What has caused disruption to the physical security market?
Big security trends are driving change in the physical security market. We see change happening around us every day, and much of it is disruptive to the status quo. We asked this week’s Expert Panel Roundtable: What has caused the greatest disruption to the physical security market in the last 12 months?
There are a few things going on. The influx of low-cost megapixel cameras and the commoditisation of video surveillance are driving the price down. This is making megapixel cameras more available to customers. We have also seen a significant increase in the number of Far East manufacturers entering the market. Because these manufacturers are growing rapidly, they are playing a role in influencing the availability of low-cost megapixel cameras.
While it has not perhaps been the greatest disruption to the market, the recent terror attacks in Paris and Belgium, plus the wave of refugees coming to Europe, have made it more important than ever to ensure we try harder to track and trace illegal immigrants. The EU’s “Right to Work” rules add to this pressure and put the onus on company managers and owners to check the bonafide credentials of foreign workers. Thankfully companies like Trust ID have the software and services that can validate nationality and industry credentials. When these systems are integrated with access control, we can ensure that we grant access only to those individuals who are who they say they are. This helps to mitigate the potential of large fines per illegal worker which can be levied by the authorities.
The greatest disruption has been the rapid price drop of IP cameras and digital video recorders as they have truly become a commodity. Once-profitable companies are now scrambling to retain margins and stay in business. A good friend of mine, who owns an integration company, once told me there is margin where there is mystery. Designing an IP camera to acquire a higher resolution image and recording those images is no longer a mystery. Creating differentiation by resolution and how video is played back is increasingly difficult. Falling margins on equipment impacts the financial performance of manufacturers and system integrators alike. I believe, in the future, there will be a small number of very large companies that sell general-purpose cameras and recorders, and then a group of smaller “added value-focused product companies.” Added value companies create products that are vertical market-focused with features that are tailored to those markets.
Remotely managed access control and video surveillance offerings are becoming practical, affordable and technically feasible, which is among the trends causing disruption in the physical security market in the last year.
The commoditisation of the products in the market is causing big disruptions to the integrators. The integrators are having either to source offshore brands that usually are of poor quality or to figure how to install the jobs with lower labour costs.
In the last 12 months, the rise of data breaches, investments of nation-states to advance offensive cyber-capabilities and the rising rate of discovery for severe technology vulnerabilities were the source of the greatest disruptions. In the next 12 months it will be the changes in attack strategies, which currently include confidentiality and availability methods, to include integrity-based attacks. Integrity attacks selectively alter specific transactions, data, and communications to benefit the threat agent. They are difficult to detect, prevent, and recover from. Financial transaction fraud, malicious control of IoT devices (ex. automotive, healthcare, etc.), and ransomware are all examples.
Commoditisation and its many variables are certainly among the trends causing big disruption in the physical security and safety market, as our Panellists confirm. Other factors they mention are data security issues as there is an increase in cyber-security breaches and recent terror attacks in Brussels and Paris. If disruption causes change (or vice versa), we can expect a lot of both in the coming months and years.
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