digital signage is now becoming more popular in retail stores and now it’s a good time to install one in yours. Whether you’re a small retail store or a large retail chain, we’ve done it all. We’ve helped and provided our customers with simple and standalone digital signage solution for a single store to building [...]
Friday, December 11, 2009
As promised last week, today we're going to continue the analysis of our recent survey on figuring out what a digital signage network should cost. My last article focused on the hardware components that go into a typical project: LCD screens, media players, wall mounts and installation services. (Admittedly, installation isn't hardware, but it does fit nicely with the other items.) Now we're going to look at the various software components that power a digital signage network. Once again, if you're viewing this in your email or RSS reader and can't see the pretty pictures, you should visit http://www.wirespring.com/blog to view the charts in all their glory. Picking up where we left off When we left him, our intrepid hero was struggling to figure out how much to pay for all of the bits and pieces that go into a typical digital signage network. Satisfied with the answers he got for the digital signage LCDs, media players and installation, he turned his attention towards the hydra that is software and support. The key challenge with getting good data on digital signage software and support pricing is that these things are often interrelated, so paying more for one might reduce the cost of the other, for example. Likewise, lots of people have navigated their way through this business using only one software scheme (e.g. self-hosted versus SaaS), and consequently have little experience with other approaches. Because we asked all respondents to give their opinions on both pricing models, this has probably skewed the data a bit. Let's take a look at the responses. What do people expect to pay for media player software? Unless you're buying some kind of low-power set top box or something equivalently embedded, you're probably going to have the option of buying your media player hardware separately from your software. If not, you could probably at least guesstimate the cost of the two components, since most non-embedded media players tend to be off-the-shelf PCs these days. Consequently, there weren't many surprises from the responses to this question: the free/open source/pirated software people make up a small but stable portion regardless of project size, and everyone else is paying for software packages that span the range from a few hundred to over $1,500 per license. This makes sense to me, since there are a lot of very high-end, feature-rich packages out there that can be used for both small and large projects. What do people expect to pay for remote management software-as-a-service (SaaS)? On the subject of software-as-a-service, I'm still not sure how to interpret the data. For example, do any of the people who have no digital signage project experience (and thus no experience with digital signage SaaS), actually have experience using any other types of software as a service? If not, it seems like their guesses would have to be coming out of thin air. Roughly equal numbers of large- and small-project people have never used a SaaS solution, though only 15% of those with mixed experience have never tried SaaS. This suggests to me that many of those noting they have mixed experience are probably pragmatists who use different software for their different products, or perhaps they've inherited some older networks using products different from those that they use today. Those running larger networks definitely expect a larger discount on their SaaS bill than their small- and mixed-project counterparts. On average, those doing small projects exclusively pay about $671/node/year (about $56/node/month), and those doing large projects exclusively pay about $470/year (about $39/month). Those who have done both kinds of projects are right in the middle, saying they pay about $598/node/year on average ($50/node/month). Given the very wide range of prices, I believe that some of these SaaS plans include products and services that aren't included with others. Unfortunately, I didn't ask for that level of detail in the survey, so perhaps some folks can leave a comment and let us know what they get with their SaaS subscriptions. What do people expect to pay for self-hosted remote management software? Since virtually everyone has experience (or at least some familiarity) with buying boxed software, I don't think the data from the "no project experience" respondents is as suspect as it was for the SaaS question above. Nearly a third of those working exclusively on small projects seem to have gone with either SaaS or (more likely) unmanaged options, whereas that number falls to only about a fifth for those who have worked on large or mixed projects. On a pricing note, one thing that does jump out right away is the huge difference between those who have never done a digital signage project (and have likely not purchased any software for it), and those who have. The "no experience" folks overwhelmingly felt that management software should cost less than $5,000, which is a pretty low number based on my knowledge of today's marketplace. This could be because they simply haven't priced out the market, or it could be because those respondents who have actually read my blog but haven't yet done a digital signage project are studying smaller networks that might eschew formal management software altogether. Otherwise, the numbers for only-small, only-large and mixed experience responses were very close, suggesting that the results here might be a fairly accurate representation of the market. Many server software packages are purchased upfront, before the network reaches a significant installed base, so project size may play a relatively small role in the pricing. What do people expect to pay for technical support? Last but certainly not least, we asked people what they expect to pay (or typically pay) for technical support. Phrasing the potential responses to this question was tricky, since many people get support for "free" as part of some other service. Others pay a fixed-fee per managed node. Still others simply pay for the support they use, usually on an hourly or per-incident basis. Because we were basically asking people to condense their experiences into one of a few fixed choices, I'm not as confident in this data as I am with data for the other assets and services studied so far. Still, we can draw some general conclusions. For example, excluding those people who get support as part of their SaaS purchase, project managers are roughly as likely to pre-pay for support annually on a per-node basis as they are to simply pay per-incident, regardless of network size. The number of networks who don't buy any support package at all also seems somewhat steady in the low teens, probably indicating that this portion of projects is handled completely in-house. I'd expect to see this number decline over time -- in lock-step with pricing if past experience is any judge. Finally (and again excluding those who get support with their SaaS service) there is a clear trend toward the lower-end of the pricing scale, both on the per-incident and per-player fee schedules. No big surprises there. In my simplified view of the world, the eight components we've studied in the past two weeks -- LCD