Despite Turbulence, Security Providers Still Soar (Ⅰof Ⅵ )

Editor / Provider: by a&s International | Updated: 11/28/2008 | Article type: Security 50

With the worldwide economic slump, security providers anticipate its effect. The Security 50 companies discuss how they stayed afloat in 2007 and remain on the cutting edge of industry trends.


For this year's Security 50 ranking, we shifted our coverage for a broader perspective. While in previous years we focused on the companies, this year we also asked them for their take on the industry. We found out what unique strengths and opportunities each provider had, along with any industry weaknesses or threats they perceived, for a strength-weakness-opportunity threat (SWOT) analysis. With a more inclusive report, providers had their say on how the industry is shaping up.


Company Strengths
Even with the subprime mortgage crisis in 2007 and the ensuing credit crunch, a number of companies still grew. They each had strategies to distinguish themselves for the competition and emphasized technological innovation, along with good old-fashioned service. While the effect of 2008's financial developments is unknown, this year's providers believe they have the ability to make it through.


Growth Factors
At the top of this year's ranking is Honeywell Security, which expanded its portfolio. “One of the most notable developments for Honeywell over the past year has been the acquisitions of Hand Held Products and Metrologic Instruments, which led to the inception of our Scanning and Mobility business,” said Frank Roth, Vice President, Global Marketing, Honeywell Security and Data Collection. “This gives Honeywell a strong position in an adjacent market.”


Bosch Security Systems also grew through acquisitions and development of innovative products, buying Canadian surveillance company Extreme CCTV in 2008. “For the last few years we have experienced a continual upward trend, driven by successful acquisitions, strategic partnerships, the expansion of our regional presence, the development of new products and also the expansion of our product range,” said Gert van Iperen, Chairman of the Board for Bosch Security Systems.


Surveillance provider Geutebrück posted revenue growth of 27.5 percent through a range of efforts. “We have been able to reduce material costs, enhance our product performance by intensive R&D and broaden our reach to the market, with additional branch offices and intensified support for our partners through end user focused marketing and expert training programs,” said Katharina Geutebrück, CEO of Geutebrück.


Having a broad base of customers helped network camera leader Axis Communications increase its revenue, with a two-tier partnership sales model. “We sell to distributors, who sell to system integrators,” said Ray Mauritsson, CEO of Axis Communications. “That is a program that has been growing, with 2 4,000 partners in that program.”


The range of Axis partners provides more opportunities for the company. “The security market is rather fragmented, as a large number of small installations are provided by small system integrators,” Mauritsson said. “We must be present with small or local system integrator to cover a large part of the market.”


Loss Factors
Some companies were negatively affected by factors out of their control, such as Israeli residential security provider Electronics Line 3000. “The decline in the company's profitability is to be attributed to the significant depreciation of the U.S. dollar against the New Israeli shekel over the past year,” said Amir Hayek, President and CEO of Electronics Line 3000. It also increased its investment in R&D and incurred development costs for its flagship iConnect solution in 2007, before its launch in 2008.

Differentiators
Company strength includes what makes it unique. Some of the Security 50 group touted a broad product portfolio, while others made innovation their hallmark.


The breadth of Honeywell's offerings allows it to offer a total solution. “Honeywell is a manufacturer that can truly call itself a full-line supplier of security technology,” said Roth. “We have extensive experience and deep resources in many areas, including intrusion, video and access control and we're also a leader in integration and making these technologies work together.”


Honeywell's experience can streamline security. “It is a true differentiator when you have an experienced and knowledgeable team behind you to help you effectively deploys these technologies — both to improve security and protect the bottom line,” Roth said.


Expertise in multiple technologies set Israeli Nice Systems apart. “For the security sector, Nice is the only company that has interactions capture and analytics solutions for all media types — from voice, including VoIP, video, data and radio,” said Israel Livnat, President of Nice Security Group.


This year's ranking included 31 surveillance companies, not counting providers of total solutions. Having distinctive products was a must for these manufacturers to stay ahead in the competitive video space.


An industry-changing product boosted market share for Axis, which enjoys a 32 percent slice of the network camera market, according to IMS Research. “We were the first on the market with the network camera,” Mauritsson said. “We're a focused company focusing on network video.”


An established name in video and emphasis on technology helped Geutebrück. “We are a highly innovative family company with almost 40 years experience in the surveillance business offering comprehensive, flexible solutions for security professionals and experts,” Geutebrück said.


For Electronics Line 3000, its product quality enables its success. "The Company develops, designs and manufacturers its solutions at its headquarters in Israel using the latest technologies," Hayek said. "All Electronics Line 3000 solutions can also be localized and customized according to partners' requirements."

For the whole picture on the report, please visit  here.

FIFA 2010 Reinvigorates South Africa Market

Editor / Provider: By Electrotechnical Unit Enterprise and Industry Development Division, Department of Trade and Industry, Republic of South Africa (DTI ) | Updated: 11/21/2008 | Article type: Hot Topics

The South African economy is expected to reverse downward growth trends in the run up to the 2010 FIFA (Federation Internationale de Football Association) World Cup.


The African nationˇs economy is expected to pick up and to see a 4 percent growth in 2008 and into the near future, despite the global economic downturn and the local, unique challenges faced by the country, including power shortages, growing inflation rates, and skills shortages in the technical and engineering sectors. South Africaˇs macroeconomic fundamentals and growth prospects remain robust, Finance Minister Trevor Manuel said in his May 2008 budget speech.


The sharp rise in global commodity prices is also a net benefit to the economy, according to the ABSA (Amalgamated Banks of South Africa) South African Economic Perspective 2008 Q2 report. The ABSA Capital Mining export price index for South Africa rose by 70 percent year-on-year in local currency (South African rand) terms, and by 50 percent in U.S. dollar terms. "Even as input prices are hit by higher oil and rand pass-through, this implies trade improvements for South Africa."


South Africa has the most advanced economy on the African continent. Its economy is classified as a middle-income emerging market, and it has an abundant supply of natural resources, including strategic metal and mineral resources. The countryˇs infrastructure supports an efficient distribution of goods to major urban centers throughout the region. This makes it an attractive destination for multinational companies to invest in, and a base for expansion into the rest of Africa.


South Africa's four main metropolitan areas dominate its economic activity: Gauteng Province (Johannesburg, Pretoria and surrounds), KwaZulu Natal Province, the Cape Peninsula (including Cape Town), and the Eastern Cape. According to statistics from official 2008 mid-year estimates, South Africa has a population of 48.7 million. More than 60 percent of this population is between 15 and 64 years of age and provides massive workforce potential.


FIFA World Cup Tournament Reveals Promising Prospects
There is strong interest in security needs and provisions for the 2010
FIFA World Cup tournament, which include security guarantees that the government has given to FIFA, as well as additional security needs that
South Africa deems important. "As host of the worldˇs most popular sporting event, South Africa is under tremendous pressure to stage a great tournament. While good results may not be guaranteed on the field, a safe and secure tournament can be guaranteed through the use of IP video surveillance systems," said Roy Alves, Country Manager of Axis Communications. Recent crowd control catastrophes and the threat of terrorist attacks around the world have placed even greater importance on safety and security for 2010. "The stadia hosting the World Cup will handle capacities in excess of 30,000 fans each, and a full overview of the venues and effective control of spectators is going to be the No. 1 priority."


