Do you know what a zettabyte is? A zettabyte is a unit of information or computer storage equal to one billion terabytes. When the Cisco Visual Networking Index (VNI) Forecast was released in 2010, it projected that international Internet traffic would increase by more than four times to 767 exabytes (an exabyte is 1 million terabytes), or by more than  three-fourths of a zettabyte, by the year 2014. This increase was equivalent to 10 times of all the traffic traversing Internet Protocol (IP) networks in the year 2008.

In fact, the report indicated that video would continue to dominate the IP traffic, exceeding 91 percent of global consumer IP traffic by the year 2014, while the increasing popularity of high-definition television (HDTV) also would be a key factor helping quadruple IP traffic from 2009 to 2014.

As Internet usage reaches previously unconceivable levels on the consumer side and video streaming and HDTV demands continue to grow, those technologies and the end user mentalities and expectations behind them are changing the video surveillance market as well.

“The HDTV concept captured the imagination of the end user. Everyone knows about the benefits of HDTV in their home and now they want that enhanced image in their surveillance systems with HD network cameras. That trend will only continue to increase demand in 2011,” says Fredrik Nilsson, general manager, Axis Communications Inc., Chelmsford, Mass.

The expectation for better images is changing the industry.

“There are times historically when consumer habits change an industry,” says Lindsay Ryerson, product management, Honeywell Systems, Surrey, B.C., Canada. “Growth in HD (high-definition) video surveillance is driven to some extent by consumer recognition from HDTV. End users are used to seeing it at home with their TVs and they are exposed to the message that better images are possible. We are also seeing more and more of HD because it drives the value of an IP system and therefore drives the growth of IP. With HD developments you can still get real-time performance, far superior low-light performance, and the images needed for better surveillance and forensics. There are still plenty of applications where megapixel cameras are a better fit, but high-megapixel cameras will remain a niche market for a while as HD supplies the bulk of the market requirements of what people are looking for (without the cost and network requirements of megapixel) when they go for IP-based systems.”

As Ryerson points out, HD’s growth and the growth of IP, always a hot topic in the video surveillance market, are connected.

In 2011, more products, developments in HD and IP support devices, and the availability of complete HD solutions will drive sales, believes Daniel Gundlach, vice president of marketing — Americas for Bosch Security Systems, Fairport, N.Y.

This year will be the year of expanded HD offerings as manufacturers such as Bosch focus on offering complete HD solutions for capturing, viewing, storing and managing HD video including fixed and pan-tilt-zoom cameras, indoor/outdoor cameras, day/night cameras, video management software (some designed to manage both HD and standard-definition or SD), storage solutions, monitors and much more.

“There is growing adoption of IP video systems in the market, and within this segment, increased demand for HD surveillance. High definition is an evolving technology with a growing adoption rate as complete HD solutions are becoming available. End users are increasingly requesting HD or megapixel cameras to be incorporated into their systems, which in turn helps to drive sales of recording systems, management software and monitors that support HD devices. It also increases demand for storage technology, as HD cameras produce video streams with higher bit rates, resulting in greater storage requirements,” Gundlach says.

Those higher bit rate video streams are also necessitating the need for better Internet connections, so it’s no surprise to see consumers and businesses continuously moving to broadband Internet services. It is a move the FCC is following. In a February press release, the FCC announced plans to modernize and streamline its universal service and intercarrier compensation policies (that pay to bring phone lines [think dial-up] to rural areas) to instead bring affordable wired and wireless broadband to America and, by default, to dealers and installers.

This will only help the IP video surveillance market in 2011, according to David Engebretson, president, Slayton Solutions Ltd., Chicago.

“There is a proliferation in all markets of broadband Internet connections. Dial-up is gone, and most people that dealers are working with have broadband Internet connections. Because people are invested in that broadband Internet experience and already paying for the Internet, it gives dealers ability to install IP-enabled cameras/controllers. The road is already paved for IP, dealers just have to drive on it,” says Engebretson, SDM’s contributing technology writer and author of the monthly column, Security NetWorkings (see page 188).

Even business are upgrading their available bandwidth, says Alan Forman, president, Altronix Corp., Brooklyn, N.Y. “We are also seeing more and more facilities upgrading their infrastructure — specifically their cabling — to accommodate more bandwidth for networked systems. This is critical for large bandwidth hungry IP video surveillance systems with multiple IP cameras, and megapixel cameras even with advanced compression.”

