Integration the name of the game in Russia can be seen in different areas of the security market, including transportation safety (airports and railway stations), city surveillance projects and protection of energy transportation (pipelines).
When it comes to surveillance, said Olga Ukolova, Security Systems Sales Promotion Manager at Panasonic CIS, ¨Of course, Panasonic is a major player. We are the market leader in Russia. The latest research shows that we have a 30-percent market share of surveillance products.〃 Other sizable players, in her view, include Samsung and EverFocus Electronics; but for IP, ¨there is only Axis.〃 She did note, however, that there are many Taiwanese, Chinese and Korean companies, but they are ¨no name〃 companies. ¨They are all doing OEM production or simply do not have a famous brand.〃
Trends in Surveillance
Another industry source cited KT&C, Sunkwang (Huviron), Hisharp, Daiwon, Computar, Panasonic, Pelco and EverFocus for surveillance products and, again, only Axis for IP.
According to Vladimir Osipov, General Manager of Satro-Paladin, there is demand for multifunctional professional solutions such as cameras with advanced technical features (high sensitivity and high resolution). In addition, he sees considerable development of IP technologies as well as strong demand for IP surveillance.
Hot products last year were DVR cards, said Michelle Tang, Sales Manager for GeoVision. However, for 2008, she sees integration of other security devices and systems, including access control and point-of-sale (PoS) systems for retail loss prevention as the main drivers of growth.
¨This year, we are integrating access control with IP surveillance this is also the trend seen in the rest of the world,〃 she said. Russia is less price-sensitive compared with other Commonwealth of Independent States nations. ¨Itˇs more about technology, features and quality, especially over the last four years.〃
In the opinion of Boris Naumkin, System Engineer at Vidau Systems an exclusive distributor of EverFocus in Russia annual growth in the Russian surveillance market has been between 10 and 20 percent. Major players, he said, are Panasonic, Sony, Samsung, Bosch, Sanyo, Mitsubishi, Pelco, Axis, EverFocus and many other famous brands.
Most major projects, said one industry source, are integrating IP with recording (DVRs), and because of this, many hybrid systems are being installed. There have also been a number of transportation and city surveillance projects; these are also incorporating intelligence like object detection and people counting.
Growth will come from complete systems that encompass networks, video cameras, huge storage systems, databases, intelligent features and video analysis,〃 said Irina Pinchouk, Public Relations Manager for Intelligent Security Systems (ISS). ¨Now, our main competitors are Russian companies that are trying to develop similar types of products and systems as ours, but they have not been as successful. We have been working with special universities to provide specialists with skills at a very high level, and this has taken a long time to build.〃
For Dmitry Kazansky, CCTV Department Manager at Escort Group, the future lies in integration and networkability. ¨Our customers a l so want powe r ful ne twork functions and integratable devices to form one network with one control point. DVR products will continue to become more flexible, and systems will benefit from greater integration.〃
Access Control and Biometrics
The access control market in Russia, said Stefan Mizha, Commercial Officer at the U.S. Commercial Service, is one of the most rapidly growing subsectors of the safety and security market. The market for access control systems is growing at 30 percent annually.
Domestically developed systems supply 70 percent of the market, said Mizha. ¨These systems are based on imported as well as domestically manufactured components.〃 Domestic manufacturers of readers are Parsec, Perco, Bolid and Eliks. Controllers are produc ed by Elektra-AC, Eliks and Metacom. Metacom also manufactures Russian analog devices for iButtons of Dallas Semiconductor. Chips for contactless identification are manufactured by Angstrem.
Despite higher prices, said Mizha, the market share of foreign equipment is growing. Key U.S. players include Apollo, Northern Computers, IEI, Pegasus, HID, Indala, Texas Instruments, Identix, Farpointe Data and Recognition Systems. ¨U.S. companies are leading the segment of identifiers and readers. Considering the limited ability of Russian competitors to satisfy this niche, U.S. companies have very good prospects.〃 Osipov said that for access control cards and readers, EM-Marine, HID, Mifare, Parsec and Prox are the major players.
One hot product in Russia, pointed out Mizha, is the iButton. ¨iButtons are widely used for access control in residential and commercial buildings. There are almost no manufacturers of identifiers in Russia. The majority of plastic cards are also manufactured abroad.〃 Imports, he added, include products manufactured by Nedap, TagMaster and Bioscrypt.
Consumers of small access control systems include small offices, retailers, apartment buildings, schools and educational institutions, said Mizha. ¨Access control systems installed in educational institutions with limited people flows mostly provide personal identification and registration with card readers at entrances and exits. Organizations with heavy people flows usually use card-activated tripod turnstiles and video monitoring systems. In both cases, proximity cards are used.〃
Mid-sized access control systems, he continued, are installed mostly in large office buildings, business centers, shopping centers and supermarkets. ¨The main features are close integration of access control with intruder alarm systems.〃 Large access control systems are mostly used by large corporations with subsidiaries in one or several cities, and airline and transportation companies with a network of client services and booking offices.
