convergence - status of the world market and contrasts with north

Convergence - Status of the

World Market and Contrasts

with North America

Jeremy Towler

At LonMark Training

Session

31st January 2011

2

Excellence in Market Intelligence 2

BSRIA Worldwide

Germany

France

SpainChina

Italy Serbia

Russia

North

America

Poland

Czech Republic

Japan

UK

Research partnersOfficesHead Quarters

Established as the global source for knowledge for the building industry, serving the whole

building environment chain from supplier to client

More than 50 years of experience in independent , authoritative technical research, product

testing, consultancy and market intelligence.

Some 160 people with depth of expertise across all industry sectors and unique blend of

technical and marketing capability and understanding

Helping clients understand and forecast market sizes, market opportunities and aid strategic

decision making

3


North American Research

BSRIA Proplan have conducted regular

Intelligent Buildings market research for more

than a decade and in North America for over a

decade

Conducted CABA Market Sizing North

America 2009/10

– Sponsored by 26 leading organisations

– Many more submitted data.

– Encompassed: Environmental Controls -

Lighting Controls - Security Systems - Fire

Detection Systems - IT Convergence

Available to purchase

4


World Study - (IT) Convergence in Buildings

Detailed Multi-client study 2010 covering world’s major and

emerging markets for BMS and IT Convergence - i.e.

Convergence of different systems over a common

communication platform

Benefits from ongoing research programme and our 2005 &

2009 studies of N.American Convergence market

Draws on status of Convergence in 12 of world’s most

important building markets, highlighting unique characteristics

of these, to report on 4 principal geographic regions, for each:

– What services are typically converged and to what extent

– If services on separate infrastructure or on the IT network (both

Ethernet)

– What is driving convergence?

– The barriers

– Who is driving it?

– The IT suppliers’ role in this market place

– Who undertakes the installation of the converged offerings

Word deliverable

Available to purchase

BMS structureIT network/

backbone

Network = Ethernet Cat 5/5e/6 and/or fibre

…the bringing together of autonomous systems onto a

common communication platform within the business

enterprise to create a single unified solution

http://www.123rf.com/photo_4696870_networking.html

5


Integration and Convergence

IT-Networks

Technical Infrastructures (HVAC/Lighting/Security/Fire etc.).

IT-Convergen

ce

Integration

IT-Networks

Technical Infrastructures (HVAC/Lighting/Security/Fire etc.).

IT-Convergen

ceIT-Convergen

ce

IntegrationIntegration

Integration is to add value by joining

or linking different building service

products/applications

Network = Ethernet Cat 5/5e/6 and/or fibre

BMS StructureIT

Network/Backbone

• Convergence will ideally use a single network, a single

communications protocol and a single user-interface

• However, separate networks are often designed only

inked at the management level and in some cases at the

control layer.

• Data is transferred in both directions.

• Different levels of convergence.

6


The levels and the data/information available

7


Development of Integrated Building

Management Systems (IBMS)

Integrate with sub-systems Integrate with other BAS

Integrate with other systems Integrate with other enterprises systems

Open Standards Enabling Convergence

8


Market Size 2009

2%

Inte

gra

ted o

nly

21% 13%

BMS structureIT network/

backbone

8%

Converg

ed (

IT)

only

34% Integrated and

Converged56% = Stand-alone

Of total $20bn system market in North America (BMS, Security, Lighting control, Fire) alarm)

9


BMS

$5.7 billion market

55% integrated and/or converged

– Of which 55% on separate BMS network (Ethernet), 45% linked to IT backbone

BMS suppliers and SIs install the BMS, lighting and often access controls

0% 5% 10% 15% 20% 25% 30% 35%

Metering

Lighting

Electrical mgt

CCTV

Access control

Intrusion

Audio and video

Fire and safety

Smoke extract

10


Lighting

$900 million market

Limited integration and convergence (89% sold as stand-alone solutions)

Nearly all installed by BMS suppliers/SIs

Lighting is integrated with BMS solutions (63%) and access controls (16%)

