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Will Asia Dominate The PACS Market Next?

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Skip Cusack
Jul 26, 2016

We've all seen the impact of low-cost Asian products on the surveillance industry. Axis was once the IP camera king, but was dethroned by Hikvision faster than you can say, "cheaper is good enough." So let's say surveillance is played out, and the products are fully commoditized (or near enough). What's next? How about PACS? Are there already signs that the Asian masters of low cost have set their sites on controllers and readers? Are there nervous signs leaking out from within the walls of the controller and reader giants? If there aren't, should there be....?

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UI
Undisclosed Integrator #1
Jul 26, 2016

I have worked with PACS OEM's in several roles, including product design and test consultant, distributor, and integrator/installer. There is no doubt that Asian controllers can be made with a lower cost with relatively good reliability, but I am presently not too worried about a Hikvision-like assault on the PACS industry for the following reasons:

1) The firmware in the controllers is the heart of the controller. The Asian access control market is culturally very different from the North American access control market when it comes to the finer feature points of how we need the controllers to work.

2) You can work with the Asian manufacturers to modify the firmware, but you face the normal language and cultural barriers encountered when designing any technical product with an Asian manufacturer. Several common threads encountered when working with Asian OEM's were having to explain exhaustively why a certain feature was needed in the firmware and not the management software and why that is important to the NA market. Another was a general attitude that "close is good enough ... we'll fix that feature or bug in the next release".

3) I have several piles of various Asian IP-based access controllers as well as wireless intercoms in my office from various testing and curiosity over the years and have found that products were not full-featured enough out of the box for the NA market. Companies that have a stronger NA presence with field offices here and have "Americanized" their products are the exception, but they have had to go through the paces of modifying their firmware and software to meet the needs of the NA market ... and have had to go through the UL/ETL testing expenses. This adds to the cost, and while not leveling the playing field, it pushes it that way.

4) Leading with price alone has not proven to be a winning strategy in the PACS market. Leading with price merely gets you onto the shelves of national disty and into the buying agreements of the various integrator buying groups along with a ton of other PACS products offered.

5) The controller cost is just one part of the overall cost of outfitting a door with PACS. As long as the substantial labor components of the locksmith, low voltage electrician, and the technician exist, a lower cost controller alone does not make the impact that a low cost network camera does. The ease of installation, wiring, programming, and servicing a door's controls all come into play.

6) We're not even to the point of talking about the software side of things. PACS software designed for the Asian market will require substantial modifications for the NA market; have you even been plunking through a software program and suddenly come across a screen that has more than a few Chinese symbols/characters on it where you were expecting to see a data field labeled 'First Name" //// lol The alternative is to design your own enterprise management software suite from the ground up using the manufacturer's SDK tool kit. $$$$ and time .....

7) Now let's flip this whole barrier-to-entry thing upside down. If we're talking something like a Mercury hardware platform knock-off .. initially maybe that's where the weak spot would be in the PACS market for a Hikvision-like model. Mercury is not truly an "open system" but is heavily marketed that way because so many companies use their hardware platform. There's nothing to stop an Asian manufacturer from targeting that model by making a full-featured door controller in various flavors with IP POE capability and taking it to all of the names we know and love in the PACS market. With enough R&D resource, disruptively lower cost boards could be made and they could pay firmware/software engineers here in NA to build the programming tool kits required to add these controllers to systems that already support Mercury and HID controllers.

8) #7 above is the real play for a Hikvision-like Asian PACS manufacturer. Can they make a full-featured hardware platform with robust tool kits for use/integration into systems offered by the cadre of companies in the Mercury OEM program? Is this scenario unfolding .. yes .. in the early stages I believe. IMO, the Mercury mentality and market penetration is much stronger and more embedded in the PACS market than any brand of IP camera, including Axis, has ever held in the VMS market. This makes it a difficult climb for an Asian manufacturer in the PACS market, but this won't stop them from trying. A low-cost standalone PACS system from China is not what they'll be offering; it will be an alternative hardware platform to Mercury. I'm sure in the early days of Axis' domination, Hikvision was not considered a threat.

9) Returning back to earth now, there are still a lot of challenges to making this model work for an Asian manufacturer. Don't think they'll be expecting integrators to re-flash Mercury controllers, but will try to make their controllers look like a Mercury controller to the management software. Isn't that what truly "open protocol" is supposed to accomplish?

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JH
John Honovich
Jul 26, 2016
IPVM

1, thanks for the detailed input.

Can you elaborate on this?

