Examining the Differences Between Linux and Windows for Security Applications

Editor / Provider: The Editorial Team | Updated: 5/5/2011 | Article type: Tech Corner

Software platforms have unique pros and cons, with a direct impact on security performance. Alf Chang, Senior Consultant for A&S magazines and a former installer, looks at key features and design considerations.

Embedded operating systems (EOS) are fundamental in computing. The advantages of different systems depend on their functionality, reliability, cost, form factor, power consumption and more. Each EOS is evaluated by how it performs in harsh environments or when power is interrupted, and how the system recovers for stable and normal operation.

All EOS are required to have real-time processing ability, as they are integrated with the processor. Any software upgrades also take place on the physical devices. The software encoding for EOS must be stable and good quality.

Finally, most EOS is stored to read-only memory (ROM) or flash ROM, rather than disk-based storage. These basic characteristics of EOS affect present operation issues.

CURRENT APPLICATIONS
EOS is deployed for many software management systems, with its origins in industrial controls and defense applications. It has now migrated to cell phones and multimedia, making its reach pervasive. EOS handles all the software and hardware resource provisioning and adjustments, being saved to the system's physical hardware. It also can carry out necessary functions through the installation of modules.

At least 40 different EOS exist, but Linux, Windows and Palm OS are more familiar in physical security. Linux and Windows Embedded are most prevalent, with some shared features for security applications:
1. Open system architecture
2. Real-time operation for multiple devices
3. Complete and unified interface
4. User-friendly and intuitive GUI
5. Strong networking, with TCP/IP support and unified MAC levels
6. High stability and robustness, with low requirements for user maintenance
7. Software stored to the ROM and can easily move files
8. Good hardware integration, or easy to place

[NextPage]The shared traits of both Linux and Windows make them suited for further software development. Chart 1 compares the performance of both systems in the past and the present, and their current status.

In the past, Windows Embedded did not support Linux. The hardware and applications only considered Microsoft operating programs, such as Internet Explorer and ActiveX. Most multimedia, cell phones and online games were geared toward Windows users.

However, Linux has many programs that cannot run on the Windows platform. This is mainly because it relies on graphical windows and resources that are incompatible with Windows, or has stability issues without Windows support. The development of KDE SC and Cinepaint enabled Linux users to migrate Windows programs to Linux. However, the Linux GNOME desktop does not support Windows.

Another crucial difference is that Linux costs nothing, while Microsoft requires a fee for Windows. The Linux source code can be reproduced for free, which is sufficient for most interface and efficiency demands from users. Windows panes are closed and less transparent, as the graphical interface's coding must be accessed from the system's core. This makes the interface more responsive that Linux, but any errors in the icon interface will crash the system. Chart 2 outlines development and applications differences between Linux and Windows.

Linux and Windows have several application differences, as Windows is more modular and expandable. It performs well for real-time and communications, and is supported by most CPUs. The Windows design is suited for the majority of network management controls, including industrial computers, network switches or mini PC terminals. Consumer devices such as digital cameras, webcams and smart phones with small form factors can be served by the Windows EOS.

On the other hand, Linux supports the X86 chip for a cross-platform system. It is easily transferable, with support on 20 to 30 CPU-based systems from most CPU or SoC suppliers. This allows for convenient Java integration for surveillance servers, and will not require the platform to be rehauled. Linux also has a complete internal network structure, supporting 10/100 M BaseT, as well as gigabit and WLAN.

SECURITY ISSUES
Security applications require specific software or hardware, so the right system will maximize performance while minimizing software requirements. In light of this trend, EOS CPUs are moving toward SoC development. Video surveillance equipment, such as network cameras, DVRs and NVRs, must be have simpler hardware design to stably run various software programs. Component suppliers must provide the virtual environment for security manufacturers to design their hardware platforms. Equipment makers can then develop their product APIs even without a physical hardware platform, along with running interoperability tests.

[NextPage]Apart from data computing power, surveillance devices with complex intelligent algorithms will require more DSP processing. Different EOS systems will affect the equipment's software, the overall solution's scale and functionality. In terms of scale, the operator requires no delay from when a command is entered and the system responds. This holds true for video surveillance and safety deployments, with more exacting requirements for critical sites.

The IT perspective for surveillance is similar to a computer user. DVRs or NVRs usually will open multiple windows to simultaneous view or record monitored areas. However, the more windows, the greater the load will be on the system. The system must simultaneously handle multiple computing tasks while maintaining smooth operation. If the processor's main unit deploys an EOS, it only requires suitable programs to be stored on the main controller unit (MCU) and then it can run. There is no need to burden it with taxing imaging algorithms. This enables surveillance equipment to run EOS on ARM MCU or Power PC architectures, with relatively simple processing demands and lower power consumption.

Megapixel or HD network cameras are impacted by the type of EOS running on their processors. Differences will affect decoding, display, computational speed, open source codes and the control interface. A network camera running at different processing speeds will affect how much resolution it can handle along with whether it can support 2-D or 3-D hardware acceleration. Whether a network camera can reach megapixel, 720p or 1,080p depends on the EOS and its impact on processor speed. The EOS will also affect multiple application processing and support for more efficient algorithms, such as Web browsing and file management. Regardless of whether the camera runs Linux or Windows, the size of the EOS will influence the camera's development and application.

As the Android platform enjoys rapid uptake, the EOS space has grown considerably. However, product makers still must decide between SoCs running different EOS. Each camera manufacturer has specific SoC partners, with the right EOS shortening development time and reducing cost for megapixel or HD camera. Most high-resolution camera models deploy the ARM architecture for efficiency, multimedia support and highly functional network surveillance equipment. The X86 chip is currently hot, making embedded CPU chips in high-resolution cameras a growing trend.

The rise of IP has propelled the networking of physical security. EOS determines a device's applications, affecting functionality, reliability, cost, physical size and other exacting system features. EOS has greatly increased the development of embedded surveillance systems, reducing R&D time for network cameras, DVRs or NVRs. Embedded equipment increases flexibility, transferability and portability. In the past five years, electronic security has progressed in technical innovation, making EOS a pivotal development consideration.

Assimilating Energy Efficiency into Security

Editor / Provider: a&s International | Updated: 4/20/2011 | Article type: Government & Public Services

Newer physical security products are made and used with energy conservation in mind. Continued efforts in R&D for products that utilize renewable energy sources while preventing excessive power usage have their role to play in ensuring a longer living earth.

CONTRIBUTING TO LEED
Many security electronics, sensors, detectors, access control devices and surveillance cameras can be designed and implemented to help meet LEED certification by understanding the characteristic of the buildings and the potential energy saving of each end user. “Most energy consumption in the building, which is generally around 60 percent, is used by HVAC and other electricity and water usage,” said Vincentius Liong, Director of Integrated Security System Solutions, Elektrodata Sistem Integrasi. “By implementing the proper security equipment product range — sensors and detectors, access control, surveillance cameras with motion detection, and more — integrated with the building automation system (BAS), a building manager could properly control, manage and monitor the usage of energy, electricity and water usage in the building.”

Physical security systems contribute to the BAS in terms of locating people in a building with efficient access control and occupancy sensors to determine the headcount per floor or per zone, said David Wilts, Director of Integrated Building Technology, Crestron Electronics. “We have worked on many projects where the occupancy sensor in the conference room turns the lights and AV system on and off, recalls shade settings, adjusts the set-point for the local thermostat, and tells the calendar application whether or not people showed up for the meeting. If no one showed up for the meeting, the room automatically became available again in the calendar.” There is a large opportunity to leverage the security system for energy efficiency and LEED efforts.

“LEED recognition does help keep an eye on the quality of products used to achieve green building goals,” said Peter Boriskin, Director of Product Management, UTC Fire & Security. “Efforts like LEED will become even more established and widespread in the near future to help initiate more green building projects and awareness.”

POWER BACKUP MEASURES
Shutting off power to conserve energy directly outside peak hours is common in green buildings. Temporary electricity suspension in response to excessive power usage or natural disasters is also a more frequent occurrence nowadays. Unfortunately this interregnum cannot happen to a reliable and active surveillance system, as emergency situations could happen any time. Security solutions must have a backup power mechanism, like an uninterruptible power supply (UPS), or else they fail in their foremost function, said Dave Bartlett, VP of Smarter Buildings, IBM.

City code requirements of backup measures in smart buildings are essentially the same as traditional buildings. “In terms of what is available beyond regulated by the codes, typically a backup system would leverage the building's energy generating system,” Boriskin said. “There is more adoption of solarpowered cameras, especially in remote locations, which conserves energy usage as well as providing the power needed.”

[NextPage]“One of the key components of a security system is a battery backup, although this is not a very green solution,” said Ryan Hughson, PM at Delta Controls. “Using alternative energy sources, such as photovoltaic power, can reduce the power requirements of the system, therefore making it more efficient and last longer.”

Renewable energy sources like photovoltaic panels or wind power feed a battery bank, which in turn feeds the building's power infrastructure, Wilts added. This could easily provide the UPS for security systems in an intelligent building.

