Qolsys joins with Tyco

Anyone see the article of Tyco and Qolsys? For those not aware, Tyco owns Simplex Grinnel, and is the parent company of, and recently spun off ADT. (i.e., Tyco is now three separate and publically traded companies, one of which is ADT…similar to how Blackstone, Vivint, and Vivint Solar are all seperate companies)

In other words, ADT just got the Qolsys panel.

http://www.iotconnectivitysolutions.com/news/2014/12/03/8123708.htm

With this investment Qolsys will accelerate the development of the company's groundbreaking residential security and Internet of Things (IoT) platform. The Qolsys product line, which includes the flagship product IQ Panel, will be immediately available to established Tyco Security Products channels in North America.

Additionally, it is unknown how much of QOLSYS Tyco now controls…(but I would be willing to wager its a controlling interest)

Grinstead [VP of Global Sales for Tyco] declined to reveal the amount of the investment, which he characterized as “additive [to current Tyco Security Products’ product development efforts] rather replacement
While Qolsys will continue to be based in San Jose, Calif., and will retain its management, brand and independence, Grinstead said there will be opportunities for R&D collaboration between the Qolsys team and Tyco.
http://www.securitysystemsnews.com/article/tyco-invests-qolsys

Well, that was short-lived. I wonder how long it will be before QOLSYS is swallowed up, and rebranded as an exclusive Tyco/ADT system? If there is one thing Tyco/Simplex Grinnell/ADT is known for, its for being proprietary, and not playing nice with others.

Fooey.

My guess is Tyco’s dipping a toe in the water before doing an acquisition and then merging them with DSC.

I guess the next 6-12 months will be telling.

Perhaps you are right. Didn’t realize Tyco had acquired DSC. I still think ADT is gonna get a piece of the QOLSYS pie though…they all have the same shareholders.

For every 2 Tyco shares, a shareholder got 1 ADT share when ADT was spun off:

...Tyco currently has 462 million basic shares outstanding, so about 231 million ADT shares and 111 million Pentair shares will be distributed to Tyco shareholders...

Not an altogether surprising move. I don’t think the direction will be obvious for a while.

True, but have you ever known Tyco/ADT to play nice with others?

Tyco’s Grinstead made it very clear who is in control of Qolsys now (if you can read between the lines).

"[Qolsys] will retain its management, brand and independence..."

I highly doubt Tyco would want to make Qolsys an ADT exclusive product, if they even want to attempt to get ADT using Qolsys, which I also doubt. They’re hedging their bets because they realized ADT is losing in the home services market and they want a piece of a home automation product that people are excited about - something with a future. Tyco made a decision to let DSC panels become Alarm.com compatible despite ADT in an effort to be less dependent on the sinking ADT ship. I see no reason why they would have any interest in limiting Qolsys to help ADT. Word around the industry is they’ve been trying to distance themselves from ADT residential for a while.

Hmm

Tyco did say the Qolsys panel is going to made available to their “Tyco security products channel”… (Which includes DSC, Bentel, Visonic).

Doesnt ADT currently use DSC and Tyco security products?

I assumed that since the shareholders of Tyco are also the majority shareholders of ADT, that they (the shareholders) have a vested interest in ADT’s success and increased revenue streams

The Qolsys product line, which includes the flagship product IQ Panel, will be immediately available to established Tyco Security Products channels in North America

Yes, ADT corporate uses DSC for the most part now. I think they used to use Ademco, even for a time after Tyco acquired DSC but eventually they made the switch due to joint ownership. Then you have all the different ADT “dealers” which can be tough to differentiate from ADT corporate who can use whatever they want.

I heard it through the grapevine that the Tyco “investment” into Qolsys was in the double digit million dollar range, and also Qolsys is gonna drop resolution products very soon, and that Tyco is going to start doing the production…(which potentially will cut out FOXCONN).

These are quotes from my source:

"It was tens of Millions of dollars[.] qolsys personal will be the innovative thinkers and tyco will be doing the manufacturing r&d and testing."
"I have a close friend pretty high up and he told me that qolsys will be totally revamped in the current year to have their own product line instead of using resolution products as their manufacture[r][.]"

If that last quote holds water that is a bit of a double edged sword. What I hope for as far as a direction for the industry and the players involved is further integration and variety of system components.

If creating their own product line means yet another GE wireless contact, only this one has a “Q” printed on the cover, I am personally far less interested than if they contribute thoughtful automation additions or sensor options that outperform or provide additional benefits above those available.

However, with their own product line comes a lot of control, and far fewer instances where firmware or revision updates are needed to fix broken compatibility. There is a lot to be said for stability. Not to mention the marketing boost from having a full line-up of Qolsys branded products.

It will be interesting to see.