The Value of IBM Video Surveillance?

Author: John Honovich, Published on May 15, 2008

Two years since the entrance of IBM into video surveillance, the value of IBM is less clear than ever. Today, SecurityInfoWatch reports on the state of IBM video surveillance and it does not look good for IBM.

Let's examine a few choice quotes from an article that is certainly worth reading:

"IBM take a role that falls somewhere between that of an enterprise-level security integrator and that of a processes management consultant."

"Hart and Allen note that their Tivoli system, which is designed for managing IT infrastructure, has been useful for managing physical-security related IT infrastructure, and can provide benefits like reporting on hardware failure or early-warning reports on impending failures."

Rod Allen, IBM worldwide director of digital video solutions states: "We come into business where they may already have the physical security running on the same network, but they're not managed in the core IT centers." Bringing any networked system (including video systems) into the IT core, he said, makes management easier."

I see 4 interesting questions here:

1. What happened to the Smart Surveillance System (S3)?

2. What type of value does the role of integrator/management consultant deliver?

3. What value does Tivoli have?

4. What value does bringing video systems into the IT core hold?

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IBM's poor positioning is evident:

1. What happened to S3? The lack of mention implies that S3 is not getting much traction. S3 was an interesting research project but it is clearly too expensive and complex to be competitive with streamlined, purpose built commercial systems. No mention of S3 amidst 2 pages of discussion is a good indicator of the de-positioning of it. Moreover, as IBM explicitly claim in this article, they are now positioning themselves as an enterprise-level integrator / process management consultant.

2. As an integrator/consultant, IBM falls into the Lockheed/Northrop/Boeing pool of big defensive contractors/IT companies fighting over mega-projects. This is a hot area right now and an area where security integrators do not have great expertise or easy access to the type of contracting vehicles critical to these engagements. That being said, this is a tenuous position to be in because all large security integrator have huge incentive to move up into this market. Moreover, "process management consulting" is viewed by most customers as a politically correct synonym for waste. The pressure will be on to cut those costs, helping security integrators move upmarket. IBM is a powerful company and should do decently here but there's no real competitive advantage that will allow them to dominant.

3. While Tivoli is a well respected cornerstone of IT organizations, the added value that it offers relative to video surveillance health monitoring is not substantial for most customers. Almost every video surveillance system has extensive health reporting and health alerting. While Tivoli's is certainly deeper and more centralized, many if not most customers will find the video surveillance system's health monitoring as good enough. The difference in this ability will generally be seen as a nice to have but not a core differentiator.

4. IBM states that their central business proposition is bringing video systems into the IT core to "make management easier." Certainly this would be an improvement and certainly IBM has a clear advantage here. However, for most organizations, making management easier is lower priority than making video analytics work or enabling the deployment of megapixel cameras. You can buy systems from many other vendors that provide solid management capabilities but better and cheaper integration of analytics and megapixel cameras. Plus video analytics and megapixel cameras have the potential to significantly reduce losses and operational costs. IBM's advantage in management will generally be overridden by their weaknesses in other video surveillance aspects.

Indeed IBM seems to be experiencing many of the pains of attacking a new market segment without the core skills in the domain. IBM acknowledges that "The language barrier between physical and logical security is colossal."

With a weak value proposition and a variety of problems being faced, IBM faces an up hill battle. Integrators should not worry about competing or partnering with IBM. Security Managers will likely not gain much benefit from using IBM.

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