Sunsets Create a Business Opportunity
This article originally appeared in the April 2020 issue of Security Business magazine. When sharing, don’t forget to mention @SecBusinessMag!
American philosopher Ralph Waldo Emerson, the author of Self Reliance and other influential essays of the 19th century, once famously said “Every sunset brings the promise of a new dawn.”
The same is true of cellular sunsets.
As most security professionals know only too well, wireless carriers regularly repurpose existing cellular frequencies. It happens on a fairly regular basis, and for the installer it means eating costs, rolling trucks and swapping out devices.
Carriers are gearing up for additional sunsets in the near future, and this time around, security professionals should prepare for it differently than they might have done in the past. They should view upcoming sunsets by Verizon, AT&T and others as a business opportunity, and a chance to escape the “crazy loop” of installing new cellular radios that will need to be replaced with the next sunset.
Sunsets Past and Future
There have been several sunsets of cellular networks since the late 1990s, including Amps, 2G and CDMA. They occurred so that carriers could harvest bandwidth to serve customers’ growing appetite for data.
That appetite has grown larger today, as video-enabled smart devices continue a steady march into consumers’ homes and offices. The need for more bandwidth is ramping up, which means the next series of sunsets will be larger – and potentially more of a problem for security professionals – than past sunsets have been.
Verizon is planning to discontinue its CDMA network by 2022, and AT&T will repurpose its 3G network that same year.
While it might seem like 2022 is still a ways away, the security business does not have the luxury of putting off the work. Sunsets do not occur overnight, in one fell swoop. Carriers repurpose bandwidth gradually, which means some outlier neighborhoods are already in the midst of losing connectivity.
Security integrators have dealt with this problem in the past by reaching into their own pockets to replace devices before they stop functioning, rolling trucks and accepting a hit to their bottom lines. Adding insult to injury, many have found themselves right back where they started, and facing yet another sunset within five years.
It does not have to be this way this time. The security business can get away from this endless cycle, and adopt technologies that make this “crazy loop” a thing of the past.
The Business Opportunity
As consumers demand more data – especially video – installers should see the upcoming cellular sunsets as the business opportunities they are. They present the chance to sell upgrades to video, home automation and interactive touchpads.
According to industry research, one in four American households plans to add a video doorbell in the coming year, and the shelves at big box stores are crammed with low-power, low-bandwidth devices that can make homes more interconnected and secure.
Relying on cellular networks alone to power security devices should be a thing of the past; the Internet is the phone line of the future. While this new reality is disruptive of old business models, there is a distinct upside for the security business: The Internet will never sunset.
Multiple-path communicators, such as Alula’s BAT-Connect communicator, offer installers the opportunity to not just weather the upcoming sunsets, but prosper through them.
Selling the Upgrade
The 2022 sunsets of 3G and CDMA do not have to be a money-losing proposition for integrators; in fact, they are a chance to offer multiple communication paths, where cell networks are no longer front-and-center.
Offering IP-based connectivity and Wi-Fi represents the longest possible horizon, as well as the chance to upgrade consumers’ security systems without tearing down existing configurations.
Adding a multi-path communications module enables integrators to add home automation, video and updated touchpads. Enterprising companies have been offering upgrade specials to their client base – especially video doorbells and touchpads – to cover the cost of the sunset expenses.
This type of functionality is what consumers will demand in 2020 and beyond, and offering multiple communication paths is the way to insulate them from cellular sunsets going forward.
The 2022 sunsets are already upon us, and installers now face a choice: cling to the old way of doing business, or solve cellular sunsets once and for all and add RMR by upselling video and interactive services. When you look at it from that perspective, this sunset presents a compelling business opportunity on the horizon.
Russell Vail is EVP of Market Development at Alula. For more information about Alula, visit www.alula.com or www.securityinfowatch.com/12070939.
