DIY and MIY – An Opportunity and a Threat

DIY means Do It Yourself and MIY means Monitor It Yourself. If you are like me you have seen these 2 terms thrown around a lot over the last 2-3 years in regards to our industry. DIY and MIY are coming. Will they get any meaningful piece of the pie? Should dealers be looking at them? If you are an existing alarm dealer how do you set yourself up to handle DIY or MIY? Truthfully I did not pay that much attention to all of this discussion until I had lunch at Xmas time with my old friend Gordon Buchanan. Gordon is in his 50’s, not really a “techie” or “do it yourself” guy but is an “early adopter” as far as technology is concerned.

What shook me up was Gordon had recently gone out to Best Buy by himself, with no coaching, no calls to any security company and bought and installed a DIY “security” system complete with hub, motion detectors, cameras, lock and light control and CO detectors. He bought the Phillips brand one that I did not know. Gordon lives in a condo so it is fair to say that his motivation was as much about convenience as it was about security. He wanted to be able to control his lights and locks through his cell phone. The scary thing to me was he never thought about calling a security alarm dealer. He simply went to Best Buy, a place he instinctively knew would have what he was looking for. And he was right. Because we are all in the security industry, perhaps we mistakenly assume that Gordon would call one of us.

It is not like the customer service reps at Best Buy knew as much about motion detectors as a typical alarm dealer. They did not but it did not seem to have matter. Gordon said the kit was self explanatory and remarkably easy to install. He showed me the two apps on his phone he uses to control everything he has. These apps are easy to use and make the alarm.com app look old-fashioned.

There are those that will say but Gordon is not really getting a full security system. But for him living in a condo the Best Buy kit was more than enough. My fear is that for many people in single family dwellings, they will think the same way. They will think these systems can give them 80% of what a professionally system can give them - and of course it will probably be at less than ½ the price of professionally installed system.

So let’s look at this event again. Gordon is clearly not a millennial. (I am sick of hearing how distinctive millennials are.) He does live in a multi-unit building so that reduces his security needs somewhat. Although he bought what we would call “security” equipment, he was looking for convenience as well. As an aside, in watching Gordon show me his system on his phone, I would argue that convenience was a much bigger draw than security. Gordon is not a Mister Fix-it kind of guy but he had no problem setting up about 10-12 different devices by himself. Based on what I know of him, Gordon would never have thought of going to a security dealer to get what he wanted- not top of mind, too slow, way too expensive and unnecessary and he does not know the name of a security dealer anyway.

You ask what about monitoring? A security dealer would surely have tried to push monitoring on Gordon. Gordon is functioning MIY and quite happy having all signals come directly only to his smart phone. He thinks that is enough. He can call the police or fire department if he sees something very definitely wrong in his condo. He has been around enough to hear about his friends having to deal false alarms, the hassle and the potential fines. He may even know that in a city like Toronto that police reaction to an alarm is very slow without verified response. In fact it was when Gordon leaned across the lunch table and said to me that based on his experience he would be seriously worried about the future of monitoring business that I really took note.

Aside from what Gordon how he thinks about all this, here is what I think. Based on the small amount of research I have done, I think DIY and MIY are definitely here to stay in some form or other. I think they are capitalizing on our whole digital, interactive, Wi-Fi-enabled, smart phone dominated world and giving customers a whole bunch of convenience and some security at a much reduced cost. It is possible these new DIY systems have the potential to take the smart home penetration rate from 20% penetration level for monitored systems to 50% and above over the next 5 -10 years. Just look at the names that are into this market now and only in the last 2-3 years- Honeywell, ADT-Samsung, Google Nest, Ring, Amazon Kwikset, Vivint, Apple and Best Buy to name some of the bigger names. I have never seen so many new names offering what we have to call a “security” product since I joined the industry 25 years ago. They cannot all be wrong. You can bet these big companies have not entered this DIY market to try to steal part of the 20% penetration of monitored security systems. They want part of the other 80%.

How far will this DIY/MIY trend spread? For sure it is attacking the traditional alarm market for residential systems including condo and apartment owners like my friend Gordon. And yes I think it will make it more difficult for alarm dealers to sell first time home buyers on a professionally installed system. I think DIY and MIY will take a healthy portion of that 80% of the security market that alarm dealers over many, many years have not been able to penetrate. Why? Because these companies like Google Nest and Ring are selling convenience, price, and ease-of-install as well as security.

What about existing monitored accounts and the potential for new ones? Is monitoring in danger? Let’s put it this way. DIY and MIY are each going to make it tougher to get professional monitoring accepted in certain situations. Certainly if I was an alarm dealer I would watching my monthly monitoring rates. To me these new interactive systems being sold by the high volume alarm dealers at rate of $50/mth are at risk in the future.

Victor Harding

Harding Security Services Inc