"The scale of the World Cup event demands security policies and procedures at designated venues to conform to international best-practice standards," said Neil Cameron, Systems and Service Divisional Manager at Johnson Controls.
"FIFA has specified basic security requirements and these cannot be an afterthought  they need to be built into the blueprints. The physical safety of attendees is paramount. High-traffic flows over short periods at these stadiums means high risk. Simply investing in a surveillance solution that is dependent on the level of alertness of the person watching the feed is not good enough. To be effective, a security system at a venue of this nature needs to be reliable, robust, scalable and integrated."


Wayne Clarke, Product Manager at i to i technologies, which is providing security to Cape Town's Greenpoint Stadium, stressed that his company is fully aware of the responsibility that comes with such a task. "We are partnering with Dimension Data on this project and are responsible for installing the video surveillance, access control and intrusion detection systems at the stadium."


Demands for Unclogging the Roads
Vehicle security is a fast-growing market. Security requirements include traceability of vehicles and anti-hijacking solutions. The security sector has been very innovative in developing low-cost solutions applicable for the local market, and these have been imported into the rest of Africa.


The need for a fast and efficient transportation system in busy metropolitan areas is also a driver for electronic security demand. The N1 between Pretoria and Johannesburg carries more than 180,000 vehicles daily. Although South Africa is recognized as having the second best road system in the world, the traffic and congestion caused by the increase in vehicles in urban regions has led to a decline in the quality of life and the waste of valuable resources in the affected areas of the city.


"The Government Communication and Information System (GCIS) shows that cash-in-transit heists and truck hijackings have increased," said Jack Edery, CEO of Elvey Security Technologies, of the notoriously high hijacking rates country. "This has led to a strong need for cameras and storage that not only monitor the roads for incidents that may affect traffic, but can also be used to identify safety and security problems. Systems of this nature offer three major benefits: Firstly, there is a deterrent factor. Secondly, such systems allow for real-time monitoring and accordingly better observation of those boarding vehicles, and of on-board activity. They also act as reliable channels for information which allows instant reaction to emergency situations. Lastly, recorded footage enables people to review incidents in hindsight and then put together evidence for use in hearings or court cases."


Safer Harbors and Construction
Harbors and shipping lines serving southern and sub-Saharan Africa have seen strong volumes of business, which has in turn led to growth in security requirements. According to Ports and Ships, which provides news and in-depth reporting from ports, July 2007 saw a 17-percent increase in volumes handled at South African ports compared with June 2007. "Containers and trucks are most vulnerable when they are at rest," said Gide on Wheeler, CCTV Technical Manager at Elvey. "The need to enhance security has led to breakthroughs in locking technology by specialist companies."


 South Africa is also enjoying a boom in the construction of office parks, Smith pointed out. However, security is not yet part of the integrated planning in the construction process. Upgrading security has been identified as a top priority by businesses and homeowners, who are increasingly looking for external expertise and new digital technologies.


"South Africans tend to move into residential estates to access the security feel that comes with them," said Clarke. "When we are called in at a very late stage to upgrade security, it usually costs people thousands of rands extra because we would have to start from scratch."


The number of residential estates opting for an integrated solution from a single service provider is constantly increasing as more people realize that buying multiple solutions from multiple suppliers is not the optimal way to go, said Ian Downie, Mining Expert at i to i technologies. "The service provider will go the extra mile to make sure its implementation is well in place and operational staff well trained, and that its systems are of the highest quality."


A Complex and Demanding Mining Sector
The ore that the mining industry produces presents unique security challenges for the mining industry. Ensuring the safety of its employees, preventing theft of raw material and equipment, and keeping unauthorized people off the premises are some of the key elements driving the mining vertical. "There are huge challenges around monitoring the workforce and separating losses in terms of product theft and that lost during processing," said Edery. "In terms of professionalism, product knowledge, distribution and installation in the mining industry, South Africa is as good as anywhere in the world."


Internal crime is a major problem, continued Edery. According to the Institute for Security Studies monograph "Theft of Precious Metals from South African Mines and Refineries," 41 percent of offenders at gold mines are mine employees, while the figure for platinum mines is 73 percent.


Mining companies are also driven by the need to comply with new safety standards and to respond to specific situations that arise, and keep in mind ease of implementation and usage of security equipment, said Johann van Rooyen, Branch Manager, Northwest Mining Division, Saco Systems. These factors generate an ongoing cycle of evaluation within the mining sector. "One of the most obvious trends in recent years has been a major swing toward utilizing fingerprint readers," he said, while noting that biometrics will become standard for other sectors as well.


Getting Out of a Rut
South Africa has enjoyed a huge growth spurt in consumer spending. The proliferation of shopping malls has acted as a big driver for demand in electronic security services. Michael Broughton, Director of the Consumer Goods Council, said that employing the latest in security technology is now non-negotiable for retailers. "The shopping experience is about atmosphere and enjoyment; you cannot have a bank-like environment where people come into a shop one at a time and have their handbags searched."


All segments of the retail sector need to be regularly updated on available technologies with a proven track record that make economic sense and can be used in the effective management of risk in a retail/distribution environment, said Keith Alexander, Risk Manager of Retail Operations at supermarket group Spar Group S.A. High-quality video images are indispensable in the fight against violent crime, which poses the greatest threat in South Africa.

Array of Projects Underway in Malaysia

Editor / Provider: a&s International | Updated: 11/13/2008 | Article type: Hot Topics

Like Thailand, Malaysia faces issues to do with bureaucracy and its ethnic population; the latter to a lesser degree than Thailand. However, new infrastructure, whether government-sponsored or private, is always being built.


The Asian Professional Security Association's (APSA) Malaysia Chapter is not as involved in the local market as Western security associations are in theirs, admitted Alex Ng, Managing Director of Viewtech & Communication and Committee Member of APSA Malaysia. Raymond Low, Deputy President of APSA Malaysia and Managing Director of Cass Technology, added that APSA does not receive the respect accorded to Western security associations because of local disinterest in involvement for the good of the whole industry. "I believe other Southeast Asian countries' security associations suffer from the same problem. Our new committee plans to aggressively promote the benefits of having a strong industry association, and to raise awareness."


Product Brands
Main surveillance brands are Sony, Panasonic, Pelco, Bosch, Axis, Verint, Samsung, Honeywell, GeoVision, Vicon, Merit LILIN and Avermedia. Bosch is very strong in highway and urban roads surveillance. Leading intrusion brands are Supa 9 by local distributor Alarm & Automation, Paradox, Secom and ADT.


