A three-member panel of subject matter experts discuss how integrators can leverage subscription-based models, Hardware as a Service (HaaS) and ROI-driven strategies to transform remote video monitoring into a sustainable revenue stream.

Remote video monitoring has become a cornerstone of modern security services, offering integrators new ways to generate recurring revenue while meeting the growing demand for proactive, technology-driven solutions. Transitioning from one-time system installations to service-based models presents both challenges and opportunities, especially when it comes to pricing strategies, client acquisition and demonstrating value.

SDM gathered insights from industry-leading manufacturers -- Axis Communications, Eagle Eye Networks, Hanwha Vision and Honeywell Building Automation -- to explore three key areas integral to capitalizing on remote monitoring services: the rise of subscription-based models, the benefits of Hardware as a Service (HaaS), and strategies for proving return on investment (ROI).

By leveraging these approaches, our expert panel provides valuable insights into how integrators can strengthen their market position and unlock sustainable growth in a competitive landscape.

SDM: How do you see subscription-based remote monitoring evolving in the industry, and what benefits does it offer integrators over transactional models?

Ted Wilkinson, Axis Communications: The evolution of subscription-based remote monitoring in the industry continues to be a clear and ongoing trend, driven by manufacturers developing products and services that lend themselves to subscription sales. This shift presents integrators with opportunities to evaluate their business model, focusing on two key areas: selling subscription-based remote monitoring of cameras and other devices, and offering managed services encompassing device management, firmware updates, cybersecurity and maintenance.

By adopting a subscription-based approach, integrators can transition their relationships with end customers from project-based transactions to long-term, lifecycle partnerships. This allows integrators to position themselves as a trusted business partner rather than a contractor. By establishing this type of relationship, integrators can not only sell products and services on a recurring basis, but they also have the opportunity to develop a managed service offering. Managed services offerings can enhance the integrators value to the end customer by improving device management, ensuring timely firmware and cybersecurity updates, and providing device maintenance, thereby eliminating issues like the dreaded "something happened, then we found out the camera wasn't working" scenario.

To capitalize on these opportunities, integrators should consider several factors, including the number and type of monitoring and management platforms required, as well as how to effectively monitor and manage these systems. By embracing subscription-based remote monitoring and managed services, integrators can create new revenue streams and strengthen customer relationships.

Aaron Saks, Hanwha Vision: A transactional model is typically focused on a more hardware-based infrastructure, for example, servers with a finite amount of capacity, whether that capacity is needed or not. Then, if you want to make a change, it's already a sunk cost. Subscription models are more fungible and elastic in that you're typically not buying hardware with certain specification limits.

If you need to record more cameras to the cloud or change the duration of video retention, then you have much more flexibility to scale with a customer for growth. If a customer needs to increase camera capacity, it's a lot easier to do it. Costs are typically paid on a monthly or yearly basis, so you don't have high initial costs or upfront investments. The spend is much smaller and more regular versus a one-time capital expense -- think of it as pay-as-you-go.

Steve Russo, LenelS2: Subscription-based remote monitoring is evolving through integrations with emerging technologies and integrating data from multiple channels to shift to outcome-based services. Meaning, subscription models are focused on tangible outcomes like reduced downtime and optimized energy efficiency as opposed to simply monitoring data, allowing clients to not only monitor, but to take action. Additionally for clients, integrators can offer highly secure and easy to update solutions that can adapt to evolving threats and regulations.

The main benefit of a subscription-based model for integrators is a recurring revenue stream, which leads to long-term relationships with clients through active, continuous engagements. By enabling continuous communication, integrators can offer regular updates, specialized services and upgrades, ensuring clients are getting the most for their investment. Additionally, these models provide insights that can help integrators refine and improve their services based on real, tangible use cases and consistent client feedback. Increased touchpoints are leading to greater customer satisfaction and in turn, better customer retention.

