ROI Inside

ROI Inside

Diversion: 2001-2004 - The Battle with IT

One of Rude's greatest challenges as he sought to prove digital video surveillance's worth was remaking the relationship between his security group and the information technology department. Rude says it took three full years to get the two teams to support each other on this project, and to build what is now an excellent relationship. Still, recalling the early days of his DVR project, Rude sounds frustrated.

"The network for security was a 10Mbps shared network that we owned," says Rude. "We had to plan for a 100Mbps switched network for digital video surveillance. We spent years just getting IT to take ownership of the security network."

Another key point of contention was that the network upgrade would also have to stay out of the DVR project budget. IT was having none of it, because (Rude eventually discovered) they thought the security group wanted to stream live video from every camera on the network. Nearly a dozen meetings over the three years, and still no buy-in from IT. So Rude changed tacks.

Instead of asking IT for support for DVR surveillance, as he had tried and failed to get for years, Rude played it coyly. He simply asked the IT department to benchmark some new technology and applications that, he mentioned with an air of inevitability, were landing in IT's network whether or not IT supported the project.

"I told them: 'We'd prefer it if you did support it, but the project's going forward, so you need to tell us what the bandwidth consumption will be'," Rude recalls.

IT capitulated to the benchmarking, and that was the turning point. They were surprised to find that the bandwidth consumption wasn't as absurd as they assumed it would be. "There was this fear of the unknown - this assumption about what video would do to the network," says Rude. "They began to see it was just another app, and they said: 'Oh, we can absorb this.'

"I've learned what you present to them and what they hear are two different things," Rude continues. "We weren't talking about putting cameras with live feeds streaming over the network. We were talking about DVRs, data collection devices. But all they heard was: 'We're going to put cameras on the network.' I just had to control the message."

Though it took far longer than he anticipated, Rude and the IT department now have a good working relationship, and have started some other video surveillance benchmarking projects together.

Phase 3: 2003-2005 - Hard ROI

The pilot went well, but Rude knew he still had a major problem in proving ROI: capital investment. Though the DVR systems performed better, they also cost more. For a long while, Rude couldn't get the numbers to a point where the return in performance made up for the pool of capital required to get the digital system up and going.

"Even with better technology and performance, we've got to be able to save money before they let us do it," says Rude. "And that was the hardest part. It took over two years, working with suppliers and, frankly, waiting for prices to come down."

Rude says that many of the small vendors in the digital video surveillance space haven't reached commodity stage yet, meaning they're still trying to recoup R&D dollars. That means higher prices. But it wasn't the only problem he faced.

Rude laughs when he recalls how many vendors would downplay the price of computers when working with him on a way to make their systems economically viable. "They had this idea that we were Intel, and we could just go grab computers in the back room for free or something." They also never took into account the cost of operating and maintaining the equipment, only the cost of buying it. Other vendors simply discounted Rude's entire ROI exercise. "They'd say: 'You're Intel. You've got so much money. Just buy the stuff.'"

Rude also met resistance from his own executives, many of whom thought a camera's a camera's a camera. Rude had to show how the quality of images drastically improved from analogue to digital and, what's more, could be tuned on the fly so that the camera kicks into high-resolution during an event.

His point was made for him several times over when Intel was able to catch bad guys and resolve incidents based on high-quality visual evidence stored in the DVRs - visuals the old system couldn't have captured.

Finally, the system's worth was showing itself, and the market was cooperating, too, as equipment prices slowly, surely declined. "We've finally, just now, gotten to the point where we can show a break-even, and maybe even a slightly positive ROI," says Rude. "It was a massive effort, but we got funded."


A new trend in digital video surveillance puts a DVR out on the edge. Rude says the benefits look tremendous. "Rather than running fibre from the cameras back to a cluster of PCs with video boards connected to a big DVR array, the DVR sits out there with the camera. So if you lose a DVR, you lose only one camera. We can also use off-the-shelf IT equipment with this new generation." Of course, Rude says, "We've got to see if it saves us money too." Just as he's finishing deploying DVRs, he's starting the ROI process again with the next next big thing.

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