Leading brands in access control depend on market segment, explained Jimmy Low, International Sales Manager at Magnet Electronic & Automation. The low end market is dominated by low-cost, OEM'd, Chinese products. This segment mainly consists of vendors of standalone system catering to few system users, and no software requirements. The mid end segment mostly presents vendors whose solutions are for more than five readers networked with software integration. This segment is made up of small and medium enterprises, commercial buildings, and small government departments. Leading brands in this segment include local manufacturers MicroEngine and MicroID.


The high end market consists of big commercial buildings, government departments, and multi-branch enterprises. This market typically requires advanced integration and networking functionality, whereby operators in different sites are able to log on to a main server for centralized monitoring and control. Leading brands in this segment are Elid and Castle, again local brands. Fingertec, RCG and Vigilance are the leading brands when it comes to fingerprint biometric solutions.


Thomas Choo, CEO of Milestone partner KL Alarm, said that in terms of manufacturing, access control is the product segment that Malaysia stands out in. "However, I believe that my company is the only local manufacturer of fully IP access control solutions." Within SE Asia, the biggest markets for these solutions are banks such as HSBC and ANZac Bank, and government sectors such as Malaysiaˇs Ministry of Interior.


Distribution, Integration and Exports
On the whole, distributors try to sell as many brands as possible, rather than aiming to be sole distributors; thus price undercutting is a constant. Players also aim to have at least one own brand, which is usually OEMˇd from China or Taiwan. Well-known distributors are Alarm & Automation (known as A&A), Saxco, Stratel, Sensorlink, and Bricomp Technologies. Notable integrators are Chubb, Secom, O'Connor's, and Johnson Controls.


Malaysia has strong links with Mauritius because of their shared and sizable ethnic Indian communities, said Philip Saint-Pere, Managing Director of Stratel: Direct flights have been in place for many years, and a number of Malaysian vendors have business in the island state. Even though Mauritius is one of the most stable African states, it is also a popular tourist destination and thus security-conscious; in the past two years the government has encouraged the deployment of burglar alarm and other security systems, making the country the second largest African market for security after South Africa.


Upcoming and Recent Projects
Integrated Transport Information System (ITIS) is a comprehensive traffic information system developed for City Hall Kuala Lumpur (DBKL) to monitor traffic flow and analyze road data in the Klang Valley (which includes Kuala Lumpur) to provide real-time traffic information to road users. A traffic control surveillance system monitors areas within the network, including incident locations, traffic volumes, and congestion levels. Information is also available to mobile phone users. Phase one was launched in early 2007, revealed Wan Yat Hon, Managing Director of Gamma Solution. Phase two saw the implementation of 90-plus cameras, and phase three will see the installation of over 100 additional cameras. In total, there will be over 200 kilometers of roads which will be monitored.


Penang and Malacca are both seeing construction of prisons, said Michael Tan, Director, GSF Solutions. Kuala Lumpur's Mid Valley City, one of the country's largest urban development projects, boasts 11 buildings hosting both residential units and offices, two shopping complexes, and three hotels. Construction is still ongoing; meanwhile Pelco and Merit LILIN cameras have been installed within the complex, and Johnson Controls is among the systems integrators involved. Six hundred doors are also being secured with a fully IP solution.


Bandar Sunway, a community well-provided with amenities developed by conglomerate Sunway Group, has numerous schools, colleges, a hospital, places of worship, and vibrant commercial areas which include the shopping complex Sunway Pyramid user of Sony cameras. Outdoor areas within the community also utilize Sony systems, said Sammy Chiu, Network Solution Specialist, Broadcast & Professional Pacific Asia Division, Sony.


Other recent installations include a few hundred cameras deployed at Kuala Lumpur's Berjaya Times Square, a building containing a huge shopping center, two five-star hotels, and an indoor theme park, said C.F. Yong, Director of Lotus Action. Western Digital Malaysia's Kuala Lumpur manufacturing facilities, located in the cityˇs Free Industrial Zone, has also recently upgraded its system with over 300 new cameras. Malaysia is also home to a number of palm oil producers another lucrative vertical market, as the industry is an established and heavily regulated one.


Kuala Lumpur International Airport (KLIA) is currently upgrading its 1997 video surveillance and access control systems. KLIA's network totals over 1,400 cameras, said Frankie Chai, General Manager of Secom Malaysia upgrading is taking place in phases but recording is at present only happening for 30 percent of these. Management is seeking to increase this to 50 percent. Sapura Poweraid has supplied and installed a security system capable of surveillance and access control a t over 1,700 locations throughout the airport; most cameras are by Panasonic.


Malaysia, like many countries across the world, is suffering heavy losses from copper cable theft, said Verghese Thirumala, Managing Director of Maxitulin. Maxis Communications, Malaysia's leading mobile phone service provider, has approximately 5,000 stations. The company is deploying, in the first phase of installment, intrusion systems at 300 of its sites, which are all located in remote areas. The second phase will consist of the installation of a new solution, at approximately 100 sites, that delivers video with alarm to the central monitoring station a system which was created specifically for the worldwide scrap metal theft problem. Tenaga Nasional, the nationˇs largest electricity utility company, is also suffering from the same theft problem.


High rates of hijackings carrying cargo have prompted increased investment in security on roads and highways, said Chai. Traffic control cameras are currently being installed by systems integrator Isolectra Malaysia; 5,000 units are planned nationwide. The majority of cameras present at highways and roads today are by Bosch, one of the leading providers to the Malaysian government due to established history in the Malaysian market.


Malaysia's Biggest Development
Iskandar Malaysia is one of the high-impact developments under the Ninth Malaysia Plan, making the area the new main southern development corridor in Johor. The former South Johor Economic Region (SJER) is the locus of a flurry of infrastructure and other construction activities, including for transportation and telecommunications, worth US$5 billion. As the area is the gateway to Singapore, the government hopes to create a zone which will offer residents a competitive edge over its neighboring city state, and where, unlike other Malaysian regions, profit-engendering infrastructure and organizations are wholly privatized. Tax incentives are hoped to be a big draw to businesses, both foreign and local; the government is also working to attract investment from the Middle East.

Southeast Asia Sees Varied Growth

Editor / Provider: a&s International | Updated: 11/6/2008 | Article type: Hot Topics

While Thailand, Vietnam, Singapore and Malaysia surge ahead, their fellow, ASEAN nations face slower or uncertain growth. ASMAG.com takes a look at the Southeast Asian markets in general before focusing on specifics.


A number of trends can be observed in the Southeast Asia region, especially in access control, said David Rees, Regional Manager, APAC, Salto Systems. The majority of office installations in SE Asia are still in premises owned or rented by multinationals; however, locally-owned companies are fast catching up with this trend of investing in access control in their offices.


Serviced office is one growing vertical; major multinational companies use these, as they offer high-level services; allow tenants who do not want a permanent office to be on short-term leases; allow them to rent small, fully equipped and serviced office space; and are thus ideal for new entrants to the SE Asian market. In these, the front door is an access control credential which is also used for the door of the individual room that is rented to the tenant for short-term or long-term occupancy.


