911, police respond and they find nothing amiss? What happens when the scenario gets played out three or four times in a month at the same residence? Do you think the municipality is going to continue to absorb the cost of dispatching officers and cruisers?

Ask any alarm company owner and I think you'll get a consistent response to that. Municipal budgets are tight and they're only going to get tighter. Just because a professional wasn't involved in the installation and monitoring of a system doesn't mean local officials are suddenly going to forgive and forget when it comes to false alarms.

For homeowners who want a little help when it comes to dealing with alerts from their Iris system, Lowe's offers a self-monitoring service for $9.99 a month. "You can set it up so if there's a triggered event in your home, it would email [or text or call] your neighbor … [or a] small network of people you'd want to receive notification of events," Wallace told SSN.

The service is ideal "if you're on vacation and you receive a notification that there is an event in your home," she said. "You could contact your neighbor—because they've also received [the notification]—and they could look into it for you."In a perfect world, it all ends well. If a pet triggered the alarm and the neighbor happens to be around to make that determination, everyone sleeps easy that night. But what if it wasn't Fido who did the deed and it's an intruder instead? What happens when the neighbor walks headlong into that situation?

Hello, Ken Kirschenbaum.

The point is, there are times when it pays to do things yourself and times when it pays to let professionals handle it. Again, it's hard to dispute the appeal of Lowe's Iris system for many people and for many applications. But should home security be one of them? Let the buyer beware.

Battered but unbowed

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Tuesday, August 7, 2012

Wayne Wahrsager’s New York Merchants Protective Co. Inc.—an alarm company in existence for more than 100 years—is no more as the result of a $20 million breach-of contract lawsuit filed against the company and Wahrsager last year by Bank of America.

But Wahrsager tells me he is still very much a player in the security industry—and planning to launch a new alarm company in October with $50 million in funding behind it.

“You just brush yourself off and start all over,” he told me this week.

It seems that what Wahrsager experienced over the past year and half would have had most people down for the count.

First, in January 2011, came the Bank of America lawsuit contending it was owed more than $19.2 million for the default of a loan.

Then, four months later, Wahrsager got fired from his job as president of NYMP and pretty much literally got thrown out of the company’s Freeport, N.Y.-based office by the receiver a judge appointed to run the company. The receiver changed the locks at the office to keep Wahrsager out but he just took his office door off its hinges and continued coming to work until a judge ordered him gone that May.

Then, last October, the judge approved the sale of NYMP’s assets to pay off creditors. The sale to Professional Security Technologies of New Jersey was completed earlier this year, Wahrsager told me.

He’d been involved NYMP since 1988, but the previous owners were cousins so it was a family business that turned 100 years old in 2010, he said.

Wahrsager contends that the company went for far less than it was worth, and that if Bank of America had been willing to work with him, he would have repaid the loan “100 cents on the dollar.” He said he’s still a named defendant in the lawsuit, which is still pending.

But Wahrsager said he’s working as a consultant for Bellmore, N.Y.-based Commercial Fire & Security, which he said was formed about a year ago.

And he’s involved in the start up of a new company that he said has a group of investors behind it and is expected to launch by the end of October if all goes as planned. The company may be called Commercial Fire & Security—the new company may acquire the existing one—or take on a new name, he said. It will be based somewhere on Long Island, Wahrsager said.

Stay tuned—it looks like another round for Wayne Wahrsager.

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