Pelco vs Integrators

By: Brian Rhodes, Published on May 14, 2012

Once an integrator favorite, Pelco is increasingly viewed with distrust and concern by many. As the former US leader becomes assimilated into a French multinational conglomerate, Schneider Electric, concerns rise. In particular, Schneider Electric has its own large system integration business that may conflict with Pelco's channel partners, the regional and local integrator.

This backdrop set up an entertaining and tense speech at PSA Security's PSA-Tec conference by a Schneider/Pelco executive. In this note, we recap the speech, the points made and the concerns of the attendees.

Keynote Highlights

During introductions, PSA's President noted that Schneider Electric's EVP of Buildings Business (and former Pelco President) only accepted an invitation to keynote PSA TEC on the condition that a 'barbershop quartet' introduce him. Playing on the gag, a group of crooners took the stage to sing an irreverent song that lamented Schneider's takeover of channel beloved 'Big Blue', the overt 'Frenchness' of the company, and the death of perks like Pelco Jet junkets/trade show trinkets.

When addressing the 'Elephant in the Room', Meyer highlighted the tenuous competitive relationship that Schneider Electric's service arm has with 'independent integrators' like the PSA members in attendance. Meyers laid out Schneider's defense of this practice in a straightforward manner, citing several justifications:

  • Major Markets Only: Schneider only competes in major US metropolitan cities, in 15 branches nationwide. This was meant to show that most "mom 'n pop" integrators have 'nothing to fear' from Schneider pursuing business in smaller markets.
  • High Profile Targets: Schneider seeks 'high profile' business and customers to enhance the Pelco name. The marketing advantage of having esteemed clientele benefits the entire channel. Likewise, self performing the install work for these clients ensures that Schneider can "manage their own standards" for workmanship and service.
  • Greenfield projects hold Pelco's interest, not cherry picking existing 'installed business' from channel integrators.
  • Necessary to Compete: Schneider sees its primary competition comes from other large, multinational integrators, and they must compete in the services market to protect its business.

Summarizing the point, Meyer noted that "Today's [Pelco] Channel Policy is the same as Yesterday's" and clearly downplayed the potential business impact to the loyal integrator channel of years past.

Despite these assurances, several integrators noted disagreement with these statements. Meyer's statements clarifying competition as limited to "large, greenfield projects" was met with several "bulls**t!" murmurs and skeptical "Riiiiiiiight" responses from integrators within earshot.

In particular, key issues we see with the statements made include:

  • It is hard to see how Pelco/Schneider taking away large scale projects will help integrators. Most integrators see the branding advantage of such wins as far secondary to their own local efforts.
  • It is difficult to believe that Schneider can restrain its focus to greenfield projects. There are simply not enough of them to satisfy a large company in a market where surveillance has already deeply penetrated.
  • That it is necessary for them to do so to compete with other behemoths (like Tyco/ADT) may be the most convincing and honest answer. Unfortunately, that is not a good sign for independent integrators nor do we think for users looking for high quality integration.

Conclusion

While Pelco/Schneider's claims are debatable, their executive chose to 'grab the bull by the horns' and speak on a very controversial subject to a contentious and fickle group of integrators. Despite assurances of mutual benefit, Schneider Electric's integration business will continue to draw the scrutiny of a skeptical dealer channel. Only time will tell whether Schneider can profitably address the needs of both sides of its business.

Comments : Members only. Login. or Join.

Related Reports

Milesight Company Profile on Jan 22, 2019
Milesight Technology, a Chinese company building an International branded business, says they are slowly building their presence through a series...
Avigilon Launches 'Renewed Products Program' on Mar 19, 2019
There are lots of 'pre-owned' cars but pre-owned IP cameras? While such programs are common in other industries, in video surveillance, they are...
Undercutting Partners, Arbitech Sells Millions In Unauthorized Axis on Mar 29, 2019
One of integrator's top complaints about Axis is poor margins. An enterprising, ethically questionable distributor is solving that. Inside this...
Axis Will Not Block Resellers on Jun 10, 2019
While Axis generally has strong favorability amongst integrators, the biggest complaint is their channel model, which results in smaller integrator...
Pelco CEO Out, New CEO Found on Oct 15, 2019
Just 2 months after Pelco was sold, Pelco's CEO is out, with Pelco bringing in an outside President and searching for a new CEO from the industry,...
Interlogix Shutting Down on Sep 20, 2019
Interlogix is shutting down, as UTC has confirmed to IPVM in a statement about their "plans to wind down" the once leading brand. Inside this...
UTC Really Screwed Up The Interlogix Shut Down on Sep 27, 2019
UTC has made many mistakes in security over the years, however, the shutting down of Interlogix is one of the biggest screwups in industry history....
Axis Cracks Down On Illicit Channel Sales on Nov 01, 2019
Axis has stepped up efforts to crack down on illicit channel sales according to various industry sources, though, Axis denies this. Online sales...
Anixter Resisting Takeover From Competitor, Bidding War Emerges, Wesco Wins on Jan 13, 2020
Mega distributor Anixter is going to be acquired but by whom? Initially, Anixter planned to go private, being bought by a private equity firm....
End User Buying Axis At Prices Better Than Axis Gold on Jan 10, 2020
IPVM recently found an integrator contract with an end-user that guaranteed the end user could buy Axis products at a price / discount better than...

Most Recent Industry Reports

Every VMS Will Become a VSaaS on Feb 21, 2020
VMS is ending. Soon every VMS will be a VSaaS. Competitive dynamics will be redrawn. What does this mean? VMS Historically...
Video Surveillance 101 Course - Last Chance on Feb 20, 2020
This is the last chance to join IPVM's first Video Surveillance 101 course, designed to help those new to the industry to quickly understand the...
Vulnerability Directory For Access Credentials on Feb 20, 2020
Knowing which access credentials are insecure can be difficult to see, especially because most look and feel the same. Even insecure 125 kHz...
AI/Smart Camera Tutorial on Feb 20, 2020
Cameras with video analytics, sometimes called 'Smart' camera or 'AI' cameras, etc. are one of the most promising growth areas of video...
China Manufacturer Suffers Coronavirus Scare on Feb 20, 2020
Uniview suffered a significant health scare last week after one of its employees reported a fever and initially tested positive for coronavirus....
Cheap Camera Problems at Night on Feb 19, 2020
Cheap cameras generally have problems at night, despite the common perception that integrated IR makes cameras mostly the same, according to new...
Milestone Launches Multiple Cloud Solutions on Feb 18, 2020
Milestone is going to the cloud, becoming one of the last prominent VMSes to do so. Milestone is clearly late but how competitive do these new...
Video Surveillance Architecture 101 on Feb 18, 2020
Video surveillance can be designed and deployed in a number of ways. This 101 examines the most common options and architectures used in...
UK Stands Behind Hikvision But Controversy Continues on Feb 18, 2020
Hikvision is exhibiting at a UK government conference for law enforcement, provoking controversy from the press, politicians, and activists due to...
IronYun AI Analytics Tested on Feb 17, 2020
Taiwan startup IronYun has raised tens of millions for its "mission to be the leading Artificial Intelligence, big data video software as a service...