Video Surveillance: Integrators' perspective on the year ahead

How does 2010 look from a video surveillance perspective? Some of the country's leading security integrators recently took a look at several of the major issues facing the surveillance industry in this exclusive roundtable: Video Surveillance -- The Year Ahead.

Our five-integrator panel -- which includes Sean Ahrens of Schirmer Engineering, Ray Bernard of Ray Bernard Consulting Services, Bill Bozeman of PSA Security Network, Jim Coleman of Operation Security Systems, and Bob Stockwell of Niscayah -- had some diverse views regarding which technology will have the greatest impact on the video surveillance industry in 2010. Two of our integrators, however, agreed that managed and remote monitoring services will have the greatest impact.

"The industry has alluded to technology for remote diagnostics, remote system heath checks, network attached video storage and a host of other remote services that, until now, were not readily available," Stockwell says. "With the technological advances in Management Remote Video Offerings, customers can take full advantage of their existing investment in video equipment while reducing costs and avoiding significant capital outlay."

Remote monitoring has can also be seen as a money-maker for business: "[Remote monitoring] has been a revenue-increasing move for the business -- not just a security improvement," Bernard says. "I don't know what the impact on the industry as a whole will be, but for many individual businesses both large and small, remote monitoring is able to make a significant contribution to the business."

All of the integrators found some common ground, in that video analytics is finding more traction in the marketplace -- although some believe progress is still slow in coming. "The improvements in the last 24 months have been noteworthy," Bozeman says. "Video analytics can now be deployed by the traditional security systems integrator in an efficient and profitable manner -- this has not been the case in the past, as deployment has been difficult, resulting in projects that were not profitable for the integrator."

Much of the attention in the video surveillance industry these days is focused on IP video. This is especially important for integrators, who may need to receive training from the various manufacturers to deploy the systems. On the whole, the integrator panel thinks the manufacturer community has done a good job in providing the necessary training. However, a wide range of new products entering the marketplace, and a predicted rise in IP video deployments are two issues that integrators should be thinking about. "Training opportunities are aplenty," Coleman says. "Investing in each of the products that seems promising is the problem. Integrators need to make choices on which lines they can support."

But the explosive growth of IP video still will not overshadow the analog market -- according to the integrators, the rumored death of analog video has been highly exaggerated; however, future-proofing efforts are still centered around the newer technology. "The only thing that was exaggerated is the time-frame," Ahrens says. "End-users are building infrastructure to accommodate IP in the future. I know -- I am designing it!"

Finally, an increase in mergers and acquisitions in the video surveillance industry is definitely a positive sign, according to Bozeman. "The activity of the M&A market is an indication that we are in an exciting growth industry the big money sees a future in," he says. "I see this as a very positive business indicator for our industry. This is not to say that when a large corporation acquires a small entrepreneurial company that everything gets better for the end-user and the integrator, as this has proven not to be the case, but you cannot argue that the big money smells roses in our niche."

Next Page: The Full Roundtable Q&A

The Full Roundtable: Hear exactly what our panel had to say...

Our Participants:

  • Sean A. Ahrens, CPP, CSC, project manager -- security consulting and design services, Schirmer Engineering, an Aon Global Company
  • Ray Bernard, president, Ray Bernard Consulting Services
  • Bill Bozeman, CEO, PSA Security Network
  • Jim Coleman, president, Operational Security Systems Inc.
  • Bob Stockwell, director of U.S. Systems Operations, Niscayah Inc.


What is the one technological innovation that will have the greatest impact on video surveillance this year, and how will it do it?

Ahrens: The semi-conductor industry shall continue to proliferate advances in camera technology. As a result, distributed edge technologies will continue to foster growth in video analytics. Time will facilitate advances of software templates or pattern recognition that will bring pseudo guard monitoring. The advancement of pattern-based camera recognition will facilitate reduction in security staffing. In addition, the use of high-resolution digital interfaces such as DVI and HDMI will replace traditional BNC/S-Video video connections.

 

 

Bernard: I believe that remote monitoring services will become very important for many companies. I know of one laundromat business in California that has been able to extend its hours of operation and increase its customer base through the use of cameras with two-way audio and remote control of doors and lighting. This has been a revenue-increasing move for the business -- not just a security improvement. I don't know what the impact on the industry as a whole will be, but for many individual businesses both large and small, remote monitoring is able to make a significant contribution to the business.

 

 

Bozeman: The virtualization of the NVR. It is already happening and this change will open up the video surveillance market to yet another level, allowing for increased deployment opportunities.

 

 

Coleman: Likely IP cameras will have the greatest impact on growth of revenue in the video surveillance segment. They will continue to grow in market share.

