Subsidized by Failure - The Industry's “Greedy Little Secret”

Subsidized by failureA number of years ago I started to notice an increase in the failure rate of certain security alarm / CCTV components. Not surprisingly, this increased failure rate coincided with a massive drop in wholesale cost. Yes, we've all heard the old saying “Good stuff no cheap, cheap stuff no good” but this problem goes beyond simple cost of manufacturing.

I was speaking with a number of manufacturers and manufacturer reps at the recent CANASA show in Richmond and my long held suspicions were verified. Many top manufacturers who outsource their product manufacturing to 2nd and 3rd world countries are relying on equipment failure to increase their bottom line.

Nowhere is this more evident in the omnipresent wireless closed architecture security alarm / home automation systems. Yes, many of these systems may appear as open architecture, in that they integrate with 3rd party products such as door locks, thermostats and light switches, this, however, is a very short term façade as the “Big Three” either already own or are working towards taking over these other “manufacturers”. In fact, some of these integrating products are manufactured by the same off-shore factories responsible for the equipment failures in the first place. This is especially true when the government of said countries actually own, control and financially benefit from all activity within their country.

Beyond Security alarm panels is the growing IP surveillance market. I remember a time when it was easy to determine the quality of the CCTV equipment based on the reputation and longevity of the manufacturer. Unfortunately, global competition along with less than reputable off-shore manufacturing processes, have changed the roles of the key players. Where previously reputable CCTV companies controlled the entire manufacturing process, from components to consumer product, many of these manufacturers now rely on private labelled OEM products from second world countries more interested in volume than the security of the end users on the other side of the world. Although many “manufacturers” may “claim” they own the factory in... lets say Mainland China... simple politics states private ownership is a façade when it comes to a totalitarian regime with a long history of many manufacturing shortfalls from lead paint on Children's toys to the seemingly constant “Capacitor failure” in modern electronics.

When one examines the actual manufacturers of most of the electronics on the market today, it becomes very apparent there is a decreasing number of actual key players in the Manufacturing sector. Many actual manufacturers make products for many competing companies. Most security alarm and CCTV / IP Video “manufacturers” rely on cookie cutter solutions from the very same off shore factories used by their competitors, so even if the consumer was to switch brands, chances are they would end up with the same crap equipment from the same crap manufacturer who don't give a crap about the reliability of the security or well being of the end consumer on the other side of the world.

Personally, I take the security of KeepSafe Systems Clients along with reputation of KeepSafe Systems VERY seriously. I, personally, closely examine the manufacturing process as well as the actual source of all the equipment KeepSafe Systems sells and installs. Although there is always a certain lack of direct control in the manufacturing process, I can control which equipment manufacturer I trust. I know this may not directly effect the corporate decisions of the “big players” in the Security alarm and IP Video Surveillance market, however it does have a positive effect the end result for KeepSafe Systems clients, and that is all that matters to me.

The above comments are the personal opinions of Heinz Kreutz and do not necessarily represent those of anyone else in the industry. Some may actually feel my opinions are crap... this is their prerogative in a free world. Some may even be angry with me. To those I say, I did not mention your name, so why are you angry? Is there an inner feeling of guilt? If so, perhaps you need to examine your business model. Have a great day :)