One note... They do have a contract, they just dont require it. if you do the optional monitoring, you are most certainly under a very binding and liability limiting contract. Just because its listed as a "terms of service" and approved with a click instead of a signature makes it no less a contract.
Impressive performance financially nonetheless, even if they are equally less than truthful as the alarm companies they love to vilify.
What caught my eyes in Forbes's article was this: "SimpliSafe has also installed a one-time programmable chip in its alarm, meaning there's no chance of an over-the-air update. It means there's no patch coming, leaving all owners without a remedy other than to stop using the equipment, Zonenberg said."
A security system without firmware upgrade capability ? Did I read that right?
When my area went from 7 digit dialing to 9 digit dialing, we had to go from customer to customer with this PROM programmer and literally burn new chips to reprogram the panels with the central station area code.
When those jerks in Congress changed the date of Daylight Savings Time, most panels could manually download the update during an onsite visit by a technician, but some panels had to have the chip physically swapped out. Luckily they'd moved to EPROM by that time, so we didn't have to physically burn anything, we could just download the old programming to a laptop, power down, swap the chip, power up, upload all the old programming to the new chip, pray, test that everything worked, try to convince the customer that they owe you money for the service call and that acts of Congress aren't covered under their warranty, get screamed at, and go on to the next customer.
Ahhh.....the old DTI panels with the programmable chip you had to take out and "burn". At least it gave you two tries with the second layer available by breaking off the second pin...lol. The good old days.
Physical security is all about multiple layers of security... I was concerned about my SimpliSafe system being less than fully secure, so I layered my home's DYI security with Canary, Arlo, Glock, etc.
I think the problem with simplisafe is that it's sort of a one trick disruption pony. Where do they pivot to and how do they move upstream? All they've successfully done is driven down alarm margins in the b2c space where the consumers already were fickle and the competition was pretty rough with the national players a la vivint / adt. I'm not sure simplisafe has eaten a ton of the profitable lunch of local/regional dealers though as much of what simplisafe has taken over in the market is lower end/smaller homes. Sort of the 80/20 rule.
I don't know what the simplisafe product pricing is out of taiwan/china, but they are still going through the cellular carriers even if at wholesale rates per line. So their 15 a month plus what the lower end of the whole sale cost is ($2 per account) the gross profit is probably somewhere around $11 a month per active user. They spend a balls ton on advertising everywhere which is fueling the majority of their growth. I can't say they are growing organically without their huge VC injection.
I should mention that the manufacturers and regional companies are already pivoting to combat simplisafe a la DMP's DIY portal for dealers and many dealers having on site shopping carts now with security packages you can customize.
Where do they pivot to and how do they move upstream?
Can they offer smart home? I don't know SimpliSafe well enough to say but that seems to be what the incumbent alarm companies are doing, e.g., Vivint now being literally 'Vivint Smart Home' and leading with smart home packages. For example, Simplisafe offers a camera now but could they also add a thermostat, etc.?
They are fairly big now so they certainly spend a 'lot' of money on advertising but if relative to their total new customers they acquire, it is say $50 or $100 per customer, that would be entirely reasonable.
Can a Simply Safe system be monitored by any Central Station? Or just a Simply Safe Central Station? If you sell a system that can only be monitored by your central station....why would you ever need to lock in your customer.
Can a Simply Safe system be monitored by any Central Station? Or just a Simply Safe Central Station?
Only SimpliSafe central stations can only be used. They use several, with COPS being the biggest, but Amcrest also being an option. Users are limited to one or maybe two choices based on where they live and whether or not they use video.