The phase change is on.
The Openpath/Allegion Ventures, Brivo Systems/Parakeet and HID Signo news signals 3 ways the industry has changed.
The physical access control industry is in the midst of a phase change. Like water does when it turns to ice, the same tools cannot be used. For instant, faucets and hoses break when water turns to ice. We are seeing that happen in our industry. Here are three examples:
(1) Openpath and Allegion Ventures represents hardware incumbents becoming enablement platforms for software providers. Historically hardware incumbents made it impossible for software companies like Latch or August, to focus their expertise on the creation of great digital user experiences or interfaces. Start ups are forced to raise money, develop, manage, everything, as both an hardware and a software company. Most cannot raise enough money, attract the appropriate talent and execute to do both. By companies like Allegion offering their hardware as a platform, they not only help software companies have a better opportunity to succeed, but they also get the opportunity to create new revenue opportunities for themselves.
(2) Brivo Systems and Parakeet represents security and access control centric software companies expanding to offer far more value to end users as well as customize their solutions per the verticals they serve. Software is no longer allowed to be generic and it no longer can solely be built for security administrators. Expect to see more software and hardware companies to vertically integrate.
(3) HID Signo represents a shift to industry leaders adopting external marketing messages and the adoption of external customer centric experiences (eg. tap to open how Apple dictates vs home cooked by our industry like twist and go). As HID noted in their press release, “The support for Apple's Enhanced Contactless Polling (ECP) to enable Student IDs in Apple Wallet, HID Signo is driving the next wave of flexibility and convenience with mobile access.” This is a big. I repeat, a big deal. This will drive mainstream adoption as customers will start to expect our industry to perform just like the payment and ticketing industries. This drives a standard and also forces our companies to focus on what we do well. It also signals that new lanes of who “owns” what are being created. Value shifts and so does who captures it.