Market optimism signals AV growth in Spain

AV Magazine Jan/Feb 2015

Slowly emerging from recession, growth in the Spanish AV economy is being led by digital signage with intriguing opportunities around the internet of things, reports Adrian Pennington

In recent times Spain has been a byword for profligacy. Grandiose construction projects supposed to be symbolic of the country's affluence were abandoned in the aftermath of the financial crash. Among them: the €1bn Ciudad Real airport 150 miles north of Madrid, in ruin since mid-2012 after three years operation; another airport at Castellon never opened as its runway was too short to secure a licence; Santiago de Compostela's City of Culture, campus commissioned during the boom, costing four times as projected at €400m and remaining incomplete; Valencia's €1bn City of Arts and Sciences, again four times over budget; and the controversial plan to create €24bn casino complex Eurovegas near Madrid which collapsed at the end of 2013 when Spain's government declined to meet the financial demands of casino operator Las Vegas Sands.

Since the nadir of 2012, Spain's banking sector has received an international bailout and the economy has emerged from recession, even outperforming some Eurozone countries including Germany with growth rates of 0.5% a quarter. Foreign investors have started to return.

The country still faces considerable economic challenges, including an unemployment rate likely to hover around 20% for several years. But even the International Monetary Fund was moved to note in its 2014 report that 'Spain has turned the corner'. That's good news for pro-AV too.

“The Spanish AV market has changed dramatically during the last five years,” observes Joan Aixa, director at Maverick's Barcelona HQ. “We've come from a very segmented market, where there was a specific AV distribution channel, to a consolidated market where IT and AV are converging. In this new landscape, AV resellers need to learn about IT to offer comprehensive solutions in sectors like education, digital signage or corporate.

He adds, “Even in spite of the economic environment we’re living through, market forecasts shows overall growth, specifically driven by products like LFDs and digital signage solutions. Meeting and collaboration solutions also represent an opportunity in the corporate market. While our economy shows improvement, companies will probably take the opportunity to renew their facilities and their AV equipment to become more productive and reduce costs.”

Jaime Villena, CEO of eyevis Spain says his division ended 2014 with a general feeling of improvement. Eyevis is to open a new showcase facility this year in Madrid, where more than 70% of its sales emanate. “Since 2015 is an election year (general election in December) that always means more demand AV solutions. Spectacular projects are already agreed for 2015. Therefore, the outlook is for growth.”

According to Federico Haba, NEC's head of display solutions Ibérica, the domestic market may be some way from reaching pre-economic crisis parity, but it is performing significantly better than in 2013. “There is optimism in the channel and based on feedback from partners and customers 2015 should be positive. There are already several projects in the pipeline which are confirming this expectation.”

NEC recently opened a showroom in Madrid to act as a meeting and training point for its partners, customers and channel. Haba thinks digital signage is key to growth in the region. “There are several major worldwide retail companies based in Spain, in clothing, and jewellery for example, which are now expanding and/or refurbishing shops and bringing interesting opportunities. These are projects where the customer has a clear picture of what and to whom they want to communicate via digital signage.”

In the digital signage space, Maverick is seeing bigger screen sizes, flexible and brighter panels and demand for different aspect ratios. It too is benefiting from investment in store layout and presentation as retailers bid to attract customers by changing the shopping experience. Maverick continues to deploy LFD and components (cables, mounts) to the 500 worldwide stores of Spanish high street fashion giant Inditex (Zara, Massimo Dutti, Pull&Bear). It also bagged another Europe-wide deal for Vodafone, which began in Spain in 2012. “More than 100 shops have been redesigned with another 100 in the pipeline,” reports Aixa. “We're working with Samsung and the reseller to maintain excellence in supplying the stock on time.”

Other recent signage projects include: Banesto Bank's implementation of a touchscreen digital signage network to enhance customer communication across its 1700 branches nationwide. Madrid-based signage and video content producer AS Video worked with Telefónica Soluciones to create and deploy 'Banesto TV' managed by Scala InfoChannel software.

The Palma Aquarium in Mallorca is welcoming visitors with a new digital signage system which updates exhibit information and measure's customer behaviour and preferences. Spanish technology provider Plexus installed the solution including 44 AOPEN WarmTouch 22-inch displays.

In advertising applications the market is changing dramatically towards digital. “Pre-existing canvas/posters are being converted into digital,” reports Ivan Del Rio, Daktronics sales representative. “Full new networks of displays are being installed where there was previously no signage before.”

