A new Parks Associates white paper explores how shifting consumer expectations are accelerating the decline of traditional home security systems and creating new opportunities for integrators focused on smart home services and professional monitoring.

The home security industry is steadily pivoting away from equipment-heavy installations toward software-based intelligence, automation and flexible service delivery, according to a new white paper by Parks Associates.

Titled “Home Security Reimagined: Intelligence over Hardware,” the report details a strategic shift that challenges the traditional model of panels, sensors and long-term service contracts.

Parks Associates reports that new acquisitions of professionally installed, professionally monitored security systems reached a nine-year low in 2024. Yet this doesn’t spell doom for the industry. In fact, integrators may find some silver linings.

“The slow housing market, depressed consumer spending, and alternatives like stand-alone smart video devices are having an impact on security system sales,” Jennifer Kent, vice president of research at Parks Associates, explained to SecurityInfoWatch. “But while fewer households bought security systems in 2024, many security providers are seeing very low churn, which is critical for keeping up their ongoing revenue.”

Kent, the white paper's co-author, encourages integrators to rethink their approach to sales and service delivery. “Security dealers need to be ready to offer consumers choice in the products they offer, choice in installation method, transparent pricing as possible, and the ability to purchase online to capture younger homeowners in the way they like to shop,” she said.

Parks’ research further shows that younger buyers — particularly those new to homeownership — value flexibility in purchasing and installation options. This makes online retail channels, app-based support and hybrid install models a high priority for integrators aiming to expand their customer base.

For integrators, knowing where to invest in physical equipment versus software-defined tools is becoming critical. Kent frames the distinction as a divide between “functional devices” and “informational devices.”

“Devices like video cameras, smart locks, garage door openers and perimeter lighting all provide functional benefits: the ability to see something happening in real time or later, control physical access to the home, and provide better visibility,” she said. These devices remain essential and often expand the value of the system while enabling recurring revenues through services like cloud storage or fire monitoring.

By contrast, many sensors, panels and keypads primarily serve as inputs and may soon be replaced or absorbed into multi-use platforms. “All of the information and inputs retain their value, and become even more valuable with the advancement of AI,” Kent noted, “but pressures of cost and disruptive innovation are likely to move these inputs into software inputs where possible or into multi-sensor devices.”

According to Parks, this shift is already underway. Cameras, smart locks and smart lights are consistently the top devices added to a security system post-installation. These technologies are seen by consumers not just as security enhancements but as tools for greater control and day-to-day convenience.

“As consumers continue to adopt more and more smart home devices, dealers will increasingly come into homes that have existing home automation devices,” Kent explained. Integrators who can incorporate third-party devices — often part of a “Bring Your Own Device” (BYOD) setup — into a unified security system can deliver more personalized, value-rich solutions. However, not all platforms support this level of integration, and the process can be time-consuming.

Additionally, this transition is widening the competitive landscape. Standalone hubs and embedded software are lowering the barrier to entry for non-traditional players such as internet service providers and mobile carriers. Parks notes that these entities are now well-positioned to offer bundled services that combine internet, entertainment and security — all from a single provider.

Still, traditional integrators have one major advantage: expertise. According to Kent, “Dealers are on the frontline of having to set consumer expectations and how new features and devices serve the customer and don’t unnecessarily expose them to privacy or data security risks.”

Parks’ research shows that 31% of 2024 security system buyers cited smart home functionality as the main reason for their purchase — up from just 19% in 2021. In fact, demand for home automation is now the top trigger for system acquisition, surpassing incidents like burglaries or starting a family.

This is an important message for dealers who still lead with intrusion protection. “Smart security systems are not just intrusion prevent/detection, ‘just in case’ investments,” Kent said. “With home control they are a part of how the household functions with daily engagement.”

Parks’ data shows that pro-monitored systems consistently receive higher Net Promoter Scores (NPS) than self-monitored systems. Yet consumers’ willingness to pay for monitoring is waning, especially in areas where police response to alarms is limited.

Kent is blunt: “The real advantage that security providers have over tech players and other smart home players is that they have a means to DO something if there’s an emergency or security threat. Monitoring sets the security industry apart, but that core capability must get better at understanding context.”

Looking ahead, Parks Associates identifies several characteristics that will separate thriving integrators from those who fail to adapt.

“Dealers that evolve with customer shopping and support preferences” will win the next generation of buyers, Kent explained. “Online sales, transparent pricing, self-install options, remote technical support, and app-based scheduling are all key elements of a modern security service that younger homeowners will expect from their security provider.”

Kent also encourages dealers to expand their role from installers to local smart home advisors. “Consumers need help in getting the most out of their systems, setting routines that work for them, integrating devices together, and physically installing new devices.”

This shift doesn’t mean abandoning traditional security, but it does require redefining what value looks like. Parks calls on integrators to embrace software-first models, intelligent monitoring platforms and broader ecosystem partnerships that make security more than just a deterrent.

The “Home Security Reimagined” white paper makes clear that legacy business models won’t carry integrators into the future. As Parks Associates concludes, the value of security is no longer limited to deterring intrusions. It now encompasses intelligence, awareness and seamless integration into everyday life.

Consumers increasingly view smart home benefits — automation, control and contextual awareness — as equal to or greater than traditional intrusion detection. According to Kent, the most successful integrators will be those who embrace verification, adopt flexible sales and support models and position themselves as local smart home experts.

As the white paper puts it, “Security is no longer just about deterring intruders — it’s about empowering households with knowledge, control and peace of mind.”

From the article, "Pro Monitoring, Smart Homes and the Decline of Traditional Security" by Rodney Bosch