screens, media player hardware, media player software, screen mounts, self-hosted management software, software as a service, installation and technical support -- are the core elements of virtually every screen network out there. Are there other things that need to be taken into account? Certainly. Bandwidth, video distribution equipment and content creation all spring to mind immediately. However, I've opted not to include those in this survey in hopes of really focusing on the most basic (and static) bits and pieces. With our basic analysis of these costs done, next week we'll turn our attention to the additional services that go along with digital signage: content production, project planning, and about a dozen other elements that we included in our survey. Plus, we'll talk about some of the things that people asked us to include in future studies. Now that you've seen our data on software pricing, I'll ask the same question as last week: What do you think of the results above? Do they fit with your expectations? Leave a comment and let me know. Click here to leave a comment What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.
Friday, December 11, 2009
Last week we looked at a list of digital signage services to find out which tasks companies tend to outsource, versus handle internally. Today, I'll break down that survey data based on network size, looking at how those with small network experience, large network experience, mixed experience and no experience responded to the questions. This data could be valuable for service providers who are trying to decide which companies to market to. Likewise, it could be useful to network owners and operators as a way of comparing their decisions to similar (but potentially competing) companies. We've got a lot of graphs and charts in today's article, so once again if they're not showing up correctly for you (e.g. in your email inbox or your RSS reader), surf on over to http://www.wirespring.com/blog to get a better look. So, how do big and small digital signage networks handle their service needs? If you missed last week's article on digital signage services, you might want to give it a quick read-through, since it presents some top-line findings that we'll be exploring in more depth today. Let me point out one quick thing before diving into the results: there are some slight numerical differences in the results between this week and last, due to rounding errors in Excel and a peculiarity with how the spreadsheet treats blank values in certain formulas. For the most part, these errors are small (less than 3% or so), and in any event they don't change the high-level findings or analysis presented in last week's article. With that out of the way, let's take a look at the charts for each type of digital signage service: Digging into the numbers As you can see, there really isn't much variance in the responses from each of the experience groups, which I found quite surprising. After all, a 10,000 screen, 500-venue advertising network is quite different from, say, a 2-screen employee breakroom application. I was really expecting to see more distinction between those with only-large and only-small network experience, but those variances simply didn't show up. Understandably, the group who admitted to having no experience working with digital signage did tend to have different answers than the folks who have done projects before. Whether this indicates a lack of understanding of the marketplace or just a different set of expectations based on some domain-specific knowledge is hard to say. Most of the time, though, even the no-experience people were within a few percentage points of those with some experience under their belts. However, there were a few areas where the groups displayed more diversity in their responses: Nearly 80% of those working with large digital signage networks handle their content management in-house, versus 74% of small networks and 70% of those who have done both. Those respondents who had only worked on large network projects were slightly more likely to outsource their project planning (11%), versus just 3.5% of those who had only worked on small network projects. Likewise, those handling large and mixed projects were more likely to outsource logistics management (35%), versus only 21% of those working exclusively on small network projects. While those with both large and small network experience generally tended to answer more similarly to those with large network experience only, one exception is in the network/operations area. Those with mixed experience were markedly more likely to take care of that service in-house (76%), versus just 63% of those exclusively working on large projects, and 64% of those exclusively working on small projects. Not surprisingly, small network managers were significantly more likely to handle installation services themselves (though it was still only 30% of them). Only 20% of large network managers handled such tasks in-house. Those with mixed experience were split between these two at about 24%. Things to cover in future surveys While I got a lot of positive feedback about this survey and its content in general, there were a few common themes in the suggestions that I received. For example, many people asked for a greater focus on content-related costs, including typical production costs, rework costs, and the like. Another popular area of focus was on hardware, with numerous folks asking for a study of pricing for components like directional audio systems, cellular modems and plans, and measurement peripherals. Still another group wanted a look at more business-y items like equipment financing and leasing, costs associated with customer attrition, and related site fees. And then there was one guy who said "Monkeys. Lots of monkeys. And pie." I'm not quite sure how I can help that last respondent (except perhaps to recommend that he check the dosage of his medication), but for the rest of you folks with requests, I'll certainly begin planning some future surveys to cover these important matters. There's clearly still a lot of confusion and complexity in our market, thanks to both the variety of skills that must be brought to the table, and the wide range of corporate disciplines that have attempted to take on digital signage projects. My goal for future surveys is to continue bringing the relevant data into the open, which should help increase confidence among potential customers and increase the size of the pie for everyone. Well, I'm finished studying this data for a while, but it certainly has been an educational set of articles (for me, at least). As many of you have been asking, yes, an update to our annual digital signage cost estimate is coming up soon -- either later in October or early in November. To compile the annual budget numbers, I definitely plan to use the data from this pricing survey in conjunction with my usual method of gathering industry-wide pricing (which largely consists of emailing and calling a lot of people). But thanks again to everyone who filled out the survey and left comments during the past few articles. I've learned quite a bit from the experience, and hopefully you have, too. Did you enjoy the way we published the survey results? Would you like to see them presented in the form of a downloadable report, a slide presentation, a video, or a podcast? Leave a comment and let us know. Click here to leave a comment What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.
