4 Security Trends in 2019… So Far
This post is more of a general take from the 10000 foot view of the Security Industry halfway through 2019. It is in no way a benchmark of what defines the industry, or even what will happen over the next 6 months. What I hope it shows is where we as industry are heading and are we ready for it.
The next stage in Security will not be the new whizbang gadget, but rather the software analytics. From ALPR analytics tied into Point of Sale systems for parking garages, to facial recognition (unless it is banned by legislature), to heat mapping in retail locations. There a multitude of other analytics using traditional security cameras now for the retail industry, the hotel and hospitality industry, even using analytics to make sure the student taking the test is the student in the seat. Apparently this is a problem still. Most manufacturers have a camera analytics suite that is a comparable as their camera line-up. Camera analytics may be processed at the edge cutting down on the amount of server compute needed. Video Management System (VMS) platforms can also provide a whole host of analytics that are server centric. VMS platform analytics can allow the analytic to use multiple manufacturer’s cameras to run the same analytic (Examples are Genetec and Milestone). Because it is server centric, there is a need for more compute to be factored in. In some cases, this may be an additional server. Some manufacturers who provide both the VMS and the camera will offer certain high performing analytics for their cameras, while they provide a host of bolt-on analytics that work with competitor cameras, but not the highly specialized analytics. An example of this is Avigilon.
Customer Experience looks different than it ever has. Customers want an experience, not just a box that sits on the wall. They want to see their home from their office, their office from their car, their car from their doorbell. We are in a new world from when most of us entered the workforce. We had a pager, or bag phone for the car, or an analog flip phone that had 30 minutes of talk time. Now we have a mini-computer (or 2) in our back pocket that has more compute power than sent astronauts to the moon. A phone can no longer be a phone. It has to do more, better. Cameras, access control, alarm panels, you name it; have to do more than be what they are. A camera cannot be a camera; it has to do 14 other things. With the introduction of Internet of Thing devices, the phone is a sensor. The CCTV camera is just a sensor, but it has to work with all the other sensors. Access control readers are Bluetooth enabled. Platforms are cloud based for the company that is outsourcing everything. Everything and I do mean everything as a service. Companies want to pay using Operational (Opex) funds and not Capital funds (Capex). Many companies, from small to large, would rather not own anything, but have the entire system provided as a service. Larger integrators have the ability to finance systems like this, which can bring long term reoccurring monthly revenue (RMR). Smaller companies are disadvantaged here, but there are companies / resources that are at the disposal of companies to make this work.
Mergers and Acquisitions
The first half of this year has been a revolving door of Mergers and Acquisitions. It could be the items mentioned in the Customer Experience trend are driving the Mergers and Acquisitions, those this year and in the past few years. There was the Cook & Boardman acquiring A3 Communications in March. Allied Universal acquired Securadyne in April and most recently Cypress Private Security in June. ADT Commercial purchased Red Hawk Fire and Security last year and is continuing to build by acquiring Security Corporation out of Detroit as late June. Convergient has been acquiring a handful of companies this year as well. Two thoughts here; One, these calculated decisions bolster these integrators for larger footprints. Two, as noted in the Customer Experience trend noted above these companies can now position themselves to provide a better customer experience with their catalogue of deliverables. But integrators aren’t the only ones acquiring. Pelco and Panasonic were both recently purchased. Both investment groups are looking to bring the camera powerhouses back to their former lusters.
Most everyone has heard of Cyber Security. This trend started three or four years ago, but it is now getting to full speed. I was asked recently in an interview with Mark Cohee with HWP (http://www.hwpco.com/) what Cyber Security really is. My answer is that it is a lot of things. I likened it to the word SNOW. In English, we have one word, SNOW. The Eskimos have 50 words for SNOW (between the two dialects of Inuit and Yupik (Source – Washington Post). This past week I sat in a talk by a FBI Cyber Security agent. Fascinating. Scary. I left there feeling like I needed a shower. According to the FBI’s 2017 report, all property crimes (except arson) cost 15.4 Billion (Source-FBI). In 2018 cybercrime cost US based businesses 2.7 Billion (Source-FBI IC3). Worldwide this number was in the Trillions. In 2017 there were just shy of 11 million people arrested for criminal acts in the US. In the same time the FBI reported less than 50 cybercriminals arrested (Source-FBI). In 2019 sources are stating the cybercrime costs for the US will be more than 20 Billion.
Cyber Security encompasses a number of broad topics that categorize the ever growing tactics being used by bad actors. As a trend, you cannot look in a security publication or to most technology providers without hearing who has the best cybersecurity. This is one reason that college graduates that have cybersecurity experience are getting scooped up right out of college. Companies are spending hundreds of thousands of dollars in penetration testing and should be. I highly suggest end-users ask for the cyber security statements to show where the companies stand. Having worked with a customer on a very public scenario when they got hacked, cyber security is necessary. Most security professionals are diligent about locking their house, setting the alarm, putting GPS on their kids' phones, and yet we leave basic internet connected devices unlocked and open for the all who want to pry to walk right in. IT departments have set their standard, which like most standards will change frequently. Companies are mandating cyber security and security manufacturers are beginning to offer products built for cyber security (Examples are Hanwha and IndigoVision). A good practice is to get the manufacturer’s white paper on their cybersecurity testing if available.
The question is how does the traditional security integrator meet this trend? My personal opinion to look through the keyhole of the future is this. IT departments are already pulling the enterprise gear (servers, switches, etc.) out of the installs. The integrator will provide edge devices and training. Installs will occur with the IT department looking over the shoulder. The traditional security integrator may have one IT-centric tech who will program firewalls, vpns, etc. on integrator supplied equipment; and once that is done, they are out. Maintenance will be provided in limited scope.