Most reports are predicting continued growth in HD and IP in 2011. The report “World Market for CCTV and Video Surveillance Equipment — 2010 Edition” from IMS Research, Wellingborough, England, predicts HD and megapixel cameras are forecast to represent nearly 30 percent of network security camera shipments in 2011 and that by 2015 more than 60 percent of network security cameras shipped will be HD and megapixel resolution.

With the higher demand comes decreased costs, another factor identified to impact the market in the upcoming year.

“As the cost of high-definition systems declines, the overall adoption of high-resolution systems continues to accelerate. Fueled by distinct image quality and coverage advantages, VideoIQ sees integrators of all sizes deploying HD cameras in a wide variety of applications from small office buildings to complex government applications over wide geographical areas,” relates Scott Schnell, president and chief executive officer (CEO) of VideoIQ, Bedford, Mass.
An independent study by Axis Communications compared costs of an analog video surveillance system to an IP system, finding that an IP-based system represents on average 13 percent lower cost than a corresponding analog system. For a further explanation of IP’s dropping costs, see “4 Reasons Why IP Surveillance Cost Keeps Declining.” 

Falling prices are leading to increased sales of smaller IP systems.

“In the past, only large camera installs were considered but now, thanks to lower price points and increased product knowledge at the dealer and end-user level, we are seeing IP camera projects with less than eight cameras on a regular basis,” says Tony Sorrentino, vice president of sales, ScanSource Security, Greenville, S.C.

Cost has always been one of the noted barriers to IP’s growth over analog systems, but in 2011 positive changes in that area and others are helping IP continue to push into analog territory.

“Analog sales/technology will continue to erode for all but the cheapest solutions. IP technology continues to be driven lower in price and will unquestionably kill off analog at some point in time. The pace of this transition, while still slow compared to other industries, is beginning to accelerate,” says Ian Johnston, chief technology officer, IQinVision, San Juan Capistrano, Calif.

In the upcoming year, network video surveillance equipment sales are forecast to continue to outpace analog video surveillance equipment sales (in terms of sales revenue), growing in excess of 20 percent compared with the previous year.

The debate of course, is when the market will tip to more IP sales than analog. At a global level, IMS Research predicts the tipping point won’t happen until 2015. Looking closer, IMS says the tipping point is 2013 in the Americas and 2012 in Europe, the Middle East and Africa.

The report lists education — both of end users and systems integrators — as a key catalyst in the transition. Integrators and dealers seem to be very aware of IP/IT training. In the Electronic Security Association’s “Electronic Security Megatrends Survey” released at the Leadership Summit held in Irving, Texas in January, IT/IP was at the top of the list for investments in their member companies’ infrastructure and human capital. When asked to project the trends for their company’s investment over the next two years, IT/IP training beat out all other answer selections with 40 percent of respondents saying it would receive an average annual increase of 40 percent or more.

Manufacturers and distributors are also increasing training opportunities in 2011.

“It is absolutely all about providing education and tools. As with many technologies, there is no free lunch. The obvious advantages of an open platform, IP video surveillance system come with a few more variables to consider when specifying. These considerations are not complicated, but it is essential they are understood,” says Pete DeAngelis, president and CEO, IQinVision.

In addition to education, advancements in cameras’ plug-and-play capabilities are also making them easier for companies to learn to install and also helps with installation times.

“Plug-and-play products incorporating internal diagnostics with reporting capabilities and the ability to be programmed via the network make deployment faster, while reducing downtime, and installation and service costs,” says Forman.

DOWN BUT NOT OUT

When discussing analog, Buddy Mason, owner of American Digital Security, an integration company, and DVR Distributors, Liberty, Mo., says “We are very big on megapixel and don’t offer analog that much. It is hard to offer a platform that is outdated the minute you put it in.”
Outdated, yes. Useful in certain applications and still a part of the market? Yes. Analog is still a strong part of the industry in 2011.
“Analog camera volumes are falling as an overall percentage of the total market. However, because of the extensive installed base of analog systems and the continued performance quality and value of analog cameras, the demand for analog cameras will continue to remain strong for the foreseeable future,” says Jason Oakley, CEO, North American Video, Brick, N.J. Oakley also points out that hybrid offerings are helping the two technologies play well together in 2011 and beyond.

