Something TERRIBLY WRONG In The Home Security Industry

Author: Brian Rhodes, Published on Aug 08, 2016

Who is terribly wrong?

The $57 million Silicon Valley funded startup, SimpliSafe or the security trade magazine that is 'mad as hell'?

*** ** ******** *****?

***$** ******* ******* ****** ****** *******, ********** ** *** ******** ***** ******** **** ** '*** ** hell'?

[***************]

Terribly *****

********** (****** ****)******* *** ********* ****** *** ***** **** '********* ** ******** wrong ** *** **** ******** ********.'

**** ** ***** ***** ***** ** ****:

********, **** **** **** ******** ***** ** (**** **** ***** ****)**** *** **** ***** *******.

Mad ** ****

******** ***** ********* ***** *** **, *********:

**’* **** **** ******* ***** *** ****; ** ** ** affront ** ********** *** ***** ** *****.

**** ** '** *****' ***?

Attacks ** *** ********

**********'* **** ****** ** ** ******** ****** *********:

[***********] ******* *** ** **** * ****-**** ******** ****** **** nasty **** *****

[**********] *** *** ** ****, ******* ******** * ******* ** sign *** *********

**** ********* ... *** *** ** **** ** *** ****** line... *** ********** *** ** ****... ****** ** ** ** for * **** ******

Contracts ** *****?

***** ** ** ***** **** ****-**** ********* *** *********** ** what *** *********** ******** '******' ***. **** ***** *********** ****, auto-renewals *** ********* *** ****** *** ********* *** *** ***********.

*** **** ************* **** **** *** ********** ** ** ******:

"**** ***** ********* **** ********* ** ****** *** **** ** feel ****."

** **********'* ****, **** *** ********* ** * *** ** taking ********* ** ****** *** *** ******** * ** ********* approach **** **** ******* / **** **** *** ********.

Simplisafe's ********* *** ************

*** ******* ***** ************ ** **** ** *******, ***, *** ****-******* - *** characteristics ** *** ********* *** *********, **********, *** ********* ** 'the *************' ***** ** ******** *****' *******. ***** ********** * system ***** ** ****** ** ******** *******, ************ *** * matter ** '**** & ********' ******** ****** ******* *** ********* the ****** ** * *** ****** *** ****** ********** *** monitoring.

*******, ** ****** ** ** ****** ** **, ********** *** most ***** *** ******* **** ***** ******** *** ******** ************* available ** **** ***** ************** ********* *********. *** *******, ********** **** not ******* ****** - * *********** ******* ** ***** ***** professionally ********* ***** *******, ** ****** ** ********* ******** ****** is *** ******** *** ********** ** '*** ** *******' ** terms ** ******. ****, *** ***** ** ********** ****** ******* is ******* ** *** ** ***** *****, ** ***** ******** to *** *** ** ******** ** ********* ******** **** ***-*** systems, *** ***** *********** **** ***** ************ ** *** *********.

*****, *** *** ** * **** ****** *** ***** ******* for ***** *******, *** **** ********** ******** ******** ******* **** costly, ************ *******.

Contracts ***** ******

*******, **** ******** *****-**** ********* *** ******* ***** ****** *** are *********. ******, **** ** ***'* '*****-**-*****' ********** *** *** ***********. *** ****** ****** ***** *********** ***** ** ****** ********* sales *** *****-****, ****-******** ********* ** *******, ********* *** ** the **** ** ******* **** ********** *** ***** *** ******* in *** ******. **** ***'* ****** *****, *** *********** ***** company ** ******* ******* ********** ********** ************, *** ** **** selling ******* ********** *** ********** **** ****** ** ****** **** dealer *******.

*** ** *** ******* ** *** ********* ********* *** ******* the **** ********** ** *** *******. ** ********** ** *** 'fed **' ***** ********* *** **, *** ****** ** ******** and ******* ********** ** *********** ***** ******.  

** * ***** *****, *** ***** ********** *** ********* ********** acumen ** '***********' ** ******** * *** ************** ** ****** markets. ********* ***** ********* **** ** ****** ** ****** ***** old-guard ********* ** ********* ********** *********, ** ****** ** ******* by * *** ********** ** *********.

****

Comments (27)

Simply safe is like a "novelty" or "AS-SEEN-ON-TV" item...like those POS radio shack motion detectors or DIY alarm systems they sold back in the 90's. People double face tape the junk to the walls, are excited and use it for a while then stop using it because the stuff is falsing too much or falling off the walls. Heck, even radio shack knew their stuff was junk because they at one point had ADT displays in their stores selling ADT systems...and that didnt last long either.

A real, true alarm system that is professionally installed looks professional and is properly maintained by a professional when issues pop up, and it is always used on a daily basis.

If people wanted to pay hundreds of dollars up front for their security system, and still pay $25 a month w/o a contract, the industry never would of went to a "Free" system in the first place. The market drove this.

