Volume 38

Volume 38 | December 14, 2023

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PSS: If you plan to be at Intersec in Dubai January 16 - 18 or want to be, please let me know, as I will be curating and activating the Thought Leadership Pavilion. It will be 2 full days of presentations, conversations, content creation, and a new spin on this conference. It is one of the biggest and best shows. Thank you, Galaxy Control Systems, Wavelynx, Veris, and HID for signing up! We have room for 2 more companies to join us. Here is an image of the Thought Leadership Pavilion:

A Review of the SIA 2024 Megatrends Report

A Bit About Trends Reports

Trends reports like this are tricky because they are imperfect and depend on your own story, which either supports, enlightens, or contradicts your point of view, and the timeframe of trends is also typically debatable. Is it now? Already past? Or ahead? 

In all accounts, it depends. 

And just like the Genetec and Gallagher Security trends report I wrote about in a prior Brief, it depends on who the authors ask or their preview that usually leans towards or away from specific trends. 

It doesn't mean that a trend not listed isn't valid. It just means it needed to be more valid and recognized by those creating the report or supplying information for the report. There is also a limitation to how long you want to make reports like this, so some things never make it onto the report. 

A good example is my own 2023 Trends that Matter or "The Inevitable" presentation I've been giving. Although I identified 16 trends shaping our industry, it's not inclusive of ALL the trends. 

Does that make my list wrong? No. It also doesn't make it right. What it does do is provide several benefits that make all of these important: 

Market Insight: They offer a comprehensive view of current trends, helping businesses understand market dynamics.

Strategic Planning: Enable companies to align their strategies with emerging trends.

Risk Management: Identify potential risks and opportunities in the industry.

Innovation Trigger: Inspire new ideas and innovation by highlighting cutting-edge developments.

Competitive Edge: Help businesses stay ahead of competitors by adapting to trends early.

What Do I Think?

Here is a summary and some of my thoughts on what SIA lists as the Megatrends for 2024:

🤖 AI: Security of AI: Discusses the balance between trust in AI, its ethical application, and maintaining cybersecurity. It might include examples of AI in threat detection and ethical dilemmas in AI usage.

My thoughts: I'm not sure how I understand the give-and-take approach around ethics, trust, and cyber security as I believe the answer is "yes to all," but there is an injection of conversation that needs to happen around ethics and trust, not only in AI but in the overall discussion of how our technologies are applied when we start moving to let the right people in and how are we doing that with ALL people in mind. I don't know where these conversations are happening or who the experts are within all the different companies having these conversations. Cyber security, ethics, and trust must be inherent in our industry function. The question I have is whether it will get in the way of business, and when organizations in our industry get to those crossroads, I'm curious to see how and what decisions are made. 

🎥 AI: Visual Intelligence, Not Video Surveillance: Focuses on how AI is advancing beyond traditional video surveillance to analyze various sensory data, like audio and thermal imaging.

My thoughts: Video surveillance is not my expertise, but as I look at access control, smart lock, and advancements in AI within visual intelligence, this is in line with the trend that I'm tracking that says every access control company is a video company and every video company is an access control company. This is especially true regarding computer vision, as we need high levels of assurance and three in-use cases, such as the lobbies of high-rise city buildings. The only way that I see this happening is with the advancements around the integration between video and access control, and the technology that will harness the value creation is AI. 

🚀 AI: Generative AI: Examines its role in security, content creation, and streamlining business operations, possibly citing instances of AI-generated security protocols.

My thoughts: This trend is probably one of the largest ones on this list that will start to have immediate impacts. The advancements we will see in every aspect of the industry, whether creation or business optimization, and workflow optimization, cannot be understated. We've never seen a technology introduced that will make advancements in our products exponentially better and impact every aspect of our business, from sales to marketing to product management to accounting. If we think the cloud will affect our industry, wait until we see AI and the pace and depth that it will go. 

👩🏽‍💼 AI: Regulation of AI: Looks at the evolving legal framework governing AI, including data privacy laws and AI accountability.

My thoughts: No doubt this will be a trend that impacts their industry, but it goes beyond AI as we start to look at the regulations around biometrics. As our industry goes into a more mainstream framework, governing bodies will continue to pay special attention to how our products and services are applied to the general public. From what I've seen so far, the dystopian views are much greater and louder than the utopian views, and as an industry, having clear collective points of view, both good and bad, will be even more critical than ever. We have been engaged with governing bodies and regulatory institutions, but I believe this trend will increase, and its outcomes will be global. Can we keep pace both in ideas and resources to have a prominent seat at the table?

💰 Expansion and Evolution of Security's Return on Investment: Highlights how security solutions offer value beyond basic security, perhaps through examples of integrated systems enhancing business efficiency.

My thoughts: If there's any trend in this report that I'm excited about, it is this one. At the access control executive brief, I talked for years about the idea that our industry needs to move beyond its important value proposition that it's done for the past 30 years and move to an exponential value story that goes beyond keeping bad people out, locking and unlocking, and focused on operational efficiencies and revenue generation. We love our TCO calculators, but we need to get equally in love with our ROI calculators. The companies that do will have at least four laps around the track, and it'll be more challenging for those to catch up than ever before. 

🛠️ Security as a Service, the Models, and the Evolution of the Integration Business Model: Discusses the shift towards service-based models in security integration, showcasing examples of how this model offers flexibility and scalability.

