The company walked away with the 2004 Technology Fast 50 Special Award for Innovation and the North West Business Insider Media Award as the top technology company in the North.
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DM was also ranked eighth in the 50 fastest growing technology businesses in the North.
Now in their seventh year, the UK Technology Fast 50 Awards are an objective ranking and celebration of the UK’s fastest-growing high-technology companies, based on percentage revenue growth over a five-year period.
Originating in Silicon Valley, the awards have become the global growth benchmark for success in the technology sector, recognising innovative strategies, sound management practices and marketplace vision.
Over the past three years, total turnover for DM has rocketed thanks to sales success both in the UK and overseas. The company has continued to invest in its core CCTV technology, while retaining its reputation for ease-of-use. Following a successful move into the growing market for network products, it has recently diversified into the development of customised product solutions for specific market sectors, including retail, gaming and finance.
Dedicated Micros’ chairman, Nigel Petrie, commented: “This is another excellent award win for DM. We’re delighted to have been recognised for our innovative approach. We follow a clear strategy – innovation without mystification – and it’s clearly a successful formula as far as our customers are concerned.”
The success follows last year’s win for DM in the International Trade section of the annual Queen’s Awards for Enterprise.
Damian Sanders, technology partner for the Northern Fast 50, said: “The standard of entrants was once again very high, further confirming the resilience being shown by the regional technology sector.”
The Holy Grail For Access And Video Surveillance – 3D CCTV
“The ‘holy grail’ in surveillance 3D CCTV is a totally automated system where low-cost sensors can monitor and entire facility such as an airport or factory, and can make decisions locally and then only report ‘true positives’ to response personnel,” said Spare.
“Unfortunately, this far exceeds the state of the art. Today’s low-cost sensors, such as 2-D video cameras have to be backstopped with complicated computer setups, software, and other types of often-expensive sensors to work around the technical limitations, making it impractical to deploy an economical system with significant coverage area.”
3D CCTV Camera
The fundamental problem, said Spare, is that computers are “lousy” at breaking down a scene coming from a conventional video camera or two into its component objects, and then classifying these objects into useful categories such as animate or inanimate, human or animal, large or small, nearby or distant. “Even with so-called ‘intelligent video’ approaches, the constraints are profound and often severely limiting,” he stated.
The consequence, said Spare, is that positive identification of any threat or anomaly — and the dismissal of non-threats — depends, ultimately, on human intervention — guards watching banks of monitors, personnel sent to investigate, and so forth.
The problem with this 3D CCTV workaround, Spare ventured, is that its effectiveness is widely unpredictable. Subsequent losses, security lapses, or false alarms have a high cost, both to the end user, and to the companies supplying security personnel and equipment. Increasing effectiveness, by reducing unpredictability, can similarly cause security costs to skyrocket.
The unpredictability comes from the human component, Spare asserted. “Regardless of how well trained, how well intended, or how well deployed security personnel are, the systems are at odd with our DNA. We are programmed, from birth, to ignore stimuli that become increasingly familiar — smells, sounds, background activities, repetitive events, etc.”
In security, Spare said, such “increasingly-familiar” stimuli include false or nuisance alarms, or banks of identical monitors where nothing is ever happening. “The nuisance alarms are particularly problematic,” said Spare. “When they first occur, they distract personnel from other areas of interest where something important may be about to happen. And, if they continue with any frequency, the brain — and the personnel attached to it — rapidly loses interest. By contrast, automated systems never lose interest. In fact, everything looks interesting, to a fault.”
The goal is for every alarm to be a true threat, and every true threat to generate an alarm, said Spare. “Take the case of perimeter security. Low cost motion detectors will raise an alarm with a squirrel as well as a human. Let’s say that alarm activates a video camera and alerts a guard to look at it. If there is a lot of squirrel activity that night, the guards will inevitably lose interest. So, you try to improve the system. You add image processing software.
