The biggest security stories of 2014

Dec. 30, 2014
A look back at some industry-changing events from the past year

This week will mark the end of yet another eventful year for the security industry. There have been a number of stories that have unfolded over the past 12 months which will undoubtedly have an impact on the way you do business moving forward. From advancements in technology to business transactions, 2014 saw events that will shape and mold the industry for years to come. Here are our editors’ picks for the top news stories of 2014:      

Emergence of 4K Video

Although companies have been working to develop 4K Ultra HD video surveillance solutions for several years, 2014 will be remembered as a real jumping-off point for the technology in the industry. A number of manufacturers have already introduced their own 4K camera models in the marketplace and that will only rise as we head into 2015. Obviously, there are still a number of things that have to fall into place from an end user perspective before widespread adoption of 4K can take place, but many people feel it will, at some point, become the new resolution standard in surveillance applications. To learn more about the evolution of 4K technology in surveillance and its potential implications for the industry moving forward, check out this column from Axis' Fredrik Nilsson that ran earlier this summer on SIW.

DIY Comes of Age

Do-it-yourself (DIY) security solutions have flown relatively underneath the radar of most manufacturers and alarm dealers for some time, but it has become apparent that DIY is now a formidable competitor. According to IHS, the global DIY video surveillance equipment market will top $1 billion for the first time in 2014, with the U.S. accounting for 65 percent of total revenue. Google, which made waves in the industry earlier in the year with its purchase of smart thermostat and smoke/carbon monoxide detector maker Nest Labs for $3 billion, also appears poised to tap into the opportunities presented by the DIY video market with its acquisition of Dropcam in late June for $555 million. Traditional alarm dealers have also seen DIY solutions make significant headway in their market with a number different home security offerings hitting the market from a variety of companies, including small startups like Korner to large telecommunications providers such as U.S. Cellular.    

Large-Scale Data Breaches Persist  

At this time last year, one of the biggest stories making headlines was the data breach suffered by Target that exposed at least 40 million payment card numbers. As fate would have it, another data breach, this one suffered by Sony Pictures Entertainment, is currently dominating the news due in large part to the political intrigue that has surrounded it with many people blaming North Korea for the hack in retaliation for the release of the movie "The Interview." Sony is just the latest victim, however, in a long list of companies that have suffered large-scale data breaches this year including Home Depot, Staples and JPMorgan Chase just to name a few. Click here to read about the top six data breach trends to watch in 2015 based on Experian's "Second Annual Data Breach Industry Forecast."             

Mobile Access Gains Traction

While mobile access control and near field communications (NFC), in particular, have yet to achieve widespread adoption in the industry, there were several developments this year that could shape the future of the technology moving into 2015 and beyond. In July, Hilton Worldwide, which operates more than 4,000 hotels and timeshare properties around the world announced that it would allow guests to use their smartphones as room keys as part of the company’s new digital strategy. Two months later, Apple further bolstered hopes for the market when it announced that its’ new iPhone 6 and iPhone 6 Plus would feature an NFC antenna design. One of the prevailing beliefs within the industry for why NFC hasn’t gained as much traction as people thought it would has been the lack of NFC compatibility with iPhones.      

Airport Security Breaches Raise Concerns

While moves and decisions by the Transportation Security Administration have garnered most of the attention when it has come to the topic of airport security in recent years, there were several serious breaches at airports around the nation in 2014 that highlighted vulnerabilities which fall outside the agency’s scope. In September, an air traffic control center in the Chicago area was severely damaged by a suicidal contract employee who reportedly cut cables and set fire to the facility’s basement before trying to cut his own throat. The incident caused major disruptions to air travel around the nation and raised questions about the kinds of redundancies that need to be in place to safeguard other air traffic control facilities. In April, a 15-year-old boy was able to scale a fence at Mineta San Jose International Airport and stowaway in the wheel well of a Hawaii-bound jetliner, sparking concerns about the adequacy of perimeter security measures in place at airports.          

Net Neutrality

Another issue that has come to the forefront late this year has been that of net neutrality. Simply explained, net neutrality is based on the principle that all Internet traffic and its contents should be treated equally by Internet Service Providers who should not be permitted to provide preferential treatment to those willing to fork over more dollars for greater bandwidth. At first glance, it may seem that this wouldn’t be a big deal to those involved in security, but the ramifications could be enormous down the road as more people install high-definition IP cameras on their network or migrate to hosted systems. To learn more about the potential implications of net neutrality on the security industry, you can read this column from Shayne Bates in the September issue of Security Dealer & Integrator magazine.    

The Rise of ISIS

While the actions of terror groups have always been one of the potential risks that corporate security executives have had to mitigate against, the rise of the Islamic State in Iraq and Syria (ISIS) has been a game-changer in the evolution of terror threats. ISIS, which has used social media to spread its propaganda around the world, recently called for individuals to carry out attacks against law enforcement and military personnel in their own countries without first seeking advice from fellow terror groups. Recent incidents, such as the October shooting at the Canadian National War Memorial and parliament building in Ottawa and hatchet attacks against police officers in Washington, D.C.  and New York City, indicate that the group may have already have some measure of success with its pleas for violence in western nations. Security executives need to be aware of the threats posed by these so-called “lone wolf” actors and perform threat assessments to determine where their organization may be the most vulnerable.

Legalized Marijuana Presents Challenges, Opportunities

With the legalization of recreational marijuana use in Washington and Colorado has also come increased demand for security – both systems integration and guard services – needed by dispensaries to keep their facilities, employees and customers safe. Some security companies have been reluctant to enter the burgeoning market, while others have been readily willing to help meet the growing demand. Because Marijuana is still considered a Schedule 1 controlled substance under federal law, most banks will not accept any money generated from the sale of pot which has essentially made the industry an all-cash business. Time will tell if more security providers will venture into protecting cannabis growers and sellers, but for the now the industry remains a largely untapped opportunity for security providers.

Comcast-Time Warner Deal

The alarm industry has certainly seen its share of new market entrants over the past several years.  Large cable and telecommunications providers see the home security and automation market as a valuable new revenue stream and as a way to increase their value proposition to home and small business owners. In February, one of those recent entrants, Comcast, announced that it had entered into a deal to purchase rival Time Warner Cable for $45 billion. The deal, which has yet to be approved by regulators, would give the newly combined company about 30 million subscribers across the nation and could have wide-reaching implications for the alarm industry.  

Notable Mergers and Acquisitions

According to a recent report from UK-based research firm Memoori, the interest of large conglomerates and external buyers in security company mergers and acquisitions was waned somewhat in recent years. With that being said, however, there were still a number of significant M&A transactions that occurred in the security industry this year with several well-known companies changing hands including the sale of Milestone Systems to Canon in June. Among some of the other notable transactions to take place in the industry this year include Vicon’s merger with IQinVision, Vanderbilt Industries acquisition of Siemens’ Security Products business, and Anixter’s purchase of Tri-Ed.