At Hikvision, Hangzhou, China, Frank Ryan, vice president of sales, also sees end users continuing to take advantage of hybrid solutions.
“By using Hikvision IP cameras with analog outputs on an existing analog system, the customer can prepare for the future when they are upgrading a system that they believe will eventually be upgraded to IP. When the dollars finally become available to move totally to an IP/digital system those IP cameras can easily be switched to full IP mode,” Ryan says.

Linda Haelsen, marketing communications manager, Security Division, Americas Region, NICE Systems, Ra’anana, Israel, also points out, “Technologies or applications that can save on [total cost of ownership] TCO or provide [return on investment] ROI will gain faster adoption — for example, megapixel cameras that in some scenarios save costs or platforms that can offer effective migration from analog to IP.”

The way Lance Holloway, director of technology strategy, Stanley Convergent Security Solutions, Naperville, Ill. describes it, “Many design considerations make IP the clear ‘go forward’ technology; while well-integrated management software, to seamlessly and effectively tie in legacy analog technology, marries the two technologies together. Typically customers want to move toward improved technology while taking advantage of past system investments; though, [this year] many customers are now in a position that allows for a completely new solution.”

World Wide Security Group, Garden City, N.Y., formed by Ken Mara, president, and Joe Ingegno, vice president in 1979, is comprised of GC Alarm, Telestat Security, Rainbow Protection and Vision Monitoring. The company also focuses on value-added solutions and meeting customers’ needs. The company does it all — fire, burglar alarm, video surveillance, access control, video verification, UL-central station monitoring, sensor technology systems, life safety systems, Medi-Alert products, home automation and home theater as well as environmental controls. World Wide Security Group makes analog/IP decisions based on the individual customer, not a market trend.

“For the entry-level client we will stay with analog, while with the client who needs higher quality, we will focus on IP cameras and when the price becomes more cost effective, we will migrate more fully towards IP,” Mara says.

Branded, “the third way,” high-definition closed circuit television, or HDcctv, is another technology fulfilling end users’ demands for better images in 2011. IMS Research predicts that the release of more HDcctv-complaint products will impact the video surveillance market in 2011. Two key proponents of the HDcctv standard, Speco Technologies and Everfocus Electronics, both announced that they intend to begin shipping HDcctv-certified products in early 2011. In the long term, IMS Research also predicts that the significant OEM/ODM membership that the HDcctv Alliance has assembled could make HDcctv a viable replacement for standard analog equipment in the long term.

Benefits aside, HDcctv’s lack of integration capabilities and its slow growth and product offering hasn’t come fast enough for some.

“Due to the slow development of HDcctv and the fact that it is a proprietary system we have gone straight to megapixel,” says Mason.

SOME INDISPUTABLE FACTS

Integration is a leading end user concern in 2011.

“Technology integration has become increasingly important as users prefer to invest in a system that can perform multiple functions. IP surveillance systems are beginning to cross over into access control, intruder detection, alarm systems and more. Moving forward, these solutions will be also be able to connect with lighting, heating, temperature controls, etc. and offer centralized and remote management,” says Jen Przewoznik, North America marketing leader at ADI, Melville, N.Y.

As Bill Taylor, president, Panasonic System Networks Company of America, Secaucus, N.J., explains it, “Security is not a separate silo in today’s companies. Instead it is becoming integral to the broader enterprise operation. To continue to sell “security solutions,” would be to miss opportunities for video and other technologies to be applied to non-security uses and for the technologies to be interfaced and integrated with other, non-security systems,” Taylor says.
Also, as Bijal Thakkar, global director of security technologies, Johnson Controls Inc., Milwaukee, points out, “Integrated solutions are frequently cheaper than buying separate solutions with limited connectivity, and offer the bonus of a single GUI, reduced operating costs, better response time and increased efficiency. An integrated system offers buyers one-stop shopping and responsibility from a single source.”

Integration’s growth is predicted to only speed up.

“I have reason to believe that this pace of growth for integrated systems will be even faster than anticipated. The industry is starting to be driven more and more by the IT community as the servers and cameras get more IT-centric. This group is used to faster design cycles and will adopt/demand new technology faster than the traditional security market has,” Johnston predicts.

IT involvement in video surveillance systems will only grow in 2011.

“The involvement of IT personnel in the decision-making process for video surveillance systems continues to increase along with the adoption rate of IP video systems. IP video is continually evolving, and improvements in system design options and compression technologies have made these systems more acceptable to IT end users. These systems are becoming increasingly mainstream as IT adopts them as another aspect of their technology infrastructure,” Gundlach says.

As IT gets involved, the spotlight on standards gets brighter.

