Technology

AT&T Unchains Home-Security Push

5/14/2012 12:01 AM Eastern

Back in the early days of the Web, consumers
were wary about sending their credit-card info over the Internet
for fear it might get stolen by a cyber-crook.

Now, AT&T is betting that
millions are willing to entrust
the telco with the virtual keys
to their houses, managed totally
over the Internet.

This summer, AT&T will
test out an Internet protocolbased
home security, monitoring
and control service
— dubbed Digital Life —
and plans to eventually offer
the “smart home” service to
any cable or telco broadband
household across the nation.

According to AT&T, the
service will provide automation,
energy and water controls,
as well as professionally
monitored security services. Users will be able to access the
Digital Life services to unlock their front doors, view live camera
feeds and adjust thermostat settings remotely. AT&T plans
to offer access from any Web-enabled device, including PCs,
tablets and smartphones, regardless of wireless carrier.

AT&T did not announce expected pricing or availability. The
telco plans to begin trials this summer in Atlanta and Dallas.
The Digital Life system is based on technology developed by
Xanboo, which AT&T acquired in December 2010.

In North America, the electronic-security market was
$34 billion in 2011, with residential and small business comprising
about 35% (or $12 billion) of total revenue, according
to estimates by Sanford Bernstein. Tyco International’s
ADT is the largest home-security provider, with an estimated
25% share of the market in 2010.

Cable operators, including Comcast and Time Warner Cable,
are looking to carve out a chunk of the home-security market
as well, and Verizon Communications has introduced a
“smart-home” service in certain markets.

The new entrants are looking to build out home security as a
fourth service, to complement
their existing voice, video and
phone triple plays. About 23%
of North American homes
subscribe to ADT or another
security-monitoring service,
Sanford Bernstein estimates.

“For cable operators and
the telcos, the home automation/
home security market
is an attractive one, and
is a sensible service extension
for a largely fixed cost
infrastructure,” Sanford Bernstein
senior analyst Steven
Winoker wrote in a recent research
report. “But it is not a
huge market, either, based
on current revenues or based on reasonable projections of
growth, at least over the next five years.”

For the Digital Life service, AT&T built two all-digital monitoring
centers for 24-hour operation. The telco said it will market
and sell the service through its 2,300-plus retail stores, as
well as on its website and via dedicated call centers.

The Digital Life platform includes built-in AT&T mobile Internet
service and will also be able to use Wi-Fi, Z-Wave and
wired broadband connections.