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Peter Strom, President and CEO, March Networks

Message from the CEOTracking Trends

By Peter Strom, March Networks President and CEO

Taking the time to reflect on where our industry is at — and what is likely to happen in the future — is important for all organizations, including March Networks. While much of this happens daily in the regular course of business, our company also makes a point of stepping back each year to assess our overall performance, finalize our strategic plans for the year to come, and communicate our key objectives to all employees.

Understanding market trends, and their potential to influence or disrupt the industry, is critical to that planning. Below are just some of our predictions for trends to watch for the rest of this year and into 2020.

Finding the potential in analysis technologies

No one will be surprised to see artificial intelligence (A.I.), computer vision and similar content analytics listed as a major trend shaping the physical security industry. Solutions employing A.I. (performing a task that would normally require human intelligence) and / or computer vision (extracting, analyzing and understanding information extracted from digital images or video) are everywhere. And most would agree our industry has only scratched the surface in terms of their potential.

While many companies are focused on the efficacy of these analysis technologies, there’s been less discussion about how to best leverage them in real-world applications. Ensuring the accuracy of these products is certainly a must, as no one wants to repeat the cycle we saw with security analytics a decade ago, when their promise initially fell far short of expectations.

With A.I., computer vision and similar content analytics, it will be interesting to watch the companies that move beyond proving viability for security purposes to deliver true business applications to the market. Right now, we’re seeing organizations working hard to develop content analytics that perform in an effective, efficient and accurate manner. Many of these organizations are true A.I. and/or computer vision companies, and they are spending a lot of money developing very advanced algorithms. However there’s still work to be done identifying the real benefit of these analytics for customers as part of comprehensive business intelligence solutions. Until that happens, and customers understand how those benefits apply to them directly, adoption will continue to be lower than all the marketing hype would suggest.

Anticipating cloud uptake

Another trend that will continue this year is the push toward centralized cloud storage, particularly in enterprise organizations. Expect to see more hybrid solutions on offer, incorporating both on-premise storage and cloud storage for the retention of critical data for longer periods.

Despite the buzz around cloud solutions the last few years, uptake has not been significant to date for several reasons. A majority of cloud solutions in the physical security space are pure cloud solutions as opposed to hybrid solutions, and many organizations have yet to embrace the costs and understand the benefits.

Most corporations considering a cloud solution today are focused on leveraging cloud storage as a backup to on-premise storage in the case of a hard drive failure, or for archiving video for an extended period. But that’s only the starting point for the power of centralized data. The real benefits will be clear when organizations start applying cloud-based analytics to enhance business intelligence and improve operations including inventory management, marketing and customer service. Expect this to be a growing theme this year and into 2020.

Access to affordable bandwidth will also help with cloud adoption. While bandwidth remains an issue for some organizations, it’s becoming less of a barrier as enterprise customers continue to update their networks and capacity.

The influence of GDPR

Data protection will remain another key focus, especially following Europe’s General Data Protection Regulation (GDPR), which came into effect on May 25, 2018.

The GDPR has impacted not only European organizations but most organizations doing business in Europe. Whether you’re a bank based in Dubai or a retailer headquartered in the U.S., more than likely you’re touching European soil at some point, and therefore you must follow GDPR legislation. It’s now clear that the regulation is casting a much wider net than some anticipated. Expect to see a stream of announcements from manufacturers through this year as they continue to enhance and offer new features to customers to support GDPR compliance, or play catch up in some instances.

In addition, we will certainly see other jurisdictions issuing their own versions of data protection legislation. California, for example, passed a similar Consumer Privacy Act in June 2018. Often considered a bellwether state, California’s Act likely signals the start of more data privacy legislation to come across the U.S.

New software entrants

A final industry shift to track is the entry of new companies in the physical security space. As I noted earlier, there are a number of startup companies focused on A.I., computer vision and similar analytics appearing in our market. While the majority of them likely won’t make it as standalone companies, many of them will be acquired by larger organizations looking to enter the video-based business intelligence space and/or accelerate market penetration. Because data analytics are becoming such a significant component of today’s ‘big data’ solutions, watch for a number of large, enterprise software companies to start focusing on the security industry. This shift will create a huge disruption in our industry and cause further consolidation.

These are the trends we are tracking, following what I would describe as a pivotal past 12 months. We are experiencing a moment ripe with opportunity for companies with a clear vision and the ability to correctly anticipate and execute on future market.

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