Friday, December 11, 2009
Five years ago, we started a tradition that -- much to our surprise -- led to industry notoriety as well as more fans and flames than you can count. Yes, that's right, I'm talking about the annual digital signage pricing guide. As the number of articles on this blog started to become unwieldy, we decided to create a single page with all the digital signage cost estimates and price guidelines that we've published over time. This year, we're introducing a brand new feature: the pricing study will incorporate some of the data collected from our "How Much Should Digital Signage Cost?" survey, which we analyzed in a series of recent blog articles. As you'll see from the results below, digital signage has never been more affordable or more available than it is today. So what are you waiting for? Keep reading to find out just what it'll take to get you into your very own 100-screen network today! A quick review and introduction For those new to the market (and those who've read these articles before but have forgotten), the numbers below are meant to model a "typical" 100-screen network. What does that mean? I think this paragraph from last year's writeup still says it well: While our previous cost estimates and ecosystem components have closely matched those from other industry analysts (so we don't think we're too far off the mark), the myth of a "typical" network is more strained this year than ever before. More vendors and network owners are choosing to implement screens with new formats and more varied locations, injecting more diversity into the projects. Plus, the idea that there's a standard staffing requirement for any digital signage network is pretty ridiculous. While we and others have proposed a list of key positions that need to be filled when creating a digital signage team, some networks are still very heavy on content production, while others might be composed almost entirely of sales folks. Still, as we looked across a wide array of networks -- representing not just our products but also our competitors' solutions -- we were able to get a reasonable feel for what most companies needed as far as the human resources side of things. What's the cost of a typical 100-screen digital signage network? Despite the many variables that go along with this type of broad estimate, we found that the data we compiled internally -- combined with the survey results that many of you contributed a few months ago -- paint a very logical picture. More importantly, the pricing continues to follow the well-defined trend that we've observed for several years now. The resulting cost estimates appear in the table below. (If you're viewing this in your email or RSS reader and can't see the tables and charts, we encourage you to visit http://www.wirespring.com/blog to get the full experience.) Cost of a digital sign for 3 years 40" LCD screen $800 Player hardware $775 Display mount $110 Player software $405 Management software & tech support $1,300 Installation $740 Initial project management $225 Total $4,355 How have things changed since our last pricing study? Right off the bat, you can see the dramatic decline in pricing, which we attribute to the confluence of a few things. First, and most obviously, the broad macroeconomic trends that we've all been experiencing the last 12 months or so have made ours an even more dog-eat-dog world than usual. With slower than normal deal flow and a more cautious customer base, many providers have felt compelled to slash prices in order to keep the deals moving. Stemming from this, several of the better-known vendors in our industry have experienced some pain (e.g. running out of working capital, having major investors withhold cash payments, trying to get bought/sold, etc.), and have consequently tried some... um... creative pricing strategies in an attempt to keep their heads above water. And finally, the tireless march of progress (aided by low or negative inflation rates) has simply made some of this stuff cheaper, as it almost always does. Interestingly, looking at the breakdown of costs by component, you can really see the effect of the commoditization of the hardware: Hardware items are taking up less and less of the pie, while the service-oriented components like management software and tech support take up larger portions. While I don't think we've seen the end of this trend yet, it's clear that those service areas are where the true value to the customer lies, so it's no wonder that they're getting bigger at the expense of the mere "nuts and bolts." The upshot to you, gentle reader, is that there has never been a better time to get into the digital signage business as a network owner or operator -- provided you have the working capital, at least. As you can see in the tables below, the cost of implementing a 100-screen network has dropped nearly 23% in the past year and nearly 50% since 2004, which is the biggest annual decline that we've recorded since we started keeping track. (Note: to ensure an accurate comparison, we removed the 24/7 tech support line from the 2004 numbers, since this was not included in subsequent years.) What happens when you consider personnel