RESIDENTIAL VERSUS COMMERCIAL
Security implementations for residential and commercial intelligent building differ in scope and complexity. “In terms of scope and capabilities, commercial-grade security management is designed more around the network, with an emphasis on the interoperability with third-party systems. There are typically more designing done to these projects,” Boriskin said. “Conversely, residential buildings often use one-vendor solution only. Except for mid- or high-rise apartment complexes, i f the residential building is a stand-alone complex, it typically would not need networking capabilities, scalability or third-party integration.”

“This makes things both easier and harder depending on different circumstances,” Boriskin continued. “A one-vendor solution allows vendors to provide an easy-to-use system for end users. However, if other third-party systems need to be integrated into the existing infrastructure, integration would not be easy or easily modified in the field. Basically, if it doesn't come in the box then the performance is not there.”

SUSTAINABLE FUTURE
Continuous R&D efforts in greener and smarter security products will facilitate the spread of intelligent buildings to save the planet. “In the past decade or so, the focus has typically been on protecting data centers and the IT resources which enterprises own,” Bartlett said. “We now need more R&D investment in security management for non-IT assets. Vendors of sensors and actuators must work with companies that can provide an integrated hardware-software solution to embed within their products. The added cost of adding security to these devices must be absorbed using more intelligent ‘system-on-aboard' silicon design. Investments in enterprise security software solutions must be leveraged to encompass these sensors.”

Smart/green building awareness could be better promoted through education on available technology and current cost considerations. “There is a misnomer in certain areas that going green equals added costs,” Boriskin said. “Once people realize that it is an opportunity to do what is right for the environment, while bringing cost benefits, acceptance and adoption of smart/green building initiatives would increase. As of now, the up-front cost of new smart/green buildings is coming down. More governments are spreading awareness by giving tax credits and constructing public green structures that people can point to and learn from.” Energy-efficient and intelligent security products will have a chance to grow and expand with this vertical.

“We see great growth potential in this vertical and are optimistic for the market situation in the next few years,” Boriskin added.

Smarten Up Security in Green Buildings

Editor / Provider: a&s International | Updated: 4/13/2011 | Article type: Commercial Markets

Smart or green buildings are multilayered integration projects, with security playing a vital part in building management for safety. These building projects worldwide offer the security industry new business opportunities while driving technological advancements for energy efficient and intelligent products.

With a growing awareness of environmental issues and the availability of advanced technologies, smart or green buildings have become a fast growing trend, leading to a booming vertical. “Generally there is more awareness of green initiatives and the threats posed by environmental degradation,” observed Terence Lee, Regional Director for APAC System Integration Business, Ingersoll Rand Security Technologies. “We see a growing trend that end users are becoming more active in driving the effort to help sustain the environment. Everyone is talking about environmental sustainability and it has become a core value for many contemporary organizations.”

A reliable physical security system, comprised of energy efficient surveillance and access control products, is an important component of a successful building management system in smart and green building projects. Industry experts contribute the average budget for security in intelligent buildings to a maximum of 5 percent of the total construction cost, said Theodore Bier, President of T.M. Bier & Associates. “The average budget is still relatively small compared to the total construction cost,” said Vincentius Liong, Director of Integrated Security System Solutions, Elektrodata Sistem Integrasi. “The cost of security systems is on average 1 to 2 percent or even smaller of the total construction cost.” Despite this observation, the importance of a resilient security system within a smart/green building should not be taken lightly, as business opportunities abound.

ABUNDANT GROWTH
A recent report published by McGraw-Hill Construction, titled “Green Outlook 2011: Green Trends Driving Growth,” states the US green building market increased 50 percent in value from 2008 to 2010 — despite the effects of the recession. This translates to growth from US$42 billion to potentially $71 billion, comprising around 25 percent of all new construction activities in 2010. According to projections, the green building market is expected to reach $135 billion by 2015. “Smart and green building requirements are coming from multiple locations, with the most from North America and Europe, based on what we have observed,” said Ryan Hughson, PM at Delta Controls.

In “Energy Efficient Buildings in Europe,” published by Pike Research, ongoing greening efforts in Europe were mandated for all new building construction. Major renovations must meet nearly-zero energy standards by the end of 2020 — 2018 is the earlier deadline for public buildings. Pike Research found the largest European markets for green buildings are Germany and France; in fact, the combined market of the rest of Europe, including Eastern Europe and Russia, is comparable to the market of either Germany or France. When looking at Europe's long-term plans, the green building market is moving from gestation to the growth phase.

In APAC, awareness for smart/ green buildings is picking up faster than before, triggered by global warming. “Large companies and corporations in Indonesia have taken the lead in promoting the trend of smart/green buildings and energy efficiency/energy saving in sustainable buildings to cut energy costs, optimize building efficiency and improve holistic company image,” Liong said. “It is hard to get exact numbers at this point on the market size, but we estimate that it will be large enough in the next 10 years and offer growth potential above average when compared to other industries, achieving as high as 20 to 30 percent growth annually.”

[NextPage]Also in APAC, Pike Research found retrofitting projects are becoming the more cost-effective approach, as the cost of new constructions increases. Developers and building owners will be inclined to reinvest in and upgrade existing facilities, allowing for the latest technologies to be incorporated and used.

“There is greater push for green building projects in emerging markets as seen in Asia, the Middle East and Latin America,” said Peter Boriskin, Director of Product Management, UTC Fire & Security. “New buildings and infrastructure retrofitting projects will provide opportunities for the industry. From both building management and security management perspectives, new technologies help to reduce TCO as well.”

UNIQUE SOLUTION NEEDS
Security products used for intelligent buildings regard energy conservation with utmost importance. “The goal of products that target the smart/green building vertical is to greatly reduce energy costs while improving the user experience,” said David Wilts, Director of Integrated Building Technology, Crestron Electronics. “Our preferred approach is to address all of a building owner's needs by integrating the ‘conditional logic' of the following systems: lighting, shades, HVAC, AV, security, scheduling (Microsoft Outlook, Lotus Domino or others) and energy monitoring.”

For smart buildings, integration can be made easier with multiple products. “For instance, Ethernetcapable field-level controllers enable system designers to create a flat architecture, which eliminates the pain of integration with multiple levels of communication,” Hughson said. “It is beneficial not only for reducing the amount of system knowledge a person needs to work with a network, but minimizes logistical concerns for integrating with components in harder-to-reach areas.”

“We have developed wireless controllers for much the same reason,” Hughson added. “We have one IP network that allows one to move seamlessly throughout the network and jump off into wireless for difficult-to-install locations. We want to avoid the strains by creating a network that fits the design of a building.”

Similarly, using Power over Ethernet reduces the number of wires that must be strung for the network, leading to reduced cost, less downtime and greater flexibility in installation compared with traditional wiring, Lee said.

“Typical indoor motion sensors are simple binary switches indicating motion or no motion, and such sensors have a long-standing history of certain basic and unavoidable operational flaws, such as false motion detections from movement around but not in the room and changes in airflow from cyclic operation of HVAC systems,” said Francis Létourneau, Sales Director for Lyrtech. “Typical motion sensors don't account for the type of objects, such as a person versus a plant,or the time the objects remain in the monitored area. They are also incapable of tracking objects while they are in the monitored area and incapable of compensating for the number of objects in the monitored area, something vital in HVAC control.”

By combining video analytics and motion detection technologies, an intelligent occupancy sensor (IOS) would be able to determine both the type and number of objects in a single room accurately. “A substantial portion of the IOS's interfaces is integrated to the onboard DSP and it benefits from a relatively small FPGA and generic components, which makes the total cost of incorporating the IOS into a manufactured solution quite low for a device of its kind,” Létourneau added.

[NextPage]REAL-LIFE INTEGRATION
INITIAL INVOLVEMENT
In the past, physical security for buildings would be a later addition to the master plan, yet security design nowadays is brought early into the building lifecycle depending on the degree of security focus and complexity of the building, said Dave Bartlett, VP of Smarter Buildings, IBM. When included in the beginning, system integrators (SIs) would be able to take advantage of this opportunity for easier work later on during actual installation, Boriskin said.

While construction sites need to be under video surveillance for property theft, highly sensitive buildings require extensive background checks with proper identity and access management for construction and maintenance workers, Bartlett said. “Developers and building management teams need t o consider electronic surveillance equipment and networks, camera vantage points, conduits, seals and tamper resistance for electronic cables and trays. This requires the building developer community to consider security design alongside architectural drawings. Successful security implementations rely on the philosophy of ‘defense-indepth,' so there ought to be multiple layers of security enforcement and management for both the physical and logical realms.”

