The security week that was: 01/22/10

The ADT-Broadview Deal

The news this week was about as big as it gets in the world of alarm installations and monitoring. I’m referring, of course, to news that Broadview Security (formerly Brink’s Home Security) will be purchased by Tyco and merged with Tyco’s ADT unit. This is, of course, the merger of the two biggest security installing and monitoring companies. ADT already had an enormous lead in the market; this makes them even bigger.

There are differing opinions on what this means for the industry, but one thing is for sure: it would give ADT substantial market share -- over 30 percent by some estimates (not the 50 percent that some reporters quoted, which was based on erroneous information from a market research firm). Both companies were growing steadily (like the overall alarm market, which is seeing steady single-digit growth percentage increases). The general consensus from smaller alarm companies (which I guess would include everyone, since these are the two biggest), is that the move gives ADT more marketing clout, but also removes the second strongest brand in the marketplace. That may mean there’s more room for smaller companies to get business. As Security Dealer & Integrator’s editor Deborah O’Mara and publisher Carol Enman told me, what this can effectively do is open up “second quote” business. While ADT’s name may mean they get to give the primary quote to a potential customer (the quoted price is likely to be “FREE”, since that’s the current flyer I received by mail yesterday for the standard “2 doors and a motion” deal), the smart customer is likely to get a second quote, and that could be your business.

Of course, merging the two biggest companies in the industry won’t be a walk in the park. ADT and Broadview execs are optimistic about this process, but there are different pay scales for the two companies, offices that overlap geographically, and different technical requirements. As one alarm industry executive told me, “I’m hopeful they can do it, but I’m also glad I’m not in their shoes. We’ve had to do this in our acquisitions; it wasn’t easy. And our acquisitions have been nowhere near the scale of this [ADT-Broadview deal].”

And in other news...
Protection One goes up for sale…maybe.

Following the revelation that ADT was purchasing Broadview (which was really a well-kept secret, I might add), we learned the following morning that Protection One had hired J. P. Morgan to assist the firm as it investigates the possible sale of the company. Protection One is said to be the third largest (ADT is #1, Brink’s/Broadview is #2) of the dealer/monitoring companies, so this is huge news itself. There’s no guarantee that Protection One will sell, or if it does, it could just be a sale to a private equity firm and not to a big competitor. CEO Richard Ginsburg shared his thoughts in our story about this subject.

Samsung unifies U.S. presence
Techwin forms agreement with GVI

There was even more business news, with the announcement that the two distributors/representatives of Samsung security products in the U.S. – Samsung Techwin Americas and Samsung | GVI Security Solutions – have formed a business pact to operate together. As part of the deal, GVI will be called Samsung Security. The move follows the acquisition of Samsung Electronics’ video security products by Samsung Techwin. Look for more updates on this story.

____________ for TSA secretary
With Southers out of the running, the president needs to move quickly

With all that news, there was even more big news. Erroll Southers, President Obama’s nominee to head the TSA, has withdrawn his name. Southers’ support of collective bargaining had become a big issue (actually, a sticking point) for Republicans and the public, and so had news that he had used a police database to run a background check on the boyfriend of his estranged wife. OK, with Southers off the list, my take is that President Obama needs to quickly nominate someone to fill this post. The TSA needs leadership now more than ever.

Loading