Poll: Monitoring and the switch to wholesale

Sixty-eight percent of respondents say there is a benefit to switching to third party
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Wednesday, December 21, 2016

YARMOUTH, Maine—Several security companies with monitoring centers switched to using third party monitoring in 2016; RFI Communications switched to Rapid Response in March, Red Hawk Fire & Security partnered with Affiliated Monitoring in October and Comtronics switched its monitored accounts to NMC. Respondents to Security Systems News’ latest poll see this trend continuing in the future.

“It's a double edged sword,” according to Rob Driscoll, general manager, monitoring services for Koorsen Fire and Security. “You do have better control of your customer service if the [central station] is in house. But, that does not translate into better customer service unless you can execute better than the third party company you are using or would otherwise use.”

Driscoll continued, “We continue to choose the third party model because we believe it allows us to focus our resources on providing the best customer service for sales, installation, and on-site service.”

While half of respondents said they operate their own central station, 74 percent said that more companies will continue to switch to wholesale monitoring.

Forty-three percent said their company uses a wholesale monitoring center, and 7 percent said their business does not involve monitoring.

Fourteen percent said that there will not be a trend of companies switching to third party central stations; the companies attracted by that model are already using it. An additional 12 percent said they have another opinion or are not sure whether more companies with central stations will switch to wholesale monitoring centers.

Are there benefits to switching to a wholesale central? A majority of respondents—68 percent—said yes, because third party centrals can adopt new technologies faster. Owning a proprietary central station means more control, according to 15 percent.

“My customers appreciate the benefits that a local independent central station brings,” one respondent said.

Seventeen percent said that they are not sure of third party monitoring benefits or have another opinion.

Another reader said that the benefits of third party monitoring centers depend on their models. “A big factor will be whether third party central stations are tempted to offer services direct to the consumer. This will erode confidence that dealers are not funding their competitors.”

Roberto Winter, Operations Centre Manager for Houle Electric, described his company’s monitoring model. “We are using a hybrid model whereby the wholesale station does only one part of the service offerings, e.g. the typical intrusion monitoring. We add an extra layer of personalized services not covered by wholesale stations. The key is that both stations are integrated.”