Is video monitoring a money-making proposition today? It depends on who you talk to. Those that are doing the best at offering it all have one thing in common: They are using a systematic approach to everything from choosing what to offer, to how they incorporate it into their business, to how they set up the cameras and train their operators.
There are several different ways video monitoring can be offered, but some of the most common are video guard replacement, video alarm and video verification (see “What’s in a Name,” page 16). Many dealers with central stations as well as wholesale central stations offer more than one of these services, but there are also those that specialize in one or two — often those that began as a guard replacement service. While some of those that have added video to an existing monitoring service have had a tougher time.
“In 2009 we bought a video monitoring platform and announced to our dealers that we were in the monitoring business to handle all of their video needs,” recalls Mark Matlock, senior vice president of sales and marketing for the wholesale central station United Central Control Inc., San Antonio. “We had a limited adoption of video. It was very slow. The main technology that did come online for us was verification from Videofied. We did a fair amount of that. The majority of the video we are doing still is verification, about 70 percent.”
Most who do all types of monitoring report that the video portion is still very small, in some cases less than 10 percent. But it is growing at a faster and faster rate.
“A tiny percentage is video right now, probably about 200 video monitoring accounts out of 230,000 total,” Matlock says. “It is a fraction of our business, but a growing part. It has accelerated more in the last two years than all the years before that.”
Video guard replacement is much more labor intensive, says Rick Charney, vice president of sales, Stealth Monitoring, Dallas. “We are looking in earlier in the cycle of an event and we have labor looking at those cameras to determine the intent and nature of the situation, as opposed to waiting for technology to alarm to a central station and get labor involved in the event.”
Viewpoint Monitoring, Lowell, Mass., has also been doing video-only monitoring for about 10 years, says CEO Brad Gordon. For his company, verification is the smaller part, less than 10 percent, he says. “Half of what we do is proactive monitoring, or the actual guard replacement where we are proactively patrolling properties following the customer’s protocols and doing what a guard would traditionally do.”
That is down from 100 percent when he started the business, particularly with the advancement of analytics technology. “Now it is 50/50, with the other half being event-driven in response to a phone call, analytics or [video] motion detector. But in reality almost all of our accounts are a blend of the two. Even if we have an account that is primarily event-driven we will do some number of proactive patrols every day to make sure the system is healthy and working.”
Nik Gagvani, general manager for CheckVideo – a Kastle Company, Falls Church, Va., says there is a lot of confusion out there about what video monitoring means. “We see video verification being when a traditional alarm sensor such as a PIR or beam break or fence sensor triggers an alarm and video is used to look in and verify the cause. Video alarm monitoring is when the camera itself is the detection device, typically with the use of analytics on the camera itself or the DVR it is attached to.”
Check Video was purchased in 2013 by Kastle Systems (SDM’s 2015 Systems Integrator of the Year), which does quite a bit of video monitoring, according Thomas Tardiff, director of the operations center for Kastle. “We have about 1,000 cameras where we are doing video motion detection. We are looking at yards and fence lines and outdoor perimeter areas. Those events go to an operator, who views the clip and live view and makes a decision based on what they are seeing.”
Wholesale monitoring company Acadian Monitoring Services, Lafayette, La., monitors about 5,000 cameras out of 160,000 accounts, says Director of Operations Brandon Niles. Like many others, he views video as an up-and-coming revenue opportunity.
“Maybe 5 percent of our business is video, but revenue-wise it is closer to 15 to 20 percent,” he divulges. About 1,500 of those accounts are verification while the other 3,500 are interactive monitoring, which commands higher premiums, he explains. However, of Acadian’s dealers that are selling video monitoring, the company has around 50 to 75 dealers doing it but “90 percent of our accounts really come from five dealers that are really growing.”
Niles points to the “CSI effect” as one reason video is beginning to take off. “Video cameras and analytics keep getting better, and better priced; but it is also the people watching those shows on TV where they see cameras doing incredible things that we really can’t do, but it is getting that idea out there.”
Consumer demand means more dealers are being asked about it, which in turn means they are asking their monitoring service provider to support it. With video technology advancing by leaps (if not yet to CSI standards), bandwidth requirements going down and the proliferation of the cloud, more and more are finding themselves faced with video monitoring. Knowing how to do it effectively, efficiently and profitably is the key to making it work.
Setup & Training
Whether you are using video as a whole or part of your monitoring service, the training and setup is different — sometimes vastly — from the traditional alarm world.
“Video monitoring takes a different type of training because you have to make decisions based on what you visually see,” says Anita Ostrowski, vice president of central station services for Vector Security, Warrendale, Pa. (SDM’s 2015 Dealer of the Year). “In video monitoring when an alarm goes off you look in to see if you can find the cause of the alarm. If you see a person standing there, there are a variety of different actions you can take.”
Often those actions are dictated by the customers themselves and may include calling or texting particular people, calling the police, or even “talking down” to the person on the video to let them know they are being watched.
“Audio is another thing that differentiates what we do,” Gordon says. “Operators will actually patrol, say, a shopping mall in Texas, and make announcements from each camera that we monitor saying ‘Good afternoon shopping mall; this is a live video patrol,’ and it lets everyone know the property is being watched.”
