InGrid Senses a Broadband Monitoring Craze

LAS VEGAS -- Consumer Electronics Show (CES) -- Executives of InGrid Inc., a startup launched in September 2004, are making the rounds at the Consumer Electronics Show in Las Vegas this week -- and they're pitching a personal digital security product that can help consumers monitor the security of their homes using broadband connections.

InGrid's initial round of "digital home protection" products are designed to provide such services as home security, medical monitoring, fire and smoke alerts, and weather reports, among other things.

As a newcomer to the home security space, InGrid is entering a crowded field ruled by such large companies as ADT, Brink's, and Protection One. It's also entering an industry with long-hyped potential that, while it generates about $8 billion in annual revenue, has been growing sluggishly compared with the overall housing market.

But InGrid officials think they can carve out a healthy niche by using new broadband and wireless technologies to provide better security services at the same or lower cost. In particular, they're counting on their new wireless grid technology to deliver protection without extensive equipment installation costs.

The InGrid system relies on wireless sensor technology to create an invisible security grid throughout the home. The company's wireless network is designed to link small peel-and-stick window and door sensors, smoke alarms, carbon monoxide alarms, and other devices with portable handsets, broadband-enabled base stations, system consoles, and monitoring services. InGrid says it can also hook up several homes and/or offices together for expanded protection.

"It is a total wireless grid," says Louis Stilp, founder and CEO of InGrid. "Most of the technology out there is as old as the industry itself."

InGrid executives also see the home security market at least doubling in size over the next few years as the industry switches over from analog to digital technology. In its latest survey, Parks Associates found that about 26 million U.S. homes, or one in four households, now have security systems.

With cable modems, DSL links, and other high-speed connections now in more than 50 million U.S. homes, InGrid officials see broadband providers as natural distribution partners for their service. So they're going after cable operators and telcos, both of which have been expressing increasing interest in adding home security to their broadband product bundles.

"We've heard from many broadband providers that digital home protection is in the cards for them in the next 18 months," says Stilp, an entrepreneur who started the company after selling TruePositon, a wireless system location developer, to Liberty Media Corp. (NYSE: LMC) in 2000. "It's the next thing after digital voice, the next part of the bundle."

InGrid is not the only new wireless security company eyeing the broadband market. Such other young companies as iControl Networks and uControl Inc. are also targeting high-speed data providers for broadband distribution deals.

InGrid officials, however, shrug off such competition. Calling the iControl and uControl systems more limited, they say only their service offers such key features as professional monitoring and battery backups.

Stilp says he's talking to several undisclosed MSOs and telcos about testing the security service later this year. If all goes well, his plans call for shipping product samples later this winter, setting up field trials with broadband partners in the spring, conducting the trials in up to three cities over the summer, and then launching the service commercially next fall.

"We'll have customers a year from now," he says. "This is one that looks very much for real."

A privately owned firm based in Berwyn, Pa., InGrid has raised $16 million in two venture capital rounds so far. Its investors include CenterPoint Ventures, Novak Biddle Venture Partners , PA Early Stage Partners, and ZG Ventures.

Stilp says InGrid will conduct a third round of funding in the first half of the year. He's looking to raise another $10 million to $15 million, enough to fund the service's launch.

— Alan Breznick, Site Editor, Cable Digital News