In the same way that music, photography
and mail have moved from analog to digital formats,
another significant part of the modern world is also
rapidly moving in that direction: physical security.
Physical security products, such as video surveillance
and building access devices, are transitioning
from analog to IP-based systems. This effectively
makes physical security more readily available to traditional
IP networking VARs as an add-on, and the upsell opportunities
are significant. Just envision a typical physical security
network: A side door alarm goes off. Cameras are triggered
to pan to that door. An access control system generates a
list of who is in the building and who left within the last 15
minutes. That's a lot of products, services and install time.
The upsell opportunity has generated a lot of optimism. Earlier this year, business research and consulting firm Frost & Sullivan issued a statement saying, "Security has traditionally been an afterthought in the building management industry, but the integration of IT presents vendors and solution providers the opportunity to position security as the technology that will lead the vision for Smart Buildings and Smart Homes. IT is the biggest driver for growth in the security industry."
Adding even more urgency to that, ipvideomarket.info forecasts IP video surveillance product sales to increase by 200 percent in only the next two years.
Adding Physical Security
- Attaches directly to traditional IP networks
- Booming market opportunity
- Low barrier to entry
- Insurance is wise
For solution provider C&C Group, physical security has grown to about one-third of its $40 million in revenues, says
Ryan Walker, director of network services, who added that
there's plenty of room for more growth.
Shouldn't It Be More Difficult Than That?
"It's not rocket science," says Chris Squier, Ingram Micro's channel security solutions adviser. "Those with IT experience will have an easier time from the technical side, but will need to enhance their consultative ‘soft skills.' Those in the physical security world who know the business side need to become IP-savvy."
"There are challenges that must be addressed. Veteran physical security providers who once had the luxury of a closed network must now deal with a security system integrated with a corporate data system. Solution providers face learning a few new tricks too. For example, when the door of an IT closet, executive office or storage room needs to be secured, the right digital cylindrical lever set (a networkable door, handle and lock) is required, and there are many to choose from. Most traditional solution providers won't immediately know the right choice, says Steve Washburn, vice president at Pro-Tec Design.
"A lot of IT folks know nothing about building codes or the construction of doors," says Washburn. "You need knowledge of building construction, plus how to set up, maintain and monitor a network and server. It becomes quite challenging."
To support solution providers, a range of manufacturers offer partner programs around their camera, storage, networking and software products. For example, IP cameras and network digital video recorders from manufacturers such as Sony and Axis Communications are interoperable with platforms that can manage a variety of security peripherals, such as proximity cards used for access control from manufacturers like Zebra Technologies and HID Global's Fargo. Cisco and Motorola are also delivering IP surveillance offerings to the channel, with Motorola this year acquiring SecureMedia in order to offer both stand-alone and integrated IP video security solutions.
The payoff for mastering this market: plentiful opportunities within businesses, government agencies, university campuses and more, says Ingram Micro's Squier, who added that Ingram Micro's security division can help partners navigate the physical surveillance terrain.
The safety of people produces legal considerations
that solution providers may not have previously
encountered."If there is a failure of the system or an act that gives rise to an injury, there is potential liability," says Robert J. Scott, managing partner at Scott & Scott LLP, an intellectual property and technology law firm. "If a physical security device failed, or there was negligence in the design, installation or management of a system, you can be exposed to negligence damages."
Scott's recommendation is to get insurance coverage. This type of insurance typically runs about $1,000 per year for every $1 million in physical security revenue the provider generates. Scott sees such insurance coverage as not just protection against a lawsuit, but a potential competitive advantage as well. "It becomes a selling point. You can tell potential customers that not only will you stand behind your contract, but that you have a giant insurance company behind you," he says.
Also be aware that there may be union rules and government-required licenses to deal with. Dealing with electrical issues, for example, could require the involvement of a licensed electrical contractor, says Scott.
Vendor training and support is how both Pro-Tec and the
C&C Group got up to speed in physical security.
Today, most of C&C Group's business comes from municipalities. It has several airport deals, including one that includes 800 cameras and another 350 to be added within the year. "Our sweet spot is an organization with three or four or five buildings," says Pro-Tec's Washburn.
Tom Burns, director of Ingram Micro's physical security division, says physical security answers the need for solution providers to diversify themselves in a competitive field.
"The days when you can be a solution provider and do one thing are going fast," says Burns. "Solution providers need to have a portfolio of capabilities to differentiate themselves, which, in turn, provides better service to their customers."
Focusing In on the Sale
Who is the physical security decision-maker inside organizations these days? Before IP technology, buying decisions were typically left to a lower-level facilities manager. Today, decisions are committee-driven and involve IT, corporate security, asset protection and procurement, says Washburn. As a result, the sales cycle is more complex, and often takes six to 12 months, with an average of nine months, he says.
"You need to figure out who are the IT facilities and purchasing people, provide them with value, show them you know what you are talking about and become a trusted adviser," he says. In this way, you can influence how the RFP is written and improve your chances of winning it.