With greater responsibility comes greater pay, in most cases, and the need for greater training.
“In a traditional alarm you get the signal and take the appropriate assigned steps,” Ostrowski says. “In video, you have to get a person who is focused and can really look at what they are seeing. The length of time [spent on the alarm] needs to be longer. They may need to compare it to a map, or click on other cameras to see the scene better. It is our more senior operators who get trained on that. They have to have at least 90 days on the floor before they can get into video.”
Charney says he tends to hire operators with experience, such as part-time police officers, retired veterans and public transportation dispatch center employees. “Training is extremely important,” he adds. “At the end of the day we rely on the people. We met with police stations with their own dispatch centers and had them help us with our training manuals.”
Acadian keeps its alarm and video operators separate, for the most part, Niles says. “Video is a higher level operator. We look for police or military background or really high caliber people. All usually have some background in recognizing suspicious activity. They spend two or three weeks learning the site they are protecting and knowing the staff and just getting that familiarity. Suspicious at a car dealership might be different than suspicious at a restaurant. Our dealers are also helpful with that, often providing maps and insight or even a background story.”
Kastle video operators are paid on average a 10 percent premium over their regular alarm counterparts, Tardiff says. “They were regular operators first and they know how to process alarms and how the systems work, then they get additional training. We also bring some people from the outside with backgrounds in it as well. We have a training course where we literally have hundreds of alarm events we run them through and make sure they are seeing what we want them to see.”
No matter how good the operator is, they can only see what the camera is installed to view, so many monitoring facilities work extremely closely with their installers or installing dealers to get things just right.
“Our installation process is incredibly intense,” Tardiff says. “We set the camera up during the daytime, then come back at night when it is pitch black and there are lights and other anomalies and reflections, and we make adjustments. Even during different times of the year we might have to go back and make adjustments.”
How a camera is set up varies according to what the monitoring center is looking at and the type of monitoring they are doing. If the camera is angled too far away, there might be too many “false” alarms, Niles says. “Camera placement is just as important as being able to adjust and fine tune your analytics. When you put a camera up, depending on the area you are monitoring, you don’t want a roadway, for example. We recommend to all of our dealers when they are setting up an account to put the camera on for at least three or four days in a testing phase so we can see what analytics come in. We don’t tweak in the daytime. A lot of things change at night. Depending on what you are looking at you want to make sure the analytics can pick up a human or a car but not a deer or raccoon.”
That might require a tighter focus, Ostrowski says. “Cameras have to be very focused so we get video that makes sense. Our monitoring department works with the installers and technicians as they are installing to say, ‘What am I supposed to be seeing here?’ We don’t just take a camera and aim it across a parking lot where people are walking or driving.”
Installation errors are the “ugly underbelly of video monitoring,” Matlock says. “When you are getting information from the camera alone it can go crazy. So many of these accounts that weren’t installed very well we are seeing too many squirrels and the central station unfortunately has to look at all of that. It can get very expensive. We charge for overage, which motivates the dealer to do a better installation.”
Matlock says they do work with installers on the setup, but don’t tell them where to point the cameras. “We actually have a list of best practices we share. One of the key things, particularly with video verification, is you don’t want a wide field of view. If you are protecting an air conditioner, just point it right at that. We don’t want to see birds flying or clips of nothing.”
For Kastle, however, that is exactly what they expect to see, as they frequently monitor outdoor open spaces like car lots and junkyards. Often what they are seeing is wildlife, which they are trained to quickly note and dismiss, Tardiff says. “It is outdoor space so they are watching rain and snow, or watching Bambi walk through like Mutual of Omaha’s Wild Kingdom. But that is how you protect an outdoor space.
“Realistically the state of commercially available video analytics cannot tell the difference between animal motion and a human walking at 100 yards away. We have 100 sites and we have had one apprehension and a couple of close calls in the last year. We need to see a person from the waist up moving by a car. If you have the video in so tight that you don’t see Bambi, you might not see that person either.” (For more on analytics and other game changing technologies see “Software & Technology Are Moving Video Monitoring Forward” at www. SDMmag.com/video-monitoring-technology.)
Making a Go of Video
Only you can know for sure if now is the time to get into video in a small or big way, but the experts have several pieces of advice if you are thinking of getting in, or expanding your current capabilities.
“Honestly it is not something we are super high on right now,” Matlock admits. “We are doing it to support our dealers.” However, he is hopeful that with the current trends of advancing technology that in five years his opinion will change. One thing that needs to happen — and something he highly recommends to a company getting into video monitoring — is to do it with more purpose and planning, whether they are a dealer with a central station or a wholesale monitoring company that works with dealers beginning to sell video monitoring.
