Signs of the Times (
Page 1 of 2 )
Channel companies are creating expanding networks of computerized signage solutions.You've probably seen them in retail stores and hotels—flat-panel displays with moving images used for advertising and news. They are the new generation of billboards, melding streaming media, RSS feeds and advertising in strategically placed eye-catching displays, and they are a new profit opportunity for solution providers.
Known as "digital signage," this new technology is expanding beyond the retail and hospitality verticals to just about anywhere the displays are bound to catch somebody's eye—elevators, waiting rooms, railroad cars and busy street corners.
"There are tons of places to put this technology," said Brian Unold, a partner at Webpavement, an Atlanta-based integrator of digital signage solutions for a growing base of commercial, educational and government clients. "Everybody is getting involved in digital signage now. Everybody else has it, so they want it too."
Making use of proven technologies to satisfy advertisers' constant search for new venues to peddle their wares, digital signage is opening new avenues to profit for solution providers, both from traditional IT and audiovisual backgrounds. Some early adopters have realized returns on their investments, and the technology is picking up momentum, say channel experts.
The North American digital signage market—which includes the sale of displays, software, software maintenance, media players, design, installation and networking services—will reach $856.9 million by 2011, compared with $148.9 million three years ago, according to a 2005 report by Frost & Sullivan, a business research and consulting company.
Even more tempting, perhaps, to those companies dependent on advertising revenue to drive their business, is the estimated $3.7 billion in North American digital signage advertising dollars expected within four years, compared with $102.5 million in 2004, the same study found.
"Although digital signage has been around now for over a decade, the commercial market is still very immature. It is only in the last three years or so that infrastructure prices have dropped low enough to bring a rollout [price] within the reach of the majority of businesses," said Nikk Smith, technical director at Pixel Inspiration, an integrator based in Manchester, England, that specializes in digital signage solutions. "All sorts of organizations are buying the technology."
A good matchOne reason integrators and digital signage solutions are perfectly paired is the complexity and number of components that go into these systems. In addition to marrying the requirements of sometimes diverse internal groups—of mixing, for example, the media buying group with the network guru—digital signage implementations go far beyond the eye-catching screens popping up near office elevators and in airports and retail chains.
"I think the biggest hurdle we see is the time frame from cradle to grave because it takes so many people to be involved," said Jimi Gonzalez, vice president of sales and marketing at Island Systems & Design, of Rockledge, Fla., which recently opened a Las Vegas office partly to expand its base of casino and entertainment clients. "It's becoming more and more prevalent as more and more people understand it."
Solution providers find the corner office. Click here to read more.
And there is much to understand. While, of course, there is no such thing as a typical system, digital signage solutions generally include a number of integrated displays, management software, content-creation software, content-distribution software, media players, high-capacity storage, controllers, video encoders, data-import software and digital signage players, which typically are one or two PCs that control the on-screen images.
Integrators come with various areas of expertise, including networking, audiovisual, retail, real estate and the entertainment industry. Whatever their background, however, they have much to learn.
"Since digital signage is basically an evolution of the LCD panel display, resellers who currently sell monitors and/or flat-panel televisions will both have an advantage in marketing digital signage," said Daniel Schwab, vice president of marketing at D&H Distributing, in Harrisburg, Pa. "D&H's dual-market expertise in IT and consumer electronics was one of the factors that motivated us to introduce this opportunity to our customers. It allows the reseller to expand his or her core competency and transition into a new sales arena."
Next Page: Prepping the market
