How Comcast’s Xfinity Home Is Disrupting Residential Security

Take a deep dive into one of the leading players — Comcast’s Xfinity Home — and a winning formula that has surpassed 1 million customers.

How Comcast’s Xfinity Home Is Disrupting Residential Security

After decades of false starts, cable, satellite TV and telecom companies are becoming forces in the residential security and connected services market.

There was a time not so very long ago when the notion of telecommunications, cable television or satellite television companies branching into the residential alarm business was roundly scoffed at by the electronic security industry community.

Having been branded as interlopers, through the years several failed attempts by those large communication companies to stake their home security market claim validated the case for many established operators who dismissed their viability let alone entertained any competitive threat.

Times change and the old guard faces a rude awakening because not only are the barbarians at the gate, they are crashing through. The cable, satellite TV and telecom “invaders” are attacking the residential security and controls market with a vengeance and have been making substantial customer conquests.

Leading the onslaught is Comcast’s Xfinity Home, which was launched in 2011 and recently surpassed 1 million customers. Xfinity Home includes 24/7 professional monitoring (by Cops Monitoring) as well as battery and cellular back-up.

Key capabilities include: remote arming and disarming, real-time text and email alerts, 24/7 video recording, live video monitoring, lighting and thermostat control, and smoke and water leak detection. The Works With Xfinity Home partner program enables the offering to integrate with an array of smart home devices.

Customers can manage and stay connected to their homes via the Xfinity Home mobile app, online portal, in-home touchscreen controller or on their TV with the X1 platform. The company charges $39.95 per month with a two-year agreement; however, promotions can drop the price as low as $24.99 and special pricing is available when Xfinity Home service is bundled with other Xfinity services like video, Internet and home phone.

Therein lies one of the key competitive advantages for Comcast and other communications companies ― selling security as one service among many to the home. And Xfinity Home’s portfolio is broadening after last year’s acquisition of Icontrol’s Converge software platform and a newly announced partnership to offer solar energy in select markets.

To find out how and why their model is working so well now, Security Sales & Integration spoke with several Xfinity Home executives: General Manager and Senior Vice President Dan Herscovici, Vice President of New Business Dennis Mathew, Vice President of Product Management Neal Foster and Vice President Operations Shuvankar Roy.

They talk internal strategies, market perspective, technologies and services, competition and Xfinity Home’s place in the security industry, and whether there are potential opportunities for dealers to partner.

Telecoms, cablecoms and satcoms dabbled in security over the years with little success. What has changed?

DAN HERSCOVICI: There’s three major areas, and I think some of it is unique to Comcast. The first is a dedication to start a business and invest in it and wait for it to grow. At Comcast, when we launch and build new businesses we are willing to invest for the long term.

A security business requires some stamina to stay in. When we first launched Xfinity Home, it was not profitable, but after nurturing and growing it over several years it has become a very exciting and interesting business. Comcast has almost a $200 billion market cap and 100,000-plus employees servicing 25 million+ homes across the country.

When you look at a company our size and you think about how successful we are at building and starting brand new businesses from scratch, I’m impressed every day at how nimble and agile such a large company can be. Comcast is a public company that’s willing to truly invest for long-term results.

The second area is the shift in the home security industry from traditional security to connected security. This transition presented an opportunity for us, specifically in that we are able to offer unique experiences when Xfinity Home is bundled with our other products. The ability to offer consumers a bundle of services with our core offerings, specifically video, Internet and voice; creates unique experiences available only to customers who buy all our products.

Xfinity Home’s marketing includes trade shows like CEDIA (pictured), online, di-rect marketing, retail stores, door-to-door, outbound sales calls and TV spots.

Customers who have our Internet and X1 TV service can manage their home security system from their TV or use our voice remote to control features such as view your cameras or arm and disarm their system. These experiences and features created interest, pull-through and economic value that allowed us to grow the business.

The third area is that we removed a lot of friction from the sales process. If you think about it, for the past 30 years buying a security system involved a bunch of inconvenience. You had to talk to somebody on the phone. Then you had to schedule an appointment in your home for a consultation. Then you had to schedule another appointment for someone to come and install.

That long process interrupts your life several times, and the installation isn’t quick and efficient. With Xfinity Home, consumers still have to make a phone call and interact with a sales agent, but they are most often doing that interaction on the same transaction when they buy Internet and video services together. So it’s not a new, unique phone call, not a unique web search or web interaction they are making for each service.

Our customers are discovering and buying security all in the same transaction when they are typically buying their Internet or TV services. This extends to existing customers who may be upgrading and adding security as well. They are doing it on the same transaction where perhaps they are talking about their bill or exploring our other products. It’s a very seamless transaction.

There’s no consultation because the technician is our expert. The Xfinity technician comes in, discusses needs and concerns with the customer, and then designs and installs the system on the spot. Furthermore, our techs install Internet and video on the spot. Removing friction from the sales process has made it really easy to buy from us. When you combine value, unique capability and experiences, and the ease of purchase, it makes for quite an attractive service that accelerates at the pace we’ve seen.

