Mircom chief technology officer Jason Falbo, left, and CEO Mark Falbo walk through the company’s corporate head office in Vaughan, Ont.Della Rollins/The Globe and Mail
The doorman of a glass-and-steel office block faces a huge, wall-mounted intercom panel. The scene, from French filmmaker Jacques Tati’s 1967 film Playtime, makes it impossible to talk about the business of building intercoms and alarm systems without smiling.
Lights flash across the intercom panel like a shooting gallery. Buzzers blare. An overamplified voice blurts out. Mr. Tati famously spoofed modern conveniences. The doorman whistles to himself in a dismissive, Gallic way.
Of course, the joke today is how quaint that all seems. The alarms and building-communication systems made by a handful of multinationals, including the smaller Vaughan, Ont.-based Mircom Group of Companies, are now exponentially more complicated. They tap into cloud servers, networks and wireless apps and can be monitored extensively on-site and even remotely. They effectively turn buildings into active, networking machines.
And this has forced Mircom and its competitors to branch far off from their original business.
"We were really hardware-centric for a long time. We would build the housings, the components, the circuit boards, the devices, and we would supply the hardware. But like most businesses, technology started to converge,” says Mark Falbo, Mircom’s president and chief executive officer.
“It used to be just a hardwired system with wires running through a building. Now it might be tied into a network infrastructure, an internet infrastructure – whereas before you would sell the equipment and be done with it.”
Back in the 1960s, when electronic alarm and intercom systems were relatively new, Mark’s father Tony Falbo came to Toronto from Cosenza in southern Italy and was working for Mirtone, which made home intercoms that connected rooms like the kitchen to the living room or bedroom.
Mr. Falbo eventually became part-owner of the business as it branched into fire-detection and alarm equipment. The company was sold by a majority owner in 1988. After a short non-compete period, Mr. Falbo restarted Mircom, originally an intercom division within Mirtone. He took that division with him and grew it by designing and manufacturing an array of alarms, control panels and now software-based emergency systems. The company is currently run by Mr. Falbo’s three sons and has around 500 employees competing against the multinationals.
"The fire-detection part of the business is an oligopoly. It’s dotted by five large companies – Siemens, Honeywell, Johnson Controls and United Technologies Corp. And in Canada, it’s Mircom,” says Mark, the oldest of the three sons. “So, by rights, Mircom is the only company of its kind in Canada that’s designing, engineering and manufacturing. We have the multinational competitors operating here, but Mircom thinks Canada first.”
By that, he means a focus in particular on Canadian building codes. For instance, Canadian regulations tend to be geared more toward emergency crews getting immediate information when they arrive. Large LED panels and graphic displays in the lobby typically provide crisis information more readily than LCD control panels, which can involve scrolling through menus and are more common in the U.S.
But LED panels can take up a lot more space. So control panels are now morphing into software systems or, in industry jargon, single-pane-of-glass systems with computer and smartphone screens increasingly replacing control panels.
“Now we're also using computer workstations, mobile apps and other interfaces to receive that information,” says Jason Falbo, chief technology officer and the youngest brother. (The middle of the three brothers, Rick Falbo, manages sales and business development.) Workstations and control panels can be in development for five years or so given their complexity, and larger systems may have as much as four million lines of computer code.
“It’s a lot closer to an airplane control system. You can’t even compare it to a lighting panel or something like that. They’re hugely complex. They’re beasts,” Jason says.
This rampant technology has pushed the company to expand its product lines and services, although fire-alarm equipment remains around 60 per cent of the business. Fire-equipment servicing is around 15 to 20 per cent. The remainder is intercom and other automated systems. The privately owned company surpassed the nine-figure revenue mark a few years ago.
"Twenty years ago, you’d have Mircom supplying the fire-detection equipment, the hardware and the parts that detect and the alarm. Maybe Honeywell would provide access control or intercom security solutions. And potentially Johnson Control would be doing your HVAC [heating, ventilation and air conditioning] controls. That’s how we went to market,” Jason says. Now many of these systems are blending through software interfaces and mass notification systems.
Yet the company occupies the unusual niche of also being an original equipment manufacturer at times for its larger competitors, filling in gaps in those companies’ product lines. “So, this oligopoly of an industry is a bit strange, in that everybody seems to be a competitor and customer and supplier to the others,” Mark says.
At the same time, the move to software-based systems has created a fundamental shift in the entire industry.
“I think the pivot from a focus on fire-detection and alarm hardware to more converged building technologies with a software focus is something that we as a family and as a company really need to deal with,” Mark says. “It’s sometimes a cultural shift. It’s an investment shift. It’s a priorities shift.”
Still, the convenience of integrated building systems also brings myriad complications. Fire alarm systems, for instance, have to remain within their own separate loop, safeguarded against the failure of other systems. However, information from the fire system can still be monitored by other platforms.
Mike Prsa, a principal and vice-president at engineering firm Mulvey and Banani International Inc. in Toronto, says common internet protocol is necessary for alarm systems to talk to other building systems and to tie into networks and apps.
“They can be integrated, but only in a secondary viewing and annunciation purpose. So I can pull data from my fire alarm system and plug it into my building-intelligence platform for reporting purposes. But I can’t command and control the fire alarm system through any other system besides itself,” Mr. Prsa says.
Then there’s the human factor. Advanced controls and elaborate circuitry are fine, but what if the building supervisor can’t work them to their full potential?
“One of the missing links that we’re finding is that building operators aren’t necessarily trained to analyze the data and understand what to do with it,” says Marianne Touchie, an assistant professor at the University of Toronto’s Faculty of Applied Science and Engineering.
The human element could be one of the most urgent aspects as building-communication and alarm systems become more complex. Mircom sees personal connections to customers as another inroad to compete against the larger multinationals, particularly as systems become more compatible with other systems.
“Some of it is guerrilla business where you go in and do more,” Mark says. “We try to be a little bit less proprietary. We try not to lock people into our technology once they acquire our systems. We provide more choice and training in open platforms,” he adds.
Because if the doorman or building staff can’t figure out the system, then it’s of little use.