COST AND COMMUNICATION
The intelligent and energy-efficient aspects of a green building each pose different integration challenges. “A smart building is designed from the ground up with interoperability in mind, but the intention of integration is not enough,” Hughson explained. “When integrators get to site and begin working with the hundreds of peripherals that make up this organism, it will come down to the small choices about how these components act on the network. Are components sensitive to the bandwidth and security requirements of the site? Are components flexible enough to allow for diverse integration with rigidly designed products? Are components simple enough to configure that time won't be wasted in needless configuration? These considerations create a fulcrum that must be balanced for the smooth implementation of a smart building.”

“The success of a green building lies in the engineering,” Hughson continued. “Tools must be designed to support the knowledge of the technician on-site. Feedback information from the system needs to be simple to understand but detailed enough to provide value. Living data is needed because no matter how well-advanced the planning of constructing a building, all the pieces will not interact until after the building is in place.”

The various building functions are made available in the construction stage to connect different technologies under a central management system. Traditionally there is a lack of coordination between security staff and other divisions, based on the nature of security work, Bier said. In order for the building to operate smoothly, effective communication between different systems is much needed.

“Intelligent buildings incorporate building automation together with security and fire safety systems to enhance the user experience while minimizing operational costs,” said Anand Mecheri, CMO of Siemens Building Technologies. “Integration of energy metering and power quality in a building greatly supports these goals.”

[NextPage]“Building automation, electrical power distribution systems, lighting systems, fire safety and security systems are generally not ordered at the same point of time. The planners/technical consultants who design these systems for the developer are also not the same. Therefore, there is a situation where different systems that need to talk to each other to create a homogeneous, intelligent environment are designed by different people, tendered at different points in time in the construction program and awarded to different suppliers who may not be able to deliver an integrated value proposition,” Mecheri said.

As green building projects cross the boundaries of different business cycles and company specialties, there is a great organizational challenge posed for these projects, Boriskin said. “It is rather difficult to ask different groups of people to work together and to understand each other's business, yet organizational convergence is crucial for these businesses to work together. Even when the top management team pushes for more efficiency from top down, getting these groups to work together is challenging.”

In order to have a holistically integrated system, higher-level management software is needed to connect the building automation system (BAS) and security system through a standards-based approach, allowing them to speak the same language, Boriskin said. “The ideal situation is that end users are able to pick a protocol that everyone can utilize and communicate with. A helpful way to overcome communication barriers might be adopting network standards, computer standards, XML and Web services as industry standards, based on an internationally unified set of standards, for easier integration, although this has yet to be established.”

In addition, the lack of awareness, education and technical knowledge of building managers and owners on the full features and capabilities of BAS might lead to conservative cost considerations, which often influence the scalability of the BAS installed. “Most usually regard the budget of BAS as the last priority of the whole building construction cost,” Liong said. “Whenever necessary, at the end of the construction project they can easily cut down the budget of a proposed BAS to the lowest minimum and downgrade the specification requirement without considering the lesser functions of the installed BAS later on.”

To facilitate smooth integration of different systems into one BAS, having an integrated building technology project manager would lead to successful project completion, Wilts said.

[NextPage]IP BACKBONE
Building subsystems are largely analog, even for newer recordholding skyscrapers like the Burj Khalifa and Taipei 101. However, more smart buildings are adopting an IP-based backbone as technology continues to advance, Bier said.

In fact, the convergence of analogand IP-based security systems is noticed in newer smart/green building projects. The ideal approach blends the two technologies with the backbone infrastructure all over the IP network, Wilts said. “Adoption of IP and IT networks as the backbone for building systems helps in minimizing engineering and deployment challenges for new buildings and for existing retrofit applications,” Mecheri said. “For example, deploying an analog video solution in an existing building presents a massive challenge of dedicated cabling to be retrofitted. Alternatively, utilizing existing data points to bridge analog video into the IP network is the most practical way to retrofit a surveillance system into an existing building.”

“Traditional analog systems are acceptable for small sites, but scalability is limited when deployed on larger sites,” Boriskin explained. “With an IP-based approach, protocols that live with security and building management systems would be able to intercommunicate better and faster. With an IP solution, the number of hardware devices gets reduced and SIs would be able to scale the system appropriately to the size of the site.”

Currently implemented network types, like Multiple Spanning Tree Protocol, have been around for 15 years or more already, Hughson said. “While it is probable that these networks will continue to be installed in the short-term, it is important to consider the rising demand for live data and the strain that is placed on a network. IP presents a great deal more longevity when considering what the network needs five years from now.”

Physical Security Consolidation and Funding Slowed Down in 2011 Q1

Editor / Provider: Submitted by Memoori Business Intelligence | Updated: 4/7/2011 | Article type: Hot Topics

Despite marginal growth and a lack luster financial performance by suppliers across the industry in 2010, consolidation increased by 75 percent on its 2009 figure that had already picked up from its precipitous fall in 2008. Similarly new investment in the supply side also increased rapidly in 2010. So with a forecast improvement in trading conditions it was naturally assumed that the trend in both consolidation and investment would continue its upward trend in 2011 and beyond.

The first quarter results analyzed in the monthly Executive Brief “The Physical Security Industry in 15 Minutes” show that both consolidation and investment has slowed down significantly. In the first quarter of this year the number of acquisitions is 20-percent down on the same period of 2010 when Tyco made a US$2 billion acquisition of Broadview Security. The number of investments has halved compared with the same period of 2010.

Allan McHale, Director of Memoori, predicted at the beginning of this year that this high rate of consolidation would continue for a few years because the major suppliers absented themselves from the dealing tables in 2010, announcing that they will be active in 2011 and companies from the Defense and IT & Communications industries were expected to continue making forays into the security industry.

The drivers that accelerated the consolidation and investment process in 2010 are still very much in place. Technologies such as wireless, SaaS, network cameras, video management analytics and HDcctv are rapidly gaining market share and opening up new business opportunities.

IP networks whether for access control, intruder alarms or video surveillance are on the verge of a long strong run. Through these factors and IT convergence, the fundamental goal of achieving the buyer's ROI is becoming a reality. The defense- and IT-related companies entered the security business because of its proven robustness during the recession and the fact that it provides opportunities to leverage their high technology, which has not changed.

In the first quarter alarm monitoring acquisitions continued to make a major contribution to the consolidation process and it's expected to continue, driven by the basic need to consolidate this fragmented sector. In addition the players here want to pursue the opportunity that is opening up through integration of the different security services delivered through SaaS which is enabling a much more comprehensive and cost-effective service to both residential and commercial customers.

The most notable sale in the first quarter of this year was the Initial Public Offering (IPO) of Infinova. This US-based company listed on the Shenzhen Stock Exchange in January and got a much higher valuation than it would have got in the western world. Some 37 million shares were issued at $8.2/share, yielding a value of about $306 million.

[NextPage]Within days its price reached an all time high of $9.5 per share raising its value to $357 million, which for a $57 million revenue company (2009) with annual growth running around 20 percent over the last two years is a very high valuation. However its valuation is approximately $243 million.

In January 2010, HikVision, a company having annual sales in 2009 of $300 million and solely serving the Chinese market listed on the same exchange and raised $500 million making an exit sales ratio of valuation 1.66 and an EBITDA ratio of 4.4 which is far from being highly rated. So it would appear that within a year the Chinese security market has moved up a gear or two and this will inspire western companies to take a serious look at floating on the China Stock Exchange. Not surprisingly China based, China Security Systems Technology (CSST) listed on the NYSE but based in China is unhappy with its current valuation and is looking to go private.

The most interesting deal this month was Tyco's purchase of Signature Security Group for $171 million. Tyco intends to combine Signature Security's Australian and New Zealand operations with its ADT Security business under the ADT name. Signature Security is a provider of electronic security services in Australia and New Zealand, providing security installation and monitoring services. This deal looks a strategic fit with ADT business, providing increased scale and attractive operating synergies.

Alliances in the first quarter numbered 24 compared with 23 in the same quarter of last year, so this is at least one area that is still very buoyant.

So how is the financial performance of security players standing up? The fourth quarter financial announcements made recently show for the most part revenues and profitability well up on the same quarter of 2010 and the full year outperforming 2009. With almost all anticipating improved trading conditions in 2011 it looks as though revenues and profitability will improve on 2010.

The star performers in 2010 include Axis Communications, Mobotix, Basler, China Security & Surveillance, Authentec and Bio-Key, despite the fact that their fourth quarter was well down on 2009. These companies are very specialist and perform in the high growth areas of the business and are strong in geographic markets that performed well in 2010.

Tyco, Honeywell and Siemens all increased both profitability and growth and are bullish about 2011. Cooper and Ingersoll Rand similarly increased their growth and profitability, whist Bosch returned to profitability on increased sales.

With trading conditions looking buoyant and the drivers that accelerated consolidation and investment in 2010 still well in place we believe that the slowdown of acquisitions and funding in the first quarter of 2011 does not indicate in anyway a change of course but is just a short-term deviation. This industry will not buck the trend much longer for global merger and acquisition activity is well up on the same quarter of last year. Listings activity has been the highest on record so far this year, with firms raising a total of $24 billion from IPOs. Interestingly Asia, which dominated equity capital markets in 2010, continued to lead the field, with China accounting for 41 percent of issuance.