Office buildings are turning to online combined with offline access control systems. Most installations are done in new buildings. In university campuses and hospitals, however, installations are mostly add-ons to existing systems; and the latter is a much less active vertical than the former in Thailand and Malaysia. For example, whereas in two other regions in the area, namely Australia and Hong Kong, access control is being used everywhere, including cabinets which house Class A drugs, this trend has not been seen in the SE Asian countries other than in Singapore.


Singaporeˇs university campuses are increasingly investing in access control, Rees continued; and its secondary schools and international schools look certain to follow suit. In Malaysia, this growth is starting to show, but not as prominently as in Singaporean campuses. In the Bangkok area in Thailand, international schools are becoming more interested in installing access control, but many find their budget does not allow for it. In Indonesia, expat parentsˇ worries of possible kidnappings have led to some growth in the international schools vertical.


Effect of the U.S. Economy on SE Asia
The U.S. economic slump is definitely having an effect on the SE Asian economies, Rees believes. ¨There seems to be a slowdown in many of the regionˇs countries; inflation is rising; there is a credit squeeze; the cost of living is rising; and reduction in sales is being experienced in various industries. Investment from overseas is also taking a hit. The weak dollar is affecting pricing in the security industry as well, because vendors who price their wares in Euros find that their products work out to be more expensive than those of their dollar-priced [U.S.] competitorsˇ, when cost in Euros is converted into dollars.〃


The present sub-prime meltdown in the U.S. and the global inflationary pressure on oil, food and raw materials affect every market, said Stewart Yen, CEO of Secom Singapore, although this is not so apparent in Singapore at the moment. "High-end office and residential buildings are currently at record prices, so people are still willing to spend on security equipment. However, this may turn very quickly if the global share markets continue to weaken or experience a sharp drop in the near future. When the economy is bad, the first thing people try to save on is security, especially in Singapore as it is generally perceived to be a very safe city."


"The current U.S. economic slump is already affecting the economies of Singapore and other SE Asian countries," said Claus Hansen, Asia Vice President, Security Business, Gemalto. "We do not foresee that the security market will suffer any worse than other IT businesses. The political climate of each country defines the need and the level of security but overall there is a global trend calling for greater security features and the necessary legislations to put these in place. For example, the illegal use of non-secure ID documents can come at a great cost."


Singapore
Singapore is a nation that is heavily focused on security, said Rees, and in constant development in terms of new construction. New technology and applications are seen in a positive light, all the way from the government down. Singapore is currently looking to attract foreign workers and residents to its island nation, and there is competition between estate developers and companies wishing to acquire quality tenants and employees. Security technology can act as an added attraction. Many expats who choose to live in Singapore are doing so for the safety of their children, and the high level of security awareness (coupled with a low crime rate) may be one reason why the country has a high proportion of foreign citizens when compared with neighboring nations.


Singapore is also developing many new residential and office buildings; there is a lot of construction around the two new casino developments; train extensions are ongoing; and Sentosa island is the focus of a flurry of new hotels and resorts activity. The government wants to attract investment from companies who are looking to develop new technologies, such as in the fields of biotechnology or IT, from a Singapore base (plants or R&D facilities). Some of these may be associated with one of the local universities.


Driving Factors for Surveillance
Singapore is touted as a safe city and has heavy video surveillance adoption, said Jafizwaty Ishahak, Research Manager, Electronics & Security & Smart cards, Asia Pacific, Frost & Sullivan. High saturation, small population and geographic size, stable political scene, and a highly secure environment in the country are the reasons for the growth of video surveillance in this market which is slower than other markets in the region.


Nevertheless, key drivers for adoption of video surveillance are proactive efforts by the government in terms of regulatory policies and strong IP infrastructure that is set in place. Being a regional business hub, global events are constantly hosted at Singapore, elevating the need for security. As a mature market with excellent infrastructure development, Singapore is expected to grow well in adoption of IP-based surveillance. Transportation is the largest vertical in Singapore, with spending on highways, train stations, and bus stations. Surge in gaming activity is also expected in the Singapore market.


Projects and Infrastructure
A key infrastructural development is the Marina Bay, said Arya Varma, Managing Director of Isolectra Far East. Other than a hub for financial institutions, it will also have a comprehensive range of amenities including shopping, dining, cultural and entertainment. The government has committed more than US$3.3 billion to date to provide excellent infrastructure, which includes the Rapid Transit System; the Common Services Tunnel, which houses services and utilities such as electrical and telecommunication cables and a district cooling system; and public facilities and amenities such as waterfront promenades and pedestrian bridges.


The area has attracted total investment of US$12 billion dollars. Key developments include the Marina Bay Sands Integrated Resort; One Raffles Quay; The Sail at Marina Bay; the first phase of the Marina Bay Financial Centre; and new office developments at Marina View. The recently completed Marina Barrage will also convert the existing waterbodies at Marina Bay into a large freshwater reservoir, complete with a series of gardens collectively known as Gardens by the Bay.


In transportation, projects are aimed to improve economic competitiveness as well as the quality of public transport in Singapore. The Changi Airport Terminal 1 upgrade commenced in May 2008 and will continue until 2011. At an estimated cost of $340 million, Terminal 1 will see major improvements to the passenger areas, creating a more integrated and appealing environment for travel, shopping, dining and entertainment.


The Downtown Line (DTL) will be the fifth Mass Rapid Transit line in Singapore. When fully completed, the line will be about 40 kilometers long with 33 stations. It will be a fully-automatic and driverless system similar to the North East Line and the Circle Line, and will be mostly underground.


Seaports such as Pasir Panjang Port Terminal (PPT) is also expanding with new berths and new cranes. The expansion plans will make space for 16 additional berths in the terminal, which will have an annual handling capacity of 14 million standard containers. Work is expected to be completed by 2013. There is also a plan to build a Cruise Centre at Marina South, estimated at $71 million.

Opportunities Abound in Brazil

Editor / Provider: Submitted by Research and Technology, Security Industry Association | Updated: 9/30/2008 | Article type: Hot Topics

After several years of fiscal struggle and infrastructure development, Brazil has emerged as one of the most rapidly growing and attractive business environments in the world. The leading industry associations in Brazil and in the U.S. give us the lowdown on South America's biggest market.


Since 1994, Brazil's economy has gradually stabilized under the Plan Real, with guidance from the World Bank and the International Monetary Fund. In addition, the energy and telecommunications industries have been deregulated, leading to explosive growth in these and other industries. International demand for raw materials has helped boost investments in infrastructure; and the PAC (Accelerated Development Plan), sponsored by the Brazilian government, promises significant investments that will bring great opportunities to the security industry. There is abundant opportunity in the Brazilian market for electronic security companies.


The Brazilian economy increased at a sustainable 5.4 percent in 2007 to US$1.1 trillion, making it Latin America's largest economy. GDP growth is expected to slow to 4.8 percent in 2008, which is still a healthy, yet sustainable rate. This growth and Brazil's stability have attracted new foreign direct investment (FDI) to Brazil, which has nearly doubled from 2006 to 2007, from $18.7 billion to more than $34 billion. According to a November 2007 survey conducted by InfoAmericas on 50 U.S. multinational companies operating in Latin America, strategic planning managers cited Brazil as the top market of interest for new investment in 2008. FDI is expected to increase by 9.5 percent per year in 2008 and 2009.


