managed vs unmanaged networks for home security aicc meeting september 10, 2013 roy perry – vp...

Managed vs Unmanaged Networks for Home Security

AICC MeetingSeptember 10, 2013

Roy Perry – VP Ecosystem Alliances

Copyright © Alarm.com 2013. 2

What Are Managed vs Unmanaged Networks?• “Managed” means all the devices in the path are under the

management and control of a single responsible party• Home routers are “Unmanaged”, and so introduce an element

beyond the party’s control, and increase technical and support costs, especially for single path communications

Battery PowerGrid Power

Service Platform

Home Router

Security Panel

BB Modem

Security Panel

Broadband

Cellular Cell Modem

UnlicensedSpectrum

EthernetLicensedSpectrum

LicensedSpectrum

Managed

Managed Unmanaged


Context for Discussion

• Total cost of ownership/operation increases when using unmanaged networks due to many factors

• Panels that transmit alarm signals for fire/smoke must conform to NFPA 72 which has supervision requirements that increase costs to central stations

• This analysis does not include the support costs associated with supporting other home monitoring and automation applications (eg video, lights, locks, thermostats)


Not a “Broadband vs Cellular” Issue

• A home network vs service provider network issue• A licensed vs unlicensed spectrum issue• An active vs passive supervision issue• A powered vs unpowered issue


Why Does It Matter?

• Unmanaged home networks introduce significant service quality issues that create risks for customers and costs for dealers and central stations– Vulnerable to service interruption with loss of power, miswiring,

router failure, user error, wifi interference, wrong passkey– Increasing complexity due to increasing variations in home

routers– Cable and telco provided routers with aggressive firewall

policies can block third party devices

• The total cost of ownership may exceed the cost of paid cellular connections


Cost of Involving Home Networks

1) Customer support costs– Increased support costs for home security dealers and central stations– Increase in customer contact, trouble tickets, troubleshooting, truck

rolls

2) Hardware costs – Increased hardware costs to work around home routers

3) Central station supervision costs– Increased supervision costs due to more incidents requiring central

station response

4) Customer churn and dissatisfaction costs5) Training costs for IT skills

– For installers, technicians, and customer care


1) Customer Support Costs

• Additional support load (inbound calls, Tier 1 tickets, truck rolls)

• Additional complexity • Additional time to resolve • Unique challenges per customer


Quantifying Customer Support Costs

• Alarm.com Findings – 10x home network tickets vs cellular

• Motorola White Paper (2011)– “Reducing Costs, Increasing Retention by Automating

Home Network Support”– Quantifies support costs associated with home networks

• Roughly 30 percent of inbound calls to carriers or cable operators deal with Wi-Fi issues

• Each call costs about $5 (5 min avg = $1/min/call)


2) Hardware Costs

• Adding dedicated broadband modem/router• To bypass home router (~$120)

• Adding dedicated wifi access points• To bypass customer wifi (~$60)

• Adding UPS (standby power) equipment• IP based fire alarm communications does not specifically

require standby power• Cable modems and routers will fail during power outages,

unless UPS used• UPS can achieve standby power equivalent to cellular, but 8

hour UPS for cable-modem-wifi-router expensive (>$200)


3) Central Station Supervision Costs• NFPA 72 imposes supervision requirements on central stations

– Single path connections must exchange signals no less frequently than 5 minutes (eg 2010:26.6.3.1.4)• Single path cellular has had special exemption (24 hours for commercial and 30

days for residential)

– Dual path connections no less frequently than 24 hours– Upon loss of connection, the central station must respond

• Must call occupant or local dealer• Many home router vulnerabilities (loss of power, misconfigured/bad router, etc)

• NFPA 72 2013, Section 14.2.7.2 updated – No longer any distinction between technologies except for dialer (DACT) – 60 minutes/6 hours for commercial– 7 days/7 days for residential (tightens cellular from 30 to 7 days)– Dramatically reduces supervision costs but will take years for adoption


NFPA 72 Supervision Requirements(5 Minute Supervision Required for Single Path Until 2013 Code Adopted By Local Jurisdictions)

Edition Type Phone (DACT) Cellular Other Single Path Other Dual Path

1999 Commercial 24 hrs [5-5.3.2.1.6.2 (2)]30 days [5-5.3.2.1.6.2 (Exception No. 1)] 5 minutes [5-5.4.4.1] 24 hrs [5-5.4.4.3.2]

Residential 30 days [8-4.3.1] same as commercial same as commercial same as commercial

2002 Commercial 24 hrs [xxx] 30 days [xxx] 5 minutes [xxx] 24 hrs [xxx]

Residential 30 days [xxx] same as commercial same as commercial same as commercial

2007 Commercial 24 hrs [xxx] 30 days [xxx] 5 minutes [8.6.4.4(1)] 24 hrs [8.6.4.4(5)]

Residential 30 days [xxx] same as commercial same as commercial same as commercial