But at night, under infrared, a squirrel poised 2 feet from the camera looks like an intruder at 10 feet. That doesn’t work. So you bury a wire at great expense that can tell you the mass of something that crosses its field. But that reacts equally to humans as to deer, and doesn’t localize the threat. And on, and on. The costs and complexity spiral upwards. And it’s fundamentally because computers don’t ‘see’ in three dimensions.”
3D CCTV Imaging
“True” 3-dimensional imaging — where the camera reports not only the colour and brightness of each “pixel” of the scene, but also the exact distance to that element — is the needed solution, maintained Spare. “Imagine an object moving into a scene that fills the frame from top to bottom, but is relatively narrow.
If your image sensor additionally tells you that the object is 12 inches away, is capped with a 2-inch wide, egg-shaped structure, and is 9 inches tall, you know you have a squirrel — and an alarm is not generated. By contrast, if the sensor reports that the object is moving, 10 feet away, is 6 feet tall, and is capped by a spherical appendage 7 inches across, you’ve got an intruder. Being able to calculate the distances to every point — which yields size and shape as well as distance — is the critical — and missing — capability.”
Spare said that once you had available 3-dimensional imaging using low-cost, chip-based sensors, additional applications in security, such as structure-based — rather than pattern-based — facial recognition, cargo monitoring, warehouse monitoring, and others would suddenly be appealing to security equipment vendors and end users — both in terms of functionality, and in terms of cost.
Particularly interesting, said Spare, would be applications that combined several low-cost technologies, such as 3D CCTV sensor imaging and RFID. “Using RFID tags in employee badges and 3D CCTV sensors in a warehouse, your security system could track all movement in the warehouse — something that RFID could not do alone — and for intruders — discriminate between human and animal, and then raise an alarm.”
The department’s inspector general, Clark Kent Ervin, said training and testing has improved since the days when screeners got an advance look at tests, some of which had laughably easy answers.
Congress has been pressuring the Transportation Security Administration to improve screeners’ ability to prevent weapons and bombs from getting on planes. In April, Ervin told lawmakers that screeners performed poorly.
The report said airports would be less vulnerable with “improved selection, training and monitoring of screeners.” But it noted that screeners on their own cannot detect all dangerous items all of the time.
The report emphasized that the best way to tighten airport security is to develop better technology, which “holds the greatest long-term potential for reducing airport security system vulnerabilities and increasing the detection of prohibited items.”
TSA screeners are required by law to receive 40 hours of classroom training and 60 hours of on-the-job training. They had to pass a test to be hired and are retested every year to make sure their skills stay sharp.
The inspector general acknowledged that test questions are better, recurrent training is improved and screeners are now getting training materials that they can take home and study. The report also applauded the TSA for teaching screeners to train other screeners, which saves money because fewer outside contractors are required to do the job.
The 122-page report listed areas where the TSA’s testing and training need improvement:
Screeners didn’t receive enough hands-on practice using machines for screening checked baggage, partly because of limited access to practice equipment.
Screeners weren’t taught some basic skills they need to do their jobs, such as handling dangerous weapons and objects, repacking bags after searches, reading airline tickets and recognizing identification for travelers who claim they can bring weapons onto aircraft.
Screeners aren’t tested on when they should pat down passengers and what the passengers’ legal rights are.
Screeners aren’t tested on or trained how to physically search animals and their cages for weapons and bombs.
The report noted that screeners, who must lift heavy bags, had the highest injury rate in the federal government last year, with nearly one in five hurt on the job. The TSA only trains some screeners on proper lifting techniques, the report said. “TSA should provide thorough training, including practice, before screeners are required to lift baggage,” the report said.
The inspector general also found that some instructors coached students through tests of their skills, which may have given an unfair advantage to some students. The TSA in May issued guidelines that prohibit test administrators from helping students during their practical skills tests.
TSA chief David Stone responded that the agency is analyzing the screener training course to make sure it covers all the skills and knowledge needed to do the job.
The agency is also looking at the feasibility of creating training centers that have enough equipment for screeners to practice on.
Stone also pointed out that the TSA is conducting several pilot programs to test new screening technologies.
<?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />U.S. comms outfit TeleTouch has made a deal to acquire the residential and commercial alarm companies owned by Progressive Concepts Communications Inc.
