This Industry Is About To Be Reborn.

I think that the Video industry will continue to split the same way Intrusion has - cookie cutter small systems using the least expensive product possible, and higher end engineered systems.  I already have companies I work with that have separated out their teams into "Door Knockers" using Chinese product, and Engineered/Integrated Systems using other product lines.

To my mind, it will go the same way networking/phones has gone.

Hikua banned from govt and sensitive sites. (Like Huawei/ZTE).  No one else will care.

I think a handful of Korean and Taiwanese OEMs are about to be reborn.

In today's globalized market I don't think it's possible to "reborn" a company by simply applying administrative measures if this company does not have any other advantages. It can be reborn by developing a breakthrough technology, having a diverse/complete portfolio (with system integration if possible), investing heavily in product marketing, offering significantly more competitive pricing by optimizing its costs (labour/production) and so on... Simple market principles. If the product is neither functional nor price competitive, it will get dumped not reborn. The simple fact of banning the use of brand "X" will not get back the golden era R&D team of Pelco or the strong innovative products that Korean and Taiwanese companies used to develop - they are just gone...

What is being reborn in this industry is how we "Go To Business" not so much the products. The average customer is very savvy these days. The trend we are seeing is the end users are starting bring more and more of our services in house. Anywhere from just needing a "Box" sale from their integrator to buying from an online distributor, even though you explain that the manufacturer's warranty may not be valid when purchasing equipment that way. Customers are also starting to install more and more equipment themselves as well. They have started doing their own wiring as well, including running the composite door cable for access control. Now many will say it would be hard for the end user to do the Access Control portion but wireless locks have come a long way in the past few years and install in minutes instead of hours. Of course many times these are the larger customers doing the in house wiring and self installations either through their own staff or in house contracted electricians.

I'm not complaining about this either. This is just an evolution in any industry and I have been saying it is a race to the top with IT for more than a decade now. What has to change is how we coincide with this change. I always tell people I would rather have a piece of the pie than none of the pie. There will always be parts of our industry that end users won't realistically  be able to perform in house installations nor do they want to. Take fire alarms for instance. Most customers don't have the qualified staff to do this but some do. We do work for a university and they have their own in house NICET technicians and their own AHJ. They do most of their own work and inspections other than say a large expansion or new building then that typically is done by a contractor. 

The key to this is how do we go to business in the very near future. Some say managed services and I do agree with this to a point. Your larger customers tend to do this already if they have a really good IT department that wants to actually deal with the security systems. I have noticed in the past couple of years more and more IT departments are willing to take on some of these tasks, if for no other reason than we are putting devices with MAC addresses on their network and they take network security as priority number one as they should. There will probably always be those companies who will require a separate network for security and won't want anything to do with the security systems. Of course for a new customer as always you have to bring in the IT department early on in the discussions otherwise it will be a constant uphill battle. 

More and more customers are also wanting their systems to be "In the cloud". Some fully understand what this means and others really don't get that the "Cloud" is just another physical box with multiple systems in some data center. I'm not sure if I am fully on board with the cloud solutions yet, the old school in me I guess, as Internet connections still go down once in a while. Of course not near as bad as it used to be. The cloud solutions do typically use the RMR model more like traditional burg systems and the monthly monitoring revenue. 

Anyways it's a long road ahead of us Integrators and how we continue to survive in the ever changing IoT's market. Like or hate it is a simple fact of life now. My prediction is figure out your go to strategy now or in 5 years be the "Trunk Slammer" of yesteryears. 

As industries go, we are in the consolidation phase.  This is very similar to the Personal Computer and Networking Industries of only a few decades ago.  The solutions have standardized, pricing has stabilized, and the go to market strategy has matured.  ONVIF is an example of an connectivity standard not unlike Ethernet and IP.  We have price points for both low-end and high-end solution sets.  The distribution and channel models are in place.

The number of key players in this market is shrinking.  If you need confirmation of these trends, look no further than next weeks GSX show.  From what I'm hearing, it reminds me of Interop about 15 years ago.

There is still certainly room for additional innovation such as cloud and analytics to name the low hanging fruit.  The future road-map for the next 5 years will certainly be challenging for many of the smaller companies.  While the cost to offer a solution to the market may not be insurmountable, the expense required to become relevant in this market is becoming increasing more difficult.

When you add the challenges of banning and importing certain vendors, and cyber security concerns; you have additional accelerators to support an industry consolidation.

I believe there will be only a handful of relevant physical security manufactures who will have a lions share of this market in the near future.  In the PC world we ended up with Apple, Dell, HP, etc...  In the networking world we have Cisco, Juniper, HP, etc...  Who will it be in our space... it's still to be decided.  Regardless if your an dealer, A&E, or end user; it's a safer choice for long term support and upgrades to stick with one of the larger brands at this time.

I have a small piece of advice for employees at companies which may be at risk during this consolidation phase.  Keep your resumes up-to-date, and always keep one eye looking for new opportunities.  There is no honor in going down with the ship.  Save that privilege for the Captain.

IMO, the industry is in quite a boring stage right now and has been for quite a while. Here are my thoughts:

- The most "exciting" thing right now is the Hikua ban. This is only exciting due to shock value. Arguably though, this adds no value to the industry. I know Hik-Haters will disagree on many points but as far as technically progressing the industry, its really of no value.

- Related to above: Another Chinese manufacturer will simply take their place in the USA possibly. Hikua will still be worldwide leaders for quite a while.

- Related to above 2 points. If a non-chinese manufacturer would like to be on same level as HikuaView, then they will have to focus on making cameras and POE NVR's designed for SMB and Consumer at an economical price point. Unfortunately, wont happen because non-USA manufacturers are only interested in making enterprise products. Which is why point #2 is validated

- The industry is rife with "smart features" that either suck, or noone cares about, or both. What I have found, the only people that are excited about the "Smart Features" are the manufacturers themselves that think this is some groundbreaking technology. It would be groundbreaking if it worked. I would be happy with just normal motion detection working for gosh sakes. wake me up when this crap works.

- Internet Exploder is still the most widely used web browser for surveillance. I would be wayyy more excited about getting stuff to work in any web browser with 0 plugins than I would smart features. This should have been done yesteryears ago.

- If I received massive interest free loans from the US govt with no payback date, govt subsidies, etc, i would start a camera business today and woop everyones azz. In other words, USA's business structure isnt globally competitive in the tech manufacturing business.  25% Tarriffs will do no good, China is still cheaper. Tarriffs were and are still a weak way to compete. My point of this point, China will continue to dominate manufacturing.

Boring