When March Networks CEO Peter Strom tells people what he does for a living, the response is usually not what the head of the video-surveillance technology company is hoping for.
“Oh, really, you guys are still around?” is the reaction he often hears.
But if the Ottawa firm’s relatively low profile since it was acquired by Chinese holding company Infinova in 2012 bothers Mr. Strom, he’s not showing it. He can even chuckle about the fact that a business that helps customers around the world keep a vigilant eye on their operations has itself become hidden in plain sight, at least in the public’s mind.
“It really hasn’t impacted us that much,” he says. “We’ve stayed fairly active, I think, from a marketing perspective in the industry itself.”
In fact, Mr. Strom says, much of the firm’s retreat from the headlines was part of a conscious decision to “take a break” from the rigorous reporting requirements required of a public company after March went private.
March has spent much of the four years since it was acquired working at making inroads in other parts of the world outside of its core markets in North and Latin America. The firm recently opened a sales and support office in Singapore with the goal of expanding its presence in Southeast Asia, an effort that has been “mildly successful” so far, Mr. Strom says.
Last year, for example, March won a contract to supply PVcomBank, one of Vietnam’s fastest-growing financial institutions, with video-surveillance equipment at 115 branches across the country.
“That was largely as a result of us getting a direct presence in the region,” says Mr. Strom, adding the company sees a major opportunity because many banks in Southeast Asia are stepping up efforts to standardize their video-surveillance platforms.
“We do fairly well in the financial services, the banking market and the retail market, and we have a number of large banking customers who do have operations or are currently investing in operations in that region, so a lot of the time they’re asking us if we can support them in that region as well.”
When Infinova announced in late 2011 it was planning to acquire March for $90 million, Mr. Strom hailed the deal as a “platform to work to accelerate our growth.”
Following a round of layoffs shortly after the acquisition, March’s headcount is now back to about 270 worldwide and 155 in Ottawa, virtually the same as before the takeover. Revenues last year cracked the $100-million mark, a similar figure to what March recorded in its heyday as a publicly traded company.
While the growth spurt Mr. Strom talked about five years ago hasn’t kicked in yet, he believes the partnership with Infinova is still paying dividends. March has many U.S. and European customers with operations in China, he explains, and the company had been exploring ways to penetrate that lucrative market well before the acquisition.
“When Infinova came along and we had discussions with them … we thought it was a very good fit and very consistent with our overall growth strategy,” says Mr. Strom, who joined March in 2003 and was named Ottawa’s CEO of the Year in 2005, shortly after the firm’s IPO.
“Because we now have a much bigger presence in that market, we’re able to support those customers as they invest and grow in the China market. It certainly has been a real advantage for us when we can sit down and talk to some of the leading corporations in the world and basically say that we have a combined 1,500-1,600 employees in China.”
Most of March’s clients are enterprise customers in the banking, retail and transportation sectors. They include Wal-Mart, four of the top five Canadian banks, Cincinnati-based Fifth Third Bank, the Bank of New Zealand, U.S. bookseller Barnes & Noble, Japanese clothing manufacturer Uniqlo and the Toronto Transit Commission.
Locally, March’s surveillance technology can be found at the Canadian Tire Centre, the Canadian Museum of History, the Canadian War Museum and OC Transpo stations.
Such lucrative clients have built March Networks into one of the largest businesses of its kind in the world. But separating itself from the pack in a crowded field that includes powerhouse competitors with names such as Bosch, General Electric and Panasonic isn’t easy, Mr. Strom concedes.
To that end, March has spent the past few years pouring big money – about 75-80 per cent of its total R&D investment – into developing products to complement its video surveillance equipment. This includes software that monitors and analyzes ATM and retail point-of-sale transactions in an effort to weed out fraudsters, as well as a platform that lets retailers use security footage to better understand customer traffic patterns – for example, knowing when to open up additional checkout counters.
“We’ve kind of evolved from being just a video-surveillance player to now being a true visual-based business intelligence company,” Mr. Strom explains.
March is also preparing to launch a subscription-based video-surveillance service aimed at small businesses. Many SMEs, particularly in the hospitality sector, are increasingly reluctant to shell out thousands of dollars up front for security equipment, Mr. Strom says, making the monthly pay model an attractive option.
“We think that’s going to be a huge growth opportunity for the company,” he says.
Mr. Strom says it’s all part of a never-ending effort to stay one step ahead of the competition.
“In technology, if you stand still, you’re pretty much dead,” he says. “The challenge for us is to continue to be innovative, No. 1. Secondly, customer requirements are changing very quickly today, and new technology comes down the pipe very quickly.”