SimpliSafe aside, I felt the piece by Security Sales in response was one of the whiniest I have ever seen.

Given that Security Sales ad revenue is based in large measure on incumbent monitoring and alarms companies, the emotional outburst is not random. It just isn't overtly disclosed.

Wonderful that they are cheap and unsecure. Link: SimpliSafe Alarms Cracked

Allow me to play devil's advocate here. SimpliSafe has big vulnerabilities, but so do 'professional' wireless alarm systems from ADT, Vivint and many others.

Worked for ADT out of college - The Smal Business contracts at the time were for 5 years and the home contracts were for 3 years. It was HARD to sell someone a 5 year contract with zero "outs." If they cancelled early, they owed 90% of the remainder of the contract. This led to sales people glossing over the contract terms, which led to pretty dirty tactics. In no way do I think SimpliSafe is the same as a full, professionally installed system, but they are right about the contracts. That being said, locking in a contract is the only way to make your money back after giving away a system at a loss (mostly on labor costs).

If they cancelled early, they owed 90% of the remainder of the contract.

And, according to ADT's residential security terms online, it is now 75% for the 'traditional security' offering:

Upon early termination by Customer, ADT may charge 75% of the monthly service charges due for the balance of the contract term

Something TERRIBLY WRONG In The Security Sales Article.

This article is fairly long. Longer than the ad it attacks.

Yet I defy you to find a single refutation of any of the points in the ad. Actually there is not even a single denial of any sort. Check it out, please.

On the other hand, there is no shortage of bodily fluid metaphors, for instance:

  1. Blood Boiling
  2. Pulse Raising
  3. Coffee Spitting
  4. Venom Spewing
  5. Bile Pedaling

To be fair, I may have missed a couple, let me know.

At first, I thought you were kidding about the 5 metaphors but they are there.

I'll take the opposing side here. Security Sales is normally copying press releases or releasing bogus awards. I think they would have gotten more positive feedback if it was not so emotional but at least they tried taking a stand on something.

SimpliVulnerable and other DIY systems are for apartments and homes valued under 200K. Once you get into nicer homes, people don't want to do it themselves; they're too busy working to pay their mortgage and taxes to deal with installing a security system. I am in front of homeowners every day; people would rather have a professional install the system. Selling against SimpliVulnerable is a walk in the park. I have yet to lose to ADT or Simpli. We're not a billion dollar company, but we're doing just fine. ;) This magazine needs to relax. Our average customer stays with us for eight years; they have no issue signing a contract. If they want a month to month, I give it to them. They just need to buy the equipment outright and pay a little more/month. Only 30% of homes in America have a home security system. There's plenty of market share to go around for all types of business models.

We do offer a DIY solution that is reliable and secure unlike Simpli, but 99% of the people we speak to would rather have us install it.

We do offer a DIY solution that is reliable and secure unlike Simpli, but 99% of the people we speak to would rather have us install it.

If they are ok with paying for the cost of a professional install, why would they want a DIY product?

What I am saying is, we have a DIY solution but no one really wants to DIY. They would rather have us install a system for them.

Only 30% of homes in America have a home security system. There's plenty of market share to go around for all types of business models.

But what percentage of 'rich' people have a home security system? Surely that is much higher than average. There's 'less' of that market share to go around.

The biggest growth potential (of people without systems) is the mid to low end where DIY solutions cost is more important, yes/no?

You're right and you're wrong. Many older nice homes do have systems but those systems are ready for major upgrades and new camera installs. Many newer homes (10 years or newer) still do not have systems.

There's still plenty of opportunities, we're overloaded with leads right now. In both commercial and residential upgrades and new installs.

The DIY companies have only helped us grow by doing all the advertising for us. People see the cool stuff on Tv and then ask us our professional opinion and we sell them something better.

There's still plenty of opportunities, we're overloaded with leads right now. In both commercial and residential upgrades and new installs.

I don't mean for you. As long as the economy grows and the rich get richer, there's plenty of opportunity at the high end.

I mean for ADT and the big mass market companies. For example, ADT's customer count is flat to slightly declining:

And you figure the DIY players are going to get better. The offering they provide in 2020 is likely to be much more complete.

Again, probably not an issue for a company like you, but what does this mean to ADT and the mass market providers?

Ok, I can agree with that. Companies like ADT, Vivint, and Monotronics Dealers are all in trouble. We signed up for the DMP DIY offering for this very reason, to target the lower cost market with much better equipment. DMP still has a long ways to go to make this a real competitive offering, but I think they're on the right track.

Even still, in smaller homes. We're finding many prefer a professional installation. We present an outright purchase option or a lease to own option. Many are more than willing to add $15/month to their monthly bill for a 60-month lease just to have it installed professionally.

I think as our DMP DIY ecosystem grows we will see more people choosing DIY as it becomes easier for them to purchase and install.

