Next generation of cellular technology improves monitoring solutions
- By Henry Laik
- Oct 16, 2009
What’s the next generation of remote monitoring? Think cellular. As technology improves and cellular networks are upgraded, the notion of transmitting IP information, both data and video, is becoming a reality.
Often relegated to the last resort of communication options, cellular data networks are now being considered as the primary method. As consumers, we are constantly being bombarded by advertising claims of the fastest, the largest and most reliable 3G networks. Cellular networks truly offer a fast, secure and inexpensive form of data communication, and, with 4G networks coming in just a few short years, the industry really needs to a take a second look at this option of data communication.
Cellular data networks are most commonly used as a backup communication path to either POTS or network communication for alarm systems. However, they also are employed in both video and access control installations where wireline communication is neither practical nor possible.
Getting Up to Speed
In a world where all things wirelessare becoming the norm, the security industry is substantially behind the curve. In addition to cell phones, wireless cellular technology touches our lives in a number of ways. The energy industry is making use of wireless home thermostats and reading home electric meters via cellular devices, plumbers and taxi cabs are using cellular wireless portable credit card scanners to accept customer payments; the state of California is using wireless cellular irrigation systems to save water and the sanitation industry is using wireless technology to help better manage trash.
The same technologies are available to us in the security industry, and it’s time to take advantage of the opportunities or to see other companies migrate into our industry and make inroads on our market share. We are approaching an inflexion point in our standard business model of subsidized communications. With few exceptions, alarm companies have long relied on their customers to provide (and pay for) communications from the premise to the monitoring center. Given the fact that more and more households are going wireless, the industry will have no choice but to respond.
Approaching the Obstacles
Alarm companies transitioning to cellular data networks must overcome some hurdles. First, there are ramifications to their standard business model. This naturally raises some concerns about the cost of cellular service, which is often the biggest barrier to adoption. There is some misunderstanding in the marketplace for those who believe that cellular wireless service plans for an alarm panel are similar in structure or cost to a voice cell phone plan.
The fact is that cellular data service for alarm panel transmission is just a fraction of the cost, and is often priced on a pay-per-use plan, sometimes just charged by the kilobyte. To offset the low, additional cost of cellular data networks, alarm companies must either slightly raise monthly monitoring fees or accept less RMR or a combination of both. Raising monthly monitoring fees has limited market appeal, especially in today’s economic climate. Accepting less RMR is equally distasteful to the alarm company.
Perhaps a combination approach will be the most acceptable method. In any case, alarm companies must make this important decision on a go-forward basis. And, as more companies make this transition, competition will naturally drive down the cost of providing this service to customers. Lower-end cost equates to broader adoption of the technology.
The second hurdle that must be overcome is that new or modified technology must exist. The key to cutting the cord will be the ability to perform over-the-air programming and in some cases, two-way voice verification of alarm events. Alarm system manufacturers must take note and introduce products capable of these fundamental tasks, as the cellular networks are ready at this time.
Companies Go Wireless
Over the last decade or so, premise wireless security systems have become the staple of the alarm company’s offering. Why? It is given that cellular wireless systems have become more reliable and cost effective. However, they also provide less risk and increase installation productivity. A logical extension of the wireless system concept is to utilize cellular networks to communicate to the monitoring center. The benefits of doing so are numerous.
Consider the installation labor costs and hassles associated with wiring a system to either a POTS or an Internet connection. With today’s shortage of highly skilled installation technicians, this task is more daunting and labor intensive than in the past. By providing the communication infrastructure, alarm companies no longer rely on the customer for this critical element of an installed system. As a bonus, alarm companies can increase their monthly RMR from reselling the cellular service. Finally, since wires do not need to be pulled to wireline communication connection points, control panels may be placed in optimum locations from a security perspective. No longer does the installer have to compromise distance versus optimum control location relative to the POTS demarcation or network hub.
There is little debate that IP-based video is currently the hottest segment of the security market. Installations are becoming more widespread in both the public and private sector. One company, for example, immediately transmits 10-second video clips when tripped, enabling security professionals in a remote location to serve as virtual eyewitnesses to a crime and contact the police immediately. As in the intrusion segment, cellular wireless data communications are being used more frequently. An array of wireless technology options exist, from point to point, point to multipoint, wireless mesh, Wi-Fi and finally cellular data networks.
From an installation point of view, cellular communication is the last option, due to cost, bandwidth and uplink/downlink speed. However, certain video applications are uniquely suited for cellular service, such as single-station portable surveillance systems used for construction sites, event security and law enforcement applications. Furthermore, cellular service is used to augment other wireless technology options such as data backhaul or remote node extension of a mesh network. In the near future, 4G cellular networks will address the concerns of bandwidth and uplink/downlink speeds, making use of cellular communication all the more appealing.
Cellular communication also is being employed in various electronic access control systems or installations, predominantly due to the lack of a wireline option. However, there is at least one manufacturer that relies exclusively on cellular communication for their products, selling the concept of security as a service rather than a systems approach.
Using cellular communication can provide additional revenue opportunities for alarm companies by expanding their service offering. Conceptually, the security umbrella can extend beyond the walls of the premise. Alarm companies can now offer services centered around protecting and/or remotely managing mobile assets via cellular wireless, and make recurring revenue on the service. In fact, an entire market segment has emerged, largely ignored by the traditional security model.
Hundreds of companies, both large and small, are catering to businesses and consumers alike, offering services such as wireless vehicle tracking, remote teen driving supervision, pet location services and personal emergency response systems. These wireless tracking services fall naturally into the monitoring services bucket.
Why alarm companies have ignored this revenue opportunity is a mystery. Offering these services changes the business model from a one-to-one RMR opportunity to a one-to-many RMR opportunity. If alarm companies offer additional services that extend to family or household items, such as boats and recreational vehicles, the revenue stream becomes tied to those services, creating account loyalty and therefore less attrition. The same argument can be applied to offering these services to commercial customers. The greater the touch points, the harder it is for customers to seek alternative providers.
Just as consumers and virtually all industries move toward the convenience of wireless, so must we. Wireless remote monitoring via cellular is becoming more prevalent, and the continuing technological advances are putting it on the fast track. The days of yards of internal cable, lengthy installations and land-based communication lines are coming to an end.
It’s time to eliminate clumsy cable installations, leaving a cleaner look and no wires for burglars to cut.
As legacy networks are retired and new business opportunities for recurring revenue are opening up, watch for significant growth for cellular wireless remote monitoring.
Henry Laik is the director of security market business development for KORE Telematics.