“One of the many positive ripple effects of the video surveillance industry becoming aligned with the IT industry is the acceptance of the need for and introduction of standards. This is because standards bring a solid foundation for the growth and regulation of the video surveillance industry; enable multi-market access; and, ultimately drive down costs for the customer by eliminating proprietary technology solutions. A standardized product can also be easily used in best-of-breed open systems and offers more options to the end user with regard to price and functionality,” Oakley explains.

Standards are a key growth factor in 2011. Most analysts cite an increase in standards as a key part of success in 2011 for IP — and the industry.

“One significant change is continued growth of Open Network Video Interface Forum (ONVIF) and the Physical Security Interoperability Alliance (PSIA) standards. Standards simplify the world, and they take the integration promise that IP has had for some many years and makes it into a reality,” says Marek Robinson, director of sales, Honeywell Systems, Coloma, Ky.

Holloway says, “Video solutions continue to experience strong growth in product breadth and technology innovation. To the customer’s benefit, industry standard operating systems on the controlling platform literally explode the applications of integration and feature capabilities for video solutions. Storage and analytics at the device, wireless IP connectivity and logical command linking are just a few examples of video technology advancements.”

He’s right. The growth of HD and IP is impacting growth and developments in other sub-sectors of the video surveillance market including analytics, remote video, lens technologies, intelligent systems, video management systems, encoders, receivers, transmission capabilities and more.

Intelligent cameras, or the use of video analytics on board IP cameras and video encoders, continues to develop. The analytics help control the bandwidth requirements of HD/IP videos because it only transmits over the network if the camera is viewing an actionable activity.

“In 2011, intelligent camera systems that incorporate a decentralized approach to surveillance will have significant impact on the market,” says Steve Gorski, general manager, Americas, Mobotix Corp., New York. “In a decentralized system, every camera incorporates a high-speed computer and long-term memory to provide several days of recording time. The PC and the video control center now serve only for viewing and controlling the cameras (PTZ), not for analysis or recording. This makes it unnecessary to purchase expensive video management software, as the most important and computer-intensive functions are already integrated within the cameras.”

Paul Bodell, executive vice president, Global Business Development, IQinVision, agrees, saying, “The camera will become a processing device for other applications, and analog systems will fade into the dim mists of the past.”

Analytics also now offers a business argument that is sitting well with end users.

“Now, IP cameras are not only used for security and surveillance but with analytics, video becomes a management tool to optimize business operations. This intelligence enables the cost of a video surveillance system to be spread across multiple departments with a retail organization because now marketing and human resources can tap into the value of video,” says Gorski.

Video software as a service (VSaaS) is also predicted to do well in 2011; the added business services it can provide end users is a reason for the growth. IMS Research lists end users with multiple sites that each require (four or less) cameras as the most successful upcoming area of growth.

VSaaS lets the industry meet end users’ specific needs. Companies such as World Wide Security Group are adding it to their offerings.

“We have introduced a new service called iVision24, by Vision Monitoring, our UL-listed central station — the monitoring branch of the company. iVision24 is custom designed, tailored to the customers’ specific security needs and more advanced than the basic CCTV service/product offering,” Mara says.
The technologies, products and standards are falling in place, but what about sales?

As Sorrentino explains it, “A general uplift of the economy overall and the comfort level for IP-based solutions is much more positive and will drive more business. There is also pent-up demand from 2009 and 2010. Companies were greatly concerned about the economy and kept spending at a minimum. Most people believe the worst is behind us and 2011 should see a significant increase in spending. No one wants less security than they did a year ago — everyone wants more, especially as price points come down. That, with the continued enhancement of the benefits of IP, the increased knowledge and the continued education, will all play a role in the continued growth and evolution of the video surveillance market.”

Johnson Control’s Thakkar says, “Video technology continues to improve in versatility, speed, image quality, storage efficiency, and affordability, which opens opportunities for new and existing CCTV users.”

 With continued product releases and integration, along with the increase of standards, end users and integrators can create more fully intelligent video systems with better design and more functionality.

“Video systems remain a tool that is effective in preventing and fighting crime and enhancing life safety. Our clients realize CCTV can perform many important tasks that are necessary to keep operations running efficiently. Camera systems are relied on more, in so many settings, and technology keeps getting better while price points continue to be affordable. More and more clients realize these systems can be a real benefit to them,” Mara says.
Video really can do more than ever in 2011 from analog to IP, from A to Z.