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Bridging Channel Gap Between IP and Analog

Editor / Provider: a&s International | Updated: 4/6/2011 | Article type: Hot Topics

The security industry should not be polarized — acquiring both analog and IP installation and integration skills might prove even more beneficial for system integrators and installers who are caught between the technological changes.

As the migration from analog to IP continues, physical security faces tremendous changes. Channel players are witnessing the change firsthand, as distributors and system integrators (SIs) understand that keeping up is the only way to ride the IP wave into a better tomorrow. For traditional SIs and installers versed in analog, possessing both analog and IP know-how offers a promising opportunity for attractive profit margin and greater business prospects in the face of fierce competition.

As a result of mounting market expectations and requirements, more traditional SIs and installers are learning and understanding IP-based solutions. With a growing number of hybrid projects, it is important that traditional SIs and installers learn the ropes about IP solutions to expand their customer base. “Incumbent installers possess invaluable experiences in terms of mechanical and engineering works, such as indoor/outdoor video cabling, electrical wiring and protective measurements, t renching and such, ” said Gavin Ng, Sales Director of Afiintra Technologies.

“Structured cabling and design are not foreign to IT/IP professionals, at least in theory. But traditional installers do provide practical experience that we lack. There is much to learn from professional installers, especially on different types of media and best practices and cabling standards.”

On the other hand, technology transfer has to take place for installers to be competent in the digital world, Ng added.

Depending on the nature of installation, analog systems are still widely deployed. Hybrid projects are increasing as users transition to IP, requiring installers to pick up the IP language. “Many projects in Asia are either fully analog or fully IP, but we are seeing more hybrid solutions as well,” said Sean Wong, Business Director of Security Systems in Asia, Anixter. “A fully IP system would enable a much better, high-level integration as opposed to fully analog, although this depends on the infrastructure design as well as the level of integration needed.

[NextPage]Driving Forces
For SIs who have adopted IP-based security products, the driving force comes from market demand for better and more convenient solutions, which consider TCO and ROI. “First, SIs will be able to stay ahead of the competition in the long run in terms of technology and capability,” Wong said. “Second, more projects are moving toward IP-based security solutions, which provides more project opportunities for SIs. Lastly, in the overall project management, initial and operational cost savings cannot be overlooked.”

Some recommend traditional SIs and installers to move away from installation as just connecting products and offer solutions instead. SIs and installers can sell value to end users with solutions rather than products. “The reason organizations implement IP solutions is a result of needs or requirements rather than mere cost,” Ng said. “IP solutions provide lower TCO and better ROI, as well as the ability to solve demanding business needs and futureproofing end users' investments.”

“It is imperative that the end users see and agree that they have a value proposition — this will only be achieved if the SI spends time with the end users to understand their key drivers such as ROI arguments, security needs, operator ease of use, scalability of the deployment and of course future-proofing against new and emerging technologies,” said Gary Harmer, Director of Electronic Security Sales for Mayflex. “If all of these items are covered then the end users are more likely to view the SI as a long term partner who continuously strives to deliver added value and proceed with the solutions put forward instead of always seeking competitive bids in the market.”

[NextPage]“To us, the drive is improved functionality and reliability, as IP technology has benefits such as increased deployment of structured cabling, remote communications and does not rely on proprietary equipment,” said Mark Harraway, Country Manager for the U.K., Controlware. “While the cost of individual IP products may be higher, IP-based systems have been shown to have a lower TCO than analog systems, and ROI is shown through higher uptimes, greater resilience/redundancy and improved functionality and flexibility in deployment.”

“The top three driving forces are solving the existing issues, improving/enhancing the current system and maximizing the value of the new system, such as flexibility and expandability,” Ng said. “Instead of justifying the cost, it makes more sense to maximize the benefits of the solution with value-added attractions. Price is just a matter of negotiation after everything is fulfilled. ROI is easier to talk about than to be proved in actuality, and we emphasize more on the savings of having greener technology, virtualization or cloud solution and having a nonproprietary open platform system that is future-proof.”

End-user requirements are another crucial consideration. “IP technology in itself is also a driving force as additional value-added functionality, such as analytics, which is easier to deploy on IP-based systems,” Harmer said. “These can be used as management tools and are often deployed to deliver information to the business on matters such as footfall, exception behavior reporting and more.”

IP technology does not always cost more, if the total investment is considered. “Having a single infrastructure, being able to capture a wider coverage area and having the durability of the current network camera solutions — it is possible to have this kind of IP solution at a lower cost than expected,” Wong said. Learning about IP solutions expands SI service portfolios and enables more options for cost considerations.

[NextPage]Learning the IP ABCs
For traditional SIs and installers, getting started with new technology is the hardest part. A common problem is solution design and sizing, since traditional SIs and installers do not fully understand the limits of IP technology, Ng said.

Other common problems are leveraging legacy equipment and addressing proprietary issues, such as telemetry or integrating hybrid systems, Harraway said. “The compromise is usually to either have a managed migration plan that may involve additional hardware on a temporary basis or to accept reduced functionality for a period.”

To overcome these issues, education and training are required to get traditional SIs and installers up to speed as fast as possible, Wong said. “Furthermore, several manufacturers are redesigning keyboards and joysticks to mimic analog systems.” Providing sufficient education and information to both sales and technical peoples will give traditional installers a good start, Ng said.

Having pre- and postsales support from IT/IP vendors is vital for traditional SIs and installers upgrading to IP systems. “We work hand-in-hand with our partners from the proposal stage to designing and commissioning of the project, and sometimes turnkey professional services are required to assist them as well,” Ng said.

[NextPage]Integrators should note that a manufacturer's support with system design might be limited to its own products and misses components like servers, switching or integration with legacy equipment, Harraway cautioned.

To survive in this multifaceted industry, learning the IP language would allow SIs and installers to earn more project opportunities. “It's difficult to provide numbers, but we noticed that different types of engineers are coming through which allows traditional installers to bid on more and more IP-based projects,” Harraway said. “This in turn opens up more business opportunities to traditional SIs and installers in various areas and verticals.”

“Many traditional SIs and installers are already adopting the IP technology, but there are some markets which are critical and do not wish to gamble with the IP technology, and therefore stick to analog,” Wong said. The majority of projects are analog, with many system migrations that will give installers with IP know-how an edge, Wong added.

Even in the U.K., where analog dominates, IP-based solutions are gaining ground. “Within the UK customer base, we confidently expect to see revenue growth in excess of 50 percent fueled by increasing interest in IP-based solutions from the traditional analog installer market, and by new entrants to the installation market with proven IP integration skills,” Harmer said. “Overall, growth opportunities may be limited due to reducing numbers of new-build projects and cutbacks in publicsector spending; however, as a whole, the market prospects for those that embrace the IP opportunity remain very strong for the foreseeable future.”

It is expected that growth in IP will persist throughout 2011, but it is difficult to project an exact figure due to challenging economic conditions in different regions, Harraway said. “Not only do we see a migration of analog security to IP, but the same shift is witnessed in projects around process control and health and safety compliance — IP fits these types of installations due to its flexibility and reduced TCO, easy installation and integration and even more redundancy options.”

To keep up with the evolving industry, traditional SIs and installers need to consider how necessary it is to start picking up the IP language.

[NextPage]Ongoing IP Issues
IP-based technology continues to evolve and some issues need to be addressed for IP solutions to gain traction. “It is still early for networked security products to take off in the mainstream market, and much effort is involved in building awareness of the potential solution that IP technology can provide,” Ng said. “Resellers and SIs need to be educated not only for technicality, but also on how they can better position IP surveillance/security solution to the end users. These groups lack confidence in positioning IP solutions and end up competing on price alone most of the time. We have seen many IP solution resellers enjoy lucrative margins, because they don't take it as just another transactional sale. It is still a high-tech sale after all, and no one should expect it to be a short cycle.”

Ensuring interoperability between different products is an ongoing effort. “Open standards allow for best-in-class product selection across a number of manufacturers to be deployed into a single system,” Harmer said. “ONVIF is a positive step forward, but more work still needs to be done to enhance user experience.”

“The knowledge base is a key point both in the installer base and system administrators, as is the entry price point of IP in certain areas,” Harraway said. “Recording platforms or hardware also need to be reviewed to make IP technology easier to adopt for both end users and the installers.”

Keeping Up?
With the current world economy still recovering, traditional SIs and installers should consider the reality of maintaining and gaining sufficient profit margin amid vicious competition. Adopting new IP skills might be an added asset. “As the security market migrates to the IP platform it will be essential for SIs to be able to discuss the merits of both analog- and IP-based systems, like deployment costs, future running costs, maintenance requirements and more,” Harmer said. “An integrator who is able to manage both types of system deployed across an end user's large estate for example will be better placed than a SI who is only skilled in one of the areas.”

