Amazon Touts Home Security Market Disruption

By: John Honovich, Published on Oct 15, 2018

Amazon is coming for ADT and all of home security. Indeed, Amazon is advertising this as, in their own words, calling home security a:

Inside this note, we examine Amazon's advertising and marketing to disrupt home security, how they plan to do this and how it could impact ADT and other conventional players.

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Poll / ****

Comments (25)

People should start being concerned about companies like amazon having too much data on them. IE- email, Alexa, shopping habits, etc. 

thieves can hack amazon and get all that data, listen into houses via Alexa, know when people are gone, disarm the alarm and go to work.

not good to have all apples in one basket.

people may say amazon is too big and has top security and is not hackable...let’s remember what happened to Experian in the past two years or so.

thieves can hack amazon and get all that data, listen into houses via Alexa, know when people are gone, disarm the alarm and go to work.

If a 'thieve' is good enough to 'hack amazon', they are going to have a lot more higher value targets than breaking into one's home.

I am not disagreeing with the larger context of Amazon being too powerful, just that the misapplication is unlikely to be focused on an individual's home.

I agree John and to add to that, in my experience in the residential market people have really only bought peace of mind and that determined the number of devices etc. then came the free systems that appealed to many more. I think there is a huge trust in Amazon and Google and i think with the added home connectivity etc it will spell doom for the ADT's. I notice in these article no mention is made of companies like Alarm.com - for me i think they are most vulnerable or am i missing something  

There may be higher value targets than breaking into a home, however, you are assuming what the thief wants. You cannot know every human's motivations. The point that it is insecure should be strong enough. Whether they steal credit cards or intellectual property from Amazon, or whether they find a house to invade and do harm face to face...

The bigger problem is educating the consumers. How can we make the common man understand?

While what you are saying is true we cannot know the motivations of all it does not change the fact that if they can hack Amazon how well do you really think all the wireless devices or alarm panels communicating over a telephone line are going to hold up to them?  Also the types of criminals hacking into large corporations are not the same type that participate in smash and grab type crimes.  

All of that said.  I have 0 of the smart home devices because I have to this point not found it particularly challenging to turn on my own lights or to pick up my phone and lookup the answer to whatever question comes to mind.  Second, I even turned off Siri because so far voice recognition software has not proved reliable when I attempted it.  Finally, I am not really a fan of things listening in 24/7 even if it is just listening for one word.

Perhaps OP meant hacking Alexa devices. Ex, homeowner broadcasts their SSID and has default credentials to get on their network or into their router. Hacker gets in and disarms alarm system or captures camera feeds.

They're not wrong. However, most homeowners still do not want to install it themselves and I don't know if they ever will. Our fastest growing vertical is young familes ages 25-35 having kids and buying their first homes. When I try and sell them a DIY system they would rather have us come install for a small fee. 

I would say the technology is ripe for distruption but not the industry (installation/monitoring...etc) as a whole. 

So where does all the liability go in all this? Home owner does a bad self-install... just saying.

This whole thing is opening pandoras box.

That's what good contracts are for. 

Home owner does a bad self-install... just saying.

Using cameras with a wide FoV and (hopefully) strong AI reduces issues with 'bad self-install', i.e., instead of PIRs and contacts that literally cannot see / know what caused it. What do you think?

I am testing two cameras inside my home, both are on my wifi network. Just yesterday I wanted to review video to see if a phone suddenly dropping to the floor unexpectedly after sitting for hours untouched on a table could be explained.  What do you know, the camera lost its connection a couple of hours prior to the incident. 

This seems to be the norm at least in my personal experience. Is it the unreliability of wifi devices or is it the same force that moved the phone?  lol

Seriously though, as long as notifications can be sent of signal loss ONLY with these types of cameras as opposed to notifications for EVERYTHING, as there is motion all of the time in an occupied area, cameras can be great alarm devices.

 

I don't think liability would be an issue at this point and it wont unless an insurance company details this in a policy. And then again who knows what insurance company amazon owns or will buy that could offer insurance 

Damn, so many different buttons I can push to label your post as 'helpful' or 'informative', but... JH, where's the 'frightening' button?

Undisclosed #1 above is afraid of Amazon or Google having so much information that thieves steal it and use it inappropriately.  I'm worried about Amazon or Google using it inappropriately! - they already do, IMHO. Either of them entering the insurance business after enticing all of us to let them into every other detail of our lives - really scary.

"...i think with the added home connectivity etc it will spell doom for the ADT's"

Perhaps this is why all the commercials from ADT lately focus on the total home/ smart home environment?  If Amazon and Google succeed in the security market, it probably won't be just due to selling increased security as much as easy to deploy "home automation".

Last year, I discussed with my wife my idea about adding music distribution throughout our house, and she said..."don't bother...I just ask Alexa to play Mozart in whatever room I find myself in, and I also have voice-activated intercom".  She then asked if my proposed system would be as easy to use, or would I be adding to my extensive collection of remote controls devices?

Google and Amazon will offer ease of installation and use, and that's hard to beat.  Is that the real market disruption?

This discussion is meaningless if we are talking about alarm security… because nobody is talking about “Part 2 of 2” of the customer expectation… aka police response to the call for help. Market disruption in this industry is not about really good automation and entertainment from Amazon, Nest and others.