Dean Drako, Eagle Eye Networks: Business owners are increasingly turning to subscription-based remote monitoring due to the tremendous cost savings it offers compared to hiring security guards. For reliability and ease of integration, a cloud-based VMS (video management system) delivers optimal results. A cloud system, which is open and non-proprietary, places the business owner in charge of deciding which camera manufacturer and which third-party technologies -- such as access control or the newest AI-powered features -- they want to use. Security integrators who sell subscription-based remote monitoring increase their recurring revenue while also providing real value to their end user customers.

By adopting a subscription-based approach, integrators can transition their relationships with end customers from project-based transactions to long-term, lifecycle partnerships.

SDM: What factors should integrators consider when deciding between subscription and transactional pricing models?

Wilkinson: When deciding between subscription and transactional pricing models, integrators should carefully evaluate several key factors. First, they should assess the product brands they plan to offer, considering whether or not the manufacturer provides robust monitoring and management capabilities built into their products.

Additionally, integrators must determine how to finance the initial purchase of devices that will be paid for by the end customer over time. They should also re-examine their sales processes and organizational structure to determine how they can accommodate the shift from project-based transactions to ongoing customer relationships.

Integrators must also adapt their compensation models to align with the changes brought about by subscription-based pricing. Furthermore, they should recognize that IT departments are often more familiar with subscription-based purchasing than security departments, so having sales staff who can communicate effectively with IT professionals is crucial. By positioning themselves as intermediaries between the IT and security departments, integrators can better facilitate the adoption of subscription-based models.

Drako: Like all modern IT systems, a cloud video surveillance system is sold as an annual or multi-year subscription. It can be more affordable for the customer than older systems, which were sold as a one-time capital expenditure. Furthermore, it means that the customer has predictable costs, only pays for what they really need, and will have a stronger cybersecurity position.

For the integrator, the total cost to serve with a cloud-based video surveillance system is drastically lower because updates and fixes take place via the cloud, so the integrator is not incurring the cost of rolling trucks and doing on-site maintenance and firmware updates. The customer has greater peace of mind as well.

The subscription service smooths out revenue peaks and valleys for the integrator, providing a steady, predictable revenue stream. Annual recurring revenue is also the key to building a strong, profitable and valuable security business.

Saks: The main benefits to an integrator of a subscription model are lower cost points, a single payment, and lower acquisition costs -- essentially streamlining their purchasing because it's now all one line item. They're not buying something outright. In fact, they can often purchase higher-quality hardware because they're amortizing the price over a longer period. The cost delta between a low-end camera and a high-end camera is going to be smaller, whether it's per month or per year, allowing the customer to get more value for their system.

Traditionally, buying new hardware like hard drives or more servers requires on-site technicians, which involves costs. There is often a delay in receiving parts, or maybe a new unit is not compatible with existing equipment. With a cloud-based remote monitoring solution, an integrator can make a change in seconds, and typically it's prorated based on where you are in your monthly or yearly plan. It's simple and efficient.

Russo: Initially, integrators need to consider what will be best for the business: a stable and recurring revenue or a more immediate influx of cash. Subscription models are better suited to scalability -- allowing integrators to add customers and introduce additional revenue generators including add-ons, tiers and upgrades. As with all services, it is also important to consider customer preferences as well. Some customers may want the flexibility and lower initial cost of subscription-based services, while others may value the simplicity of a one-time transaction.

Hardware as a Service (HaaS):

SDM: What are the main advantages of offering Hardware as a Service (HaaS) for both integrators and their clients?

Saks: Some manufacturers offer hardware on a monthly payment basis instead of requiring a large initial payment. The hardware price might be rolled into an existing subscription, or it might be a separate line item. For integrators, HaaS -- like with SaaS -- creates a predictable and steady revenue stream, providing stability and growth potential. It also creates up- and cross-selling opportunities where integrators can bundle hardware with additional revenue opportunities like SaaS, maintenance, and data and analytics solutions.

For customers, switching to a HaaS model can significantly lower their initial investment, freeing up capital for other priorities. Customers also benefit from ongoing maintenance and support, which limits additional expenses for repairs or replacements.

Russo: For integrators, HaaS -- like with SaaS -- creates a predictable and steady revenue stream providing stability and growth potential. A HaaS model creates up- and cross-selling opportunities where integrators can bundle their hardware with additional revenue opportunities like SaaS, maintenance, and data and analytics solutions.

