New report reveals monitoring makes up 75% of home security revenues
Monitoring revenues are still the financial bedrock of the U.S. security industry, constituting 75% of all revenue, according to Home Systems: Home Security Update, which reports monitoring will cushion this market during the recession.
This new report from Parks Associates finds the number of monitored security households intending to cancel their service is only 4 -8% higher than normal due to the economic downturn. The report also warns that the resilience of this service category will attract new competitors.
"Traditional security providers must anticipate communications and entertainment service providers will introduce their own home monitoring systems," said Tricia Parks, CEO, Parks Associates. "There have already been announcements in Canada and Europe for home monitoring using security as a primary application. It is reasonable to presume carriers will do the same in the U.S."
Home Systems: Home Security Update reports the number of monitoring service subscribers will not increase as quickly now as in past years due to the drop in new starts and the lower number of households moving into new residences. However, the current base of customers shows a predilection to keep their monitoring services and will even tolerate a small fee increase.
"A slight rise in monthly fees, such as from $25 to $26.95, will not cause current subscribers to abandon their services," Parks said. "Security providers can use a minor fee increase to offset immediate losses due to slower market growth and increased competition. What is critical, nonetheless, is understanding the exact amount of increase that customers can bear."
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About Parks Associates
Parks Associates is an internationally recognized market research and consulting company specializing in emerging consumer technology products and services. Founded in 1986, Parks Associates creates research capital for companies ranging from Fortune 500 to small start -ups through market reports, primary studies, consumer research, custom research, workshops, executive conferences, and annual service subscriptions.
The company's expertise includes new media, digital entertainment and gaming, home networks, Internet and television services, digital health, mobile applications and services, consumer electronics, and home control systems and security.
Each year, Parks Associates hosts executive thought leadership conferences CONNECTIONS™, with support from the Consumer Electronics Association (CEA®), and CONNECTIONS™ Europe. In addition, Parks Associates produces the online publication Industry Insights in conjunction with the CONNECTIONS™ Conference series.
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