2012 would be remembered as the pivotal year for home security. A perfect concoction of investment, technology and new entrants has now changed the market landscape forever. Service/business models, ubiquitous broadband and smartphones have finally colluded to make home security and surveillance a more than affordable and viable solution. According to Frost & Sullivan, even the cash-strapped European region is expected to witness a CAGR of 7.7 percent in the home automation and security segment, to surpass US$450 million by 2017.
2012 would be remembered as the pivotal year for home security. A perfect concoction of investment, technology and new entrants has now changed the market landscape forever. Service/business models, ubiquitous broadband and smartphones have finally colluded to make home security and surveillance a more than affordable and viable solution. According to Frost & Sullivan, even the cash-strapped European region is expected to witness a CAGR of 7.7 percent in the home automation and security segment, to surpass US$450 million by 2017.
In 2012, Vivint was sold to The Blackstone Group for more than US$2 billion, and ADT in North America was spun off from Tyco International to form the independently operated ADT Corporation. Of course, everyone now recognizes that the big play here is not just security but home automation; offering numerous services with little extra "cost per user" required, by virtue of cloud computing. "This is the opportunity that has got markets and investors excited," said James McHale, MD of Memoori Business Intelligence. "But for all the hyperbole and talk of doubling residential penetration, have the ‘big boys' really embraced the revolution? Or, have they left the door open for smaller and more innovative companies to gain a foothold?"
Mark Richards of Hive Labs certainly thinks so. "Our vision is that everyone should have home security and not at $30 to $50 a month. The alarm business models are still exactly the same as they ever were, and it won't last forever. Long-term contracts, not being open and honest with pricing, and salespeople knocking on doors are from another era." Richards puts forward a persuasive argument, in McHale's view. Almost all the smaller companies entering the market have a background in software. They understand it. Web services, cloud, agile programming techniques and third-party APIs, for example, enable companies like Hive to offer video surveillance services for $5 per month with no contract. "It's services like Hive that have a shot at growing the US market to 40-percent penetration, not the incumbents," Richards said.
According to McHale, the home automation market in 2013 is up for grabs. “Winners will be the ones that can offer the same seamless experience that consumers have come to expect from the likes of Apple.”
While the market is seeing a shift in technology and increased demand for innovative products, the supply chain is also responding to such developments.
Tech Development
Home automation installation has always been of interest almost exclusively to professional home automation specialists. However, more manufacturers are currently determined to simplify home automation, and spread installation and programming know-how to more participants in the supply chain, according to Frost & Sullivan's latest European home automation and security market report. They have intensified their focus on training traditional electrical contractors, and are exploring other routes to market in order to reach a wider customer base.
"We expect to see continued expansion of home automation services, with lifestyle enhancement playing a major role as an additional offering to home safety and security," said Merlin Guilbeau, Executive Director and CEO of the Electronic Security Association. "These services are making customers' lives not only safer and more secure, but simpler, more energy-efficient, convenient and entertaining." Recent examples include the home automation/security panels, launched by the likes of Google/Motorola Mobility, Honeywell Security and SMC Networks, residing in tablet/pad form factors and remotely controllable/viewable via smartphones. "At the association, we're stressing the importance of being ahead of the game. Whether it's the 2-G sunset, the disappearance of POTS, or the continued rise of home automation as a source of RMR, it's important to be proactive rather than reactive," Guilbeau cautioned. "Even though none of the issues is a surprise to anyone, what remains to be seen is how security integrators and businesses can turn these trends to their advantage."
What follows is a helpful list of things to look out for when sourcing and implementing security systems for three different dwelling types: single house, apartment building and gated community.
Single Houses
The most critical requirement is the migration of backup dialers to 3-G/4-G, as the sunset on 2-G nears. Additionally, the price war on system equipment and services will only intensify, with more mobile technology providers and service carriers entering the scene, said Balázs Rózsás, Head of IP Cam Technologies, a Hungarian surveillance dealer that is also branching into home automation and security with its partners. "With the global economic backdrop, affordable price/performance will be sure to come up in every conversation and inquiry."
Other alarm system considerations include:
- WCDMA/HSDPA/GSM/GPRS/EDGE 850/900/1800/1900/2100MHz for remote setup and viewing
- Preconfigured and remote arming/disarming
- Wireless motion/intrusion detectors with adjustable sensitivity levels, independent zoning and arming/disarming
- Integratable with nighttime megapixel cameras (video at UXGA or 1,600×1,200 or stills at QVGA or 320×240, with onboard audio/video storage and motion detection with proper timestamps
- Auto dialing, texting, video texting, emailing, voice/video over IP and mobile apps, and a combination of the above while notifying the security service provider or authorities
Apartment Buildings
Video door phones and video intercoms are increasingly blurred. Key purchasing considerations include the following.
Main Gate
- Aesthetically pleasing, vandal-proof, weather-proof video cameras with easily adjustable viewing angles
- Ergonomically adjustable keypads or touch panels
- Intuitively designed, easy-to-use pads or panels that visitors do not need to squint and study for a few minutes and can find whom they want to reach and where to press in seconds
Property Manager/Guard Unit
- Easy-to-use interface for visual/audio verification of visitors/guests, preferably available on a mobile unit (with GPS), and for paging a specific tenant (without looking into their home)
- Mass notification capability where there are multiple managers/guards, without affecting system reliability and cost
- Centralized management software, with digital maps, for overseeing multiple buildings and guards
Apartment Unit
- More discreet wall-mount
- 4” to 7” color displays (TFT-LED)
- Wireless handsets or pads that are open to home automation integration and software upgrades
Gated Communities
Access control of tenants, visitors and vehicles can be extremely complex, so the No. 1 requirement would be scalability and versatility. Reliability of IP networks can also be shaky at times, so a dedicated VPN architecture must be put in place, with auto system diagnostics, backup power and emergency maneuvers.
Equipment Security
-Temperature/moisture/mold/smoke/fire/weather/shock/explosion/lightening/interference-proof
Functionality
- Tenant/visitor/vehicle management open for building automation and guard/service management integration
Scalability
- Open platform for various software and communication protocols, with readily available standardized parts, modules and apps