Home and building security provider ADT has signed two smart home deals this week, adding Nest thermostats to its US ADT Pulse offering, and adding established security business Tyco’s gateway devices to its UK and South African portfolio – after promising a new Pulse smart home hub and camera unit developed in partnership with LG, and IFTTT integration, back in May.
The smart-home-as-a-service market represents a big opportunity for service providers looking to sell a comprehensive smart home offering to consumers in an affordable monthly bundle. At a much reduced or non-existent upfront cost, consumers are able to enjoy all the emerging benefits of a smart home, while the operator is able to count on predictable subscription revenues – or use the offering as a way to reduce churn on their other products.
Because of this, pay TV providers and ISPs are well placed to convert existing customers to smart home customers. Energy utilities also enjoy the same position, with pre-existing customer relationships, but home security alarm system providers are also well placed to provide a smart home package with a strong security focus.
So it’s no surprise to see ADT reinforcing its smart home offerings by adding new devices to the ecosystem. With Nest, ADT gets to advertise Pulse using the market-leading and rather aesthetically pleasing Nest, as well as sell all the integrated benefits of Nest’s adaptive energy management and HVAC automation. Nest already has similar deals with American Family Insurance and Solar City, that push its thermostats into new smart homes.
Pulse customers will now be able to control Nest via their ADT app, and potential new customers in Atlanta, Chicago, Denver and Miami may be eligible for a free Nest thermostat when they sign up for an ADT Pulse plan. ADT notes that this is the first such commercial partnership in North America; where ADT makes its Pulse platform more appealing via Nest, and Nest (bought by Google for $3.2bn) gets paid for its hardware and gains the possibility of selling further Nest products and services to these new customers.
ADT has also recently developed a Pulse API architecture that it says will accelerate the integration of third=party devices with Pulse. It seems that Nest is the first such product, but ADT’s core service offering is augmented by opening it up to these other devices – as it creates a more compelling and sticky (churn-wise) offering, without ADT having to do all the legwork of developing things like smart lighting or thermostats.
On the customer-facing side of things, ADT just has to manage its application (the new version of which is now in the iOS and Android app stores), and ensure that its API remains up to date. The Pulse hardware currently consists of a central hub (featuring WiFi, cellular and Z-Wave radios), an alarm panel for entering security codes, and a range of cameras (WIFI) and edge-sensors (Z-Wave) to trigger alarms.
Nest slots in via its WiFi connection and the Pulse API. A touchscreen panel ties the whole ecosystem together, with control over all the connected devices, and also hosts useful information like weather forecasts, news headlines and traffic reports.
Other Z-Wave devices can also be added to the system, and ADT lists a number of products from Sercomm (cameras), Netgear (range extenders and touchscreen panel), as well as a range of lighting products from Jasco and Kwikset, a garage door opener from Linear, and a thermostat from RCS. Adding devices not approved by ADT could be problematic, and ADT advises against this.
Notably, the addition of Nest potentially opens up the Pulse ecosystem to the Nest-backed Thread protocol, a new rival to Z-Wave’s mesh networking functionality. Thread is an IPv6 ready (6LoWPAN) 802.15.4-based protocol that we expect to begin appearing in the Nest portfolio.
It seems logical that a Nest thermostat could use Thread as the baseline communications protocol between its devices, with WiFi triggered to move video footage or high-bandwidth data when needed. Thread is also a good match for the environmental sensors that can provide motion-triggered alerts and ambient temperature readings to the central hub – which we anticipate will be the thermostat.
A product refresh is promised, however, which would likely add Thread to the thermostat, as we don’t expect the launch of a central standalone hub, despite perhaps being the easier option for Nest engineers. Nest’s main draw has always been the thermostat, and shifting the marketing focal point from a semi-iconic smart home device doesn’t seem likely.
“The integration with Nest is an important milestone for ADT as we continue to expand our ecosystem,” said ADT’s CIO Arthur Orduña. “Giving our customers the security and monitoring they need to protect their most important assets, along with the smart home and automation technologies they desire, is a critical part of the new ‘Smart Security’ category that we are defining for the North American market.”
The Tyco deal:
With Tyco, ADT will be using Tyco subsidiary PowerMaster’s 360 Intrusion Gateway – a WiFi and Z-Wave gateway that includes cellular radio and battery backup in case an intruder tries to cut the power or internet connection. “Leveraging the interactive platform with the Tyco Security Products intrusion technology will enable us to provide a new level of service and experience for our customers,” said Gail Hunter, Director of Marketing for ADT in the UK.
Tyco’s Intrusion Director of Product Management, Tim Myers, added “in concert with our integrated data and smart services platform and IoT strategy, this latest offering strengthens our commitment to development. We’re very pleased to be able to leverage ADT’s market strength in the UK and S.A. to expand our footprint in the interactive security and connected home space.”
The platform that Myers mentions is Tyco On, launched back in November, which the world’s largest fire protection and security company hopes will help integrate third-party hardware into its existing offerings. This approach allows a Tyco customer to add new functionality to a system purchased from Tyco, and lets Tyco use the new devices to provide better safety and security alerts to its customers.
“As the core of our IoT strategy, Tyco On builds on our deep expertise in systems integration and services, and our installed base of more than a billion sensors, tags, devices, and systems around the world. Tyco On unlocks the value of this data with the power of analytics to deliver a range of smart services for multiple vertical markets, from healthcare and hospitality to petro-chemical operations to education and more,” said Tyco’s CEO, George Oliver, at launch.
With an extensive installed-base of its own, letting third-party gear into the ecosystem lets Tyco gather and access more contextual data – which helps inform its own security and fire alarm systems. With a connected building and HVAC system providing its temperature data to the Tyco fire alarm, and cameras providing visual confirmation, a fire alarm can be triggered more quickly and false alarms can be prevented and remotely diagnosed.
Another benefit of new connectivity is found in the installation process. Tyco points out that its Installation and Services business benefits from a testing app that is used by its fire alarm installers. Whereas the old method involved two technicians, one at the control panel and another moving throughout the building checking that each alarm sounds correctly, a new app using the Tyco On architecture means that a single technician can connect remotely to the control panel while on the move.
This cuts down on staffing needs per job, allowing Tyco to service more customers with current staff, or slim down its wage bill. Tyco says that the next step of this remote testing application is to provide immediate cloud-enabled access to the control panel to provide remote testing.
Another side of Tyco’s business that stands to benefit from the new Tyco On architecture is its Retail Solutions division. The company says “in over 4,000 retail locations, Tyco is helping retailers tie together data from RFID tags, video, electronic article surveillance and traffic sensors, transforming it into actionable intelligence through our TrueVUE software.”