 

 

Stockwell: Managed Remote Services Offerings will be the significant "piece of the puzzle" for customers who have made a significant investment in video hardware and infrastructure over the years. The industry has alluded to technology for remote diagnostics, remote system heath checks, network attached video storage and a host of other remote services that, until now, were not readily available. With the technological advances in Management Remote Video Offerings, customers can take full advantage of their existing investment in video equipment while reducing costs and avoiding significant capital outlay. This is especially appealing given the current economic climate -- everyone appreciates spending less and getting more.

 

 

Next Page: Is video analytics gaining traction?

How will video analytics gain traction and becomes a profitable part of the video surveillance industry in 2010?

Bozeman: It already has for these who have chosen to dip their toe in. The improvements in the last 24 months have been noteworthy. VA can now be deployed by the traditional security systems integrator in an efficient and profitable manner. This has not been the case in the past, as deployment has been difficult, resulting in projects that were not profitable for the integrator.

 

 

Ahrens: Advances in the development of pattern recognition templates will foster expansive growth in video analytics.

 

 

Coleman: Video Analytics will become easier to set up and use. Products like Video IQ's [intelligent cameras with built-in edge recorders] are easy to implement into an existing system.

 

 

Stockwell: First, video analytics must be a "soft solution" that is importable to existing hardware platforms. Companies have a large capital investment in hardware and cannot financially change (nor will they) just to have analytics. Second, video analytics should be called "Business Intelligence Reporting." In retail for example, it should capture customer shopping patterns, shopper trends and other data that is critical or can be critical to the retail marketing and Consumer Packaged Goods (GPG) executives. BIR will only get traction when a sound business case can be made that clearly shows a significantly positive impact to the bottom line via increased sales, revenue, market share, etc.

 

 

Bernard: Total cost of deployment and difficulty of deployment have been two of the barriers to widespread use. I believe that in the past, video analytics have been over-hyped, in great contrast to the few large project failures, and so potential customers don't have a sound basis for making the decision to investigate technologies themselves. An honest casebook of video analytics successes and failures, along with the key factors involved, could help prospective customers discover if they have common situations to the successful deployments. When the focus is on the technologies themselves, the discussion becomes too complex as there are too many technology factors. If the focus could shift to applications, with "great fit, good fit, and acceptable fit" criteria, I think we could see more projects achieving success.

 

 

Next Page: Assessing IP video's market growth

2009 saw a slow-down in the overall market growth projections for IP video. Do you expect 2010 to be similar to 2009 in terms of market growth, or if not, what will turn it around in 2010?

Stockwell: Such a slow-down in IP Video is not surprising, given the state of our economy. All leading economic indicators clearly predict overall flat sales in 2010 and this includes the IP Video market. However, some in our industry believe that customer losses will worsen in this downturn and therefore drive customers to increase security expenditures. This is wishful thinking and does not reflect reality. In my opinion, customers will demand that their security executives work harder to eliminate waste, improve operations and maximize the use of existing infrastructure. And one such maximization could involve the development of an IP migration strategy which utilizes as much of the existing infrastructure as possible. This may be the niche for the IP video industry for 2010.

 

 

Coleman: We don't think things will turn around until third quarter. 2010 will be closer to 2009 than 2008.

 

 

Ahrens: The initial impression by end-users was that IP was cheaper, which pushed market share; manufacturers responded by biting down on a bitter pill. What end-users and manufacturers learned was that to match the same functionality of analog CCTV, end-users and manufacturers needed to spend a lot of money. End-users learned they were potentially giving up a lot by moving towards IP; it is my opinion that this caused the IP market slowdown. However, with so many organizations investing in IP camera technology, advances in R&D, and standardization, I believe that IP will eventually replace analog.

 

 

Bernard: Lowering the total cost of deployment can certainly help. The cost of learning curves is often not taken into consideration, but it is definitely felt by customers whose personnel are impacted. In several recent projects, we found a number of usability issues with the video management software that were totally unnecessary. As the products had grown, features were tacked into them apparently where convenient for their programmers, rather than the users. The industry as a whole is very over-dependent on training both for integrators and customers. Analog cameras and matrix switchers, although providing less capability than today's networked video products, were simpler to install and operate than network cameras and video management systems. In spite of this, our consulting business is currently involved in more video projects than we have ever been involved in before. This gives me the impression that things are improving, although the degree of change is hard to measure.

 

 

Bozeman: IP will continue to grow at a much higher percentage than analog, but both are dependent on an economic recovery.

 

 

Next Page: How is industry doing on IP video training?

In your opinion, are the manufacturers/product developers providing the training you need to successfully use their technology in IP video projects, and are they also being accurate about the capabilities and specifications of their IP product lines? Why or why not?

Bernard: We have had no trouble getting training or technical support from any of the manufacturers whose technologies we've been involved in. All of the manufacturers that we have dealt with directly have been very honest about their technologies, including sometimes recommending competing products.

