Editorial: The consequences of false alarms for our industry

Why we're risking $6 billion in recurring revenue, and how to fix the problem

The term "false alarm" has become almost meaningless, because it now has so many definitions and applications, each with different consequences. This also explains why it is so difficult to have constructive discussions among industry professionals about false alarms. Difficult or not, it's a topic we need to discuss. Furthermore, we need to discuss unnecessary police response stemming from false alarms.

Take our poll: Should all burglar alarms be verified before calling for police response?

Today, the traditional monitoring center is rapidly becoming "the bad guy" by default because 100 percent of all requests for police response come from a private monitoring center to fulfill a private contract. And in the United States we have roughly 20 million existing recurring revenue customer contracts for alarm monitoring. If we multiply those 20 million accounts by an estimated annual revenue of $300 per account, we find that upwards of $6 billion in recurring annual revenue is in play here, and that means $6 billion in recurring annual revenue is at risk from the consequences of false alarms.

Decades of documentation from the police themselves tell us that nearly all requests for help called in by alarm monitoring centers are unnecessary. The defensive reaction from our law enforcement partners has been to quietly downgrade the calls coming from monitoring centers to low priority courtesy response, from a prior status of high priority emergency response. Admittedly, it differs widely amongst the 10,000 police jurisdictions we have in the United States.

The root of the strained police relationship is obvious to some of us alarm industry old timers. The basic business model for traditional monitored alarm systems is still a process of elimination performed without meaningful analytics. A site inspection is part of that process of elimination, because alarm site sensors and controllers simply detect and announce abnormal movement, with zero analytics. Monitoring centers use the local police as an alarm response to determine IF an emergency exists, not BECAUSE there is a known emergency. Sure, we see a lot of excellent technology, but on the whole, I believe most of the technology supports the outdated business model.

Police now have a great deal of leverage to affect our industry. It is hard to justify historical un-verified alarm response. At one level, this can be interpreted as a "gifting of public funds." If an un-verified alarm response is seen from that perspective, then we have to consider that dedicated police response to a private interest group to fulfill a private contract is an unlawful activity, at least in most states. Consider also that an unverified alarm response could be interpreted as a "false police report", and requests for emergency services, when no known emergency exists, can be a misdemeanor.

Police departments are saying they are not in the alarm business and that they do not care what technologies or procedures are used by the alarm industry. The message is to not substitute police response for a private technician's response or a customer service response to fulfill your private contracts.

The overall problem and subsequent solution for unnecessary police response has become very complicated, however I think it can be easily explained. Monitoring centers are the key, but it means an overhaul of our way of thinking.

  • The Problem: We assume that all incoming signals are real until confirmed false.
  • The Solution: We assume that all incoming signals are false until confirmed real.

I believe the industry is floundering in the middle of the transition between the two conflicting business models. I believe the surviving business model will be to assume all incoming signals are false until confirmed real -- by next-generation analytics (or remote video access) at the site and monitoring center. Some monitoring centers try to do it now, while others are sloppy and irresponsible. With several hundred monitoring centers operating in the United States, the gap between good and sloppy is very wide. Historically, sloppy performance was rewarded. But in the new business model, sloppy performance would be severely penalized.

This content continues onto the next page...