“Traditional SIs and installers need to prime their skills for projects and be able to provide more value-added services, where services command a high percentage of the total project management,” Wong said. “Selling a fully integrated solution will help to control the project and margin better.”

Securing the Future of Energy

Editor / Provider: By The Editoral Team | Updated: 3/30/2011 | Article type: Government & Public Services

Studies and discoveries in alternative energy resources have been made over the recent decade, spurred by both environmental and political concerns. The glaring ramifications of overreliance on fossil fuels and oil to power our planet have led governments to create incentives for private companies to funnel investments into renewable energy, with the help of grants and subsidies.

At the moment, the bulk of renewable energy plants rests in solar- and wind-friendly European countries, such as Spain, Germany and the U.K. The U.S. is following suit, with President Barack Obama passing a clean energy stimulus package worth US$787 billion in 2009. Despite the economic instability, there has been tremendous growth in the development of solar and wind farms over the past five years. Although the percentage of growth may plateau over the next decade, the actual number of renewable energy farms will continue to rise, calling for more attention to suitable physical security measures.

The market for renewable energy has grown rapidly for some years, according to Ted Campbell, Senior VP of Renewable Energies Business, Schneider Electric. “However, we are expecting the world economy to be affected in 2011 and this will translate to budget cuts for many large countries. Thus, we expect a flat market in 2011 and over the coming years, yet solar energy will continue to grow at an excess of 20 percent over the next five years within the U.S.,” Campbell said. “We Securing the Future of Energy By Mariko Higashiyama produced 18 to 20 gigawatts (GW) in 2010 from solar farms, and predict a doubling of this number at 44 GW by 2015.”

By 2020, renewable energy should account for 20 percent of Europe's final energy consumption. To reach this goal, there has been a boom in renewable installations in different countries, thanks to the support policies implemented by several governments, said Ippazio Martella, President of Marss. In Italy, there is still much room for growth. “We have entered into a Third Budget Law which includes having 7,000 megawatts (MW) of solar panels installed by 2010. We are still far from the goal set for 2020, so it is easy to understand that this market will continue to increase.”

Germany and Spain are among the countries leading the march in harvesting renewable energy. According to the German Trade and Investment Office, the photovoltaic (PV) industry posts an annual turnover of approximately $14 billion and employs more than 133,000 workers. Government incentives within these European countries are also encouraging research and development within the field. In a report by the European Photovoltaic Industry Association and Greenpeace International, current investment in PV development is worth $47 to $54 billion and could reach $95 billion within the next four years. “The cost of PV panels is going down,” said Chuck Scifers, Head of Business Development, Jet Protect. As PV panel prices fall at a rate of 3 to 5 percent each year, it will advance the growth of large solar farms. “There are three areas of solar development: residential, commercial and farms. Utility and financing companies are entering into agreements to develop large solar farms and we should expect much development in this area.”

[NextPage]Inadequate Security
The design and planning concepts for each project varies, depending on country and budget. “The size of the farm also greatly affects the type of security required,” said Hagai Katz, Senior VP of Marketing and Business Development, Magal Security Systems. “This is still a budding market, so it is difficult to grasp a clear concept of what is required in terms of security for every situation.”

Due to the isolated nature of renewable energy sites, some places are equipped with minimal security. “At a wind farm, there is little that needs to be done in terms of security,” Scifers said. “Someone may drive to the site once a day but generally, no one is present at the site. This is often also true for many smaller solar farms. For some sites, a maintenance worker will simply go there once a week to log his visits into the system by swiping his RFID card, or by accessing the numeric key lock. It is not the type of facility where there are 200 people providing maintenance on a daily basis. Some solar farms may have secure structures to house the ancillary equipment.”

As previously mentioned, the size of the farm affects the level of maintenance and security required. “It is common to see someone on-site if it is a very big farm, although they are not there for security purposes but primarily for performance purposes — to monitor the equipment and make sure disturbances can be fixed in a timely manner,” Campbell said. “However having said that, there are still farms where there is no one on-site. This is because if, for example, a 500-kilowatt inverter goes down, the farm is only losing a tiny fraction of their generating power — it is not a catastrophe, compared to an oil rig or a nuclear power plant.”

The lack of dangerous substances on-site minimizes the amount of security and surveillance deemed necessary on-site for both maintenance and security purposes, said Gaetano Capula, Director of Marketing, GPS Standard.

The requested access control is often basic. “One can think of it like any other factory, where only basic access control is required,” Katz said. “This is because from a terror point of view, small solar and wind farms are not very high-profile.”

Perimeter security could be comprised of a standard fence. “However, farms should know that fences can be easily cut and bypassed,” Capula said. “Microphone cable or fiber optical systems may be in place to sound an alarm if a fence is being tampered with, but if the perpetrator refrains from touching the fence, such as by using a ladder, no alarm is generated.”

Many wind farms do not have fences because they are in remote locations and not many people access these areas,said Robert Putnam, Head of Media Relations, LRAD Corporation.

Much of the security equipment in place is installed as a safety precaution. “Energy collected at a farm is converted and housed in structures similar to freight containers,” Campbell said. “A 50 MW farm would have roughly 50 of these structures. Access control is simple at best and there may or may not be a security camera present. However, perimeter security is used to secure a group of houses within a grid-type substation to prevent unauthorized people from entering and accidentally electrocuting themselves.”

Still, not all farms have these structures. “There are farms where the inverter and other equipment are sitting out in the weather,” Scifers said.

More people are using video surveillance and recording, but it is not as prevalent as one may expect, Campbell said. “Large-scale security is not an area that is very developed at this point in time.”

[NextPage]Raisi ng Security Awareness
Alow-level awareness of security will not last much longer, as emphasis is being placed on the necessary security measures required by renewable energy farms. “Issues such as theft and vandalism motivated by the lack of security are slowly gaining awareness,” Capula said.

Parallel to the market growth of renewable energy, awareness and the need to protect such installations are also growing, Martella said. “The demand and the value of investments are high, especially if compared with the various incentives for these kinds of installations. Therefore, they have to be protected. Since 2007, the total value of stolen PV panels, just in Italy, is more than $271 million.”

PV panels are hooked up in a series and if one panel is removed, then the power production capability of a whole chain of panels is destroyed, said Gregory Johnston, CTO of Jet Protect. “Solar farm racks are streamlined for quick and efficient installation. This also means that they can be removed fairly quickly and a thief can steal hundreds of panels in a night.”

Wind farms are less prone to theft compared to solar farms, but it is not unheard of. “Wind farms do not have to worry about people coming in and walking away with turbines,” Scifers said. “However, they still do not want people entering the site because turbines are at risk of being dismantled to salvage metal and copper for scrap metal.”

Theft and vandalism can damage earnings from green power sites. “Solar and wind farms are huge investments and investors are expecting a certain level of return on their investment,” Johnston said. “If panels are being stolen, power production is down and additional expenses will be needed to replace the panels. This is another reason why people are becoming more aware to these threats as it directly affects the financial plan for the project.”

Security should be implemented from the beginning of a project. “For a long time, the emphasis has been placed on getting the renewable system up and running that security is the last thing on their minds. We believe solar farms are racking up loses from theft on a daily basis and things are being stolen from the construction site as soon as the workers leave at night. Uninstalled panels worth thousands of dollars can easily be taken,” Scifers said. “To combat this issue, farms would often employ a contract security guard during off-hours to ensure the products meant to be installed will still be there in the morning. But from an economic standpoint, this may not be the best way to use resources compared to installing electronic security equipment.”

There are currently plans for solar farms in the Sahara Desert, where there is optimal sunlight 365 days a year. “These will be national assets and will thus be more protected because damage to such a large site would incur grave consequences. These sites have central points where if damaged — even if it is only a small part of the site — can shut down the whole farm,” Katz said. “Instead of PV panels, mirrors will be used and they are more risky because the core production is turbine operated, just like a regular power-plant. There will be organizations wanting to, and capable of, undermining the production ability of these sites. Also, in large power plants, a few stolen copper wires could cause the whole farm to lose its grounding and thus create massive technical as well as economical damage.”

[NextPage]Insurance and Animal Rights
As the market continues to grow, a driver for more advanced security systems will be insurance. Another growth factor is the desire for a minimal effect on the natural wildlife and habitats surrounding these sites.

Insurance will advance the level of security required on renewable energy farms in the future . “Investments that can total up to $1 billion must be protected, and it must be protected in order to be insured. Still, only the minimum level of security will be implemented to help mitigate risk, rather than provide high-level security,” Katz said. “This is because it is still too early in the game to confirm if high-level security is needed, or if a lot of damage is being done — unfortunately, security will always grow on the study of previous cases. Once large-scale damage occurs — either due to terror, theft or vandalism — regulations will become tighter.”

Animal-rights activism will also advance the installation of better radar and perimeter systems. “A solar installation in Southern California was shut down because it interfered with the habitat of a specific species of turtles. Another wind farm ran into issues because the propellers on the turbines were killing falcons, which are Environmental Protection Agencyendangered birds,” Scifers said. “In the U.S., construction of solar farms are extremely regulated. One farm went through numerous meetings and ended up with a 650-page document regarding the erection and maintenance of the site. It is exponentially easier in Europe and Canada compared to the U.S.”