While the market wants digital, specific legislation in certain cities is preventing some prime locations from going digital. “It is becoming a big issue in Spain and there are attempts to put new regulations in place,” informs Del Rio. “Currently, there are only two outdoor digital signs within Madrid, both are Daktronics displays.”

The particular and prominent characteristics of the Spanish pro AV market share many similarities with other parts of Europe. “Ensuring there is balance and correlation between price and quality is vital and has even become more of a factor in the purchasing cycle,” suggests Rafael Serrano, Technical Consultant, Adder Technology. “Long buying cycles are prominent in the industry fuelled in part by the macroeconomic pressure.”

But Serrano agrees that development has been slow in recent years albeit with signs of infrastructure improvement more recently. “This has created opportunities for contracts within the commercial sector, which are typically concentrated around the population centres (Madrid, Barcelona, Valencia, Seville). There are fantastic examples of pro AV installations in all of these cities at the cutting edge of technology, from shopping centres and train stations to museums and digital billboards.”

There is also major state-led infrastructure. The government is topping up its €10bn investment in a national high-speed rail network with another €3.6bn for 2015 with the northern corridor between Madrid, Asturias and the Basque Country a major beneficiary.

Despite the emergence of these opportunities, Serrano finds that local pro AV has experienced a decline that is still ongoing. He blames the unpredictable economic situation.

“The negative state of the Spanish economy will, unfortunately, continue to have an effect on demand in the pro AV market in the short term,” he says. “What we will see is continued interest in HD and the switch to digital television. While budget restrictions will impact on the uptake, we will also see movement brought about by the focus and use of 4K / UHD.”

Smart city, smart solutions

Barcelona has always been an important seaport, the centre for Catalan commerce, a city of artists and architects. It is now being rejuvenated as a leading Smart City, and according to Barcelona tech incubators Claro “probably one of the best places in the world to build your Internet of Things (IoT) or data startup.”




Yahoo Labs and Telefonica/O2 have already based facilities focused on IoT and personal data in the city's high-tech zone 22@Barcelona. Regeneration work begun on this neglected industrial hub in Poblenou in 2001 and its cluster of green enterprises is now a model for similar initiatives in Boston, Rio de Janeiro and Cape Town.

In 2016 networking giant Cisco plans to open a €24m IoT innovation centre at a 1,720 sqm campus in 22@Barcelona. It will research technological development and market opportunities related to smart cities. Cisco will task the facility with designing urban services and solutions for cities, such as smart parking, smart lighting, location-based analytics, energy management, safety and security and cloud exchange.

Barcelona's own 'smart' credentials include hybrid electric/diesel buses and bus shelters using solar panels and touchscreens to show waiting times complete with USB ports. Motorists can find parking spaces from data relayed by street sensors to a mobile app. Energy efficient LED street lights, activated by motion, will be installed on 160 streets by the end of the year. WiFi and RF sensors on rubbish and recycling bins are being testing in two city neighbourhoods to detect levels of waste so that municipal rubbish collectors can plan the optimal route and times to collect it.

There's even a smartphone app that will overlay bus stop routes and the distance to stops in metres via augmented reality displayed on screen. Turn the phone sideways and it becomes a compass with each stop shown as an arrow pointing in the direction to take.

Barcelona is capitalising on its hosting of the annual Mobile World Congress but instigating Mschools, an educational programme aimed at getting secondary-school students to undertake classroom study using mobile technology. It has been used in both state and private Catalan schools since 2013 and is backed by the mobile operator's trade body GSMA.

This private funded city-specific project aside, ICT in schools is largely driven by the Madrid government. “In Spain, the education market is driven mainly through public investments, so the opportunity will come from high schools and corporate training facilities,” says Axia. “IFP (Interactive Flat Panels) and collaboration solutions for the meeting room will be the lead technologies in the short term.”

Sharp VS manager Alfred Lozano reports an increase in interactive whiteboard requests and collaborative software for wireless interactivity in Spain. “Projectors are increasingly being replaced by mid to large size monitors in order to offer higher brightness and a better user experience,” he says. Madrid Business School 'Instituto de Empresa' recently installed 24 units of Sharp’s 80” IWBs. “After a long period of a very slow market growth, some investment in the private corporate market seems to have increased,” is his downbeat assessment.