For customers looking to switch to a HaaS model, they can significantly lower their initial investment, freeing capital for other investments. Integrators often include ongoing maintenance and support to limit additional expenses for repairs or replacements. Additionally, integrators often have real-time monitoring capabilities to significantly reduce unplanned downtime. They are often able to detect potential hardware failures before they occur.

Drako: There is huge momentum behind the Hardware as a Service for cloud video surveillance. Eagle Eye's version is called Eagle Eye Complete. The Eagle Eye Complete program gives security integrators the option to offer customers a new video surveillance system at a much lower upfront cost. The customers pay via an affordable annual fee. Our offering comes with a lifetime repair and replace policy, so the cost of the system is very predictable. The business owner never has to worry about unexpected expenses to upgrade or replace equipment -- it's all included in the subscription price.

Wilkinson: When looking to offer HaaS, or more generally Anything as a Service (XaaS), integrators and their clients need to consider the potential benefits of moving from capital expenditures (CapEx) to operational expenses (OpEx). In many cases, OpEx investments make it easier for end customers to secure funding. This approach also may have tax and cash flow advantages, potentially eliminating the need for projects to go out to bid. Moreover, XaaS can enable larger projects by presenting costs as manageable monthly payments rather than significant upfront costs.

For integrators, XaaS provides the opportunity to regularly upgrade technology, ensuring end customers' technology is current and they have the latest hardware and best performance. This positions integrators as trusted technology business partners, fostering long-term relationships and opening doors to additional revenue streams.

Furthermore, XaaS enables integrators to expand their offerings to adjacent technologies, such as access control, audio solutions, cloud storage, disaster recovery, structured cabling and IT services. By bundling these services, integrators can increase average deal sizes, enhance customer satisfaction and solidify their role as strategic partners.

SDM: How can HaaS help integrators lower client acquisition costs or streamline the purchasing process?

Saks: Not all manufacturers, Hanwha Vision included, offer Hardware as a Service (HaaS). In cases where it's not directly available, some integrators may work with a financing company to offer smaller payments without a large capital expense. This approach enables integrators to provide a value-added service by shifting their billing to the end user.

Additionally, integrators using a HaaS model often include real-time monitoring capabilities to significantly reduce unplanned downtime. They can detect potential hardware failures before they occur, helping streamline operations for the end user while also demonstrating the value of the integrator's services.

Drako: The purchasing process is simpler with a HaaS solution because lots of costs are integrated into the subscription. The customer does not have to understand any long or complicated quote of equipment. There's another benefit for the integrator: HaaS customers are stickier. With a lifetime repair and replace policy, the hardware is always up-to--date. There are fewer issues and the customer is happier. It also means that the integrator maintains a relationship with the customer throughout the subscription period so that the customer does not go and get a new or different integrator when it's time to expand or upgrade.

Russo: HaaS lowers client acquisition costs for integrators and streamlines the purchasing process by reducing upfront costs, improving the total cost of ownership, enhancing customer and integrator experiences, and simplifying the contracting process. Integrators can close deals faster and reduce sales and support efforts leading to impactful, long-term relationships with clients that could create a scalable path to efficient growth.

Wilkinson: By offering XaaS, integrators can make the budgeting and approval process easier for clients, reducing the need for upfront cash outlays. This approach can also provide tax and cash flow advantages. It can also eliminate the time-consuming process of "going out to bid," allowing clients to more easily get the technology and services they need.

ROI Calculations:

SDM: How can integrators effectively demonstrate ROI to potential clients when proposing remote monitoring solutions?

Drako: When proposing cloud-based remote monitoring solutions, integrators can effectively demonstrate ROI by leveraging existing security cameras and infrastructure. When a business does not have to rip and replace existing cameras, there is instant ROI. The ease of integration with any third-party technology is another way to show a prospect that cloud-based remote monitoring is a sound investment -- one that can adapt and scale as their business grows.