costs? As noted, the table above is a composite estimate for running a 100-screen network over the course of 3 years. Building on work that we did last year to figure out the approximate cost (including personnel) for running such a network, we've re-verified that the "average" 100-screen network takes somewhere between 7 and 15 people to run. We stuck with the assumption that the average salary for these personnel is $50K (which is fair, since average salaries haven't dropped that much in the past 12 months). But we reduced the average staff size by one person (to reflect the dismal state of employment today), bringing the average headcount to 9 people. This adds up to another $450,000 in salaries and associated costs every year, for a total of $1.35M over our 3-year planning horizon. That's equivalent to $37,500/month in expenses, or $375/screen/month. When added to the $121/month in capital expenses, the "average" screen in a "typical" 100-screen network costs about $496/month after salaries are factored in. In other words, a 100-screen network would need to pull in just under $50,000/month to break even. What about connectivity and content? First, connectivity. To the people who tell me year in and year out that I need to include bandwidth and connectivity costs in my estimates, I once again went out to the masses and asked. Aside from a couple of interesting exceptions, most networks are still sharing the bandwidth that's already in place at their host venues, essentially getting Internet connectivity for free. So while connectivity could easily add another $30-$150/month in expenses to your network if you need to spring for it, in my experience this will be the exception, not the norm. And with airports, malls, superstores and coffee shops giving away free bandwidth to anybody with a wireless adapter, I really don't expect that to change. I know a lot of people are waiting for WiMax to really start making headroads in the market, but today we're still stuck with 3G at best, and 2.5G or worse in areas with poor coverage. So cellular connectivity doesn't really save anything versus wiring into an existing LAN or using WiFi today. Next, content. In 2007, we took a look at some of the content creation costs that go along with digital signage networks and found them to be all over the map. Since then, content gurus like Pat Hellberg and Gary Halpin have chimed in with explanations of why certain things cost what they do. But during that period, nobody has really ventured forward with a formula for guesstimating the a la carte content production costs. The good news is that the prices in our 2007 budgeting article have likely fallen, thanks largely to the lousy economy, low inflation, greater competition, improved workflow processes, and offshoring. The even better news is that since last year's budgeting article, I discovered that every single network I spoke to has at least one in-house content person who handles some (or nearly all) of the network's content needs. Consequently, at least part of the content creation budget is already built-in to my estimates above. Closing thoughts (and some more light reading) So there you have it, the 2009 digital signage pricing estimate. After speaking with a bunch of networks directly and incorporating the data that we culled from the 220+ responses to our pricing survey, I'm more confident of the numbers above than ever before. Want more info on the survey results that informed our final pricing numbers? Check out our recent articles where we looked at each category in detail: Digital Signage LCD and Installation Prices Are Falling Digital Signage Software, Management Services Costs Vary Digital Signage Services Mainly Handled In-House How Network Size Impacts Digital Signage Service Choices Of course, even with all my number-crunching, I don't claim this data is perfect. That's why I hope you'll chime in with your own thoughts and experiences. So... Are you surprised by the big drop in costs this year? Do our numbers match up with your own experiences on the open market? Leave your thoughts in a comment below! Click here to leave a comment What's WireSpring's Blog All About? WireSpring provides hardware, software and services for digital signage and kiosk projects. But our blog is a labor of love. Our posts cover everything from case studies to creative briefs, and are authored by some of the industry's most well-respected leaders.
Wednesday, April 22, 2009
Roanoke, VA and San Francisco, CA/April 21, 2009 - Leading Digital-Out-Of-Home Media company, LevelVision LLC (www.levelvision.com) and their college division, LevelVision:College are excited to announce their end-of-semester “Domination” offer. This is the first time the company is offering a Single Advertiser Takeover Opportunity and is a DOOH Industry first. Just as Spring Semester is wrapping [...]
Thursday, April 16, 2009
WARSAW, Poland, April 16, 2009 – DDS Poland, a Scala Certified Partner in Poland, has supplied Atvertin with operational and content management solutions to develop and manage an extensive, scalable 52-store proof-of-concept digital signage network for Tesco in Poland, which launched in September 2008.
