Security Business

MAR 2019

Find news and information for the executive corporate security director, CSO, facility manager and assets protection manager on issues of policy, products, incidents, risk management, threat assessments and preparedness.

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10 Security Business / / March 2019 Top Story impact on their professional dealer base. "ADT could work out a pro- gram similar to DragonFly offered by Honeywell a few years ago, where dealers get a cut of each online order or dealers could offer the DIY system with the monthly monitoring plus concierge services on top," Kozak speculates, adding that an additional option for LifeShield is professional installation vs. self-install. All things considered, Kozak doesn't expect the acquisition to have much of an impact on ADT's current market share unless they make some substantial changes to the LifeShield product line and RMR structure. "Despite LifeShield being a DIY offering, the monthly subscrip- tion for monitoring is on-par with the rest of the pro monitoring industry – which also includes $99 activation fee and a 36 month contract," he says. "This will help ADT compete more with brands such as Frontpoint, Scout Alarm and Brinks. "If ADT was able to overhaul the existing product line of LifeShield and come to market for a monthly subscription fee similar to Ring, this could have much larger (positive) implications for ADT's market share," Kozak concludes. ■ ADT has acquired LifeShield, a pioneer in the do-it-yourself (DIY) home security space, in a deal val- ued at approximately $25 million. This is the third time in six years that ownership of LifeShield has changed hands. The company, which was founded in 2004 and was the first to bring a wireless DIY security solution to the residential market, was purchased by satellite TV giant DIRECTV in 2013 as cable and telcos were ramping up their presence in the home security industry. Following AT&T's acquisition of DIRECTV in 2014, LifeShield was put on the auction block once again and eventually acquired by private equity firm Hawk Capital Partners in 2017. "We are confident that LifeShield's capabilities and approach, com- bined with the brand and scale of ADT, will create an opportunity for us to offer our services to a broader cross-section of U.S. households," ADT President and CEO Jim DeVries said in a statement. Added Mike Hagan, LifeShield Chairman, who will continue with ADT as an advisor: "We look forward to working together to...capitalize on the attractive market opportunities in the DIY segment." Industry Impact Blake Kozak, Principal Analyst for Smart Home and Security Technology at IHS Markit, says ADT's pur- chase of LifeShield demonstrates the need for indus- try firms to have a diversified approach to home security and monitoring. "Although ADT and SmartThings had partnered for a starter kit capable of being professionally monitored, reception of this product has been modest at best, with heavy price reductions since the 2018 holiday shopping season," Kozak says. "Brinks Home Security (formerly MONI/ LiveWatch), have been very active in combining DIY with professional services – from the acquisition of LiveWatch to partnering with Nest." Kozak projects that combining DIY installation with professional monitoring, as ADT is doing here, could see a big increase in 2019 and 2020. This is further evidenced by SimpliSafe's revamped offering, Amazon/Ring coming to market with $10/month monitoring and now Arlo announcing a security kit – although the pro-monitoring option is still pending, Kozak says. Additionally, Kozak does not expect ADT's significant ramp up in the DIY segment to have much of an SECURITY WATCH BY JOEL GRIFFIN, EDITOR, SECURITYINFOWATCH.COM Get more residential security news: technologies ADT Acquires DIY Security Pioneer LifeShield Acquisition marks the third time in six years that ownership of the company has changed hands LifeShield's capabilities, combined with the brand and scale of ADT, will create an opportunity for us to offer our services to a broader cross-section of U.S. households." – Jim DeVries, ADT President & CEO

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