0% 10% 20% 30% 40% 50% 60% 70%

BMS

Metering

Electrical mgt

Access control

Intrusion

Audio and video

Fire and safety

Smoke extract

11


Security

$10 billion market

High integration and convergence of the three security products

Installed by CCTV, access controls and intrusion specialist installers,

but also BMS suppliers/SIs and IT SIs

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

CCTV Access control Intrusion

CCTV Access control Intrusion Other

12


Fire & Safety

$2.7 billion market of mainly sold alone solutions (88%)

Convergence negligible due to regulation, 11% of the market integrated

Mainly integrated with BMS (60%), access and audio

0% 10% 20% 30% 40% 50% 60% 70%

BMS

Metering

Lighting

Electrical mgt

CCTV

Access control

Intrusion

Audio and video

Smoke extract

En. Mgt Software

13


Proportion Stand-alone vs. Integrated and

Converged

- Converged BMS

- Convergence IT

Integrated only

Stand alone

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2009 2010 2011 2012 2013

14


Trends

Intelligence in buildings not a new topic, but now much greater attention to:

Energy usage

Increased building performance

Cost reduction

Increased efficiencies

Increased security

Increased safety

15


Trends

Corporations increasingly taking centralised decisions - need more and better information

Government wants to reduce CO2 emissions and energy consumption

Technology advancements are key drivers e.g. IP, wireless, PoE

IT barriers (lack of bandwidth, security) eroding

Scope and expertise increasing, integration/convergence of products

A number of companies can now take on the role of Master SI (the outcome however still depending on the person in charge)

Data centres are becoming more intelligent

16


Barriers

Resistance from FM and from IT to converge (stick to

own areas of expertise and competence)

Lack of training and skills

Construction process uses traditional route with main

contractor and sub-contractors

Long-term outsourcing contracts

Historic objections relating to the IT infrastructure e.g.

security, downtime, bandwidth

17


How Quickly will Integration Grow?N

um

be

r o

f P

roje

cts

Time

Hurdles:

• Too much

customization

• Lack of standard

applications

• Ability to demonstrate

and convince the

clients on ROI

18


Drivers convergence

Energy and building performance

Energy savings and efficiency

Improve building performance (better decisions)

Reduce maintenance costs

Increase the value of the building/rental revenues

Security

Higher level of security (physical

and IT security converged)

Efficient data sharing

Remote access

Bandwidth and storage

optimisation

Access cards a requirement

Link data sharing between

departments (e.g. ANPR +

Parking + AC + HR + Payroll +

Cashless payment)

19


Drivers – uptake of IP products

Penetration of IP, 2009, % share by volume

0% 10% 20% 30% 40% 50% 60% 70%

BMS

Lighting (controls)

CCTV

Access control

Intrusion

Fire and safety

20


Who is driving convergence?

BMS

IT

Security

• Ubiquitous Ethernet in large building projects

enables majority to be converged at

management level

• But IT Convergence not perceived a benefit by

many BMS suppliers

• IT suppliers keen to drive IT convergence

• Cisco: Sales of hardware (switches) and Mediator

• IBM: software, consultancy and Master SI

• Oracle, HP, Plexus etc. offer software/advice

• Raised security- linking access requests and

intrusion with video

• Cost reduction and efficiency improvement

• Enabled by IT (hardware, cabling suppliers /

channel)

• Security SI/installers high end drive it

21


Who is driving convergence?

Energy

rating

schemes

Political/

economic

factors

End-users

• Most converged buildings in US are

LEED silver/gold/platinum accredited

• Buildings consume 70% of electricity

and 40% of primary energy

• International pressure to reduce CO2

• Government stimulus

• Pressure from society / corporate social

responsibility for green profile

• Reduce energy costs

• Improve building performance and

management

Convergence

Snapshot India

Key players,

barriers, drivers,

suppliers and

trends / forecast

23


Key Players

Honeywell is big in integrated Building Management

Systems (IBMS) market

JCI and Siemens also prominent

Main companies driving convergence are the IT players

– Cisco works on the top layer with Mediator system

– IBM

– Wipro is active on the control layer

24


Convergence – Status Quo

Feedback from some major systems integrators (SI’s)

suggests convergence still not very clear at the moment

Some pilot projects being executed but little concrete data

to quantify convergence at present

Frequency of convergence highest in IT/ ITES, Pharma,

High-end Residential, Industries (manufacturing) Airports,

other transport buildings and hotels

25


Barriers

Design: Putting multiple systems on IP

Execution: Expertise in putting the systems together

Price is holding back investment

Bandwidth often perceived a major issue for joining IT + FM

End-users having multiple decision points (cost/benefit/ROI)

