Who's got the communications answer when POTS goes away?

I've been following the POTS Sunset news as it's occurred, blogging and writing stories when the FCC asked for public comment, and when AT&T proposed POTS be phased out by 2014, and again when the FCC released its National Broadband Plan, which proposes a way to deliver broadband services to every American... Maybe the FCC should work on national health care, too... I've gotten a lot of comments on the blog and have had some really good phone interviews with some industry folks. Now those folks may not agree on who's got the best technology to solve the POTS Sunset problem, but they DO all agree that the time to act is now. I spoke with Lance Dean at 2GIG back when the FCC first sought public comment on the nascent Broadband Plan. He pointed out that the infrastructure, the PSTN and the POTS service it makes possible, was going away whether the industry wanted it to or not. "“There’s 700,000 lines going down a month. If you do the math, that’s 8 million a year," Dean said. "In a few more years there won’t be any more landlines.” I also spoke at length recently with Mike Sherman president and CEO of AES IntelliNet and Tom Reed VP of sales at NextAlarm. Both men seemed to feel the sunset of POTS was not only inevitable, but was also an opportunity to fix what has been wrong with the industry and take control. Sherman was emphatic that the big problem with which the industry has dealt from day one is the fact that it hasn't owned or controled the communications pathways upon which it relies for the delivery of it's alarms. Of course, his company provides a solution to that, providing an AES IntelliNet dealer with his or her own network of radio relays--an IntelliNet mesh system--that Sherman claims is the way to go.

I think the bottom line on this is that the alarm industry has maybe four alternatives. One is POTS. We know it’s going away, we don’t know when, but it is going away, and that has always been reliable. You have the Internet, which has incredible problems, incredible delays. Try pinging a central station in Boston. Try it several times a day. The ping time will vary all over the place. That's not security-grade reliability. It's the same thing with GSM--which is cellular radio--it's patchy. The networks 'busy-out' ... Smartphones are sucking the life out of the GSM system because they use so much data. So the GSM system, like broadband, has finite bandwidth. Then there's IntelliNet. This is the dealer's network. The dealer owns it and controls it ... With IntelliNet, finally, the dealer owns and controls the communications piece. It’s always been owned by the phone company or the cellular company or the cable company. It’s the communications piece that makes the dealers’ service possible ... The other thing is that you can’t surf the web on it, you can't play games on it, you can’t shop on it, you can’t download stuff on it. It’s been designed specifically for the security industry. It's been optimized for security monitoring, so it meets the five nines reliability that the security industry relied on way back when it created itself and relied on POTS.

Sherman, in speaking about the "busy-out" problem GSM has, cited an article from BusinessWeek. Interesting read... Reed claimed NextAlarm's answer utilized the system the end-users were flocking to, the system in which the government is already heavily investing--broadband--and made that system more reliable.

We actually recognized four years ago as people started to move from POTS to VoIP and that's when we started developing our product... We've got one patent issued and a second patent granted ... Obviously, we believe that IP is the way to go. Our solution is agnostic to panel and agnostic to central station. We think that for legacy panels, that's the way to go. Many companies are looking to GSM, and there’s a couple challenges with that. One of them, obviously is congestion. If you’re in a congested downtown, urban area, it’s getting harder and harder to get a reliable GSM signal, particularly here in the US--you don't see it in Europe or Asia--we have such a good wired infrastructure that telcos have not put in as many towers. The problem is that the instant someone needs help--whether it's PERS or some other alarm--they need help. You can't hope and cross your fingers that you get a GSM signal. Another challenge is that most of GSM is metered. If you want something that's cost-effective for a customer who wants to do open/close reporting, wants to have two-way voice and those kinds of things, GSM can get very expensive. Most of the plans only have six or seven metered signals a month. If you're doing open/close you could have as many as 60 a month ... And finally, the GSM expense to add to a panel is pretty expensive. The device we're providing today is available for dealer purchase from ADI for $99. What are the advantages of IP? Very low cost for bandwidth. We've got a small fee per signal, but there's no metering, so you have the ability to do open/close, you have the ability to do two-way voice.

What about Sherman's critique of unreliable signal transmission with broadband? Reed provided a brief description of the NextAlarm solution. From Reed's info:

VoIPAlarm by NextAlarm.com was built to solve these problems. VoIPAlarm allows customers to enjoy the benefits and cost savings of Voice-over-IP service, while still allowing their alarm systems to accurately communicate with their monitoring centers. VoIPAlarm operates over your standard Cable Modem, DSL, or Terrestrial Wireless Broadband Internet connection, and works with any alarm system capable of sending signals using the Contact ID format (including the Abbra Professional Series by NextAlarm.com). VoIPAlarm requires no changes to your existing alarm system, other than a one-time purchase of a Broadband Alarm Adapter from NextAlarm.com. Simply plug the Broadband Alarm Adapter into your home network, and plug your alarm panel into the Adapter (rather than into your regular telephone line), and NextAlarm.com will immediately begin to monitor your security system over Broadband. VoIPAlarm even offers Line Security, a new security measure not available with standard telephone line hookups. Our servers are in constant communication with our Adapter installed at your home or business. If we should lose contact with the device, our E-Notify service can alert you in a matter of minutes. This extra security measure is only possible through the always-on, always-connected nature of VoIPAlarm.

Regardless of which technology you go with, it seems pretty clear that the time to make changes and talk with your customers is now. Sherman warned of potential consequences if the communications path is not made a top priority:

The industry is based on a recurring revenue business model, and if the communication is not there, or not reliable that threatens our business model. The security industry cannot—cannot—afford to sustain any newsworthy, bad releases. We have to deal with the reliability of the communications because if we don’t we’ll all be punished. You need to understand the importance of the decision when you opt for a technology—whether it’s IntelliNet or something else. Know what you’re getting. Look past the glossy brochure that the purveyor provides you.

Reed said there were definite, necessary steps ahead, and those steps would not get easier with time:

You've got start this conversation today--and it's not going to be an easy conversation ... It’s like with the kids who hide their bad grades, and forge mom's signature and pretend nothing's wrong for three months and then it’s worse when the truth comes out. The industry can’t hide from this. It's like a ticking time bomb. We need to go out now and talk with our customers and give them a communication solution that works. That’s what we’ve been pounding the drum for. With the POTS Sunset on the horizon, it makes the drum beat that much louder and faster. We can try and hold back the flood, but the industry’s not big enough to hold it back. We have to say, 'It’s going to happen, we may as well get ready for it.' We’ve got maybe a seven or eight year window.