The Asian access control market is culturally very different from the North American access control market when it comes to the finer feature points of how we need the controllers to work.

I am curious to know what the differences are.

U
Undisclosed #2
Jul 26, 2016
IPVMU Certified

...but I am presently not too worried about a Hikvision-like assault on the PACS industry...

Any Hik attack on PACS will not look the same as the one on CCTV.

CCTV was the invasion. PACS would be the mobilization.

Using of one of the largest security sales and support organizations in this country.

Hik dealers feeling the squeeze as their ranks swell, may eagerly seek new product line opportunities.

UI
Undisclosed Integrator #1
Jul 26, 2016

Hi John,

Most of it beyond the scope of our discussion here, but a couple of examples:

1. Similar last names are so common in user databases, that some systems do not have or require a last name field, or the "name" field in the software is just one data field. The unique identifier is often the first name, believe it or not.

2. They often take a much more pragmatic approach to using the ACS as a forensic tool. What I mean by this is we often go to great lengths to make sure the door status sensor and the exit sensors on doors really work and that they are an important piece of the forensic data on why a door opened, or is open or closed. They do not place such a high importance on peripheral sensing since they have cameras everywhere. if something happens at a door, it is assumed that the video will tell the whole story. While we place importance on the use of REX sensors on doors, even ones that always open from the inside, so we can shunt door alarms, they don't place a similar importance on them, and figure if there is a REX sensor, it is there to unlock the lock.

3. They don't seem to need as many bells and whistles as we do; again, video cameras are everywhere.

3. They use biometrics more than we do in the North American market.

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FL
Frank Lucero
Jul 26, 2016

I rather see technology coexist within our smart devices. Here is a free access control idea from my dungeon. It's just a dream.

Let's say I am developing a 'smart lapel', this is my new key fob. If gives off 2 signals for authentication one is RFI let's say 802.15.4 and the other is optic let's say 700 nanometers.

Each door or set of doors has a camera or set of cameras and are now my main set of access control.

The two authentications are broadcast and intercepted by the camera which contains technology to verify my 802.15.4 certificate and my infrared light beacon coming from my lapel. All I do is touch to initiate a broadcast while standing in front of the door. The camera records the whole event, the request beacon, the rfid certificate and the pulsing infrared led signature.

Camera analytics know which door I am standing in front of, can tell which way I am facing and then proceeds to unlock the door with valid credentials.

My lapel is programmed and updated, tracked and audited via my smart device. I can walk into any facility in the world running this system and generate a access request to the facility. All of my credentials are automatically sent to the site administrator along with any point of contacts capable of authorizing my access.

I have tried eliminating all current access control providers and their software, hardware. No more back up batteries in those clunky altronix power supplies with a fire alarm interface, no more Hoffman enclosures with gutter boxes, terminal strips and finger duct. No more copper, or cable management and conduits, raceway. No more facility codes or pivclass, client licenses, reader licenses. You get the point.

All that is needed is the technology to stand alone at the door...Assa Abloy?

There you go a universal access control system without all the baggage.

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Brian Rhodes
Jul 26, 2016
IPVMU Certified

All that is needed is the technology to stand alone at the door...Assa Abloy?

There you go a universal access control system without all the baggage.

Until you consider there are at least three 'standard' door thicknesses, eight common door lock prep patterns, six standard finishes, twenty common mechanical key profiles, and some astronomical combination of 'architectural' customized openings.

And then we have to consider the fringe door types like Herculite, frameless, and pivotless sliders...

:)

U
Undisclosed #2
Jul 26, 2016
IPVMU Certified

And Europe is distinct from that and even more combinatorial, no?

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Brian Rhodes
Jul 26, 2016
IPVMU Certified

This is an interesting topic. I'll assemble the salient points and include them in an upcoming post.

I also do not think a 'Hikvision' access brand is imminent. Here are some thoughts:

1) Western Access Control is Ultra-Conservative: I don't mean politically; I mean it is risk-averse to an extreme. When doors locked at the wrong time could lead to injury or death, not many are willing to save a few dollars by buying an 'unproven' brand. Rather, they'll pay more for a 'premium but familiar' name if it means avoiding risk in function, support, or repair. Even brands who have been selling/shipping/installing product for a decade are considered 'new' in a market where lock companies go back 200 years or more.

2) Asia is good at hardware; flaky at software: While it's pure ignorance to suggest Asia is incapable of good software design, the fact is there aren't many good examples. Electronic Access Control is just as much good, dependable, stable, bug-free software as it is hardware. A huge portion of the PACS market does not want to shop for hardware and then use something different for software (ie: as is common with video surveillance), but rather use one vendor who endorses and supports both under one brand.

