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u.s. cable companies home in on security

by:AAA     2021-01-13
(Reuters)-
Consumers are increasingly turning to less likely sources of home security --
Cable company.
The decline in prices of key components such as cameras and wireless technology has reduced entry barriers to the $13 billion home security market, traditionally the site of players such as ADT.
For cable companies such as Comcast and Time Warner Cable, home security is another source of revenue for rebuilding profits that are due to increased programming costs and a decline in the number of video users
This is also a way for cable companies to invest billions of dollars to generate high returns.
Video and data services have been fast over the years.
According to industry estimates, home security users will stay for an average of seven to eight years, and unlike fickle cable users, they can be attracted to attractive exchanges from satellite and telecom competitors.
Jim Johnson, executive vice president of IControl, said cable companies \"are under pressure from traditional businesses, so there is some urgency to increase revenue, \"The main home safety suppliers of Comcast, Time Warner Cable and Cox Communications.
The 58-year-old Bruce Bird, one of the most recent converts, believes he does not need a home security system until his New Jersey beach house was robbed in last December.
Just after he spent thousands of dollars repairing the damage caused by Hurricane Sandy, the criminals tore off the cabinets and ran away with his flat-screen TV.
Pharmaceutical consultant Bird has decided against traditional security providers like ADT and has chosen Comcast, already his cable company, to protect his holiday home on Boracay, New Jersey.
\"I keep getting flyers in the mail saying I have technology so I just called Comcast,\" he said . \".
Service is not cheap.
Bird said he spent about $700 on his beach villa to install Comcast\'s Xfinity family products for cameras and sensors, as well as other features, when he was away, he can control the thermostat and the lights.
As part of a $209 bill including cable, telephone and Internet, Bird pays about $49 a month for security services.
Using his smartphone, he can now check the four cameras inside the house and email photos of anyone entering the house.
The largest Comcast in the United StatesS.
Cable operators with 22 million video subscribers entered the security market in 2010, but did not disclose the number of users.
Time Warner Cable serves 12 million video customers with 30,000 users in its security business, the new chief executive Rob Marcus said at a recent investor meeting.
Consumers can now \"observe what your dog, cat or nanny is doing during the day\", he told investors \".
The company began selling the service in New York City this week, the last big home safety market the company has yet to develop.
Adam Mayer, vice president of Time Warner Cable\'s \"smart home\" division, said the company could create special packaging for apartments to break into the broader New York market.
Private-held Cox does not state how many users have purchased its products, saying it plans to occupy a \"health percentage\" of the $1 billion potential market in the area it operates \", the spokesman said.
Cable operators must rely on years of experience, infrastructure and name identification to exceed existing operators including Protection, Protection 1, Ascent Monitronics.
There are 6 ADT alone.
5 million of customers, about a quarter of the United StatesS. market.
Prices are becoming a key battleground and if customers combine home safety with other services, Comcast, Cox and Time Warner Cable offer discounts.
This makes the price of home safety $30.
$50 per month, just under the charge of the ADT for its new \"pulse\" product.
Even with the difference, Empire Capital analyst Jeff Kessler said cable companies may take years to gain the trust of consumers in a market where the safe providers
\"What people think about cable companies is that they will be there between 8 and 5 next week.
You can\'t do that if you want the police to come in 5 to 6 minutes, \"Kessler said.
Nevertheless, Kessler estimates that cable TV will add 25 million units, while traditional security companies will have between 5 and 6 million units in the coming years.
Larger security companies will withstand new competition, he said, because there will always be customers who prefer the products of specialized security companies.
Mitch Bowling, an executive at Comcast Xfinity Home, said half of the company\'s security customers are new, and 96% of Xfinity home customers have purchased at least two other Comcast services and two-
Thirty of these customers have never purchased home safety products before.
Jessica Reif Cohen, an analyst at Bank of America, said adding a home security business would raise Time Warner Cable\'s share price by $20,
Cable companies have also seen opportunities to extend such services to small businesses.
They also want to increase home automation services and use broadband networks to allow customers to remotely control lights, appliances and thermostats.
Wireless operator AT&T Inc. , which launched home security and automation services in 2011, plans to provide services in more than 50 markets by the end of 2013, surpassing their original plan and moving to the country in 2014.
Glenn Lurie, head of AT&T\'s emerging equipment business, said such services would end up earning $1 billion a year.
Verizon Communications has a product, but it will not connect consumers to the police or other authorities in an emergency.
In June, DirecTV acquired a family safety company called LifeShield.
Paul Guyardo, chief revenue and marketing officer at DirecTV, said the service would start trial in the fourth quarter and be released nationwide in the first quarter.
Home safety and automation is a lowchurn, high-
He noted that this is a complement to the DirecTV video business.
Not every cable company is charging the market.
There are no products for chartered cars, cableways and network plates.
Dish says it is \"constantly evaluating opportunities\" while Charter says it is focusing on its core business.
Speaking in an interview, adt ceo Naren Gursahaney said he was discussing potential partnerships with each paying TV company.
\"To a large extent, they decided to try the market themselves,\" Gursahaney said . \".
\"If they want to provide the best combination of varieties including the ADT. . .
We are open to such discussions.
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