DirecTV’s Acquisition of LifeShield Could Set It Apart From Other ‘Bundled Services’ Competitors
DirectTV, El Segundo, Calif. is the latest cable services provider to enter the security space with its acquisition of LifeShield, Langhorne, Pa. According to DirecTV, LifeShield will continue to run with its existing team, which includes CEO Michael Hagan, in its Pa. headquarters.
Robert Mercer, spokesperson for DirecTV, told SDM, “We’ve been looking at a number of firms but it was important for us not to rush into the home security business unless the right opportunity came along, as it did with Lifeshield. The video home security buss is a good strategic bid for us. It’s a profitable business with low market penetration. The important thing for us is that we have the ability to leverage our strong, nationally recognized brand and our national footprint and our sales and marketing expertise that will enable us to take full advantage of the opportunity.
“Lifeshield was the most attractive security firm for us for several reasons,” Mercer continued. “It required a minimal investment. Its products are innovative, they’re easy to use and install. And this is key: we would be able to control and seamlessly integrate the service with our video experience.”
A clear differentiator in DirecTV’s approach to the security space is its choice to acquire an existing security company (and its customer base) rather than start a new business division from the ground up, as Comcast, Verizon and AT&T have done.
LifeShield’s current security offering is centered around wireless home security solutions and monitoring services (provided by Protection 1’s five UL listed monitoring stations). Mercer said the current plan is to continue the partnership with Protection 1 in order to offer reliable, professional monitoring. LifeShield offers interactive home security features with remote access, which other new players in the security industry have often cited as the gateway to the untapped 80 percent of the market.
While Lifeshield does offer traditional installation, customers can also opt for do-it-yourself setup for most systems as they are wireless. Mercer said the DIY option will continue to be available, though the company is looking forward to being able to offer simultaneous in-home installation for its TV and security services. “We have a nationwide network of technicians in the field that make millions of house calls every year,” Mercer commented. “Having a technician in the home that can take care of everything — DirecTV service and home security service — will remove a significant barrier to those folks who may be challenged by a DIY approach.
Lifeshield has a presence in all 50 states and counts around 22,000 subscribers. Mercer estimated DirecTV’s U.S. customer base to be more than 20 million, making it the second largest paid TV service.
DirecTV said it will roll out security services to new customers beginning in the first quarter of 2014 and offering promotional upgrades and moving packages to existing customers that year as well. It is unlikely the company intends to make significant changes to the existing LifeShield offerings right off the bat, though it may add some functionality to the LifeShield platform. Mercer explained, “Initially, we will continue to offer the LifeShield product under their brand name along with our video service for a period of time. Then, when we fully integrate the business, we’ll market the service — but linked to the DirecTV brand… We’re also looking at a number of unique features to offer our customers that will enhance it and further differentiate it from our competitors.”