The majority of home security companies require a contract when a customer signs up for their service. This is often times because the customer doesn't pay for the equipment itself, it is on loan throughout the duration of the contract (and then again if the contract is renewed). The up-front costs associated with these types of platforms are relatively inexpensive in comparison to those that do not require a contract.
Companies that require the customer to purchase all of the equipment up-front do not typically require a contract. With these types of providers, customers are usually only required to pay their monthly monitoring fees. However, the up-front costs are more expensive since the customer owns the equipment/system outright.
The above graph represents what consumers believed was a reasonable policy cost regarding cancellation. The overwhelming majority said they would prefer no cancellation fee at all, but that would mean paying for the system or more expensive up-front costs. A flat fee and a lower percentage of the balance costs are viewed as the next most reasonable fees for cancellation.