Compare this discussion to solar powered submarines. We assume the sun will be available on-demand, just like we are assuming the police will be available on-demand.   Here, the “big disruption” is low priority or no police response to calls for help from monitoring firms, like ADT and Monitronics, for millions of deterrent alarm customers. Without meaningful reaction-to-the-action, a deterrent sign and decal is a cheaper alternative.

We believe Amazon should do what others cannot do. In this case, provide private response to millions of calls for help that are not within jurisdiction of local police. A new source of major revenue with high margin and market dominance, the Amazon way.

Source: Lee Jones; Support Services Group

Market disruption in this industry is not about really good automation

Strongly disagree. Really good automation fundamentally changes the false alarm problem.

Why do police not like security alarms? They are overwhelmingly false and waste their time.

Why are security alarms overwhelmingly false? Because it is very hard to visually verify whether there is a real alarm.

Automation using smart video directly addresses that problem and therefore will reduce false alarms significantly. Yes/no?

John… Yes, I agree with most of your good critique of my comments. Your original discussion was focused on Amazon. I tried to continue that discussion but got off track.

This whole subject of “security” is a bottomless pit. The need for protection of people and property is global in size and as old as civilization itself.  The US is one of the last places on the globe where private firms, like ADT & Monitronics, could demand emergency response (without an emergency)by local law enforcement to private contract customers.

Reports say this “market” occupies about 20 % of US households, so on a global stage, or US stage, the broken antiques like Monitronics, and much of ADT, should not attract much attention from the disrupters, but will provide lots of work for the renovators. We believe Amazon will focus on that part of this massive market that does not have to be fixed first.

Many areas now require video verification before dispatching an officer. There are cameras that offer this functionality already out there in the market for just this reason. In the end an alarm system is just a deterrent. The hope is having the alarm will make the thief choose a different target. If the thief wants something bad enough they wont care if you have an alarm or not. Smash and grab is a common method thieves use, they are gone long before anyone could be sent.

Police response will become quasi-virtual in nature.  They will mandate via city ordinance or resolution a home to PSAP connected solution similar to the RSI Technologies/Videofied product.  It will have to be some type of "motion viewer" integration or association with a home's various intrusion detection devices followed by subscriber verification/confirmation of the event as a real or false alarm.  We are already almost there.  It's up to the alarm industry and manufacturers to beat Amazon with a better mousetrap which means being the first and best to market a standards based solution built on a COP that all manufacturers can talk to.

The average home user can't remember a 7 character password.  I spent 20 minutes trying to explain the different between left clicking a mouse and right clicking.  No chance in hell customers are going to install IOT devices to replace their monthly ADT system.  Sure there's the 5% of customers with tech know-how but 95% of people are completely useless.  Give it 40 years and this may change.

If we make a conscious effort to educate the average human we can make this happen faster. I think the education of consumers, or lack thereof, is a MAJOR problem in this industry. It's not a fun industry, it's not a glamorous industry, and we're NEVER cutting edge... it's an annoying necessity for most people that have video surveillance.

They just don't care as long as there is video evidence for posterity's sake (we're not "protecting" anything, we're just watching). This needs to change. People need to know that your crappy, insecure, "so cheap and convenient" camera is DDoSing my Playstation network and I can't have that!

I have a few thoughts on this.   There is a segment that will want do it yourself systems and it will eat into our channel without a doubt.  There will also also be people that want it done for them, especially higher end larger homes. Think about it.  Painting is just about as DIY as you can get but there are some very successful professional painters out there.

However, where I think that Amazon will really hurt those in the residential market is the $10/ monitoring.   Even if a customer does not want DIY, Amazon will beat $10/month into their brains enough that they will come to think that that is what monitoring is supposed to cost.  I think that this will hurt us the most. 

Anthony, good points.

Painting is just about as DIY as you can get but there are some very successful professional painters out there.

I would extend your analogy to say that Amazon's intentions here are effectively to make a 'robot painter', by increasing the automation of alarm monitoring and simplifying its installation. To the extent that they can do that, many more people will go DIY, yes/no?

Yes a very good point.

What I do think we'll see is customers expecting that whatever is going to be installed and by whomever, works with their other devices. This will drive standardization and marginalize those whose products don't play nice. I also think we'll continue to see social media based escalation become more prevalent. Wouldn't it make sense if my alarm goes off for my friendly neighbors to get a push notification and at least peek out their windows to see if they can confirm the alarm? Especially if they know whether I'm supposed to be home or not? In my neighborhood, Facebook is often used to serve that purpose, but poorly because it's not direct enough. (If you want to know more about Kevin, who knocked on your door with a story that he has some left over concrete from a job he just finished, Facebook will tell you he's been pulling this scam for years, so it can be very entertaining)

The challenge for any industry is assuming the new is going to work and behave the same way the old did. Paradigm shifts happen because the emphasis on what's important in an industry gets changed and solutions that were market leaders before the shift, no longer appropriately address the market and become largely irrelevant.

I think the risk is at the manufacturer level, for an integrator, I think the challenge is to be forward looking and ready to pivot as things change, just as they have in the past. 

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