Inside UTC's acquisition of GE Security

There seems to be no shortage of off-the-record comments being slung around the ISC West 2010 tradeshow about UTC's acquisition of GE Security, but decided to go straight to the source by speaking with UTC Fire & Security (UTCFS) President of Global Security Products Mark Barry and UTCFS CTO of Global Security Products Mike Regelski about how the acquisition is going.

Here are some of the most pertinent thoughts that these two industry leaders had to share with you our readers on topics ranging from product overlap to new R&D to the GE dealer channel and how to keep margins from being squeezed:

Mark Barry: "The deeper we get into the acquisition, it's clearly not about product overlaps. Rather, it's about complementary technologies and how we can bring better products to market even faster."

Mike Regelski: "There really is very little overlap. We now have critical mass in access control, fire, video and intrusion. We think we can even innovate faster than the start-ups. As we put the customer first in our efforts, we see it's all about making the integration easier."

Mike: "I think video has been very important for both companies. In recent years, we saw UTC invest in analytics and GE invest in IP video. Now we can ties these two things together. We haven't been known as a video company in the past, but it's been very important to product strategy, such as the video tie-ins with Lenel's software."

Mark: "Everyone who has been around for years in the video space has had to reinvent themselves recently [because of the transition from analog to IP video]. GE launched the TruVision product line and has continued to expand its video products line."

Mark: "Does fire belong in the security industry or is it a standalone business? Our strategy generally is to keep it separate. One reason is that a fire solution is usually decided upon at a different time than when the security system is decided upon. Another reason is that very few sales teams can sell both effectively. That said, a significant portion of fire sales does go through the security channel, especially in the residential market space. There really are very few channel partners who are doing both fire and security."

Mark: "The GE dealer channel will keep the same management team. We licensed the right to use the GE Security brand, so our residential dealers don't immediately have to rebrand. The difference is that UTC Fire & Security is a company brand, not a product brand. The years 2010 and 2011 will still see GE branded products."

Mike: "I'm very excited about the use of digital credentials to open locks and using Bluetooth on cell phones to open doors to buildings. It goes from carrying around an additional card, fob or token to carrying something already carry. Our Onity business is strong in the hotel space. Imagine if you could make a reservation and have a confirmation sent to your Bluetooth phone. You could then check-in to the hotel by presenting your phone to an automated kiosk to obtain your cards or even use your phone at the door to your hotel room."

Mike: "There is a lot of potential in the market for access control projects. Less than 10 percent of doors in a building have electronic access control because it is usually too expensive. We're working to take products like Onity, which are in expensive, and combine them into a full security management system like what we have from Lenel."

Mark: "I want to build products that cut install times and which don't require the channel partners to have to go back for service they shouldn't need to do. One aspect of this could be simply lengthening the battery life for sensors, which is something we've done."

Mike: "We fundamentally believe in quality. We make the channel money if they can install, walk away and never have to come back."