AAA Enters Security Industry With Acquisition

IPVMU Certified

I think their marketing will be pretty easy, "You have trusted us with your vehicle for years. Now trust us with your home. Introducing...." Something like that at least. AAA is still a huge name for the older generation that has been somewhat scared to dice into the smart home or do it yourself security systems. AAA name alone will open those doors.

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Undisclosed Integrator #1

In reply to Ross Vander Klok

They do have a large marketing and sales staff. I have family members who work there in sales. Not certain that those folks could cross-sell modern security systems due to lack of technical knowledge. I can say they will put every effort into chasing that RMR commission and will likely brute force their way past lack of knowledge.

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Jon Dillabaugh

In reply to Ross Vander Klok

Pro Focus LLC

But since they are keeping it as a wholly owned subsidiary, they will miss out on riding the brand recognition of the parent company, right? If they were branding it AAA Security then I could see that point.

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Undisclosed Integrator #1

In reply to Jon Dillabaugh

That’s a good point. However, whenever there is these type of purchases companies frequently say this only to roll it into the corporate brand a year later. For example - Avigilon is already starting to show signs of Motorola branding.

Canon/Milestone/Axis is the one rare example of this not being the case.

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Undisclosed #4

In reply to Jon Dillabaugh

IPVMU Certified

But since they are keeping it as a wholly owned subsidiary, they will miss out on riding the brand recognition of the parent company, right?

Why do you think that being a WOS precludes them from changing the brand to AAA? There are many other reasons to operate as a WOS, e.g. financial/culture, besides branding.

Perhaps the AAA club wishes to let them dba as their current brand; or maybe they wish to leverage the AAA brand, but being a WOS does not control the decision.

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Dan Gelinas

IPVM

Thank you for the feedback, Ross and UI#1. Interesting point about the lack of technical knowledge. At least in this short-term, Safe Security will continue to function as a completely self-sufficient and independent security company owned by AAA. What is the likelihood that AAA will train more sales staffers as they go forward?

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Undisclosed Integrator #1

In reply to Dan Gelinas

Very likely. They invest very heavily in training.

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Douglas Button

Very interesting! I see this as a very bold move, adding yet another powerhouse to the market of ADT, Brink and such. It will unfortunately be another challenge to the "little guys" who's bread and butter is residential security. It might be that there is a niche here that does not impact the residential market by focusing on mobile needs, or simply adding another national Central Station to the monitoring options. If it follows the auto market, AAA will be the Central Station and communication platform, and there will be local security dealers who are AAA authorized. It will be interesting to see this develop.

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Undisclosed Integrator #2

Just a general comment on AAA. If you don't have a membership, get one today. I was in the unwashed masses for most of my life and about 5 years ago opted to try a membership. Other than an IPVM subscription, It's the best $100-150 per year you could spend. (and I'd specifically recommend the Platinum for the extra $50.

My membership covered 4 of my work vehicles. We've had techs break down on the road. I've had free tow jobs, flat tires replaced, ran out of gas assistance, keys locked in the vehicle, and the best hotel rates on the market just by being a member. You break down and call their toll free number and you have service to you generally within 45 minutes, with text updates of the progress while you wait. They could probably roll into a monitoring service fairly easily.

Look into it yourself, but like IPVM, I've more than reaped the annual cost by being a member.

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Undisclosed #4

In reply to Undisclosed Integrator #2

IPVMU Certified

Look into it yourself...

I looked on the WWW and saw the BBB gives the AAA straight A’s.

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Undisclosed Integrator #6

In reply to Undisclosed #4

If it comes from the BBB, it's got to be gospel!

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Undisclosed Manufacturer #3

This exact model has existed in Australia for quite some time - most of our state-based AAA equivalents (RAA, RACV, RAC etc) are also in the residential security business now, and it seems to work well for them. They do a lot of package deals mixing car, house insurance and security.

Works well as they generally considered "high trust", reputable organisations that also do a lot of consumer advocacy etc on the motoring side.

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Undisclosed Integrator #1

In reply to Undisclosed Manufacturer #3

They do a lot of package deals mixing car, house insurance and security.

"Bundling" is definitely AAAs method here in the US - life insurance, car insurance, homeowners insurance, roadside assistance, etc. There is a lot of competition in the residential market so I don't see any other means for them to compete.

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Lee Jones

Support Services Group

Congrats to Paul Sargenti… good timing for an exit… before ADT crashes, or is broken up. Monitronics/Moni/ASCMA/Brinks has already crashed from $88.00 share price several years ago to a “penny stock”, @ $00.88 today.

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Undisclosed Manufacturer #5

In reply to Lee Jones

ADT / Pro1 / ASG / Brinks / Red Hawk / / / /....isn’t going anywhere. Stock is in the toilet, sure, but they’ll rebound fairly quickly. Too many acquisitions happening here to precede a major crash IMHO.

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John Honovich

In reply to Undisclosed Manufacturer #5

IPVM

I agree that the acquisitions will help ADT's stock to not 'crash' simply because the commercial integration businesses they are acquiring have low risk but they also have low upside (i.e., commercial integration does not have much potential for huge growth or profits).

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Lee Jones

Support Services Group

In reply to Lee Jones

Addendum:

AAA and Hetke are known “innovators”. They probably see value in SAFE that others have overlooked . Maybe have a business model that does not require on-demand police response. They probably know when and how to tell existing RMR customers that have been downgraded from police notification to customer notification. Bay-area law enforcement are also innovators and trend setters, such as San Jose VR-Verified Response and San Francisco customer registration/permits/annual fees paid by monitoring firms. And competition, like Bay Alarm, with private emergency response. Maybe we should just watch SAFE and learn.

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Undisclosed #4

IPVMU Certified

In reply to Lee Jones

Monitronics/Moni/ASCMA/Brinks has already crashed from $88.00 share price several years ago to a “penny stock”, @ $00.88 today.

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Undisclosed Integrator #7