IT/Security Convergence Alters the Face of Video Surveillance

Video networks are now among the strongest sales trend running through the physical security industry, and the trend is one of the major underpinnings for the key issue that everyone talks about today – IT/security convergence. Clearly, the digital/IT impact on video surveillance systems is changing the face of the video surveillance industry all across the world.

Beleaguered IT Slash Prices

Since 1999’s Y2K scare and 2000’s high-tech startups and established companies’ NASDAQ market tank, IT capital investment by American corporations has been scant.
To maintain order levels and ensure overhead operations weren’t affected by this decline, distributors and value-added resellers (VARs) became super-competitive by reducing their prices. Thus, IT product pricing fell to levels that narrowed operating margins considerably and affected overhead operations anyway.

What did IT companies do next? They began looking for greener pastures, particularly those that fit the familiar IT model they understood as video surveillance.

They don’t necessarily do this from the position of traditional distributor functionality to be successful. In addition to selling the products and components the market wants, they sell them directly to users and add the services wanted by the security market, including design, support and maintenance. It’s close to the industry model of corporations that now outsource their human resources and legal departments.

PC-Controlled Video Gets Popular

One of the trends that is appealing to these companies is the rise in use of PC-controlled video surveillance systems. This trend is powerful since it not only demonstrates what users want in networking, it also centralizes a convenient method of video surveillance control with the normal routine of IT people who use their PCs for everyday jobs.

The percentage of PC-controlled video surveillance systems has recently risen from 16 percent in 2000 to 40 percent in 2002. This increase is traceable to the use of DVR systems, partly to those with Web browsers, and also to trend of networking with IP video systems using Network video recorders (NVRs).

When looking at the graph, remember this PC-based usage trend comes solely from a nationwide survey of system integrators and not from companies that regard themselves as security dealers. On a national basis, this picture of growth is overstated because dealers aren’t as active in the installation of video networks as are integrators.

If dealers could be more active in this network category, how much more business could they write? How much closer to the IT/security convergence trend could they position themselves to take advantage of future growth trends? The same could also be asked of security distributors.

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