Amazon shakes up home security business

Amazon announced last week that it is jumping into the home security business—with both feet I might add—with the unveiling of five security packages for both homeowners and renters. What is most interesting about this announcement, though, is Amazon's go-to-market strategy, which involves no monthly fees, just an upfront cost for the equipment package. Plus, all five equipment packages include free installation and visits from Amazon smart home experts to go over what is the best fit prior to choosing an option.

For those who have been following the success of Amazon's Alexa, this move really shouldn't come as a surprise, especially considering all of the inroads Amazon has been making in the smart home space, from its acquisition of Ring, the smart doorbell company, to its new in-home delivery service, Amazon Key, that features its Cloud Cam and partnerships with smart lock providers.

It will be interesting to see how this will shake up the current home security market, which traditionally has existed on a RMR model that includes spreading some of equipment cost out over several months or years. It will also be interesting to see how this move succeeds overall for Amazon, as the security packages get a bit costly on the higher end.

So, let's take a look at what packages they are offering, many of which work in tandem with Amazon's Echo and Alexa. Amazon is offering two outdoor security packages and three indoor packages. The first outdoor package, for $240, includes “expert smart lighting that will make it look like you're home,” the website reads, while the Outdoor Plus package adds in a smart doorbell. For indoor security, the base package for $320, which is “perfect for renters” the website says, includes motion, door and window sensors, an indoor camera, smart siren and smart home hub. Homeowners can choose from Smart for $575 or Smartest for $840, each of which adds devices to the base package.

As consumer buying seems to be moving more toward a subscription-based model, this seems like a bit of risk to ask homeowners to pay that much up front, but it may be a risk that pays off for Amazon. For one, consumers who may not have taken the leap into the smart home or home security will see this as a way to get both—the Alexa voice assistant and home security—all from one provider in a very seamless way.

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