New technology may be the answer for renewable energy farms. “Response from environmental groups is getting louder due to the high number of birds being killed on a regular basis by the wind turbines. Their voices are going to weigh more and more heavily over the next few years,” Putnam said. “For now, in the U.S., avian radar systems are set up to shut down the turbines until the birds leave, but this affects the productivity of the site due to shutdown costs and no energy is being produced when the birds are around. Research is being done now to deter birds and animals from entering the farm area completely, using long-range acoustic devices.”

It will take some maturation time to determine concrete security needs for renewable energy farms. Yet this is a space that should be noted due to the fast-paced growth of such farms and the numerous security needs that will develop within the next decade. Investments continue to pour in and these investments must be protected — with a little help from capable electronic security systems.

IPv6 Implications for Physical Security

Editor / Provider: Submitted by KBC Networks | Updated: 3/24/2011 | Article type: Tech Corner

As the number of IP addresses runs out, IPv6 adds many more addresses. Edgar Martinez, Senior Technology Engineer at KBC Networks, examines how this network change affects physical security equipment.

The path to Internet protocol version 6 (IPv6) has been laid out for more than a decade. Yet, as the number of devices connected to IP networks continues to skyrocket — and remaining available IP addresses under the current IPv4 protocol evaporate before our eyes — many organizations will begin the transition to IPv6 in the near future.

This next-generation protocol will provide ample IP addresses for generations to come, to the tune of a ridiculous number which allows the equivalent of roughly 100 unique addresses for every square centimeter on the surface of the Earth. Where you are standing now is equivalent to 370,000 IP addresses. Right now, IPv6 allows allocation of an IP address to every imaginable IP device, from smart phones and surveillance cameras to Internet-connected fridges and even toasters. As a result, the emergence of IPv6 represents a tremendous step in the evolution of IP networks and global communication.

For the physical security industry, the evolution from IPv4 to IPv6 is, in many ways, as significant as the shift from analog video to digital video. Vast networks of cameras — both analog and digital — are being connected to IP networks, and the responsibility of managing those endpoints often falls on the shoulders of IT managers. Fortunately, the advancements of the new protocol will streamline the implementation and management of both native IP and hybrid security networks.

However, just as the gradual shift from analog to IP security equipment has created “hybrid” networks, the shift from IPv4 to IPv6, which is still in the early stages, will create a different form of hybrid network. In this case, the term “hybrid” describes a combination of multiple protocols. IPv6 was designed to integrate with existing IPv4 networks, which makes it possible to deploy IPv6 in a manner that makes the most sense for the organization undergoing the transition.

Analog versus Digital In video security applications, it became important to clearly understand an analog versus digital product. Analog equipment never had TCP/IP functionality. As technology changed the industry, products emerged which were labeled “digital.” These digital products were tailored to provide the ability to transition or connect analog equipment to networks. Included during this transition were changes to sensors and access control mechanisms. Integration demanded interoperation and interconnection. For our discussion, we will define “analog” as any source that natively does not support TCP/IP, such as cameras, VCRs and UFOs. The term “digital” applies to any device that does, such as video encoders, decoders, DVRs and NVRs.

[NextPage]It is clear that for your system to evolve with changing standards, you must understand what your current network and devices are capable of. Once you understand what you are working with, you can plan accordingly and make careful choices to future-proof your network.

Gaining an understanding of where you are and where you intend to be is the main goal. And when theory and reality collide, as they often do, it's always a good maintain a sense of humor. Given the challenges of matching the correct devices and solution for a network, IPv6 fortunately provides several options to ease things a bit.

With the ability of IPv6 to coexist with IPv4, there are several transition strategies for organizations:
● Tunneling: Comparatively simple way to start using IPv6, packages traffic from IPv6 devices (cameras, routers and more) within IPv4 packets so they can sent over an IPv4 infrastructure.

● Dual-Stack: Allows both IPv4 and IPv6 packets to travel across the network. While this approach better accommodates a gradual transition over several years, it requires that all network components be able to operate both protocol stacks.

● Translation: Enables an end-to-end IPv6 capability by implementing application-level translation between IPv4 and IPv6 on the host or router.

Even with multiple deployment strategies and the inherent flexibility of IPv6, adoption has been slow at best. The reality is that while IPv6 was primarily developed to solve the dwindling IP address issue, it delivers a range of capabilities that tip the scale in favor in making the transition sooner than later. IPv6 offers a host of performance advancements that most would expect of a next-generation protocol, as well as improvements and fixes that make deploying and managing IP networks a less daunting proposition. These include:
● Lower Software Requirements: Whereas IPv4 devices often require additional software for functions such as security, IPv6 devices have built-in software to handle those functions.

● Easier Network Deployment: When rolling out largescale IPv6 networks, components are automatically configured (true plug-and-play). In addition, as a host device is moved within a network, routing is dynamically reconfigured.

● Easier Network Management: With auto-configuration, there is no need to run network services and servers separately. Plus, as mentioned previously, IPv6 can route and coexist over networks that are still using IPv4.

● Improved Multicasting: With IPv4, multicasting capabilities must be added separately, and are often slow and difficult to manage. With IPv6, multicasting is built-in and requires minimal management from IT personnel.

● Packet Prioritization: IPv6 enables routers to treat packets differently, based on the type of traffic they carry. For example, a packet containing surveillance video data can have priority over a packet containing standard accounting data to ensure the quality of the video stream is maintained at the highest possible level.

● Enhanced Security: Security features developed for IPv6 — referred to as IP security — are embedded into the protocol, as opposed to the add-on security capabilities required by IPv4.

[NextPage]What does this mean for security professionals? For now, the key areas to consider when deploying IPv6 in a security network environment are
● What combination of protocols will be used at the outset and
● What devices will be connected to the network.

In other words, how the transition to IPv6 will take place and the kind of protocol “blend” that will be used will determine the network components/ devices that will be able to live on the network. While IPv6 e xpands the number of IP capable devices that can connect to the network, analog devices will still work. In this scenario, only the encoder needs to be IPv6 compatible, which is often a better option for insulating expensive video source equipment from future protocol or network changes. As long as the encoder is compliant, any analog video camera can work on an IPv6 network.

Getting Ready for IPv6
It goes without saying that it's important to learn as much about your evolving network as possible, and this holds true with IPv6. Based on recent estimates, only 2 to 5 percent of possible IPv4 addresses remain available, which means that the day to make the switch to IPv6 will be here before you know it.

In fact, major Web organizations including Google, Yahoo and Facebook will participate in a global IPv6 test day on June 8, to facilitate the transition to the new protocol.

In the meantime, conduct your due diligence, investigate the many IPv6 resources online to learn how IPv6 improves network functionality and properly test your security equipment. Making network changes like this can seem intimidating at first. But once you fully understand the benefits that IPv6 can bring to your security network, taking the plunge will be well worth the effort.

Geutebruck products certificated for Russian nuclear facilities

Editor / Provider: Geutebrück | Updated: 4/7/2011 | Article type: Government & Public Services

In 2010 practically the entire Geutebruck video security product range was awarded official Russian ‘OIT' certification confirming its suitability for use in nuclear power stations and other nuclear facilities. This testing and certification of physical security and safety products for use in the Russian nuclear industry is carried out by the Interdisciplinary Special Training Centre (ISTC) in Obninsk. Part of Rosatom, the national atomic energy corporation, this institution provides advanced security training for managers and specialist staff working in the atomic field, and acts as the standards and certification authority for physical safety and security equipment used there.

Set up in 1993 with international assistance, the ISTC is a world leader in the training and continuing education of specialists in the field of physical security for atomic sites. Its principal Yury Barabanov, reports, “Co-operation with American partners is very constructive. With their aid we have been able to build up a modern training centre with excellent teaching and physical resources, all necessary teaching and materials as well as an up-to-date set of standards documentation. We have a large range of technical teaching materials and our own training sites where dozens of the latest monitoring systems operate under realistic conditions.”

Assessment and testing
Recent upgrades have seen the laboratories and proving grounds expanded and equipped with the latest equipment for electromagnetic, functional, climatic and mechanical testing. Here new products and systems are checked under conditions which are as close as possible to those found on nuclear sites, and this includes examining responses to power failures and other technical problems. “This,” claims Evgeny Taranov, head of the standards and certification department at ISTC, “is a special focus of ours and what sets our approach apart from other certification systems.”

The centre's clients are leading Russian and foreign security equipment manufacturers who usually submit small numbers of devices for certification. So it was a significant event for the ISTC testers when GVS ZAO submitted practically the whole Geutebruck range of video security products for certification.