My thoughts: This one reflects the legacy part of our business, and I'm not sure that this matters as much as we say it does. What matters more is the separation that we will see between the companies that support SaaS models and those that do not. This will be the story of haves and have-nots. It will become ever more challenging for those who wait to introduce SaaS models because of the volume needed to generate enough revenue to matter. We're an industry that struggles to see the hockey stick growth of organizations, so it just takes time. I am not saying that there won't be some. Still, realistically, if you have 1 foot in the old and one foot in the new, those who have a big foot in the old and try to add on SaaS models are going to struggle for 10 to 20 years, while those who build cloud-first, AI-first, mobile-first, and with SaaS models at the core, will see rapid growth. The clock is ticking on this one, and the longer you wait, the harder it will be. That, to me, is the bigger story. 

💻 Impact of the Megatech Companies: Explores the influence of large tech companies in the security industry, possibly highlighting partnerships or market disruptions.

My thoughts: This is another area that can be underestimated. I believe this makes a significant impact for two reasons. Number one, the mainstream megaphone these companies bring and the force with which they can create what they want is undeniable. Second, they have time and money. Most companies in the industry do not have a megaphone. They also do not have the time or the money. The biggest impact I believe we will see from this trend is going beyond the shifting value arbitrage of our traditional business and areas that we made money for years off of to the areas where they make money. Still, the bigger impact, in my opinion, is the "feature-ization" of our industry. What I mean by that is their impact will be felt in the fact that they will be able to bundle our industry into a larger value proposition. Because they can make money elsewhere, they're not concerned about making money with what we do. Specific verticals and certain areas of our industry are not that interesting ($$$$), so they will need partners to get to market at the scale and depth required. Still, if we don't have a clear point of view as an industry and believe that by delaying, we will stop this title wave from impacting and changing the structure or industry, then you are foolish. They are like water, and where they find the least resistance, they will go, and again, they have the time and money to wait it out. Now, I'm more optimistic about this impact on our industry, and I am all for it. So please don't take my text as being negative. It's only negative if you don't do anything about it. Those who do something about it will find that the addressable market and revenue opportunities are much more tremendous with them than without them. 

☁️ Cloud Consolidation: Addresses the impact of dominant cloud hosting players on security, including challenges and opportunities.

My thoughts: My biggest fear with this trend is that for every dollar our industry makes, 30%(?) will go to these Megatechs and cloud providers and the depth of data they will have. How this plays out will be interesting to watch, but if we take the recent AWS news and go deeper than the palm vein reader they showed and look at the services they now offer natively in AWS, are we at the beginning of a new dawn where it is easy to create an access control system using their services or are we at the dawn where it is easy to Incorporate access control functionality into other services and ever-expanding the featurization of our core offering? Short answer: yes. 

As I was quoted in the report, "The global security industry is in the midst of a profound transformation, transitioning from a hardware-centric model to a software-centric paradigm. With the emergence of cloud computing, mobile technology, and artificial intelligence, the industry has evolved beyond its traditional role of providing safety and security. It has become an enterprise software industry that drives operational efficiencies and generates revenue on top of our core value proposition. This shift has attracted major players in the tech industry, such as Apple, Google, Microsoft, and Amazon, who are disrupting established norms and introducing innovative concepts like Mobile Wallets, scaled credentialing, and expansive ecosystems, which integrate our industry into a broader value proposition and in some cases, is making core disciplines of our industry a feature."

🏢 Real Estate Reoptimization: Integrates security with real estate efficiency, potentially showcasing smart building technologies and integrated security systems.

My thoughts: Without a doubt, this one will make an impact. Given that all our products go into the built environment, if the built environment changes, then so do we. To what degree and to what extent are what debates are made for. But I believe what is being asked of our products and services is changing, and we can't rest on the last 30-year-old use cases to drive our fit for purpose in the real estate market. One way to get ahead of this? Please go into the market and see it first hand for yourself.  

💾 IT-OT Convergence: As IT and OT systems converge, edge devices are no longer isolated, and OT systems are integrated into a company's data environment. This convergence creates more extensive, complex networks, increasing cyber and physical risks. The security industry has an opportunity to provide value in addressing these risks, shifting from the physical to the logical safety and security postures.

My thoughts: No doubt this is a trend, but I find it not as exciting or impactful as the impact enterprise software is having on our industry. The IT-OT convergence conversation is a subset of the broader digital transformation enterprise software has on our industry. IT-OT convergence gets much attention because of our systems' shifting use cases and responsibilities. This shift is not happening because of IT; it is happening because we are moving from a hardware to a software industry. 

In Conclusion

In conclusion, the "2024 Security Megatrends" report by SIA will spark insightful conversations within the industry. While trend reports like these are subjective and dependent on individual perspectives, it is valuable.

It is essential to view these trends as data points that can drive meaningful conversations within your company, with customers, and with the ecosystem, both internal and external to our industry (see my points on having points of view).

While the report provides valuable insights, it is also crucial to consider perspectives from outside the industry to avoid being confined to a narrow viewpoint. By embracing these trends and engaging in open discussions, we can steer the industry toward a future of innovation, collaboration, and enhanced security.

With this in mind, let's use this and any report like this as a starting point to explore new possibilities, challenge existing assumptions, and shape the future of the security industry.

I'd love to know how you leverage these trend reports in your business. Please let me know, as I'm sure the collective awareness would help others and yourself make this process more effective.