The DACH Territories: Global recession clouds AV fightback

AV Magazine

All AV sectors are having supply chain problems since the pandemic restrictions have been relaxed in many parts of the world.

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The supply chain crunch has replaced Covid as the chief inhibitor to business across much of Europe. Large projects are being placed on hold due to a shortage of components.

“Sometimes it comes down to one part of the specified solution causing the delays, such as the displays or audio end points,” says Kai Ellingsen, senior sales manager, Atlona.

“The sector faces challenges with supply often struggling to keep up with demand and a lack of facilities able to deliver repairs,” reports Niels Lubbers, sales manager CVP. He adds that there are still plenty of big projects moving forward with the region’s economic climate “currently very active and stable” but there’s a cloud on the horizon.

“The order books seem to be full and installations secured until the end of this year,” concurs Volker Unland, sales director for Germany North and Austria at Hypervsn.

“However, the overall mood and outlook for the upcoming year doesn’t seem to be that optimistic. The economic recession and inflation expected in the global economy … will definitely negatively affect the DACH market too.”

Hybrid world
With back-to-the-office and hybrid working on everybody’s mind, vendors of conference and meeting solutions technology are reporting positive business, a trend expected to continue for the next 12 to 18 months.

“The DACH market is growing strongly, especially in video conferencing and hybrid meetings,” says Doug Remington, GM head of EMEA at video collaboration and device manufacturer, DTEN. “In the meeting area, there are still complex installations, but companies are moving towards setting up small, multifunctional rooms that are less complex because they are used by many users. These spaces will combine audio, video, wireless content sharing and collaboration.”

Ralf Kalker, regional sales director at conferencing specialist, Konftel says corporates are particularly keen to offer their employees the possibility of hybrid working. “Mercedes Benz explicitly states that employees are allowed to work hybrid or via video meetings wherever the tasks allow it. Similarly, insurance companies, bank advisors, real estate agents, lawyers, architects – anyone with counselling needs are setting up conference technology,” he says.

Kalker spots a broadening of the user base for video conferencing systems. “Whereas it was once about high-level equipment in really big conference rooms with digitalisation of the home office, today the emphasis is exactly between these two poles. The focus has shifted to ad hoc meetings, short team meetings, digital brainstorming or digital learning group support. But they are all meetings with two to ten, maybe fifteen participants and where we see the strongest demand for VC equipment because standard kit such as laptops and webcams are obviously not sufficient.”

“Retail continues to grow, especially in digital signage with indoor and outdoor display applications,” reports Michaela Hirsch, sale director, Germany, Peerless-AV. “Whether it’s a direct view LED installation, or an LCD display solution depends on the application as well as on the budget.”

The tech trend for meetings and collaboration is moving strongly in the direction of hybrid meetings, confirms Remington. “Two verticals in particular are worth mentioning here – education and medical. Universities are increasingly offering their students the possibility of hybrid learning and in medical, VC is increasingly being used for training and diagnosis. Doctors no longer have to be on site and can make diagnoses from anywhere.”

Digital Pact fur Education
Bielefeld University in Germany, for example, redesigned its teaching systems last year to offer students hybrid learning. Since the beginning of the winter semester 2021/22, 70 rooms have been equipped with DTEN D7 55in systems and some group rooms with 75in versions.

In 2019, the German government unveiled a 6.5 billion EUR ‘Digitalpakt Schule’ to digitise 40,000 schools but a report from May this year criticised rollout as being too slow. By the beginning of 2022, only ten per cent of the funds from the programme had actually reached the schools, concluded a research group from the University of Hildesheim and the Berlin Social Science Centre (WZB).

“We see the rapid digital transformation of education (and justice departments) with federal states and municipalities investing in the digital educational infrastructure,” reports Mark Bultinck, sales director, Crestron.

“So far only a minor part of the budget has been invested,” confirms Unland. “Covid and a lack of infrastructure to host classes online have exposed how far behind German schools are in terms of digitalisation. This experience will hopefully give the final push for a fast and significant development in this area from which the pro AV businesses in the region will benefit.”