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Under the acquisition, still to be approved by regulators and company officials, Teletouch will receive the assets of Houston-based Hawk Security Services as well as alarm monitoring account holder of State Hawk Security Inc.
Terms of the deal, announced Oct. 26, have not been disclosed.
As part of the deal, State Hawk CEO Thomas “Kip” Hyde has been named as the new CEO of Teletouch.
“The key to this combination will be leveraging Teletouch’s existing corporate infrastructure, customer base, telemetry products and two-way radio operations to expand Hawk’s presence throughout Teletouch’s current 10 state markets and beyond,” Hyde said in a statement.
Teletouch serves the Alabama, Arkansas, Georgia, Florida, Louisiana, Mississippi, Missouri, Oklahoma, Tennessee and Texas markets.
The State Department hopes the addition of the chips, which employ radio frequency identification, or RFID, technology, will make passports more secure and harder to forge, according to spokeswoman Kelly Shannon.
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“The reason we are doing this is that it simply makes passports more secure,” <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Shannon said. “It’s yet another layer beyond the security features we currently use to ensure the bearer is the person who was issued the passport originally.”
But civil libertarians and some technologists say the chips are actually a boon to identity thieves, stalkers and commercial data collectors, since anyone with the proper reader can download a person’s biographical information and photo from several feet away.
“Even if they wanted to store this info in a chip, why have a chip that can be read remotely?” asked Barry Steinhardt, who directs the American Civil Liberty Union’s Technology and Liberty program.
“Why not require the passport be brought in contact with a reader so that the passport holder would know it had been captured? Americans in the know will be wrapping their passports in aluminum foil.”
Last week, four companies received contracts from the government to deliver prototype chips and readers immediately for evaluation. Diplomats and State Department employees will be issued the new passports as early as January, while other citizens applying for new passports will get the new version starting in the spring.
Countries around the world are also in the process of including the tags in their passports, in part due to U.S. government requirements that some nations must add biometric identification in order for their citizens to visit without a visa.
Current passports (which are already readable by machines that decipher text on the photo page) will remain valid until they expire, according to a State Department spokeswoman.
The RFID passport works like a high-tech version of the children’s game “Marco Polo.” A reader speaks out the equivalent of “Marco” on a designated frequency. The chip then channels that radio energy and echoes back with an answer.
But instead of simply saying “Polo,” the 64 Kb chip will say the passport holder’s name, address, date and place of birth, and send along a digital photograph.
While none of the information on the chip is encrypted, the chip does also broadcast a digital signature that verifies the chip itself was created by the government. Security experts said the U.S. government decided not to encrypt the data because of the risks involved in sharing the method of decryption with other countries.
RFID technology has been around for more than 60 years, but has only recently become cheap enough to be adopted widely. E-Z Pass prepay toll systems across the country run on RFIDs, pets and livestock around the world have RFID implants, and businesses such as Wal-Mart plan to use the tags to track their inventory.
But Electronic Frontier Foundation attorney Lee Tien argues that RFID chips in passports are a “privacy horror” and would be even if the data was encrypted.
“If 180 countries have access to the technology for reading this thing, whether or not it is encrypted, from a security standpoint, that is a very leaky system,” Tien said.
“Strictly from a technology standpoint, any reader system, even with security, that was so widely deployed and accessible to so many people worldwide will be subject to some very interesting compromises.”
Travel privacy expert Edward Hasbrouck argues that identity thieves are not the only ones with an interest in recording the data remotely. Commercial travel companies, including hotels, will capture the data to create commercial dossiers when people check into hotels or exchange currency in order to up-sell their customers, he argues.
While there are no laws in the United States prohibiting anyone from snooping on someone’s passport data, Roy Want, an RFID expert who works as a principal engineer for Intel Research, thinks that the possibility of identity theft is overblown.
“It is actually quite hard to read RFID at a distance,” said Want.
A person’s keys, bag and body interfere with the radio waves, and the type of RFID chip being used requires readers equipped with very large – and obvious – coils to capture the data, according to Want.
