“Security practitioners are looking for a new level of service — specifically, heightened communication, timely and topical information, and reduction of revisits for corrective action,” says Richard Widup Jr., ASIS President.
“Business intelligence software will give end-users valuable, profit-improving data. This will, consequently, increase the use of physical security devices for data gathering, such as card readers, video surveillance and alarm point monitoring,” says Bill Bozeman, CEO of PSA Security Network.
“While advances in biometrics are not new, the biggest impact (in 2014) may come from that area, which has received increased attention recently in part by the fingerprint identification system incorporated into the new Apple iPhone and other mobile consumer devices,” says Don Erickson, CEO of SIA.
“The entrance of larger, non-traditional companies like Comcast, Time Warner and AT&T into home automation and security is challenging traditional integrators to keep up,” says John Knox, ESA President.
“All the metadata being created (by IP-based systems) is a valuable way to look at what’s going on in the enterprise and start finding valuable little nuggets of information that will help managers improve their business,” says Jay Hauhn of Tyco Integrated Security.
If the past five years have taught us anything in the security industry, it’s that the words “security” and “recession” mix about as well as oil and water. Once again, across every conceivable technology and market segment, the security industry is thriving — outdoing sales and spending figures from corporate facilities down to single-family homes.
As we turn the page on 2013 and head into another year of projected success, one thing is clear: the state of the security industry is strong; and security dealers and integrators — as long as they continue to embrace cutting-edge technologies and sales tactics — will ride the wave of overall success to increased profits.
PSA Security president and CEO Bill Bozeman describes the state of the industry as “good to very good as compared to other non-security related businesses.”
Adds Security Industry Association (SIA) CEO Don Erickson: “If the ISC East Expo and education conference sessions were any indication, then the state of the security industry is very strong as we head into 2014.”
Here’s a look at a few of the major technology and market-related trends you should be watching as we move through 2014 and beyond.
Both Erickson and John Knox, president of the Electronic Security Association (ESA), say that the continued advancement in home automation will have the greatest impact on the security industry in 2014 — more than any other market.
“The biggest changes will be in the home, where consumers will continue to push for high-end functionality for security systems and for other lifestyle functions,” Knox says. “Home automation definitely offers the greatest opportunity for growth, and it also gives us a chance to expand the market for home security.”
In fact, according to Berg Insight’s Smart Homes & Automation report, the number of new smart home installations in North America was on track to reach 2.3 million in 2013 — an increase of 66 percent year-on-year. The strong growth is expected to last throughout 2014 and for years to come, driving the number of new installations each year to 12.8 million by 2017. As a result, penetration of smart home systems in North American households will increase from just 3.2 percent at the end of 2013 to 16.6 percent in 2017.
These home automation and security technologies give homeowners the power to control their residential systems at the touch of a button, from anywhere in the world thanks to mobile functionality (for more on the innovations in home automation, please read the December 2013 special cover section of SD&I).
The exponential increase in residential security and technology options, however, has been like blood in the water for many large service providers, who, like hungry sharks, are now infiltrating the residential security space — an area once claimed by mostly smaller players. “The entrance of larger, non-traditional companies like Comcast, Time Warner and AT&T into home automation and security is challenging traditional integrators to keep up,” Knox acknowledges.
It may be a familiar refrain, but the continued rise of network-based systems — from video surveillance to access control and beyond — is having a profound impact on the commercial security industry. Not only are these technologies making security departments more efficient and powerful, they are also changing the way systems are being integrated together and how organizations use the information that is produced.
At some point in the last couple years, the term “Big Data” went from being a buzzword to something that can tangibly change the way integrators capitalize on the commercial market. “All the metadata being created (by IP-based systems), is a valuable way to look at what’s going on in the enterprise and start finding valuable little nuggets of information that will help managers improve their business,” explains Jay Hauhn, CTO and vice president of industry relations for Tyco Integrated Security. “That’s where the market is going.
“The retail market is leading the way by using video analytics to create the metadata that tells them things like how many people were in the store and which path they took to get there — and then the ROI changes,” Hauhn continues. “I think retail will help us refine the software and these processes, and it will eventually move into other markets.”
“Business intelligence software will give end-users valuable, profit-improving data,” adds PSA’s Bozeman. “This will, consequently, increase the use of physical security devices for data gathering, such as card readers, video surveillance and alarm point monitoring.”
New ASIS president Richard E. Widup Jr., CPP, the Senior Director of Corporate Security for Purdue Pharma LP, agrees: “As integration improves, so will the quality of data. This will lead to data analytics for analysis of the security function; creation and development of KPIs and metrics; and cross functional use of security devices for other aspects of the business such as HR, Finance and Operations.”
IP systems creating Big Data is just the tip of a much larger iceberg rooted in IP. The increased functionality of these systems is enabling end-users and integrators alike to mobilize and streamline their business operations. Functions such as improved remote diagnostic capabilities — only achievable with IP-based systems — will have a huge impact on limiting truck rolls for security dealers and integrators in 2014.
Then there’s mobility and the cloud — both major spawns of the IP migrations. “From a traditional security perspective, the most significant advances (in 2014) will be those that feature mobility across all devices and systems,” Widup says. “Consider for a moment the capabilities that cloud computing has brought to the security industry. The ability to place and retrieve security information in a cloud exists, but there is a need for the provider offering a scalable pay-as-you-go product while still providing for protection and resiliency of the data to mature,” Widup says.