Profitable opportunities for security companies in the Brazilian market are concentrated in major infrastructure development projects such as oil and gas, urban surveillance, intelligent transportation systems, and world-class events such as the 2014 World Cup finals. "Security businesses can reach these markets by attending trade shows such as ISC Brazil the show of choice for companies that offer sophisticated security solutions for major projects," said Pedro Duarte, President of Latin American Marketing for GE Security.


Since 1995, in an effort to encourage foreign investment, foreign investors and foreign capital have been considered equal to Brazil's. Industries such as telecommunications, mining, transportation, and petroleum have been opened to foreign investors. Foreign nationals are permitted to purchase land in
Brazil. (Land purchases near the borders require special registration.) However, foreign investors are required to register with the Brazilian Central Bank within 30 days of their initial investment and investments involving royalties and technology transfer must be registered with the National Institute of Industry Property.


The electronic security industry has also benefited from the influx of FDI as foreign companies such as Honeywell, Siemens, Johnson Controls, and HID Global claim notable shares of the market for electronic security in Brazil. In fact, multinational companies have a greater presence than local ones, as electronic security equipment requires technologically advanced components typically not manufactured in Brazil.


Where to Focus One's Efforts
With a current cumulative average growth rate estimated at 16.2 percent through 2012, the demand for electronic physical security products is growing at more than twice the rate of GDP. The rapid growth of the electronic security market in Brazil has led to a highly complex and fragmented value chain, with a large number of participants. There are currently over 100 equipment manufacturers and a wide range of distributors and integrators.


According to the latest study from the Brazilian Electrical and Electronics Industry Association (ABINEE), sales of products related to electronic security in 2006 were above $200 million and systems integration products and services were above $900 million. Although the commercial sector uses electronic security at a greater rate than the residential sector, increased household consumption due to job growth is one of the key factors driving the increase in security demand. Household consumption drives not only demand for residential security, but also demand for security in the retail and banking sectors as consumers are increasingly able to open bank accounts, obtain credit, and shop.


Since 2001, Brazil has experienced a rapid increase in the establishment and growth of financial institutions and in the consumer banking system. The new sophistication of the banking industry has also helped to stabilize the economy. However, the surge in global oil prices has pushed up fertilizer costs and has been among the main causes for an increase in food price inflation. Consumer prices in Brazil rose at the fastest pace in more than three years in the first half of 2008 as the cost of rice, meat and other staple food items rose sharply. Brazilˇs central bank is following the lead of the U.S. Federal Reserve Bank in attempting to control inflation through managing interest rates. Brazilˇs central bank raised its benchmark Selic lending rate three times this year to curb resurgent inflation and prevent the economy from overheating.


The modern banking industry has proven to be one of the major drivers for electronic security market growth. There are vast opportunities for security businesses in the banking sector. Brazilian banks are increasingly investing in business solutions, which include: digitization of documents, business intelligence solutions, digital certificates used for e-commerce, VoIP, enhanced security, electronic fraud prevention, ATMs, and applications developed on open source technology platforms such as Linux.


The use of debit cards accounted for 28 percent of the total transaction volume in 2006. In Brazil, these cards are rapidly migrating from magnetic strip cards to chip-enabled cards under the Europay, Mastercard, Visa (EMV) protocol. EMV-compatible terminals have caused fraud rates to decrease by more than 80 percent since the start of the migration process in 1999. The same cards are used at ATMs, which are monitored by video surveillance systems providing an increased market for this technology. The retail segment is also investing in automation, management, and logistics, adopting smart cards for both in-store and Internet shopping.


                                                            The expansion of credit can only increase the market volume of the Brazilian electronic security market, which reached $214.8 million in 2006 and is expected to grow to $530 million by 2012. The market for electronic security is forecast to grow at a compound annual growth rate (CAGR) of 16.2 percent through 2012. By 2012, the residential market is expected to account for 16.4 percent of the total market. By the same year, the proportions of the market held by various technologies are expected to be:
 alarms 15.7 percent;
 fire detection and monitoring systems 5.8 percent;
 video surveillance systems 41.9 percent;
 electronic article surveillance (EAS) 9.7 percent;
 physical access control systems 26.9 percent.


It is expected that local and international electronic security companies will continue to target the commercial and industrial market segments in the short and medium terms, changing focus to the residential and service sectors in the medium and longer term. Development of affordable integrated security solutions that include a high level of customer service is recommended, including specialized technical support in the local language. This service-oriented strategy will not only secure customer satisfaction and loyalty, but also provide ongoing revenue opportunities.


Complete security solutions with combined applications such as EAS, alarms, video surveillance, and access control is also a recommended success strategy that can be established through strategic partnerships with local companies. It is predicted that more foreign entrants will partner and form joint ventures with local companies along the entire value chain. Partnerships with local companies will not only facilitate the ability to provide reliable and integrated solutions customized to clients' requirements, but also gives foreign companies tax advantages.

Environmental Monitoring, the Missing Link to a Complete Security System

Editor / Provider: SUBMITTED BY WINLAND ELECTRONICS | Updated: 9/26/2008 | Article type: Commercial Markets

Winland Electronics offers a solution that effectively reduces false alarms from environmental factors.The majority of damage caused to property is not from break-ins, but rather environmental hazards. Security providers need to ask themselves what they are doing to protect customers from the potential dangers of water, temperature, humidity and other adverse environmental conditions.


Statistics from the Insurance Information Institute reports that the percentage of losses from environmental hazards is about seven times higher than that from theft.


If one looks at any facility  whether it is residential, commercial or industrial there are critical environments that should be monitored. Most security professionals do not recognize the opportunity to expand their business by integrating critical environmental monitoring as part of their security solutions. All of Winlandˇs products are designed to interface with any security panel, allowing security integrators to easily install products in existing or new security systems.


Watching Wares
The Winland Electronics EnviroAlert EA800 wireless environmental monitoring and data logging system helps food shops throughout the European Union meet Regulation 852/2004 of the European Parliament and the Council on Hygiene of Foodstuffs.


This regulation requires all food business operators to maintain a permanent procedure or procedures based on the Hazard Analysis Critical Control Point (HACCP) principles. There are seven principles that are used to identify potential hazards and steps to eliminate or reduce these hazards by establishing limits, corrective actions and recording of critical information.


A potential hazard that is in every food shop is unsafe temperatures of storage coolers and freezers. This can result in costly losses of perishable food products or legal repercussions from customers consuming unsafe food.


The EA800 provides food shop owners an automated means of monitoring the temperatures of their coolers and freezers, as well as providing an automated log of the temperatures that is required by inspectors. There are many applications for the EA800, including in bakeries, restaurants, and food processing facilities.


The EA800 provides the flexibility to simultaneously monitor up to eight zones for temperature, humidity, water leakage and electrical contact, using up to four wired and four wireless sensors. Each sensor zone has a designated output relay that can be connected to any security panel, dialer or transmitter to activate an alarm when programmed limits have been exceeded.