The multifaceted process involves analyzing the documentation and the verification of production checks as well as physical testing. This meant GVS ZAO needed to provide Russian language documentation for all individual components and for complete CCTV systems, comprehensive data on the operation of equipment at dozens of sites, as well as the documentation required by other certification authorities. All this material was used by ISTC specialists to compile the basis for certification and to assess the most important reliability parameters which then need to be confirmed during the certification process. The tests then covered the full functionality of the equipment; its electromagnetic tolerance and its response to external influences as well as its overall performance in realistic conditions.

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[NextPage]For certification the ISTC specialists also needed to satisfy themselves about the manufacturing quality control procedures. As Konstantin Arbuzov, GVS ZAO's marketing manager for Russia and CIS countries explained, “Here Geutebruck benefits from the fact that its video systems are tested at each production stage, then assembled and integrated with other systems before leaving the factory. Whole installations are set up and tested in operation. Usually the official hand-over to the customer takes place in Windhagen too, with the final technical adjustments being made at that time. In effect what is delivered to site is a fully tested, fully functional system which already meets all the customer's requirements.” – He was therefore gratified but not surprised that the ISTC team concluded that the Geutebruck production checks do indeed guarantee high quality and readiness for on-site operation.

Why certification?
As Arbuzov reflects, “Although the certification process is particularly strict in all regards - from document preparation to the technical testing on the proving ground - you have to admit that it is justified and necessary. After all the security of atomic sites depends on it. And of course we were delighted that Geutebruck equipment was successful in every respect.”

With high profile customers including Gasprom, government departments and the Russian Federation Central Bank, GVS ZAO is well-established in the Russian security market. Not only are Geutebruck system solutions already standard at Rosatom sites associated with the international programmes for the EU and USA atomic security, but some of their equipment is already installed by a number of Russian systems integrators in companies in the atomic energy industry and in Rosatom scientific research sites and nuclear weapons complexes. However there is little doubt that the certification of Geutebruck's product range will enable the company to significantly strengthen its position.

“Certification gives us an important competitive advantage,” reports Arbuzov. “It opens up new sales opportunities and helps to promote new developments. For customers who don't necessarily operate in the atomic field, this ‘OIT' certificate represents the ultimate confirmation of security and functional capabilities and that gives us the edge over other video security systems.”

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Security Business: M&A Drivers, Valuation and Investment---Part II

Editor / Provider: Submitted by Memoori Business Intelligence | Updated: 3/15/2011 | Article type: Hot Topics

Security in 2010 saw a rebound in activity. Allan McHale, Director of Memoori, delves into key M&A trends and considers what could happen in 2011. This is Part 2 of a two-part series. 


Strategic Drivers 
In the last two years, M&A activity has been driven by strategic buys, particularly by the major global security companies, defense companies and from outside the security business — IT and communication companies and more recently validation, authentication and biometric companies. This dynamic seems to continue to apply in 2011 and beyond.

Private equity has played a much more passive role in recent years. It has suffered as a result of the financial meltdown and has not been able to recycle through the natural process of initial public offerings (IPO). It is going through a process of restructuring and is redefining investment parameters. So, public equity will continue to dominate the M&A scene for the next two years. However, private equity has in the past been a major source of funding for acquisitions, and the pundits tell us that private equity buyouts are bouncing back. In 2011, IPO activity is likely to be concentrated in China, primarily to float the fast growing local manufacturers, but we may see more “Western” companies follow the example of Infinova's listing on the Chinese Stock Exchange.

Defense, multinational security and IT-related companies will engage in more transformational transactions. In the last two years, such deals included Safaran's purchase of GE Homeland Protection, Schneider Electric's acquisition of Pelco and UTC's buy of GE Fire and Security. In 2010, Safran continued this strategy with the purchase of L1-Identity Solutions. Flir Systems, Hexagon, 3M and Hewlett-Packard have joined in, with respective acquisitions of ICx Technologies, Intergraph, Attenti and Cogent Systems, and Arcsight. We expect more of the same in 2011.

The defense industry has, over the last three to four years, entered the commercial security business through the combination of marketing their existing technology and also making some strategic acquisitions. Federal Signal, General Dynamics, Mantech International and BAE Systems all acquired suppliers in the security industry in 2010. We expect this process to continue in 2011, blurring the lines between the commercial security and defense sectors.

[NextPage]

Cross-border transactions will also continue to be a significant driver. Exposure to US market segments has become a strategic priority for a number of European companies, but we expect that most activity under this dynamic will center on Asia and particularly China where rules on ownership have been significantly relaxed in recent times. UTC Fire & Security has made a number of strategic investments there in the last few years.

Possibly the most important driver is the result of the push to IP networking. Buyers are gradually accepting that security does not have to be a cost center, and that particularly when integrated with other services, it can increase productivity in the enterprise, made possible through convergence. While technology has been the enabler of change, the motivator now is clearly to deliver products and services that increase productivity and provide an ROI. The market is now in the process of rapidly adopting to changing requirements for more converged and integrated solutions. This is driving a need to acquire and or merge with suppliers that have IT and networking expertise.

IP-based products, be it access control, intrusion detection or particularly video, grew rapidly in 2010 and are believed to be on the verge of a strong run. Analog sales by comparison fell in 2009, but unlike IP, they did not increase their rate of growth in 2010. Falling prices and improved performance have all conspired to improve IP-based products' ROI and TCO and made it easier to install, run and service the new technology. We believe that the major emphasis in the security business will be an acceleration of shift to IP from analog, and a sharp increase in a move to managed/hosted video. With this will come more demand for companies having this expertise, and we shall see an increase in their valuation.

Exit Valuation 
Figure 1 shows that the average valuations of security companies based on earnings before interest, taxes, depreciation and amortization (EBITDA) and revenue exit multiple fell by as much as 40 percent during the period 2008 to 2009, with 2007 being the historical high. There is a very high variation in these numbers, ranging from 0.5 to as high as 16 in the case of revenue multiple for a PSIM supplier in 2010 that just started to generate sales. EBITDA multiples have ranged between 1 and 13. We have noted higher figures being quoted in the financial press on some deals, but without details being given. The two trends that stand out from these figures are that software and biometric suppliers achieved the highest valuations in 2010, and that, in all sectors, the average valuation benchmark has gone up.

At the same time, the stock market valuations during 2010 went up from a decline that started in 2008. During 2009 and 2010, according to anecdotal information, fewer sellers were proactive in the market. It is, therefore, not surprising that valuations started to go up in 2010, and this trend is expected to continue in 2011. This rise in valuation is likely to be a gradual one because this is a competitive market with unit prices falling, and increased revenue is likely to be modest in 2011 for most companies. We estimate that the median valuation for physical security companies in 2010 was 2.2 times revenue and 5.7 times EBITDA. These figures are lower than those given by the financial experts.

[NextPage]

Investment Market
The improving exit market and company valuations, along with a renewed excitement in the IT sector and a stronger economy, are all factors that have engendered a confidence among venture capitals that they must move on in 2011, and, therefore, investment is forecast to rise.

During the two years prior to 2008, investment capital was abundantly available to start-ups and acquisitions in the physical security industry. But as a result of the credit crunch in 2007 and the financial meltdown that followed in 2008, finance started to dry up that year. Since then, as our figures clearly demonstrate, private equity made little impact on the acquisition market in both 2009 and 2010, but venture capital wad available to finance development in selective companies, particularly those close to achieving a viable growing business.

In 2009, we recorded 17 announcements of capital injection by venture capital companies, with total funds amounting to US$144 million. In 2010, the total investment was $142 million from 19 arrangements. The majority of these involved investment in US companies by US venture capitalists. However, in 2010, there was a flurry of activity in renegotiating debt financing, particularly by established companies, and the consensus was that the industry is now in a much stronger financial state.

Few venture capital companies specialize in the physical security industry, and it is clearly not the most attractive technology sector. However, there are segments within in it that are particularly attractive to them: information security, identity and security solutions, and defense. The former is regarded as having massive potential.

Identify M&A Targets
One of the major sources for M&As is the continual flow of start-ups. The security industry has produced a very rich seam of new companies that are developing cutting-edge products particularly associated with IP-based video surveillance. The epicenter of entrepreneurship in the physical security industry is currently firmly established in the IP video business. The U.S. is home to approximately 37 percent of these companies, and the next most populated country is the U.K. at 13 percent, followed by Korea at 11 percent, Taiwan at 7 percent, Germany at 6 percent, and China, Japan and Israel at 4 percent.

In the U.S., almost half of these companies were founded around 2000. This is an astonishingly high percentage of new companies, and it is not evidenced in any other country that we have reviewed. So, the U.S. has not just spawned more companies, but they are much younger. None of the other countries in our sample had established new start-ups younger than four years, and only Israel, Taiwan, Germany and the U.K. had more than 12 percent of companies younger than 10 years old.

The U.S. leads in entrepreneurship in this field because the technology to produce the new digital video solutions comes from the electronics and IT industries where the U.S. already leads. The second reason is that all the support needed for setting up new ventures is well-established both in terms of financial investment and management skills. Both of these are well-practiced and encouraged in the U.S., particularly in Silicon Valley and Boston areas; we estimate that approximately 50 percent of the new companies in this business are clustered in these 2 regions. Finally, American culture encourages risk taking; failure does not necessarily have stigma attached to it that it does in Europe.