“More importantly, the pay-as-you-go model allows a constant stream of RMR for integrators and product providers. Anything connected to a network can be tracked — and making this a product-rich market without being ‘Big Brother’ is a gold mine,” he adds.
The base of this huge IP iceberg is the end-user’s IT department — after all, IP-based systems reside on their networks. This is a continuing trend — back in 2009, 75 percent of integrators and installers surveyed by IMS said three of every five IT managers are involved in physical security purchase decisions. That means that today’s security dealers and integrators need to be able to “talk the talk” with their customers’ IT departments.
Still, despite all the technological advances and increased functionality, the baseline of customer service is just as important as ever. “Customer service is at the top of the list," ASIS' Widup says. “Security practitioners are looking for a new level of service — specifically, heightened communication, timely and topical information, and reduction of revisits for corrective action. Additionally, strong, sustained relationships between security manufacturers and systems integrators would greatly benefit end-users by reducing response time and increasing the accuracy of product and service information provided for building of a solid, strategic business case for procurement.”
According to the National Systems Contractors Association (NSCA) Financial Analysis of the Industry Report — a survey of its membership — the corporate, healthcare and education markets capture the top spots when the respondents were asked to indicate the primary vertical market that accounted for the largest share of their revenue in their last fiscal year. The government and houses of worship markets followed.
“Whether you are speaking about issues associated with Clery Act implementation facing college campuses, additional oversight of petrochemical facilities, or the requirements imposed on hospitals by the Joint Commission, regulatory compliance will continue to drive market opportunities,” SIA’s Erickson says.
“With advancements in the quality of physical security device integration, the protection of critical infrastructure and the enterprise will continue to be a strong market — especially oil and gas, energy, and chemicals,” adds ASIS’ Widup.
According to “The United States Security Industry: Size and Scope, Insights, Trends and Data,” an extensive benchmark study of the private security industry’s expansion over the past decade and projected future growth conducted by ASIS Intl. and the Institute of Finance and Management (IOFM), video surveillance is the fastest-growing technology market in the security industry. The survey said that 17 percent of respondents were expected to increase video surveillance spending by 10 percent or more in 2013 — led by finance and insurance firms, healthcare, and manufacturing companies.
No doubt a byproduct of the IP technology boom, the report states that “the ability to watch and transfer video across the globe — and to deliver it to myriad devices — creates an opportunity to merge a security department’s video surveillance strategy with an organization’s broader effort to monitor all business activity. When examined jointly, a business case for upgrading IP video capabilities becomes easier to make.”
In its recent report on the top surveillance trends to watch for in 2014, research firm IHS forecasted that the un-cooled thermal camera market will see the largest average selling price (ASP) decline during the next few years in the video surveillance market. “While the number of un-cooled thermal camera units shipped to the commercial security industry suggests that the market has not yet been commoditized, increased competition, new products and new end-user markets will mean 2014 is a breakthrough year for the technology,” research manager Niall Jenkins says.
Other key takeaways from the report include:
- The global video surveillance market will grow by more than 12 percent;
- The video surveillance camera category winner in 2014 will be 180/360-degree panoramic network cameras, with global unit shipments forecast to increase by more than 60 percent over 2012;
- With increasing awareness of embedded audio analytics and even sound source localization, market penetration could be about to rise; and
- More new product and service announcements from network focused security companies, as they seek to add new revenue streams to their portfolio.
For more on 2014 video surveillance trends and technologies, be sure to check out additional articles in this special section, including a closer examination of the IP migration; a look at how HD and megapixel are driving the market; and an outline of video verification service as it relates to alarm monitoring.
Access Control and Intrusion Detection
Technology releases and advances in the consumer market are driving the demands on cutting-edge access control systems. In just a couple of examples, consumers — and thus security end-users — want the ability to open doors with their phones; and biometrics has gone from a government program to something every other person has on their smartphone or tablet.
“While advances in biometrics are not new, the biggest impact (in 2014) may come from that area, which has received increased attention recently in part by the fingerprint identification system incorporated into the new Apple iPhone and other mobile consumer devices,” SIA’s Erickson says.
“Consumer demand will begin to fuel wider adoption of biometrics into access control systems. “Smartphones have identified fingerprint authentication as a starting point, but more systems will also adopt identity verification via iris, facial and vein recognition, among other forms of biometrics,” Erickson continues. “Moreover, SIA sees biometrics for logical access driving increases in physical access security. That's different from the past, where advances in physical security such as the use of tokens and smartcards have shepherded advances in logical security.”
End-user spending on access control and identity management will continue to grow, with 51 percent of organizations planning to increase spending on access control in 2013, according to the ASIS/IOFM survey. The most spending was projected among healthcare and manufacturing facilities.
Both standards bodies are also working hard in the access control space. The Physical Security Interoperability Alliance (PSIA), for example, is currently preparing to release test tools for its Access Control and Intrusion profiles. ONVIF continues its work on “Profile C” — a specification that will create interoperability between physical access control systems (PACS) and IP-based video surveillance networks.
Given the key protection role that alarms have played for decades and the fact that it is a mature technology, growth in the alarm sector is tied to growth in new businesses and the replacement of older alarm devices, according to the ASIS/IOFM survey. The survey goes on to report that more than 35 percent of respondents planned to spend more on alarms in 2013, led by the retail, utilities and professional and business services markets.
Be sure to check out the latest in the mobile access control craze — from NFC to Bluetooth and beyond; along with a state of the industry report on the fire & life safety market from SD&I expert Greg Kessinger.