QUESTION:

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Ken:

    I’d like you to consider commenting on the following issue:

    We do a lot of takeover business from the national companies.  Lately, we’ve been running into outright refusal by the largest alarm company to release cellular backup units, even when the customer owns the equipment.  We always have the customer call and ask for the unit to be released.  Most of the time they are given the runaround but, last week, a customer was blatantly “no” that the cell unit would not be released.

    Cellular is like radio although radio is gone by the wayside for the most

part.  Cellular GSM is the new industry standard as it allows remote

programming, audio/video and text messaging all over the cell network (for

example: I can use my iphone to remotely control my alarm system and get

texts any time my wife comes home and turns off the system). 

    A new cell unit is around $200.00.

    There is no phone number.  The cell backup simply transmits the burg/fire

signals over the cellular network as opposed to using a phone line.

    Most cellular backup providers will allow the alarm company, using it's

programmer, to just take over the unit.  Telular, however, requires the

company that originally installed the unit to call give their OK to release

the unit.  This prevents unauthorized takeovers of a company's systems.

BUT, if the agreement is terminated and the customer wants to go to a new

company then that's their right to do so.  But, if the original company

doesn't release the cell unit, the customer is deprived of its use.

    I look at it like the neighbor is loaning me use of his lawn mower and I put

it in my garage and refuse to return it.  It's interesting subject matter

but I see it as conversion.

    In my days in law enforcement, this would be considered “conversion”, or the unauthorized taking of control of another person’s property without their consent.  Presently, I am planning to give customers the Attorney General’s complaint form when this happens so that we can get several dozen complaints filed in an effort to show them the error of their ways.

What do you think?

DM

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ANSWER:

    This is a perfect example of evolving technology that will require contract changes.

    The issue also looks a lot like the "panel code" issue that always generates lots of discussion, and some legislation by the way.  

    If a consumer purchases a system it makes sense that the purchaser have the right to access the system to make use of it.  But does that mean that if Alarm Company A sells and installs an alarm system with cellular communication that the subscriber should have the right to cell unit so that a new alarm company can take over the account?  I don't know the answer.  I do know that we have taken the position that panel codes belong to the alarm company, not the subscriber, and don't have to be released.  My contracts do provide that upon full performance of the contract the code will be released, and there is at least one jurisdiction [I forgot which at the moment] that has statute requiring that the code be released or disclosed to permit takeover.

    I think it comes down the how the contract is presented.  If an alarm system is installed with the understanding that continued monitoring and service is required by the installing company, that the panel code and cellular communication remains property of the installing company at least until a period of time passes, then I don't see why that contract provision should be disturbed; it should be enforced.

    I can't help but draw an analogy, which some of tech guys may say doesn't apply.  I recently got a "kindle" from amazon.  It's an electronic book.  It accesses the internet, but only one address, amazon kindle books.  I can't use it and switch to Sony, which I understand also has an electronic book.  It appears to internet capability from anywhere, yet I can use it for only one thing, ordering books on line from amazon.  Anyone who buys this product has to understand its restrictive use.  Why should a consumer of an alarm system not be confined by the terms of sale of the alarm system.  If the contract makes it clear that the communication device belongs to the alarm company then who should complain?  A new alarm company who wants to save $200 and labor charges? 

    What do you all think, and anyone know of any legislation out there that addresses this issue?