Russo: Integrators should start by clearly identifying and demonstrating client-specific pain points and leveraging data and case studies to show how their solutions can help address these challenges in a cost-effective, scalable, and adaptable way. Additionally, integrators should ensure they are taking into account the total cost of ownership when comparing SaaS costs with on-premise solutions. There are many IT costs associated with on-premise solutions that are no longer required when moving to a subscription model. Showcase how remote monitoring solutions can improve the lifespan of company assets and reduce replacement costs as well as the value of compliance and risk mitigation.

Wilkinson: Learning to effectively tell customers the value story is the most challenging thing for integrators to do as they propose remote monitoring solutions to their customers. To effectively demonstrate ROI to potential clients when proposing remote monitoring solutions, integrators need to engage with not only the security team, but the IT and finance departments as early as possible. One thing they can do to increase the validity of their story is by telling customer stories. After winning a few projects, they can conduct case studies with recognizable local clients, which increases their credibility and showcases the tangible benefits of their services, allowing them to attract more customers and further their business objectives.

Saks: The term remote monitoring is often associated with viewing live video from another site, but it also includes ensuring that a surveillance system is online and functioning properly. A cloud-based remote monitoring solution like Hanwha's DMPro gives integrators total visibility into a system's health. This accessibility is key to demonstrating ROI, as integrators can leverage a dashboard view of the entire system to showcase value.

For instance, Hanwha's DMPro provides a single-pane-of-glass view into a system, enabling integrators to quickly identify and resolve issues. If a chain has multiple cameras or NVRs offline, the dashboard allows for rapid identification and resolution, minimizing downtime and maintaining operational efficiency. By generating detailed reports on system usage and expenses, integrators can provide clear evidence of value. For example, if the accounting department needs to compare expenditures on cameras versus the value they bring, such insights can be easily shared.

SDM: What additional benefits, such as improved loss prevention or faster response times, have clients observed after implementing remote monitoring?

Russo: In addition to loss prevention and faster response times, customers can benefit from enhanced predictive maintenance, increased operational efficiency and improved security and risk management.

Wilkinson: IT managed services providers and alarm companies have long recognized the importance of strategic partnerships in remote monitoring. By selecting the right hardware and software partners with supportive products and features, integrators can scale their business over time. Starting with 12- to 24-hour service levels, they can gradually expand to establish a network operations center (NOC) or security operations center (SOC), offering 24/7 coverage and higher service level agreements to their customers as their business grows.

Saks: A key benefit of remote monitoring solutions is faster response times. Integrators can promptly address customer issues, whether it's resolving system outages or mitigating theft. For example, if a client experiences increased shrinkage, they can quickly share live camera or dashboard views with local law enforcement, enhancing security response.

Additionally, clients benefit from enhanced system visibility. Integrators can monitor retention times and extend storage capacity remotely without needing an on-site technician or additional hardware purchases. These capabilities not only reduce downtime but also improve overall operational efficiency.

For integrators offering remote monitoring, tech support, or other value-added services, these solutions also present an opportunity to resell services with an added overhead, ensuring profitability while delivering high value to their clients.

Drako: Whether the potential customer is a large international enterprise, a school campus, or a multi-location retail organization, certain integrations can provide an immediate return on investment. There are hundreds of examples of valuable integrations, such as AI-filtering to reduce false-positive alarms, AI analytics to alert the business owner when a retail store is at capacity, or an integration with a License Plate Recognition system to ensure that unauthorized vehicles are not permitted on campus.

Security integrators can also monitor the health of their customers' systems. A cloud video surveillance system can send a notification to the integrator if their customer's camera or bridge goes offline. The integrator promptly solves the problem (generally without rolling a truck) ensuring that the customer's remote monitoring system is always operational. Health monitoring alerts are an easy way for integrators to provide a valuable extra service to their customers and derive additional recurring revenue.

Enterprising security integrators can also monitor AI analytics for their business customers. Motion alerts, line crossing, and other AI alerts can be sent to the integrator. The integrator advises the customer or takes action to investigate and respond to analytics. Like health monitoring, this is a service many business customers will find extremely valuable, and it's an additional way for the integrator to add more recurring revenue.