IBM eyes video-surveillance business

NEWS

Looking to cash in on the increased focus on physical security, IBM announced on Tuesday that it will push into the video-surveillance systems market. The company feels its expertise in computer systems and data analysis will quickly gain it customers in the market, which continues to shift from analogue to digital systems, as government agencies and companies focus on getting more security out of their surveillance systems. "It really boils down to the management of data which is complex," said Mike Maas, vice president of marketing for IBM's communications sector group. "The ability for us to apply digital services and capabilities to security applications will lower cost, (and) these kinds of things can greatly enhance security." In the current tech malaise, the strategy could help the technology and consulting giant grab a significant share of an estimated $5bn (£3.1bn) in video-surveillance revenue expected by 2005, according to market researcher J.P. Freeman. While IBM bills the move as mainly a new service the company can offer to clients, Big Blue stands to see increased sales in other related products such as high-end storage systems, network systems and a variety of software applications, Maas said. The main benefit IBM brings to the table, Maas added, is its expertise in handling digital data. The company's technology -- from research into image and voice recognition to mining information from large databases -- can augment the capabilities of equipment that many companies already have in place, he said. "We don't tend to get into things in a small way," he said. "We see this as a big opportunity, and we see it as a big business." The move is also a way for IBM to be all things to its client, said Joe Freeman, principal analyst and chief executive at J.P. Freeman. "It puts them closer and closer to a one-stop shop operation, which in the case of IBM is what they want to be," he said. The analyst believes the new service, which will be staffed by consultants picked up by Big Blue in its $3.5bn acquisition of PriceWaterhouseCoopers last year, will be one of many services the company will offer its consulting clients. IBM's information technology focus will be both a benefit and a hindrance for the company, Freeman said. While integration into current information systems and networks could reduce costs, many security systems are still run by old-school chief security officers, not as part of the IT department. "It's kind of breaking into a new culture that (IBM) may or may not understand," Freeman said. "If...a security executive is in charge of the system, and they don't want to use the IT network, it might take (IBM) a little longer to sell to clients. Instead of getting right into it on Monday morning, it may take until Thursday." IBM acknowledges that getting up to speed will be a task. "Clearly there is some mind share that we have to gain over time," said IBM's Maas. "As we build some business, especially with big customers, we are hoping for word of mouth as well." Despite the hurdles to overcome, the company thinks the new market will still be business as usual. "It is a fairly straightforward business development task for us," Maas said.

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