Video Surveillance Reality Check: Part 2

Industry thinkers weigh in with current perspectives on surveillance industry trends

[Editor's Note: asked four industry notables to blow away the hype, roll up their sleeves, get their hands dirty and not pull any punches when it comes to where they see the video surveillance industry today. The result was honest, open takes on our business. Their columns will be appearing consecutively on Part 1 featured Bosch's Dr. Bob Banerjee. Part 2 begins below and features the words of Ari Erenthal, who handles video surveillance systems sales for products distributor B&H Photo Video in New York. As a little background, Ari has seen 40 percent of his sales move into the IP video space. In subsequent parts, each written by a different guest columnist, we'll link all these stories together and promote the heck out of them on the site (all will appear on the "columns and features" segment of our Video Surveillance section; click the "products" navigation drop down and choose "video surveillance"). We hope we stir up some feelings. The comments area is open, so share your perspectives, too!]

For those of us in the surveillance industry who have survived the financiapocalypse, 2009 is ending on a note of hope. Yes, we've all had a hard year, the hardest since the early '90s. I, however, remain optimistic. I predict that several of the trends that have emerged this year will cause the industry to not only carry on but to grow. In the future, we'll all remember 2008 and 2009 as the years that changed everything.

The most visible trend, of course, is the increasing professionalism of the industry. The most obvious manifestation of that professionalism is the adoption of standards. Instead of the hodgepodge of proprietary standards and closed systems we've been saddled with since the earliest days of the DVR, we can foresee a future where customers can buy an IP device knowing that it will work with all the cameras they already have and all the cameras they will buy in the future.

It doesn't matter which standard wins, or even if neither does. Microsoft and Apple are two de facto 'standards', and users initially have to choose either Apple or Microsoft for their computer systems. Once they commit, they can go out and buy whatever software they want from whichever vendor they please, without having to even consider compatibility beyond looking for a logo on the box. Several people who attended either the PSIA or ONVIF events at this year's ASIS described just how different things are with standards. One well known industry blogger described how a company called Synectics walked in with an NVR which worked with all the cameras present. This was noteworthy because the blogger had never heard of Synectics. Neither had anyone else attending the event. As the blogger put it, "(t)hat's right, a random company downloaded the spec, implemented it, and then just showed up and made things work. Pretty cool."

In 10 years from now, I will be training some industry newbie, and I'll retell this story -- and I love telling the rookies good war stories -- and the newbie will be completely unable to wrap his or her mind around the concept that this was somehow novel in 2009.

"What kind of industry," the newbie will ask, "would allow the horrible waste of time and resources that comes with each company using their own proprietary standards? That would be as stupid as Ford cars only using Ford tires and Ford gas and only driving on Ford highways."

And I will have to laugh and agree and then tell the newbie that when I started, we were still convincing customers that DVRs were better than VCRs.

The next major trend, and one that is even more significant in growing market share, is falling equipment cost. Partly in response to falling component costs -- a 500GB hard drive costs about $50 nowadays, at retail prices -- and partly in response to manufacturers trying to woo skittish customers with slashed security and capital improvement budgets, manufacturers were forced to cut margins. The big companies were cost conscious, but the guys in the middle of the pack were very sensitive in their pricing. And some of us learned that it is better to make $5/unit and sell 1,000 units than make $50/unit and sell 50 units. Without naming names, some of the brands we carried priced their units extremely aggressively and the market definitely responded.

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