 

 

Ahrens: The amount of training that manufacturers provide is only window dressing to really understanding IP. Security professionals don't have time to learn a program or understand how TCP/IP will affect them. Organizations that wish to implement IP will need technologically savvy personnel to guide them through the process. They need to follow what the manufacturers have done, because I am not sure manufacturers fully understand all of the unanticipated issues with IP -- such as an IP camera "locking up" and you need to cut the power to "reboot it" to get it working again. Now that's technology.

 

 

Bozeman: The IP training has improved a great deal. All manufacturers have marketing departments that occasionally take liberties with product descriptions, and this is true in all industries.

 

 

Stockwell: There is a deluge of new product offering from new companies that say their products are "tested" when they really are not. Integrators are being asked to take these new offerings to market and install them in real-world situations where the products have not been tested against the full contingent of existing technology in the marketplace. When new offerings do not work as described, it can create potential liabilities and damage the integrator's relationship with the customer. Generally, training is "adequate at best"… for initial training. Manufacturers offer structured training classes that are limited in times and locations, requiring integrators to spend unnecessary cost on travel. Worse, there is very little ongoing "field" training.

 

 

Coleman: Training opportunities are aplenty. Investing in each of the products that seem promising is the problem. Integrators need to make choices on which lines they can support.

 

 

Next page: The death of analog video?

Have the rumors of the death of analog video been highly exaggerated?

Coleman: Yes -- IP will continue to grow, but analog will continue to have a solid slot in the marketplace.

 

 

Bernard: Analog video will continue to live as long as people sell it, and as long as deploying network video (that takes advantage of all that the technology can offer) remains as complicated to deploy as it is now. That is changing slowly, but the rate of change could pick up at any time. That ball is in the court of the network video product manufacturers.

 

 

Ahrens: The only thing that was exaggerated is the time-frame. End-users are building infrastructure to accommodate IP in the future. I know -- I am designing it!

 

 

Bozeman: This will eventually happen, but it will take several years. It will be similar to the VCR evolution to the DVY -- not overnight, but it will happen.

 

 

Stockwell: Yes and No. Customers have invested in their current system infrastructure, and given the current economic situation, cannot afford to replace analog equipment. In many cases, the business does not have the capacity to handle IP devices (ports not available, bandwidth issues, etc.). I recently read that 80 percent of all video cameras sold last year were analog. Security integrators must assist their customer with an engineered strategy to migrate to IP over time with hybrid offerings. But in the long term, analog will surely be replaced with new technology…just as video tapes were replaced by DVDs and audio cassettes were replaced by CDs.

 

 

Next page: The affect of acquisitions

With the recent high number of significant planned and/or completed acquisitions, mergers and product division sales across our industry (UTC/GE, DVTel/Ioimage, Bosch/Extreme, Nice/Orsus, Panasonic/Sanyo, SCM/Hirsch, March Networks/Cieffe, L-1/Bioscrypt, General Dynamics/Axsys, GVI/PacketNVR, GE/Safran, Moog/Videolarm, Orsus/Cinario), how is the future of video surveillance innovation being spurred (or stymied) by mergers and acquisitions?

Bozeman: The activity of the M&A market is an indication that we are in an exciting growth industry the big money sees a future in. I see this as a very positive business indicator for our industry. This is not to say that when a large corporation acquires a small entrepreneurial company that everything gets better for the end user and the integrator as this has proven not to be the case but you cannot argue that the big money smells roses in our niche.

 

 

Stockwell: The explanation for this spate of acquisition mania can be attributed to companies striving to 1) Reduce the need for extensive and costly R&D; 2) Improve speed to market of new technology; and 3) Bargain shopping. Security technology companies appear to be purchasing new technology instead of deploying R&D in a rush to market. At times, it also seems as if the acquisitions are done to eliminate competition. Lastly, all of this is perpetuated by the current credit crunch which has driven many technology companies to the brink, leaving them no choice but to sell to a suitor with a stronger balance sheet.

 

 

Ahrens: The mergers of manufacturers and product lines will help cameras communicate and will limit interoperability issues. The real advance will occur when we have an IP standard that is similar to what we have for analog -- NTSC, PAL, etc. The question is, can we get them to agree?

 

 

Bernard: Anything that adds to the confusion makes the buying decision harder. Currently, the confusion level is very high for video compared to other technology segments. There is a difference between complexity and confusion. Product complexity under the hood, and industry complexity in the product landscapes don't have to translate into confusion for customers. Those are solvable problems. To solve them, the industry players will have to become more aware of them from the customer perspective.

 

 

Coleman: Market share is going to those embracing open architectures and coming at the cost of proprietary offerings. Innovation continues to come from smaller companies who are then sometimes bought by larger companies.

 

 

Coming Soon: The Manufacturers' Perspectives on The Year Ahead for Video Surveillance

Loading