As you would expect, main AV activity is located in the major cities (Berlin and the Ruhr area, Vienna, Graz, Bern, Hamburg, Munich, Stuttgart and Frankfurt) “where large universities, financial centres, government districts and industrial companies are particularly concentrated,” says Matthias Wolff, sales manager, Lightware Visual Engineering.

Many enterprise-level firms are headquartered in the Frankfurt Rhein/Main Region, often because of its proximity to the international airport, notes Ellingsen.
Atlona’s regional HQ is in the Frankfurt area, which is also home to its strongest dealer base. A recent project for the Deutsche Bahn HQ in the Bahntower in Berlin, saw 300 rooms deployed with Atlona Omega switchers and extenders.

The ski areas in the region, as well as on the coasts of northern Germany are hotspots for tourist and sports activities and related DooH. In Switzerland, Zürich is central to the corporate market, and Basel important for the chemical and medicine industry.

“Even smaller municipalities in the DACH region are increasing their efforts to stay or become more attractive,” says Unland. “AV installations are an essential part of everyday life, regardless of whether it’s work or leisure related.”

AV adoption doesn’t generally differ from other European countries, but there are certainly application considerations owing to regulations in each country. Hirsch points out that the installation of a digital signage/DooH solution, on a main road or Autobahn is heavily regulated in Germany but this differs from neighbouring countries.

“DACH is treated as a unit due to the predominantly German-speaking regions. Thinking big also makes sense in many projects and avoids unnecessary cross-deliveries, additional costs, and Co2,” she says.

CVP recently established a new warehouse, engineering centre, and sales infrastructure (in Belgium) to better serve the continent, especially post Brexit. Says Lubbers: “This ensures the largest selection of the most sought after equipment is held in stock locally, improves delivery times, remove price barriers (duty and VAT free where applicable), and expands our consultation expertise.”

The region also differs within countries in terms of mentality and dialects. “The Bavarian spoken in Germany is closer to Austrian than to the rest of Germany,” informs Hirsch. “In the north is the beautiful Frisian region, between Nordics and Benelux. In Switzerland, three languages are spoken and they are not a member of the EU.”

Hirsch sees the region as a unit “because we feel connected via the predominantly German language, as well as the direct proximity of the countries. Is it fair to treat DACH as a single entity? That’s probably a personal or business decision that everyone must make for themselves.”
Data protection laws can differ from other European countries “which makes implementation of cloud services that are hosted abroad more difficult,” says Bultinck.

“There are also some differences between the different countries. Projects in Austria are typical smaller and require intensive support by local companies. In Switzerland we see more international companies and projects which are sometimes initiated and coordinated from abroad.”

Focusing on the Swiss

According to Lightware’s Swiss general manager, Giuseppe Rizzo the Swiss market is still suffering from the health crisis. “Many projects which were planned after Covid are still pending installation because the companies that operate in the sector are experiencing financial issues,” he says. “What strikes this small but strong market harder is that, if there is a project to install, integrators are not getting products because of the chip supply crisis.

“Even worse, during Covid, many pro AV technicians moved to the IT industry, which looked more stable, so we’ve not had enough human or financial resources to proceed with installation. Despite this, we expect a thirty per cent plus growth compared to last year. This could have been higher without the Corona and chip crises.”

Switzerland has the highest penetration of Apple products in Europe, and along with local brand Logitech, Swiss customers requires compatibility with both, he says.

“It makes it hard for the pro AV industry to find its place because of the lack of integration and compatibility of products and solutions.”
Not only does 60 per cent of the population also speak German but “the market and channel structures are very similar to each other,” says Unland. “The major players are more or less similar.”

Corporate meeting room collaboration technologies are more requested than ever.

Companies have realised after Covid that their meeting rooms need videoconference solutions.

In Switzerland, the education market “is still developing, moving from projectors to touch screen solutions,” suggests Rizzo.

“Offering solutions for home study is a big topic. We’re even getting requests from primary schools.”

Switzerland lags behind Germany in the transition to AV over IP and “is still not top of mind for Swiss integrators,” says Ellingsen.

A final note is that, across DACH interest in the FIFA World Cup in November is anticipated to be high with a number of special events looking to equip with screens and audio solutions.”