Demand for integrated security systems encompassing video observation, intruder and fire alarm systems, payment systems, document workflow and control of building engineering systems is growing. ¨Russian customers want technical solutions with availability for controllers and interfaces to be connected through LAN, instead of traditional RS-485 and RS-232 interfaces,〃 Mizha said.
According to Cyrille Lebedeff, Export Sales Manager for Sagem Securite, Russia is an industrialized country with a high level of technical competence. ¨Even though we are the worldwide leader in biometrics, we find that many Russians have been developing this technology for many years. That said, the Russian market is very much ready to buy our products; OEM is another good opportunity for us here.〃
Proof of that lies in the success of companies like Papillon Systems. ¨We have been in the biometrics business since 1990 and have been selling our products to the Ministry of Interior and other government and military agencies since 1991,〃 said Ivan Shapshal, Deputy Director General and General Director of Sales, Papillon Systems. ¨We have a system (AFIS/APIS and LS) that uses fingerprints and palm prints to set up a criminal record database with possibilities to solve crimes by identifying latents lifted from crime scenes. We also make all the peripherals and have developed the software. It is a 100-percent Russian-made product.〃
Possession of advanced technology does not mean that Russia is good at mass production. ¨The processes to control quality are just not there,〃 said Lebedeff. ¨You simply cannot compare our plant in France with the ones here. Sagem is about cutting-edge technologies with a strong commitment to developing local markets.〃
Russians, said Lebedeff, are open to using all biometrics, not just fingerprint. That said, as in other markets, fingerprint dominates (more than 90 percent). ¨At last yearˇs show, I saw a Japanese company selling vein recognition products, but I have not seen it back here again this year, nor are any Korean biometrics suppliers visible.〃 Major players, said Osipov, are Biocode, Biosmart and Lucky. Shapshal noted that introduction of a biometric passport will be a major driver.
While Lebedeff reported that Sagem has not done any facial, iris or vein installations in Russia yet, he sees interest for all biometric technologies. Such technologies, however, are in early days. ¨We have installed iris recognition in a few nuclear installations, but that is still in the experimental phase,〃 Shapshal said.
IP: Ready or Not?
¨Itˇs obvious that almost all manufacturers have been participating in the IP race,〃 said Naumkin of Vidau Systems. Mass applications of these technologies, he added, are gaining ground in Russia, but communications and infrastructure have been obstacles. ¨If growth in this direction doesnˇt scale down, in two to three years we will see a huge increase in sales of IP solutions.〃
IP is mostly involved in huge projects. Aleksey Vitalisov, Business Development Manager for Armo Systems, said that his company is working on major city surveillance and traffic monitoring projects that require IP video systems. ¨We have to satisfy our customers so we are paying close attention and providing them with consulting services to better enable them to buy the right systems and equipment. They need to know what is essential to their needs and what is not.〃
¨Russia is a very different IP market,〃 continued Vitalisov. ¨In city centers where network infrastructure is well developed, it is easy to integrate IP with existing networks. In the suburbs and other cities outside Moscow and St. Petersburg, it may take another five to seven years to develop the necessary infrastructure to enable IP use. Network construction is the major bottleneck that the industry is facing.〃
Tang of GeoVision seconded this: ¨IP solutions are a hot topic as are any products connected to this trend, like IP cameras, video servers and management software for NVRs. The Internet environment in Moscow is improving, but there are still many limitations. It is not as advanced as in, say, Scandinavia.〃
While Helen Silina, Public Relations Manager at Satro-Paladin, recognizes that IP is becoming popular, she puts it at only 5 to 8 percent of the market. ¨People do not know much about it. That percentage will grow very fast in the next few years, though.〃
Whether IP takes off or not, she added, does not depend on the type of company, but how top management views IP and whether it thinks that it is worth installing. Big projects, she said, include the Russian Winter Olympics in Sochi in 2014. ¨Moscow, St. Petersburg, Nizhny Novgorod and Sochi will all see major airport and railway upgrades, including installations or upgrades of security products and systems.〃
Pavel Vikmorovich Kurilenko, Sales Manager at ON Com a distributor for Axis does not see price as an issue. ¨The price of IP compared with analog camera systems is about the same and that does not even take into account the fact that IP systems deliver vastly better performance. That said, there is a lot of competition from analog. There are also a lot of hybrid systems on the market.〃
He is confident that IP is happening now. ¨I disagree that it will take three years for IP to take off. It will happen much faster than that, especially in Russia. There is a lot more competition from analog cameras in markets like Poland where there is a much bigger existing base. All new markets like Romania, Ukraine and Russia are seeing high growth for IP as they can go directly to it.〃