2010 Commercial 24 hrs[26.6.3.2.1.5 (6)]30 days [26.6.3.2.1.4 (B) (Exception No. 1)] 5 minutes [26.6.3.1.4.1] 24 hrs [26.6.3.1.4.2 (2)]

Residential 30 days [29.7.8.1.2] same as commercial same as commercial same as commercial

2013 Commercial 24 hr [26.6.3.1.5] 1 hr [26.6.3.1.5] 1 hr [26.6.3.1.5] 6 hrs [26.6.3.1.6]

Residential 30 days [29.7.9.1.2] 7 days [29.7.9.1.4] 7 days [29.7.9.1.4] 7 days [29.7.9.1.4]


State Adoption of NFPA 72 Editions(As of July 2012, Only 1 State Had Adopted 2010)

ALABAMA 2007 IFC2009ALASKA 2007 IFC2009ARIZONA 1999 IFC2003Phoenix 2002 IFC2006ARKANSAS 2002 IFC2006CALIFORNIA 2007 IFC 2009COLORADO 2002 IFC2006Denver 2002 IFC2006CONNECTICUT 1999 IBC2003DELAWARESussex County 1999 IBC2003DISTRICT OF COLUMBIA 2002 IFC2006FLORIDA 2007 IBC2009GEORGIA 2002 IFC2006HAWAII 2002 NFPA1-2006IDAHO 2007 IBC2009ILLINOIS 2007 IFC2009INDIANA 2002 IFC2006IOWA 2007 IBC2009KANSAS 2002 IBC2006Wichita 2002 IFC2006KENTUCKY 2002 NFPA1-2006LOUISIANA 2007 IBC2009MAINE 2002 NFPA1-2006MARYLAND 2010 IBC2012MASSACHUSETTS 2007 IFC2009MICHIGAN 2007 IBC2009MINNESOTA 2002 IBC2006MISSISSIPPIJackson 1999 IFC2003MISSOURISt. Louis 2007 IBC2009

MONTANA 2007 IBC2009NEBRASKA 2002 NFPA101-2003Lincoln 2007 IFC2009NEVADA 2002 IFC2006Las Vegas 2007 IBC2009NEW HAMPSHIRE 2007 IBC2009NEW JERSEY 2007 IBC2009NEW MEXICO 1999 IFC2003NEW YORK 2002 IFC2006New York City 2002 NFPA 72-2002NORTH CAROLINA 2007 IFC2009NORTH DAKOTA 2007 IBC2009OHIO 2007 IFC2009OKLAHOMA 2007 IFC2009OREGON 2007 NFPA 72-2007PENNSYLVANIA 2007 IFC2009RHODE ISLAND 1999 NFPA1-2003SOUTH CAROLINA 2002 IFC2006SOUTH DAKOTASioux City 2007 IBC2009TENNESSEE 2002 IFC2006 | NFPA 101-2006TEXAS 1999 IBC2003Dallas 2002 IFC2006Houston 2002 IFC2006UTAH 2007 IFC2009VERMONT 2002 NFPA 1-2006 | NFPA 101-2006VIRGINIA 2007 IFC2009WASHINGTON 2007 IFC2009WEST VIRGINIA 2007 IBC2009WISCONSIN 2007 IBC2009WYOMING 2002 IFC2006

Source: Data from law.resource.org updated as of 7/31/12


4) Customer Churn and Dissatisfaction

• Router password is often forgotten or unknown, frustrates installers and customers and results in longer installation times

• Future home network problems may be blamed on home security provider

• Customers hold alarm company responsible when monitoring fails, not router manufacturer or network provider or power provider

• This results in decreased customer satisfaction and increased churn through circumstances beyond dealer control


5) Technician IT Training for Home Networks• Installers, customer care, and technicians must now

be trained on how to setup and troubleshoot home routers and wifi networks, and how to escalate issues to ISP


Broadband Can Be A Managed Connection Too• Some cable operators use a dedicated cable-

modem/wifi router to bypass home router• This reduces support costs but increases hardware

cost, opportunity cost– ~$120 for cable-modem/wifi router– Consumes static IPv4 address

• Future: Embedded cable modems could be used in panels with benefits similar to cellular (operation during power failure and bypass of home router)


Does Dual Path Help?