Still, he concedes that a determined snooper could create a snooping system.
“In principle someone could rig up a reader, perhaps in a doorway you are forcing people to go through. You could read some of these tags some of the time,” Want said.
But Want thinks that overall the chips will help cut down on passport fraud.
“The problem with security is there is always a possibility of attack,” Want said. “RFIDs are not going to solve the problem of passport forgery, but people who know about printing are not going to learn about RFIDs.”
Violent crimes dropped 3 percent in 2003 while property crimes were down 0.2 percent according to the 2003 FBI Uniform Crime Report. There was also a 6.3-percent drop in arson fires between 2002 and 2003.
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The report shows that for the third-straight year, burglaries were up. Though like 2002, that increase was only 0.1 percent. Robberies were down for the second year in a row with a 1.8-percent drop from 2002. Burglaries are usually defined as nonviolent thefts after a property break-in, while robberies involve theft with the intention or use of violence.
The FBI says violent crimes overall are down 25.6-percent during the past 10 years while property crimes have fallen 14 percent in that period. Violent crimes include homicides, forcible rape, robberies and assaults while property crimes are defined as burglaries, larceny and car theft.
Forcible entry accounted for 62-percent of the 2,153,464 burglaries in the <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />U.S. in 2003. The FBI says burglary victims collectively lost $3.5 billion. Most burglaries — 66 percent — took place at residences and 62 percent of home burglaries took place during daylight hours.
The only violent crime showing an increase in 2003 was murder, which was up 1.7 percent. A majority (31 percent) of violent crimes was committed without weapons (i.e. fists, feet) while 27-percent were committed with firearms.
Incidents of arson are in a separate category of its own, and the FBI says there were 4,605 fewer arsons in 2003.
Much of the work was executed within the past 12 months as nuclear facilities around the country face a federally mandated deadline of October 29, 2004, to enhance their site security.
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The <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />U.S. nuclear power industry and nuclear fuel processing facilities are among the most demanding industries in the world when it comes to security. Increased security measures call for stronger outdoor and perimeter detection, including enhanced video surveillance capability to monitor secure facilities and detect the entry of unauthorized personnel.
“Ensuring that no unauthorized person gains entry to a secure facility or sensitive area — whether at a nuclear plant, industrial plant, government mission-critical facility, airport or commercial building — is a top homeland defense priority,” said Seth Ellis, CEO of Digital Infrared Imaging.
“Our advanced thermal infrared imaging cameras are so sophisticated and sensitive that they are able to determine whether a figure as far as one kilometer away is a human crawling on all fours to avoid detection — a potential attacker — or simply a dog.”
One of the reasons DII is so attractive to nuclear plants, explained Ellis, is that the company is able to customize its cameras and offer various lens options and new detector technology. He added that DII has strong relationships with security integrators, ARINC and Nuclear Security Services Corporation (NSSC), both of whom specialize in providing solutions for the nuclear industry
The results qualify 2004 as the company’s 58th consecutive year of sales increases and the 14th straight year of increased earnings. JCI’s sales totaled $US26.6 billion, 17 per cent higher than the $US22.6 billion for the year ended September 30, 2003.
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The growth in revenues reflects a 20 per cent increase in Automotive Group sales of seating, interiors and batteries, and a 9 per cent increase in sales by the Controls Group, which includes the Control and Facilities Management Group, part of which is JCI’s Integrated Security Solutions Division. Operating income for the Control Group increased 12 per cent, reaching $US1.3 billion compared with the prior year’s $US1.2 billion.
Net income for fiscal 2004 was $US818 million, up 20 per cent from $US683 million. The net income increase was aided by higher equity income and a lower effective tax rate. Diluted earnings per share for 2004 were 18 per cent higher, reaching $US4.24 compared with $US3.60 for the prior year.
In terms of fourth-quarter results, sales for the 3 months ended September 30, 2004 increased 13 per cent to $US6.8 billion from $US6.0 billion for the same period of 2003. Operating income was $US414 million, up 15 per cent from last year’s $US360 million.