“Today many dealers are doing it to fill a need for the customer, often in onesie or twosie situations. There is no written plan to go attack video; but if they really want to be in the business they should do that. Most of them are accidental. It all begins with dealer education. Facilitating these one-off needs is a force-fit every time and the dealer has no clue how to set up a video account for false alarm reduction, because that is not what they do. We have held training classes where manufacturers showed them how to sell to the customer and what is the proper way to install, sell the value and set it up correctly. That to me is the most important thing if we are going to succeed in unison with our dealers out there. It is currently being implemented in a haphazard way, and there needs to be a cohesive plan to go forward and make this profitable.”
Jeremy Brecher, vice president of technology for electronic security, Diebold Security, Canton, Ohio, agrees. “If you do it right and have the right customer base and can scale it, then it is definitely profitable. We aren’t being pulled into it. Maybe some of the traditional alarm companies are, but we are trying to lead into this.
“Video is a huge piece of the future of almost everything. It is going to be the future of security and … it is important to find a model that works for your customer base. Standardize as much as possible. Look at it in terms of whether there is a need for it.”
Gagvani adds, “If done right it is a great investment. But it is not a matter of ‘If you build it they will come.’ The most successful companies are proactive. Others say they will monitor anything their dealers want them to, which causes disappointment all around when they get a lot of false alarms.”
Guard replacement-type video monitoring is probably the most challenging to get into, Charney says. But it can be very profitable for those that do it. “We have grown our business from less than 10 employees to more than 145 focusing exclusively on the real-time video monitoring,” he describes. “We think it is a good space to be in, but whether they should get into the space is very much a case-by-case scenario. It is not easy to immediately adapt with real-time service versus an alarm-based service.”
Those who offer video-only strongly suggest doing video as a completely separate offering for that reason. “As much as they seem like they are the same type of business, once you bring them both in-house it is really like two separate businesses,” says Daniel Forrest, president, Eyeforce Inc., Houston, a wholesale monitoring company that specializes in video-only monitoring.
“With burglar alarm monitoring there is relatively little training and personnel involved,” Gordon adds. “What we do is incredibly labor-intensive. We have 100 employees that go through two weeks of intensive training before they ever set foot on the floor. When companies attempt to add something like this on, they often fail. It seems like a logical progression for them to get into, but it is a very different infrastructure and business model. A monitoring center is low labor. Ours is high labor.
“But it is what people want. It is a proven trend. If you want to do it you need to commit. You can’t fit this square peg into a round hole of a burglar alarm central station. It is a completely different animal.”
Verification is a different — and perhaps easier — path, says Donald Young, chief information and operating officer for Protection 1, Romeoville, Ill. While guard tour offers a higher revenue potential, it is a more difficult path to entry. “When we rolled out video verification, the operator just had to make a judgement call based on that eight-second clip. I started PPVAR (Partnership for Priority Verified Alarm Response) for the express purpose of coming up with a standard, and three-and-a-half years later we finally have that. Video verification was meant to be handled the same way companies handle traditional alarms.”
Young adds that for a little bit of extra effort, the margins can be worth it. “This wasn’t profitable [for us] when we were just bringing up live cameras. The reason why it is profitable now is we are just asking our operators to render a little more judgement for eight more seconds of their time.”
He suggests becoming informed on what is out there, which vendors offer what, and what works or doesn’t. “If you can’t monetize it, what’s the point? I suggest talking to other PPVAR members who are actively engaged in this.”
The CSI mentality may be what is driving things, but a realistic expectation — at least from the dealer and central station’s point of view — will go a long way to making it successful, Tardiff adds. “Look at what the real cost is. You have to realize your labor cost per alarm is three or four times what it is for a traditional burglar alarm.”
Niles agrees. “It is profitable once you get to about 1,000 cameras. If you don’t have that much, or if you just do video analysis mixed with regular alarms, you either have to have one big customer that makes it worthwhile or expect to lose money for a couple of years. For us, we built it eight years ago and we weren’t making any money the first four or five years. We knew it, but we believe in it and three years ago it took off and has grown ever since.”
Niles offers this further advice for wholesale central stations: “Go into it with the mindset that it is a true partnership with the dealer. We have been able to successfully not charge for excessive signal fees because we let them know when it is going bad, for example. At the end of the day it is about providing quality service to the customer, which is really what matters. When you treat dealers with respect, that good relationship will flow over to the customer.”
What’s in a Name?
There are four primary types of video monitoring, although there is not always consistency on what those are called or how they are defined:
1. Guard replacement(sometimes called real-time, proactive or interactive monitoring) — watching the camera all the time, or making specific rounds using the camera to replace a guard, often at night or on weekends.
2. Video verification— usually a 7- to 10-second clip attached to an alarm that is generated from a sensor or other traditional means to visually verify that there is a real alarm.
3. Video alarm (or incident monitoring or video motion detection) — uses analytics on the camera or DVR to note pixel changes or other parameters and generate an alarm based on the camera itself.
4. Video system health (or guard tour or sometimes also proactive monitoring) — checking in at set times during the day to make sure cameras are all functioning and placed correctly.
Software & Technology Are Moving Video Monitoring Forward
One of the keys to video monitoring is the way in which it is presented to the operator. In the past this could be cumbersome and often led to many false alarms. But analytics and software platforms are making video monitoring simpler and easier to use. Click here to read more.