The data log feature will date and time stamp sensor data, event and alarm history. The sensor data can be programmed to log from every 30 seconds to once an hour. This data is stored in the EA800 and can be transferred to a USB memory stick for viewing on a PC. A data template, which comes with the EA800, can be downloaded to a PC and allows the data to be viewed easily.


The EA800 can be installed quickly using wireless sensors, eliminating the need to run sensor wires back to the base unit. The applications are endless and can provide significant business growth, as well as providing a complete security solution for customers.

Indian Security Feels Impact of U.S. Financial Crisis

Editor / Provider: Submitted by Frost & Sullivan (South Asia & Middle East) | Updated: 9/25/2008 | Article type: Hot Topics

The subprime crisis and the resultant economic slowdown in the United States have gradually cast a shadow on the Indian electronic security industry. A growth consulting company provides its viewpoint.


The U.S. economic slump and escalating interest rates and energy prices have impacted certain sectors of the Indian economy at this point in time. High energy prices and interest rates, for instance, have driven up costs in the construction sector, pushing real-estate prices upward. At the same time, high financing costs have deterred prospective buyers from investing under such conditions.


Sectors such as real estate, IT-ITeS (IT-enabled service), hospitality as well as cement, metal and other industries are reportedly experiencing a slowdown. At 22-percent growth in the first quarter of fiscal year 2009 (Q1 FY09; started in Apr. 2008), IT-ITeS sectorˇs growth already fell short by 6 percent when compared to the same period in FY08. As opposed to an aggregate growth of 40 percent in Q4 FY08, the metal and cement sectors registered just 19-percent growth in Q1 FY09. Similarly, the hospitality sector stands at 17-percent growth in Q1 FY09 when compared to 30 percent in Q4 FY08.


While the debate on the extent of the impact of these factors on the Indian economy is still on, there is no doubt that the global downturn, relatively high inflation and political upheaval do not bode well for the Indian economy. The Indian electronic security business depends heavily on the performance of these sectors and investments therein. Electronic security and such investments are not on the priority list for many end users as they continue to slash budgets and expenditures. Currently, the focus seems to be on increasing revenues and reducing costs.


Market players in electronic security have confirmed a sluggish demand, a drop in sales and delays in execution of existing projects. Moreover, they admitted that there is a substantial delay in payments from customers, signaling cash flows problems that may affect profitability of projects.


Suppliers focusing on the IT-ITeS, commercial and premium residential markets have also reported muted Q1 growth and are talking about a similarly poor performance in Q2 FY09. Postponed investment decisions will have a strong negative impact in the remaining part of this year. Players who have witnessed good growth are reviewing their marketing strategies, and a large section of the industry seems to be focusing on government and industrial projects.

Survival of the Fittest

Editor / Provider: Hayden Hsu | Updated: 9/23/2008 | Article type: Hot Topics

After the subprime mortgage, Fannie Mae and Freddie Mac crises in the United States, fears of credit crunch and hard landing seem to have swept the world over. ASMAG.com looks into how these financial issues might have affected or will affect the security business.


The U.S. Federal Reserve (FED) lowered interest rates in 2001 to stem economic and financial crises after Sept. 11th. The move attracted investors to invest in real estate en masse, leading to a boom in housing construction as borrowers with low incomes and bad credits were encouraged to sign subprime mortgage agreements with high default rates.


Unfortunately, starting from 2006, house prices decreased dramatically which in turn made refinancing more and more difficult, resulting in the painfully felt credit crunch. "Many defaulted and their houses were acquired by lenders, who tried to sell these houses in a hurry to pay their debts to government-backed banks like Fannie Mae and Freddie Mac," Kilic continued. "House prices went down further, causing the housing bubble to burst. And the subprime crisis emerged."


In the beginning, most economists thought that the crisis was a local problem within the United States. "Ripple effects in the international arena soon appeared with the Northern Rock bank run. Bank of China then had one of its biggest drops as the bank was holding almost US$9.7 billion of securities backed by U.S. subprime loans," Kilic recounted. Now the crisis goes global.



North America
"Declines in new construction sites, high levels of house inventories and the degradation of subprime markets will continue to adversely affect the U.S. residential security market for the near future," said Tom Brigham, President of Brigham Scully Public Relations.


"However, the security industry is not a typical industry," Brigham clarified. For instance, government controlled entities, from transportation hubs and schools to military bases and embassies, will continue to add security systems to protect staff and attendees.


"It's often claimed that security is a recession-proof business. Security may be, but security products certainly are not," cautioned John Honovich, President of ipvideomarket.info. "The subprime meltdown is clearly evolving into a general debt crisis where accessing capital will become significantly harder for everyone."


Since security products are capital expenditures and capital is tightening, organizations are going to find it more painful to purchase new security products. "Just the talk of a downturn is enough to trigger a more conservative approach to budgeting," said Adam Stroud, Director of Sales and Marketing for Paxton Access. "Identifying a budget for installing and/or expanding security systems will be challenged fully by management during tougher economic times, by the question of the system's return on investment (ROI)," said Dave Tynan, Vice President of Global Sales at Canada-based Avigilon.


"Essentially, the recession will motivate companies to delay purchases and keep their existing systems for a few more years," Honovich predicted. This will have a severe impact on the security business, with possibly many security companies going out of business.


Europe and the Middle East
The strength of the Euro, at a record high versus the dollar, is becoming a problem for Europe's exporters. The International Monetary Fund (IMF) already lowered its 2008 GDP growth forecasts for Britain and Germany: from 1.75 percent to 1.4 percent and from 2 percent to 1.5 percent, respectively. "Our main concern as a European manufacturer is the weakening U.S. dollar," said Fabrizio Colciago, CEO of Italy-based Cieffe (a March Networks company). With around 70 percent of its revenue coming from abroad, the increasingly strong Euro has put a brake to Cieffe's otherwise healthy growth. "We are hoping for a more stable American economy."


In the Middle East, rising labor and material costs have made products more expensive to end users, said Itamar Yaar, CEO of Yaar Strategic Consultancy & Management. "The weak dollar works against us as most of our expenses are paid in Shekels while we used to price our systems in dollars," said Almog Aley-Raz, cofounder and CEO of Israel-based PerSay, also facing Colciago's conundrum. "We have moved to Euros (outside the United States) in order to compensate for this."


According to Archana Rao, Senior Research Analyst at Frost & Sullivan (EMEA), there are two possible outcomes as to how security will be affected. "The first is a mild recession causing a slowdown in the economy, slowdown in the construction sector and mild rise in unemployment which are expected to slow down the growth of the security market." A more serious impact on low-end segments will be witnessed, whereas high-end segments such as banking and corporate will still maintain or increase their security investments to maximize their ROI.


"The other possible scenario is a major recession," said Rao, "which causes business shutdowns, an increase in unemployment, total collapse in the housing sector and drastic reduction in security budgets, thereby posing significant challenges to all segments."


