Titled Home Systems:
Home Security Update, the report finds the number of monitored security
households intending to cancel their service is only 4 to 8 percent. While the
cancellations are higher than normal due to the economic recession, the report
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,” says 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.”

The number of monitoring service subscribers
will not increase as quickly as in past years due to the drop in new starts and
the lower number of households moving into new residences, yet the current base
of customers shows a predilection to keep their monitoring services.

Parks suggests that a slight increase in
monthly fees will not cause current subscribers to abandon monitoring services.

“Security providers can use a minor fee
increase to offset immediate losses due to slower market growth and increased
competition,” says Parks. “What is critical, nonetheless, is understanding the
exact amount of increase that customers can bear.”