What Happened to the Predicted Mass Extinction of Security Dealers?

The world is rife with apocalyptic predictions. Let’s start with Y2K. At the stroke of midnight on January 1, 2000, analysts predicted that entire computer networks would crash, causing mass chaos for our global population since we were wholly dependent on computers. Aside from a few power issues in several countries, the new century arrived with nothing more than the typical hangover.

In the mid-2000s, when IP network convergence was in full bloom, another disaster prophecy was issued: IT systems integrators would enter the physical security channel and, like the dinosaurs 66 million years ago, security dealers would become extinct — changing the course of the industry forever. Doomsday was looming.

Let’s go back a few decades to see why we anticipated this.

The IP camera was invented in 1996 and by the mid-2000s, everybody was talking convergence. The realization that IP would disrupt, and ultimately replace, traditional analog brought with it the provocation that IT systems integrators would transform the status quo.

After all, the telecom industry’s migration to VoIP and subsequent mass absorption into IT presented a foreboding example that was difficult to ignore: security dealers were toast. We all thought so.

Over time, as security technology did give way steadily from legacy to IP, security integrators began to hire new personnel with the necessary networking skills to augment their existing business model. We can now look back at that time and see the dramatic impact of network-centric technology in our industry.

A host of new skills were needed to implement the new technology and help it deliver value. the technology itself cannot do everything; it requires someone with a unique skillset to install and operate it. Without question, the technical capabilities of the systems integrator evolved tremendously during this time.

Incredibly, we do not see the predicted mass extinction of the traditional security channel! The great threat of invasion from the IT integration world never materialized. So what kept that change from occurring?

I have a pretty solid theory why this never happened because I experienced it first-hand.

When I was at a VAR Business 500 IT integrator in 2004, we became an early adopter of IP video. With our background in switched infrastructure, IP telephony, and all other things IT, we chose to explore new margin opportunities with IP cameras and video management software.

We dove in headfirst and became a leading reseller and integrator of Axis cameras and Milestone software. It made a lot of sense for us; we sold compute, storage, switches, and labor alongside cameras and VMS. We had never sold one analog camera or DVR, as there was no legacy in our business whatsoever. We were good at IP video management. All was well in our world.

That early adopter success with Axis and Milestone gave visibility into the industry. Leaning on that vision, in 2007 I took a new job with Milestone Systems in a sales role. I spent that year traveling 17 states, meeting security integrators and preaching the gospel of IP technology. I met a lot of great people and was exposed to a variety of legacy technology.

And then I made the most amazing of discoveries: The Altronix low-voltage power supply!

You see, in my former work at the IT integrator where we added IP cameras and VMS to our portfolio, we hired third-party electricians on every job to install the external cameras. Those cameras were in exterior enclosures with heater-blowers. They operated on 24 volts. We instructed the electricians to run a 110-volt line to these enclosures and step it down to 24 volts at the enclosure. We were clueless about this.

And please understand, we had every Cisco certification possible, platinum status with HP and IBM, sold every form of IT equipment available, and did sophisticated implementations of technology — but we had never heard of an Altronix power supply.

Of all the amazing technology influences on security over the last 20 years, the importance of the low-voltage cable and the bucket truck — an apparatus not utilized by IT integrators — remain the great irony in the evolution of security technology to IP.

Of course, there are many specific skillsets that define the integration channel in security, but it is these two rather simple elements that I find are a key to what never really happened: the mass extinction of security dealers.

Perhaps it is these same lessons from the past that new entrants are learning now?

Today, we have industry outsiders making bold claims about many in the industry, using expressions such as “dinosaurs” when referring to the technology and our channel. They are likely believing that another mass extinction is on the horizon.

I take that with a grain of salt — and a few learnings along the way.

by Tim Palmquist, VP Milestone Systems – Americas

For a link to the full article, please visit SDM Magazine’s blog.