Net income rose 24 per cent to $US273 million, up from $US220 million for the fourth quarter of 2003. The increase was aided by a lower effective tax rate and lower “miscellaneous-net” expenses. Diluted earnings per share increased 22 per cent to $US1.41 for 2004 from $US1.16.
The tax provision in the quarter benefited from a lower base effective tax rate and a $US10 million favorable resolution of worldwide tax audits, which together contributed $US.09 to diluted earnings per share.
Revenues for the quarter increased 17 percent to $US9.3 billion with organic growth of 9 per cent. Revenues for the first three quarters were $27.6 billion, 23 per cent above last year.
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Cash flow from operations was $US950 million, including $US201 million of voluntary contributions to pension plans, and exceeded net income after capital expenditures of $US180 million.
“This was another solid quarter the UTC way,” said Chairman and CEO George David. “We had tougher conditions in Carrier’s North American air conditioning markets after an exceptionally strong first half, but excellent Otis results and continuing recovery in aerospace aftermarkets provided the balance. As anticipated, restructuring costs in the quarter reduced EPS by 8 cents.”
“As we close in on the year, we’re tightening EPS guidance to a range of $US5.45-$US5.50, equaling 16 or 17 percent growth for the year. Operating cash flow remains strong and after capital expenditures should equal net income for the year including approximately $US700 million to fund pension plans. We’ll confirm 2005 expectations at our usual investor meeting in December, with the outlook currently being for double digit earnings growth,” concluded David.
Third quarter results include restructuring charges of $US58 million. As previously disclosed, full year charges for cost reduction actions will exceed the favorable impact of a second quarter tax settlement and first quarter contract related gain. Favorable foreign exchange added 3 percentage points each to revenue and EPS growth in the quarter.
Year to date acquisition spending of approximately $US340 million does not include the Linde Refrigeration transaction, which closed earlier this month for about $US390 million including debt assumed. UTC has repurchased $US688 million of common stock year to date, including $US208 million in the third quarter. Full year share repurchase is now expected to exceed $US900 million.
For the nine months to date, UTC reported EPS of $US4.23, 20 per cent above last year. Net income increased to $US2.14 billion, 21 per cent above last year. Cash flow from operations was $US2.84 billion and after capital expenditures of $451 million exceeded year to date net income.
Results include sales of $US1,784.2 million, operating income of $US199.4 million, diluted earnings per share of $US0.93, net cash from operating activities of $US164.0 million and free cash flow(1) of $US144.1 million.
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For the 2004 third quarter, sales increased by 41.1 per cent to $US1,784.2 million from sales of $US1,264.6 million for the 2003 third quarter. The increase in sales from acquired businesses was 22.7%, or $US286.6 million.
Consolidated organic sales growth was 18.4 per cent, or $US233.0 million. Organic sales growth for the company’s defense businesses was 17.3 per cent, or $US193.4 million, driven by continued strong demand for secure communications and intelligence, surveillance and reconnaissance (ISR) systems, aircraft modernization, aviation products, training and government services, training devices, imaging products and naval power equipment and services.
Organic sales growth for the company’s commercial and other non-military businesses was 27.4 per cent, or $US39.6 million, primarily due to increased volume for commercial aviation products and for security products and maintenance services.
Consolidated operating income for the 2004 third quarter increased by 30.8 per cent to $US199.4 million from $US152.4 million for the 2003 third quarter.
Consolidated operating income as a percentage of sales (operating margin) decreased to 11.2 per cent for the 2004 third quarter, compared to 12.0 per cent for the 2003 third quarter. This decrease was principally due to lower margins for the Vertex Aerospace business, which was acquired on December 1, 2003, and changes in product sales mix for certain businesses within the specialized products segment. The changes in operating margin are explained in the company’s segment results discussed below.
Net income for the 2004 third quarter increased by 34.7 per cent to $US102.5 million, compared to net income of $US76.1 million for the 2003 third quarter. Diluted earnings per share (EPS) increased by 25.7 per cent to $US0.93, compared to $US0.74 for the 2003 third quarter.