 "Demand will go down slightly, but effects on electronic security will be minimal and short-term," Yaar predicted. On July 21st, the British Olympic Delivery Authority began the process of inviting expression of interest for its command and perimeter security system (CPSS). The total investment in security in connection with the 2012 London Games started out with an initial budget of $400 million and has now spiraled to more than $2 billion.


Asia
The U.S. economic slump is definitely having an effect on the Southeast Asian economies, David Rees, Regional Manager, APAC, Salto Systems, believes. "There seems to be a slowdown in many of the region's countries." Singapore might be the only exception as high-end office and residential buildings are currently at record prices. "However, this may turn very quickly if the global share markets continue to weaken or experience a sharp drop in the near future," warned Stewart Yen, CEO of Secom Singapore. "When the economy is bad, the first thing people try to save on is security, especially in Singapore where it is generally perceived to be a safe city."


In India, the local economy is more integrated with the global one than ever before, said Yash Kansal, Senior Commercial Specialist, U.S. Commercial Service (Delhi, India). "The slump in the United States is severely impacting the Indian manufacturing and services market where companies are experiencing a dip in their profits, with the Sensex dropping by 40 percent in the last two to three months." With increasing inflation and interest rates, consumer spending is reducing, further impacting the demand for goods and services. "As businesses aim to cut costs to remain competitive, spending on budget heads such as security equipment is being deferred," Kansal observed.


China is not faring much better, either. Recent surveys done by ASMAG.com China indicate that the financial and economic crises have cast a shadow over the minds of many Chinese manufacturers and exporters, who are worrying about delayed payments and projects. Whether China will be able to escape the fate of a post-Olympics "economic hangover" remains to be seen.


WORDS OF ADVICE
"Corporate and high-end users will probably not be affected as much, as their security systems have other value-added functions like monitoring productivity and improving efficiency," said Sarangan. People who deploy security equipment solely for security purposes, on the other hand, will treat security as a cost and are more likely cut it when there might be cash flow problems.


"Thatˇs why we are counseling our clients to sell the 'payback' side of security systems and show how they increase profits and ROIs," Brigham suggested. Businesses should be asking: Will additional investments reduce the amount of investigation time, or improve response time so that investigations are conducted more effectively? "If we assume that short response time equals greater percentage of successful investigations, then there's improved ROI," illustrated Tynan. "Only higher performing systems will meet the needs of organizations during an economic downturn."


The government's Freddie Mac and Fannie Mae rescue plan should be a good sign, Brigham reassured. "It sends a signal to investors worldwide that the U.S. government is prepared to take all necessary steps to prevent the credit troubles from engulfing financial markets and further weakening the economy and housing markets."

Asian IP Camera Suppliers to Sharpen Their Competitive Edge

Editor / Provider: a&s International | Updated: 9/9/2008 | Article type: Tech Corner

The rise of IP heralded the age of networked surveillance. At the edge are network cameras, stalwart sentinels ready to capture images. ASMAG talked to several Asian vendors about their solutions and how they fit into surveillance for the future.


Asia has emerged as a major player in digital surveillance, thanks to its strong production capabilities and robust IT sector. One of the top Asian players in network cameras is VIVOTEK of Taiwan. Its new award-winning PTZ network camera features Sony progressive scan CCD, 2.6x optical zoom lens and Power over Ethernet (PoE), said Owen Chen, Chairman of VIVOTEK. The camera's dual-stream support allows users to view video through a Web browser or 3G mobile device simultaneously, with different resolutions and qualities in MJPEG or MPEG-4.


GeoVision's IP cameras also pack a hefty punch. "Based on years of in-house experience on PC-based video surveillance systems, we are now developing and designing IP cameras for hybrid surveillance integration," said George Tai, CEO of GeoVision. The company's 1.3 megapixel camera uses a Sony progressive CCD image sensor for crisp images and also supports MJPEG and MPEG-4 formats. It is integrated to GeoVision's video analytics and video management software, making it part of a total surveillance solution.


Camdeor Technology applies its experience and integrates IR functions with network cameras. "We focus on what we have and provide value-added products to the market," said Russel Yang, Assistant Manager of the Overseas Department, Camdeor. "Furthermore, we bring IP cameras to outdoor applications with our IP 66 design, giving customers more options."


Camdeor's expertise with IR and lenses gives it an edge, while incorporating H.264 for the greatest compression benefit. "Most IP players focus on developing software applications and use third-party optical and housing designs," Yang said. "The cost of IR cameras and components is getting lower if users buy an IP camera and pay a few dollars more, they will have IR capabilities. We believe everyone will buy IP IR cameras to see in both day and night."


Other cameras combining IP with IR's all-seeing benefits include ones from Three Brain Technology, using two switchable CCDs to eliminate IR cut filters and color coating, said Young Lee, Chief Marketing Officer for Three Brain Technology.


Beside from making IR IP cameras for outdoor applications, Zavio also targets smaller applications with its wireless IP camera. "The camera is aimed at the residential and small business markets, where customers tend to be more price-sensitive and range requirements are roughly 5 meters in the dark," said Shau-Chau You, Product Manager for Zavio. It uses white light LEDs instead of IR LEDs for less color distortion under natural and incandescent light, without an expensive ICR switcher required for IR LEDs. The camera also enables remote surveillance with its 3GPP support.

Top Regions and Applications
The deployment of network cameras requires a stable Internet connection capable of transmitting images in real time. As a result, network cameras end up in areas with developed Internet networks. Europe and North America were key export regions for most Asian vendors, courtesy of their mature IP infrastructure.


"Ethernet bandwidth influences the size of the IP market greatly, so more advanced countries like America or Singapore specify IP cameras for public construction," Yang said. "For countries in the Middle East, they are still using dial-up, which results in slow IP camera performance. In these countries, the biggest buyers for IP are usually governments or global companies."


Governments can establish dedicated networks for security, ideal for applications to monitor large areas remotely. "The main use of network cameras is for public monitoring," Yang said. "For government or in banks, they have money and the network infrastructure. Government applications for network cameras include jails and traffic monitoring."


For Zavio, 90 percent of its business is overseas, including OEM, to the United States and Europe. "These regions are our main market, but we are not limited to them," You said. "The Middle East and other regions are also seeing strong demand."


This is not the case for VIVOTEK. "Europe also has a strong demand because it is more receptive to surveillance," Chen said. VIVOTEK also has strong growth in other parts of the globe, but Europe has accepted VIVOTEK-branded products more readily and has a more developed Internet infrastructure. This makes it an ideal market for the company's network cameras.


GeoVision sees more demand for IP solutions in western Europe, along with North America and Latin America, Tai said. "The GeoVision IP surveillance platform allows for intelligent integration with e-maps, PoS systems, EAS systems, license plate recognition systems and access control systems."


Regardless of region or application, demand for network cameras is growing, giving Asian vendors a new product niche to expand.


