VARs Chasing Digital Signage Opportunity

Market projected to hit $1 billion by 2012

Digital signs, which can range from small LCDs to large-screen plasma TVs, seem to be nearly everywhere these days. Now VARs are becoming increasingly active with the technology that delivers advertising, merchandising, and non-commercial information in banks, car showrooms, malls, big-box stores, hospitals, airports and many other locations. Digital signage is emerging as a medium with tremendous versatility and potential, many channel executives believe.

 Lynn Hudgens, owner of Turning Point Solutions Group, a solution provider in Alexandria, La., said the emerging market represents multiple opportunities for resellers. “As these signs serve so many different applications, they give us the opportunity to sell to all kinds of organizations and businesses,” he noted.

While large plasma and sleek LCD displays immediately come to mind when people think of digital signage, they are only part of a much larger picture, according to Hudgens. He explained that digital signage is usually part of the corporate network – and can be managed either internally or externally, which translates into opportunity for the channel.

As a result, digital signage has emerged as another application, such as file and print or web services, that VARs can add to their managed services portfolio, said Hudgens.

Research company Frost & Sullivan forecasts that the worldwide digital signage systems market will grow from $313.9 million in revenues in 2006 to more than $1 billion in 2012 at a compound annual growth rate (CAGR) of more than 20 percent.

Some of the main growth drivers include overall ease of installment, network flexibility and management, the ability to remotely control multiple screens, and falling prices.

 “Another driver is ad dollars moving towards digital signs and digital networks and away from television,” added John McGoff, an account executive with Sarcom, a Cincinnati, Ohio-based solution provider.

Sarcom, which does a lot of enterprise IT work for companies such as Bosch, Eli Lilly and Kroger, has built a practice around digital signage, noted McGoff. “We have installed more than 8,000 screens,” he said, noting the company makes money from consulting, hardware sales, installation and support. Sarcom farms out content creation and maintenance.

As proof of the growth in this area, Santa Ana-based distributor Ingram Micro recently launched a digital signage division that offers resellers a dedicated team of marketing and product specialists to help with the technology. The new division will give resellers a number of business-building resources, chiefly access to Ingram’s solution centers which are labs equipped with popular digital signage products.

Ingram’s new division will leverage the national reach of United Service Source, Inc. (USSI), a member of the Ingram Micro services network. USSI can help solution providers to design, deploy and service digital signage solutions.

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