Developing the Security Business through Acquisition and Alliance---Part I

Editor / Provider: Submitted by Memoori Business Intelligence | Updated: 3/15/2011 | Article type: Hot Topics

Security in 2010 saw a rebound in M&A activity. Allan McHale, Director of Memoori, delves into key trends and considers what they portend for 2011.

This is Part 1 of a two-part synopsis of Memoori's study “Survey of the Security Business 2010,” an annual review about the world's business for physical security equipment. Its objective is to bring together valuable statistics about the business size, shape and structure across three main segments: Access control, video surveillance and intruder alarms. The review will analyze business opportunities that have taken place in mergers and acquisitions, alliances and investment across the world in 2010. It also reviews technological and commercial trends shaping the future and impact on where investment is most likely to be targeted in 2011 and beyond.

We estimate that the world market for electronic physical security equipment in 2010 was US$18.67 billion, growing 4 to 5 percent on 2009 but still marginally below its peak in 2008. Of this, video surveillance took the largest share at 47.5 percent increasing its share by 4.5 percent, at the expense of intruder alarms at 29.5 percent; with access control at 23 percent.

So despite overall growth, intruder alarms sales have declined and access control has lifted marginally, while video surveillance has performed well despite poor economic trading conditions that have prevailed over the last three years. This is a robust market which has outperformed many of the electronic equipment businesses supplying the industrial and commercial markets. For this reason, acquisition and investment has surged ahead in 2010 and is forecast to continue for the next two years.

Figure 1 shows the geographic distribution of sales 2010 and has changed significantly in the last three years. China has doubled its market share in the last five years to 11 percent, while other emerging markets in Asia, Central and Eastern Europe and South America have similarly increased their share of the market. This trend will continue with China probably becoming the biggest single market by the end of this decade.

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M&A in 2010 and Forecast to 2015
Figures 2 and 3 show security deals completed from 2000 to 2010 and Memoori's forecast to 2015. The value of 2010 deals was $7.98 billion, growing almost 75 percent from 2009. This is the highest value ever recorded and is 28 percent higher than the previous record set in 2005 and 2007. This is startling, not least because it is in stark contrast to what has happened in similar businesses. So what has caused such a surge in consolidation, at a time when the global market for physical security equipment has experienced little growth?

In 2009 we identified 77 acquisitions compared with 80 in 2010. So the almost doubling in value is not the result of more transactions. The reason is that this year, consolidation has been much more focused at the top end of the business, between established large companies. The buying price for just three deals amounted to $4.3 billion, some 54 percent of the total business transacted. Another seven companies paid more than $250 million to complete deals.

The drivers to achieve growth are to deliver products and services that increase productivity and provide ROI. IT convergence and integrated solutions are the way forward. For companies to deliver such systems, many have decided it is necessary to acquire expertise.

One example is the need to join physical security with identity management and biometrics. Some of the largest acquisitions in 2010 were in this area. HID Global, 3M and Hewlett-Packard have all bought big in the last four months of 2010.

We identified 17 significant deals for alarm installation and monitoring companies, netting a value of $4.18 billion. This segment has attracted 52 percent of the total spend on acquisitions. So why has alarm monitoring, long the fragmented and low-growth sector of the security industry — but cash cow provider — undergone such a surge in acquisition activity? On first observation, cash flow in the difficult trading conditions of the last two years appears to be the main driver. However just removing the surface layer reveals that integration of different security services delivered through SaaS enables more comprehensive and cost-effective service to both residential and commercial customers. The need to scale up quickly is driving consolidation.

There have been major landmarks during the last 12 months. In January 2010, Tyco International purchased Broadview Security for $2 billion. This was followed in April with GTCR's purchase of Protection One for $828 million. In September, Safran bought L1-Identity Solutions for $1.1 billion and in December, Monitronics was acquired by Ascent Media Corporation for $1.2 billion.

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Outside Interest
Excluding alarm companies, the surge in acquisition activity has been driven by companies from outside mainstream physical security. Safran, L-3 Communications, Flir Systems and 3M pulled off major deals in 2010, but mainstream suppliers like Schneider Electric, UTC Fire & Security, Honeywell Security and Bosch Security Systems have been conspicuous by their absence.

This year will be a hard act to follow, because continuing this rate of consolidation will require the merging or acquisition of large leading suppliers and their numbers are shrinking. However, this high rate of consolidation will continue, because the major suppliers absented themselves from the dealing tables in 2010 and have made claims to be active in the near future. UTC Fire & Security has made it known it intends to grow through acquisition and it is now over a year since its purchase of GE's Fire & Security division. This month,Tyco announced it set aside $500 million to acquire companies in India, Brazil, the Middle East and China to push inorganic growth in these markets.

Given these facts, the continued interest for IT and communications-related companies see benefit in buying into the security business. In its current fragmented state, we forecast 20-percent growth in the value of deals over the next five years as shown in Figure 3. This illustration shows that cash deals have accounted for as much as 95 percent of transactions in 2008-2009, but this will fall as the security business is once again attracting private equity finance. Without this, the forecast growth in consolidation will be hard to achieve.

Alliance
Since 2008, the number of alliance arrangements has doubled from 45 to 91 in 2010. The most rapid growth was in 2009, when the number increased by 75 percent.

Both prior to, and in 2008 the vast majority of these arrangements related to partners coming together and making their products automatically communicate. This could be similar products such as cameras or different horizontal layers in a system such as video management and analytical software. The majority of these related to the video surveillance, particularly vendors creating software platforms such as Milestone Systems. As there is not yet a common communications standard, such alliance is vital if best-of-breed products are to flourish. The other alternative to alliance is to manufacture a complete portfolio of products that have been designed to work together. This is what the major suppliers have been doing for many years, using their own proprietary communications protocol. This method is no longer acceptable to most end users.

End users are demanding full plug-and-play seamless integration with other control infrastructures, including convergence with the business enterprise. So alliance needs to go one step further to extend the digital link and enable end-to-end communication, bringing all information together. We believe this was the reason for rapid growth in alliance activity in 2009 and its continuation in 2010.

In June 2010, 3VR certified Arecont Vision's full line of megapixel cameras as part of its SmartCam program. Arecont Vision said 3VR completed participatory testing in its MegLAB program and was certified in camera integration, feature integration and load testing. In addition to proving a degree of product differentiation, more comprehensive certification programs will be important, as network cameras and edge devices take on more features that require IT-like configuration at the time of installation or later, when users wish to make add-ons or changes. Megapixel cameras, in particular, come with features and settings that can perform differently when used with different VMS systems.

Alliance is also extending across business boarders to deliver value add solutions. A good example was the announcement in June 2010 of a partnership between Computer Network Limited (CNL) and ESRI (UK). CNL supplies physical security information management software. ESRI is a software manufacturer providing the backbone for world mapping and spatial analysis. The combination of these technologies will allow ESRI customers to bring their entire security estate into one system and CNL customers to leverage greater efficiencies and improve their operations.

Both alliance and M&A will become one of the main conduits for delivering this delayering process. However some companies will elect to develop their own products. An example is Axis Communications, because it has chosen to develop its own layers, such as VMS.

Alliances for the purposes of sharing development costs or working together to explore new markets, while less frequent, is increasing. Some opportunities have been taken up by suppliers of video surveillance to join with access control and alarm manufacturers to combine Fig 3 - Forecast of Deals to 2015 22 FEB 2011 www.asmag.com 4272 information and data through a common software program and this again has extended the application for their products. This has been partly driven by the need to counter the consolidation process that is taking place across the horizontal layers of security systems.

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Three years ago, manufacturers focused on one aspect of the business. In the case of video surveillance, the business was made up of layers including IP video software platforms, video hardware and video management systems. Most of the leaders in these fields sold to other hardware suppliers that offered systems, and distributors or system integrators. As the demand for total solutions grew, alliances rapidly developed between manufacturers in the different layers so that best-of-breed products could communicate and work together. This has developed with time into much stronger partnerships sharing development and promotional costs. These partnerships progressed further by companies joining together through merger or acquisition, to produce vertical-integrated companies that can deliver a full surveillance system.

We have identified alliance arrangements between manufacturers and system integrators, working together to provide a solution for a particular vertical market and sharing the development and promotion costs.

IT network design and install companies are crossing the boundary between IT and physical security to offer a complete solution. In many cases, they doing this through collaboration and alliance with physical security suppliers. A noticeable trend has been the identity validation suppliers move to integrate with access control. Their preference appears to be to go the whole way and acquire an access control manufacturer.

Alliance will almost certainly play a more important role in the future. It would be surprising if the more successful partnerships do not ultimately lead to merger or acquisition. 2010 has shown that merger, acquisition and alliance have become a vital part of security companies' business strategy.