How big do you see the smart home market getting?

HERSCOVICI: The home security market is a $9 billion opportunity in our footprint. Roughly 25%-30% of broadband households have a home security service, and that will grow 1%-3% over the next five years. The more exciting part is the upgrade cycle. Connected home security is still in the first half of its game.

Probably more than 50% of home security households are still on old-school security. We see the pace of upgrade accelerating and think there’s a lot of opportunity in upgrading those households over the next five years. The smart home side of the question is harder to pin down as it is too broad a term and it’s unclear what it actually means sometimes.

We focus on categories of experiences. The next adjacent seat to home security is what we call peace of mind, which is less about calling the authorities and more about giving you information about what’s going on in or outside your home. The ability to quickly check the Xfinity Home mobile app to see if your kids are home or if a package was delivered or get alerts that a motion was detected can offer peace of mind.

Then there’s other verticals that are interesting in health and wellness, energy management, the kitchen, and entertainment. In my mind those opportunities are unlimited.

Do you target prospects outside of the Comcast cable footprint?

HERSCOVICI: No, but there are two parts of our business. One that Dennis Mathew leads is the wholesale business. Xfinity Home mostly focuses on consumers within our footprint. Our business wholesale side is where we sell our security platform to other service providers to brand and sell our total home security and home automation solution as their very own. In that business, we sell to companies including Cox and Rogers and other cable companies. We hope to further expand this business.

DENNIS MATHEW: We’re excited to be in the wholesale business. We completed our acquisition of Icontrol earlier this year. Now we’re working to continue to grow the relationships we have acquired and have started to expand the sales pipeline. This is wholesaling under a white label our home security, home automation and video recording capabilities to service providers, allowing them to sell all these capabilities directly to their customers under their brand.

HERSCOVICI: The Xfinity Home business is similar to ADT and Vivint. The wholesale business is similar to Alarm.com.

The Xfinity Home Secure package includes a touchscreen controller, wireless keypad, motion sensor and three door/window sensors. Add-ons include cameras, smart thermostats, outlet controllers, smoke detectors and additional intrusion sensors. Systems are professionally monitored by Cops.

As you’re building up this subscriber base, how are you managing attrition?

SHUVANKAR ROY: Generally attrition is in line with industry standards. We are on par with some of the best home security companies in the U.S. We manage it mostly on the front-end by creating a great customer experience from the time of purchase through the installation process and afterwards, ensuring they understand how to use, operate and engage with the Xfinity Home system.

One of the things we noticed with old-school home security systems is that many people stop arming and disarming the system. They might still be paying a monthly bill because they are locked into a five-year contract, or perhaps due to false alarms or frustration or confusion they stop using it.

We spend a lot of energy focused on engagement and usage, and we work hard to deliver value to our consumers beyond security to ensure they’re using their home security system as often as possible. We want our customers in the Xfinity Home mobile app checking the history of when the doors opened or when motion has been detected.

We want our customers to purchase a connected camera so they can monitor their home and look at snippets of video where motion was detected. We want our customers to arm and disarm their home security system via the mobile app from anywhere. We want our customers to achieve peace of mind thanks to these kinds of capabilities.

We offer a two-year contract with our service as opposed to some of the longer contracts from some of our competitors. We believe it’s better to retain customers through a superior experience than due to locking them into longer contracts.

Describe the Xfinity corporate culture, and how you recruit and train.

HERSCOVICI: Within Xfinity Home we mirror a lot of the Comcast corporate culture. Believe it or not, we’re a family-run business. Brian Roberts took over the business from his father Ralph, who founded it with two others. Brian carries that sort of family-focused, family-first philosophy throughout the company. Because of the type of work we do at Xfinity Home, we’re a little more entrepreneurial.

We’re a bit more nimble and agile and move a little faster, and tend to question the status quo a bit more. Many times we will develop new processes that are better than what existed prior, and the other parts of Comcast will take those on and use those as best-in-class examples to make the entire business better.

We tend to attract people that have that entrepreneurial spirit, have that go-getter spirit, and love the hard work, strategic thinking and execution that’s required to build a business like ours.

Read on to see what Comcast execs have to say about the smart home and how they feel about DIY systems…

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About the Author

Contact:

Scott Goldfine is the marketing director for Elite Interactive Solutions. He is the former editor-in-chief and associate publisher of Security Sales & Integration. He can be reached at [email protected].

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One response to “How Comcast’s Xfinity Home Is Disrupting Residential Security”

  1. Julie Painter says:

    I live with my father (93yrs of age) and the loud bonging sound made every time a door is opened that sound is rather annoying. Plus the outdoor cameras (@) are not what we expected. If there were to be a person trying to burgler our home the pictures are too small to ID the person(s). Very disappointed in that… We really want the system removed ASAP.

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