Challenges Ahead
With strong technology and worldwide demand, network camera vendors see excellent growth potential. However, before they claim success, several issues must be overcome, from technical difficulties to market awareness.
"The next trend will be megapixel cameras based on H.264," You said. "Current megapixel cameras based on MPEG-4 platforms are impractical, as they deliver low frame rates and require huge amounts of network bandwidth and storage."


Increasingly sophisticated hardware is part of GeoVision's long-term goals and an R&D challenge to overcome. "GeoVision will continue to develop higher megapixel IP cameras and advanced video analytics software," Tai said.
"In the meantime, we will watch how the IP camera TCO (total cost of ownership) may affect growth and market acceptance."


VIVOTEK found that existing processing components, like DSPs, did not serve its needs. In 2003 it began to develop its own SoC and launched the first one in 2005. "This helps us control component costs and provide better support to customers, as we aim to be a total solution provider," Chen said.


VIVOTEK strives to offer more high-end products, planning to incorporate megapixel, newer compression formats and video analytics in the future. "Our direction is to serve the high end professional market," Chen said.


Ultimately, finding good partners is crucial for Camdeor. "Integration is the biggest challenge, as we must select the right customer," Yang said. This means clients who are committed to quality and less interested in haggling over a "price negotiation."


"They need a good engineering team, as an IP camera is not plug and play," he said. "There are firewalls. For remote monitoring, there are multiple firewalls if there are multiple sites. It's not a hardware issue, but a software setup issue."


This is evident in differing video standards worldwide, such as for watching live footage on mobile devices. "The main countries are the same, as they must pass the same protocols, but the interface is slightly different," Yang said. "A very well-educated user will understand these differences."

Product Demands in Italian Residential and Banking Markets

Editor / Provider: a&s International | Updated: 9/3/2008 | Article type: Hot Topics

In Italy, the banking and residential sectors are major customers for electronic security products. IP is proving hot in large government and industrial projects.


The fastest-growing vertical markets in Italy are banking and residential. "It is not a standard market," commented Aldo Punzo, Product Marketing Manager of Bettini. "If you want to sell a DVR, you can make it in Taiwan or Italy, and it is the same. In Italy, however, the features that banks need are different, especially in terms of central management system (CMS) software that allows users to centralize all DVRs."


"Ninety percent of Italian banks are using domestic products; the quantity for each is very small," said Punzo. "Banks have many separate rules and DVR requirements." There are different rules, he said, regarding privacy, legal compliance, cost issues and technological specifications. Each bank has a lot of unique requirements that it wants for security and DVR operating systems. This means that the DVR product has to operate on a platform so banks can centralize everything.


Another issue is that not all bank branches have ADSL lines; they may have only analog phone lines. "Equipment must be able to connect to everything from analog to advanced devices," said Punzo.


IP surveillance is not growing much in the banking sector because end users are not keen to supply the needed bandwidth. "Banks do not want to share bandwidth with security because it is needed for other purposes," said Punzo. "It will take three years before bank managers start thinking about IP. In the meantime, the industrial segment is going for IP in a big way."


Residential market is also a rapidly growing vertical that has different requirements in terms of security demands. According to Andrea Hruby, Managing Director of HESA, a couple of passive infrared (PIR) or magnetic contacts were sufficient for most homeowners. "Now, however, everyone is installing a detector on every window to prevent intrusion." In Italy, there are a lot of condominiums and detached houses with gardens. "In the past, security systems were turned on only when people left for holidays. Now, houses are being armed even when residents are home," said Hruby.


Furthermore, the wireless market is quite large compared with other countries. Customers do not want wires or holes so they use wireless detectors for perimeters. They are going for wireless because of easy installation, system upgrades and cheaper price.


Other unique features sought by Italian end users are voice dialers for house alarm control panels. "Voice dialers are dialers that are more and more often integrated with control panels. They send voice messages over PSTN or GSM telephone networks to relatives, neighbors or friends' phone numbers, instead of connecting to monitoring stations," said Hruby.


He attributes the popularity of such products to the lack of a sufficiently large market for monitoring stations in Italy. "People prefer to have an alarm and voice rather than connection to a monitoring station. The market in Italy is not big and the cost is very, very expensive. That is why very few can afford to pay monitoring station service," said Hruby.


IP Trends
According to FlavioVenz, Managing Director of Nexxt, 70 percent to 80 percent of large projects are based on IP and open architecture. Italy, however, still has an important analog market, and these small businesses are not installing IP solutions.


"In general, the IP market in Italy is still quite small and mainly for big projects; IP is not yet used in the commercial sector, but only by large industrial companies, government agencies and banks," said Hruby.


Another obstacle is the highly fragmented market. "Most of Italy's 5,000 installers are not familiar with IP," explained Venz. "End users are not asking for IP solutions. This is something that has to be pushed a bit more before it takes off in Italy. What happens often is that IT managers are jealous of who gets access to the network; they do not want to share their networks with security. In the next five years, though, I expect IP to become more common."


Redo Bezzo, EMEA CCTV Product Manager of Honeywell Systems Group, also suggested that 90 percent of new projects developed in Italy are now looking for IP solutions. "Since everyone talks about IP, end users are keen on it; they are the ones that keep asking for IP."


According to Bezzo, installers will offer their customers IP solutions, but may also recommend an alternative analog solution where there may be specific functional requirements or system benefits which are better suited to analog. "Installers are looking to provide their customers with the correct solutions, using the right technology for the job" said Bezzo.


Buying Behavior
In South Italy, buyers are more price-sensitive when compared to the North. South Italy is less industrialized and the cost of living is lower. The standard of living is also lower than in North Italy, consequently, cheap products are popular.


The northern and central parts of Italy are more industrialized and business-oriented. In the North, there are many supplicated installers who prefer not to sell inexpensive DVRs. "We are selling very high quality DVRs in Central and North Italy," said Venz, "because professional installers are trying to differentiate themselves from the electricians who also deal in electronic security products and systems. Low-cost, low quality products are sold mainly by electricians," said Venz.


Another unique buying behavior is that Italians take special notice of aesthetics. "For alarm control panels and other visible parts of the system, such as the keypads, Italian consumers ask for a lot of variety when it comes to design, much more than in other European countries," said Hruby.


Advice for Manufacturers
The Italian market is fragmented with many small installers. Venz pointed that there are more than 5,000 installers, most of which have no more than five or 10 employees. It is, therefore, very important to work with local distributors, suggested Venz. "Only local distributors can support manufacturers in efficiently distributing their products in such a fragmented market."


Many small installers in Italy need support, so manufacturers must work with local distributors. "This is very different from the U.K., France Germany and Spain, where the size of individual installer is much bigger; they have large networks, encompassing logistics, finance and technological support," said Venz.


Hruby agreed that manufacturers need to approach big national distributors or otherwise limit sales to the local market. "Since there are no major national installation companies, such as ADT, HESA created a network with about 100 of the biggest security installers in Italy called Gruppo Italiano Telesicurezza (GIT)."


"We created a network of installers throughout the nation," said Hruby. "Customers in one city may need service in another city; we can refer them to another installer via our network. To encourage installers to join, we reserve a specific range of products in a given area so that others will not be competing with them directly."