Big-Complicated-Hidden fine print Contracts are going the way of the VCR. The guys that are hanging on to the old school "RMR" to float the boat will have significant issues in the coming years if they are not making changes to their business model that reflects today's consumers.

Integration is not just a buzz word anymore.

Not really. It just depends on the market segment. I don't see selling systems at cost/loss changing in the commercial fire alarm realm or even commercial security other than maybe low end strip mall tenant deployments.

This is only going to affect low-end residential. I agree with the other poster above that this is a non-issue in 200k+ homes.

The emotions and condemnation in SecSales editorial might have been copied from the steam industries responses to gasoline powered vehicles in 1905. Like it or not, millennials are changing so many industries and that's positive. The refusal to accept long term contracts with hefty severance penalties is going to drive real change in our industry. Home automation encompasses all things of the home, including features other DIY systems lack and we as integrators either adapt and offer compelling value statements tailored to the customer's desires or they go elsewhere.

We don't give away systems for free, so my perspective may differ greatly from the traditional residential alarm providers but the bottom line is adapt and offer what the consumer wants or begin the slow spiral to the bottom.

I would like to play devil's advocate here and share my own experience. I have been working in the security industry for over 25 years and my first reaction when I decided to have an alarm system was to go with ADT. We signed a 5 year contract for $65 per month. Over 5 years we paid $3,900. When the 5 years expired we keep paying $65 per month since it was in auto paid.

One day my wife asked about this $65 while she watched an ad on TV for simply safe. While i was traveling she called ADT and asked about our old equipments, that we couldn't connect to remotely, and asked about the price and why it was so expensive. The answer, we so better than simply safe, their technology is not reliable. She told the agent on the phone she could get a system monitor for $25 per month. The agent offer to lower cost to $45/month with no upgrade of the equipments paid for 5 years already.

Long story short, she switch to Simply Safe. I got home she had the new system installed and it was up and running. Total cost forecasted for 5 years: $395 initial system + $25*60=$1500. Total cost $1895 versus $3900.

So John analysis is correct, Simply Safe doesn't have all the functionalities of other "professional System" but it will do the job for most standard homes in the US for a far lower cost.

Bottom line is: Simply Safe is probably not the right solution for high end monitoring needs but for standard house monitory it will do the job with no contract and for lower cost. Taxi got disrupted by Uber, Hotel by Airbnb, home monitoring by Simply Safe...adapt or die.

7, your first mistake was calling ADT. Their equipment is no more secure than Simpli and their customer service is awful. It's always better to go with a local Bosch or DMP dealer. They're typically better alarm companies. Although being a Bosch dealer doesn't mean much now that you can buy it through distribution...but that's another topic.

SimpliValunerable is still vulnerable, and there's no way to fix the vulnerability. We talk on IPVM about Hikvision and Axis vulnerability issues all the time. At least those can be resolved with a firmware update or a passcode change. Simpli's system is vulnerable because of the hardware, software and wireless protocols they use to control their system. Burglars are getting smarter; I see it every day. Everyone who has a Honeywell, 2GIG, GE or Simpli system are all at risk of the same basic hacking technics available for free on youtube.

We put our customers under contract so we can always provide them with the latest security updates for their apps and hardware. To ensure their security system is secure. No contract, no updates, we would not be able to support it if we weren't guaranteed revenue. Most people get it.

"7, your first mistake was calling ADT."

This is not an atypical outcome of the high cost of information.

You need a product. You spend a significant amount of time "surfing," but you're buried in claims and counter-claims. Ultimately you give up and go with a national provider. They've been in business all this time. They're successful. You imagine that they must at least be adequate.

Many things are easier with the internet, but businesses spend a lot of bucks figuring out how to bury valid but adverse reviews and push a favorable image. Sometimes you win, sometimes you lose...

another former ADT customer

Somewhat off topic, but did anyone else notice that the upbeat song that starts playing after the doom and gloom statistics are done is THE same song Axis has used in their promo videos (and has for many years)?

Surely Axis doesn't own the song, and theres nothing immoral or unethical here, but it sure is a funny coincidence. Either the Security Industry was assigned a handful of stock songs they can use, like Ringtones on your first Nokia, or, Simplisafe is an undercover fan of Axis. Im not implying SimpliSafe is trying to "piggyback" off that now famous tune, but it is interesting given that there are millions of happy, optimistic songs floating around out there. Just sayin...

9, I think it's just that lots of companies use the same stock music in their videos / commercials.

For instance, I grabbed this one. It's different than the one we are discussing but I've heard this in numerous online videos:

This advertising form, when somebody saying bad things about the competitor always the point where I turn around and leave the conversation. If you have only one weapon (price) it's not a unique selling point, not a feature, or whatsoever. I always buy value. Even I can't afford at the moment, when I decided to buy. Just wait next month, etc, but buy some value.

Another point is that wireless security system? It always make me laugh. :) Maybe we have different mindset about this, but this is the way how you make it easy to access your property...

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