• Dual path reduces supervision costs, since NFPA 72 supervision is relaxed from 5 minutes to 24 hours

• Updated to 7 days for both single and dual path in 2013 Code

• Dual path can actually increase support costs, since it adds a second path that must be supported

• Cellular backup meets requirement as dual path, but is not continuously active (only used upon failure of alarm transmission via broadband) so requires test signal monthly (weekly in new 2013 code)

• Redundant managed/managed active/active dual path in theory is highest reliability, but cost prohibitive today


Home Router Security

Panel

BB ModemBroadband

Security Panel

Cell ModemCellular

Standby Powered Grid Powered

Service Platform

BroadbandDedicated BB Modem

Dedicated BB Router

Cellular Cell Modem

Security Panel

Cell ModemCellular

Home Router

BB ModemBroadband

D1. Unmanaged/ Managed

D2. Unmanaged/Managed

D3. Managed / Managed

Active

Standby

Active

Active

Active

Standby

Unmanaged

Security Panel

BB Modem

Security Panel

Broadband

Cellular S1. Managed

Sing

le P

ath

Dua

l Pat

h

S2.Unmanaged

Cell Modem

Single vs Dual Path Arrangements


Cost Analysis – 2010 Code ComplianceSINGLE PATH DUAL PATHS1 S2 D1 D2 D3

Type Managed Unmanaged Unmanaged/Managed

Unmanaged/ Managed

Managed/ Managed

Network Provider Cellular BroadbandBroadband + Cellular

Broadband + Cellular


Router Type None Home Router Home Router Home Router

Dedicated BB Modem /Router

RedundancyActive/ Standby

Active/ Active

Active/ Standby

Operation During Power Failure (<24 hrs) Yes No Standby Only Yes Standby Only

Power Failures*/mo 1 1 1 1 1Home Router Failures*/mo (incls wifi) 1 1 1 1 1Broadband Failures*/Mo 1 1 1 1 1Supervision Events Triggered 0 3 3 0 3Cellular Support Calls 0.1 0.1 0.1 0.1Wifi Support Calls (Wifi= 10X cellular rate) 1 1 1 1Support Cost (Wifi calls 5x longer) $0.10 $5.00 $5.10 $5.10 $5.10Supervision Cost (5 minutes) $0.00 $15.00 $15.00 $0.00 $15.00(ALL CALLS ARE $1/minute)Access Point Hardware ($60 ea/60 months) $0.00 $1.00 $0.00 $0.00 $0.00BB Modem/Router ($120 ea/60 months) $0.00 $0.00 $0.00 $0.00 $2.00Incremental Hardware Cost /mo $0.00 $1.00 $0.00 $0.00 $2.00Cellular Transport Cost $1.00 $1.00 $1.00 $1.00Total Cost/Mo $1.10 $21.00 $21.10 $6.10 $23.10


Cost Analysis – 2013 Code ComplianceSINGLE PATH DUAL PATHS1 S2 D1 D2 D3


Unmanaged/ Managed

Managed/ Managed




Router Type None Home Router Home Router Home Router

Dedicated BB Modem /Router


Active/ Active

Active/ Standby

Operation During Power Failure (<24 hrs) Yes No Standby Only Yes Standby Only

Power Failures*/mo 0 0 0 0 0Home Router Failures*/mo (incls wifi) 0 0 0 0 0Broadband Failures*/Mo 0 0 0 0 0Supervision Events Triggered 0 0 0 0 0Cellular Support Calls 0.1 0.1 0.1 0.1Wifi Support Calls (Wifi= 10X cellular rate) 1 1 1 1Support Cost (Wifi calls 5x longer) $0.10 $5.00 $5.10 $5.10 $5.10Supervision Cost (5 minutes) $0.00 $0.00 $0.00 $0.00 $0.00(ALL CALLS ARE $1/minute)Access Point Hardware ($60 ea/60 months) $0.00 $1.00 $0.00 $0.00 $0.00BB Modem/Router ($120 ea/60 months) $0.00 $0.00 $0.00 $0.00 $2.00Incremental Hardware Cost /mo $0.00 $1.00 $0.00 $0.00 $2.00Cellular Transport Cost $1.00 $1.00 $1.00 $1.00Total Cost/Mo $1.10 $6.00 $6.10 $6.10 $8.10


Cost Rankings of Solutions (2013 Code)


Unmanaged/ Managed

Managed/ Managed





Active/ Active

Active/ Standby

Total Cost/Mo $1.10 $6.00 $6.10 $6.10 $8.10


Key Conclusions

1. Single-path managed (S1) connection to home security panel avoids customer network problems and therefore reduces support costs

2. Single-path unmanaged (S2) connection (eg using customer router) offers lower connectivity cost but introduces support and supervision costs exceeding the savings

3. Dual-path managed/unmanaged active/standby (D1) is no more reliable than single-path managed (since cellular used in both cases), but introduces support costs even though secondary path may rarely be needed

Bottom Line: NFPA 72 Supervision requirement of 5 minutes remains in effect until 2013 Code adopted; compliance when using IP-only can be costly; need states and localities to adopt asap; recommend cellular or dual path in the interim.

Thank You

Roy [email protected]


Backup Slides

24


2010 Code

25


2010 Code (cont)

26


2013Code

managed vs unmanaged networks for home security aicc meeting september 10, 2013 roy perry – vp...

Documents

hardware costs

training costs

dissatisfaction costs

home network support

unmanaged home networks

unmanaged slide

home monitoring

home security dealers