Consultants staying in comfort zone / lack of knowledge

26


Further Comments on Integration/

Convergence

Integration growing at a rapid rate as customers want

simplified systems and to manage buildings from a remote

location

Convergence is low but will grow as India is an IT savvy

country and new technology acceptance is high - Customers

prefer installing latest systems, no longer legacy systems

IT software companies driving the convergence market -

acting as super system integrator and providing consulting to

deliver end-to-end solutions

System Integrators argue that the IT systems are ready to

absorb the bandwidth issues and make systems work

efficiently

27


Further Comments on Integration/

Convergence

In video surveillance & access control IP is taking over

Datacenters look for integration and convergence +

Green Building management layer

Open protocols are becoming the norm:

– LonWorks and BACnet are preferred option in India

– ModBus popularity rising

Consultants are key – majority of building projects are

driven by them in the Indian market:

– Play a major role in new projects

– Old projects are mainly done by the existing vendors.

Convergence

Snapshot

UK - Europe

Overview of

findings

29


Pressure to cut energy consumption (example UK)

The UK is committed to a 20% reduction in CO2 emissions by 2020 compared to 1990 levels. The CRC is being administered by the Environment Agency

The buildings we work in account for nearly a fifth of the UK’s total carbon emissions.

Large organisations that have used more than 6,000 MWh of electricity in 2008 (roughly equating to £500K spend) will have to purchase and surrender allowances each year to cover their CO2 emissions

30


Overview UK

The most advanced market in Europe is the UK with a

number of large projects over the last 5 years

Retail: Westfield Shopping Centre, London and Stratford

(planned), Union Square, Leeds Trinity, Highcross

Leicester

Sports facilities: Ascot Racecourse, Twickenham, football

stadiums

Education: Bristol university, University of Sussex

Health: Hammersmith hospital

Finance and professional services: Bank of England,

Deloitte

Data centres

A number of players are active in this space.

– e.g. Arup, CDC, Bailey, Dimension Data, Redstone,

Honeywell etc.

31


Continental Europe (not UK)

Few new build projects with different levels of

integration and convergence

Awareness and uptake relatively low

The norm is separate networks for IT & security

and HVAC services – no communication

between the networks

Germany most advanced in Continental EU for

energy management and building integration

BMS suppliers increasingly add lighting

controls and blinds controls to the HVAC

services offered, but not IT and security

32


Typical services included in

new build vs. retrofit

New Build

HVAC (+ energy

management/metering)

CCTV

Access controls

Water metering

Lighting (increasingly)

Audio & video

Access tracking (retail)

Fire, life and safety systems

Retrofit

CCTV

Access control

Most projects are new build

33


Key factors in convergence project

The consultant/SI needs to be involved from the

beginning to spec the IT requirement and scope

Holistic approach

Right procurement route

See IT broadly – IT is a business tool/service

Often gap exists between concept and finale

deliverables.

– The project/investment is not necessarily cheaper (only

the cabling part)

– but potential saving because of better coordination

– Savings on operational cost

34


Integration and

Convergence

Benefits

• Prolong lifespan of investments

• Optimise occupancy rates

• Informed building management &

investment decisions (which

buildings to use)

• Reduce utility costs over time

• Manage choice of energy suppliers

• Improve productivity and working

practises

• Customer attraction - satisfaction -

retention

35


BSRIA Contact Information

Jeremy Towler

Principal Consultant

Intelligent Building Technology

BSRIA HQ

Old Bracknell Lane West

Bracknell - RG12 7AH

England - UK

[+ 44] 1344 465 573

[email protected]

www.bsria.co.uk

Alex Detre

VP Business Development

BSRIA North America

Ottawa, ON

Phone 613.218.8849

[email protected]

blocked::blocked::outbind://22/www.bsria.co.uk

convergence - status of the world market and contrasts with north

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