3) Punitive Western Codes: This one is a little delicate. Because many parts of Asia still wear 'developing' or even '3rd world' labels, the concept of central building/life safety codes are not prevalent. While a strong central government is expected, the pure scope of having jurisdiction over matters life building codes or occupational safety is so broad it isn't nearly as defined, understood, or enforced as Europe or North America.

Unfortunately, in North America, we have a legacy of nearly 300 years of industrialized tragedy (Here's one example from 1911 of many) that elaborates how a strong set of architectural and life safety codes was brought about. Keep in mind, this sordid history is apart from further mandated product performance certifications like UL.

The bottom line: following and understanding these codes, and their cultural importance, is not an exception in Western markets. Until Asia adopts congruent regulations or Asian vendors demonstrate a clear commitment to manufacturing western code compliant product, EAC products from there run the risk of being trivialized as 'not serious' or 'not commercial grade'.

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Campbell Chang
Jul 27, 2016

I'm seeing a lot of the same arguments which were used initially when Hik & Dahua were on the rise.

"Trusted brand" "Manufacturing quality" etc etc.

To the question at hand, Hikua aren't going to get on the physical side of things. I could be wrong here but I don't see them chasing the physical locks/strikes etc.

What they have targeted is the EAC part. I saw Dahua had some IP door controllers on display last year at ISC West. Axis have their A1001. Both Dahua and Hik have intercoms on sale now which are relatively decent.

I have little doubt that Hik & their 30000 engineers are beavering away creating an EAC platform which will in all probability integrate quite seamlessly into their 5200 platform. And I'd be seriously surprised if they don't have a 2142 with an inbuilt door controller in the works somewhere.

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Brian Rhodes
Jul 27, 2016
IPVMU Certified

But Hik & Dahua didn't overcome those arguments by winning the brand battle on the fronts of 'brand trust' and 'high quality'. Rather, they have used low prices and operating subsidies to gain market share. See Hikvision Desperate And Destructive Slashing for just one example.

Not to say this approach couldn't be a factor in Western access markets, but there is plenty of skepticism whether it would be nearly as effective.

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UI
Undisclosed Integrator #3
Jul 27, 2016

I don't see dominance but I do think there could be more penetration. The owners of our company have been looking at the Chinese offerings on PACS and intercoms to reduce cost on small system sales. Testing a controller now from Ansoncorp and honestly for <$200 for a 4 door controller is pretty amazing. The software is very light with limited features but you get what you pay for.

I wouldn't be surprised and kind of expect Hikua to bring something to this space for the NA market.

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U
Undisclosed #2
Jul 27, 2016
IPVMU Certified

If you want my considered opinion there's one main reason we have not seen the roll of Hik access control in North America. That is because it is built around iVMS 5200, which itself is being delayed, apparently to encourage the major VMS providers to provide broad and deep integration for Hik cameras.

Though make no mistake, they have not be idle during this time.

Access Control Panels:

Readers:

Intrusion:

Electrirfied hardware:

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U
Undisclosed #4
Jul 29, 2016

This discussion actually feeds into my fairly well-documented distaste for Hik and why I've avoided the dumpster-diving out of not only principle, but also foresight.

The commoditization of video has already happened. People who want dirt cheap crap can get their dirt cheap crap.

However, the people (companies) who want access control are looking for a high-quality, reliable, and functioning system more often that not. Of course there are some who want dirt cheap keyless entry, and for those people, IEI still makes a great keypad and maglocks are still cheap. But for the midsize and large business that wants a legitimate access system, a Chinese piece of junk just isn't going to cut it.

And, let's not get into the absurdity of building access being run by a company that is owned by the Chinese government. Most people already think they're hacking into everything we have right now anyways (they are), and I don't think people will be keen on the fact that a hack of their own system could literally mean opening up the door and letting people walk in.

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U
Undisclosed #2
Jul 29, 2016
IPVMU Certified

And, let's not get into the absurdity of building access being run by a company that is owned by the Chinese government. Most people already think they're hacking into everything we have right now anyways (they are)...

How do you propose we stop them, considering their SOC's are already in everything, including many devices that are "Made in America?"

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Brian Rhodes
Aug 04, 2016
IPVMU Certified

Thanks to all who added input to this thread. Very interesting and well-reasoned responses all the way around.

We published Chinese Spam Access Control Is Here using some of the comments found here.

Thank you again.

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