Wednesday, April 8, 2009
TAIPEI, TAIWAN, April 8th, 2009 – CAYIN Technology, the professional supplier of digital signage solutions, releases the advanced monitoring software. SuperMonitor 2 is dedicated to CAYIN digital signage networks. The handy and powerful software assists administrators in monitoring live status of multiple DOOH networks and managing different servers and players simultaneously and efficiently. SuperMonitor 2 fulfills the [...]
Thursday, January 22, 2009
Aldeasa Stores in Palma de Mallorca Airport, Spain deploy Scala Digital Signage. Madrid, Spain (PRWEB) January 19, 2009 -- Scala, the leading provider of end-to-end connected signage software, today announced that Aldeasa Stores in Palma de Mallorca airport, Spain, has deployed a multichannel, multi-screen Scala network as part of a proposed global rollout strategy.
Friday, January 2, 2009
An Exclusive From Minicom for 2009 I love this new exclusive. It is just what we need to start off the 2009 Digital Signage Revolution. This is also just what the forum needed too! Which is a great connectivity provider that actually can provide some really down to earth information for resellers, integrators and end-users. You [...]
Sunday, September 21, 2008
When I was first introduced to TJ McCue over at www.q4sales.com I thought it was going to be a website job or technology company that needed some marketing online, or possibly a new advertiser for the Digital Signage Forum. At first, I was a little uncomfortable because TJ seemed to be picking my brain and [...]
Sunday, September 21, 2008
By John Ochoa, Director of Business Development, Digital Signage If you haven’t noticed, digital signs are suddenly showing up everywhere. Retail stores, malls, movie theaters and banks are using digital signage as the tool of choice for advertising, customer education and self-service applications. In an age where people expect instant information at every location, the [...]
Sunday, August 10, 2008
China’s Growth in Out-of-Home Media Seen Across All Consumer Touchpoints With just over 1.3 billion people, China is the world’s largest and most populous country, it is also home to the world’s largest out-of-home digital signage networks. China is a country on the move, from mass transportation systems to elevators to hotels and shopping malls, [...]
Saturday, August 9, 2008
Experts say the digital signage market is poised for explosive growth, providing great sales opportunities The popularity of digital signage is apparent in just about every facet of our lives. Digital signs are commonly installed in transportation hubs, arenas, schools, stadiums, convention centers, banks, airports, corporate facilities, and retail businesses. They can deliver relevant, meaningful [...]
Thursday, August 7, 2008
CCN the UK Government and Public Information network has sold its digital signage network to Life Channel owners CanMedia. CCN had been toiling away in the sector for almost 5 years, and over that time have built an impressive network of connections (Tony Blair launched their first network in the North East of England), but [...]
Sunday, August 3, 2008
Unlike other TV networks, CBS is taking its commitment further. Owning networks—or, at the very least, signing exclusive sales agreements with networks—allows CBS to control not only content but all inventory, a plus for advertisers. “CBS is more serious about the space than their competition—they aren’t just looking to rep space,” says Daniel Wilkins, president [...]
Sunday, August 3, 2008
Automatic quarterly updates to Software-as-a-Service content management system enable improved control of digital signage networks ETOBICOKE, Ontario – July 29, 2008 – Rise Vision, Inc., a provider of a web-based content management system for the control of digital signage networks, has issued the Summer ’08 Release of its Rise Display Network (RDN) service. Quarterly updates [...]
Friday, August 1, 2008
Digital Signage Solutions Leader and Major Sailing Content Publisher Team with Apple(TM) Reseller Solutions, Inc. to Design and Implement State-of-the-Art HD Network to Debut in August in Prestigious International Yachting Destination Last update: 3:01 a.m. EDT Aug. 1, 2008 BLACKBURN, England & COWES, ISLE OF WIGHT, England, Aug 01, 2008 (BUSINESS WIRE) — Dynamax Technologies [...]
Friday, July 11, 2008
Welcome to the BIG SHOW! I am happy to announce the Digital Signage show is a new sponsor for the digital signage forum and the digital signage directory. They are really nice people and put on a great tradeshow!! The Digital Signage Show delivers strategic, marketing and technical business solutions for organizations wishing to deploy [...]
Thursday, July 10, 2008
REDMOND, Wash. & EAGLE, Idaho–(BUSINESS WIRE)–Sept. 19, 2006–PlayNetwork Inc., the leading custom media services provider for businesses worldwide, is now using the BroadSign(TM) Suite to offer full-service video media solutions to retail, hospitality, health clubs, banking institutions and other businesses. Retailers and other businesses looking to feature dynamic video content for customers to experience can [...]
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Friday, August 6, 2010
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