Economics

Why would Alex listen to the other arbiter? Why not shoot them, too? Why not get a bunch of your friends, and fight your enemies until you establish yourself as a local warlord? That's what these security companies would be positioned to do, and that's going to bring out the worst of humanity.

Meanwhile, what if Bob was behind on his payments? Is this going to be like The Purge, where you can just do crimes to anyone who can't afford private security? That's going to extra suck for groups that are historically economically disadvantaged (women, children, descendants of slaves, chronically ill, to name a few)

And again, there's not really a reason for these different entities to compete when they can instead form a cooperative trust. That's sort of the history of the gilded age in the US. it sucked for most people.

It sounds like it's going to devolve into the rule of might-makes-right, where whoever has the most guns and willing soldiers gets to say what's what. Real life has at least some thin wrappers around might-makes-right, with rights enumerated in the constitution