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In The Boardroom With...

Mr. Bill Taylor
President
Panasonic System Networks Company of America

Updated September 2011

At the recent ASIS International 2011 , Panasonic System Networks Company of America announced it is focusing on integrated solutions and highlighted a range of innovative systems providing affordability and lower total cost of ownership (TCO).

“The excellent performance and versatility of Panasonic video surveillance solutions provides the core imaging platform for a wide range of specialized systems tailored to meet the needs of vertical markets,” said Bill Taylor, President, Panasonic System Networks Company of America. “As we continue to develop new and innovative video surveillance products with open architecture, we are working more closely than ever with companies that specialize in applications for specific markets.”

Panasonic also announced it is highlighting its corporate green initiative to emphasize the growing importance of environmental conservation in manufacturing and energy consumption, as well as the role of security and video surveillance systems to help realize these objectives.

Panasonic's green initiative begins with the corporate “eco ideas” commitment to produce energy-efficient products, reduce CO2 emissions in manufacturing and encourage the global growth of environmental activities. Panasonic has achieved ISO 14001 certification for environmental management of its manufacturing sites by reducing emissions, employing materials recycling procedures and developing manufacturing practices that produce low material waste. Panasonic is also certified RoHS-compliant, representing a significant reduction in the use of lead and other hazardous materials in manufacturing. Panasonic cameras and other system components are designed to consume less power, reduce materials usage, and enable simplified system design.

This year, Panasonic was the only consumer electronics company to be listed in the top ten brands on the Interbrand Best Global Green Brands 2011 ranking.
For more information: http://www.lrgmarketing.com/pdfs/Panasonic_ASIS11_overview_release_final.pdf, www.panasonic.com/security, www.panasonic.com/psna, www.panasonic.com/pressroom

Panasonic NYSE:PC


SecurityStockWatch.com: Thank you for joining us today, Bill. It's a pleasure to speak with a newly elected member of the Security Industry Association Board of Directors. Congratulations!

1) Before getting into security industry trends and Panasonic solutions, please give us an overview of your background.

Bill Taylor: After earning an undergraduate degree from the University of Colorado at Boulder and an MBA from the University of Denver, I've gained over 25 years of leadership experience in communications and networking technologies at a variety of companies including AT&T, Kodak, Philips and Motorola. Through the years, I have worked in sales and marketing, corporate strategy, research and general management. My current position is President of Panasonic System Networks Company of America, a division of Panasonic Corporation of North America, the principal North American subsidiary of Panasonic Corporation. We are based at Panasonic's North American headquarters in Secaucus, New Jersey, but I've also worked internationally in Asia/Pacific and Europe.

2) SecurityStockWatch.com: What is your perspective on the benefits of IP solutions and the issues involved in the migration of analog to IP?

Bill Taylor: Today's IP-based digital video systems are built on a network that uses the same kind of infrastructure as other computer systems. There are numerous advantages to this approach. First is the potential availability - through network connectivity - of video anywhere it is needed, from any computer or even from mobile devices. Additionally, for many IP-based networked video systems, the expansion of "smart" features at the edge of the network (i.e., inside the camera), helps minimize the system's computational load and the amount of data that travels across the network. IP-based cameras also offer higher-resolution image quality and use new compression formats (H.264) to minimize network bandwidth usage.

Yet, even with the advantages and increasing market presence of IP networked systems, most systems in use today are analog. Furthermore, the emergence of IP systems has not made analog systems obsolete or less suitable for certain applications. When carefully reviewing the economics of a deployment, users and integrators may conclude that keeping all or part of an existing analog infrastructure is the best route to the greatest return on investment (ROI). This strategy is made possible by hybrid technology, enabling elements of a networked system to be integrated with an existing analog system. Enterprises that have multiple locations, such as retailers, hospital campuses or school systems, may choose to link an existing analog system in one or more locations to an overarching, enterprise-wide IP networked system. Video encoders provide the critical technology link between a legacy analog system and a new IP system. Strategic use of encoders can provide a seamless migration path to connect older systems with newer technologies, preserving the value of existing resources and incorporating them into a modern networked system.

3) SecurityStockWatch.com: Video analytics continue to gain traction in our industry and we read with great interest about Panasonic's new i-PRO SmartHD Cameras which enable face detection even in high-contrast lighting and multiple video streams, among other features. We understand there's also a new weatherproof version. Please tell us more about this important new product line introduction and the solutions i-PRO SmartHD brings to market.

Bill Taylor: Our new i-PRO SmartHD network cameras feature high-definition (HD) image quality and exquisite color reproduction using lower bandwidth. The six new models also incorporate the Panasonic UniPhier System LSI chip (H.264 high-profile format) to combine high-definition video and real-time video streaming (up to 30 inches per second) at a lower data size. A new 1.3-megapixel MOS image sensor enables high sensitivity (0.3 lux in color) and lower power consumption. The camera series includes both IP box cameras and fixed IP domes, including models that are vandal-resistant and meet international IP66 standards for dust and moisture resistance. The i-PRO SmartHD cameras are capable of detecting faces automatically, even in high-contrast lighting situations, and when paired with our NV200 recorder, enable real-time face matching based on previously analyzed images. In short, the line provides high quality video to enhance functionality, efficiency and reliability of complete video systems.

These cameras can really make a difference in a variety of real-world applications. For example, in the retail market the system would be able to detect a previously identified shoplifter returning to a store among several customers entering at once, and send an alert via email or text message. i-PRO SmartHD can provide a clear view of an entrance where complex lighting combines dark and light areas, and the high-resolution images make it easy to read a license plate number. Real-time 30 ips recording allows crucial moments to be captured in full-motion video.

4) SecurityStockWatch.com: What are your target markets for the new i-PRO SmartHD solution and what is your perspective on the market drivers at this challenging economic time?

Bill Taylor: As the economy improves, the broad need for security and the growing awareness at companies of all sizes of the benefits of video surveillance will continue to drive demand. Also helping to increase business will be the availability of robust networked systems and new technology innovations that are expanding system capabilities. Network integration of higher performance video systems enables interoperability with related systems and processes such as inventory management, retail traffic pattern analysis, manufacturing, medical processes and diagnostics, and crowd and traffic management, among others. Any true business application that can benefit from high-resolution imaging can leverage the abilities of SmartHD cameras. In addition, the availability of video anywhere on the network opens the door for utility in many business operations across the enterprise in addition to security. The market will continue to develop these applications based on user needs.

The vertical markets we have identified as particular targets for i-PRO SmartHD products are retail and finance at the branch level. In these applications, the face detection capabilities of smart cameras, paired with face matching software, can be used to detect and identify an individual of interest returning to an environment among several customers entering at once. Another more positive application would be to identify and alert management when a VIP customer enters a business.

Among the demands of all markets are top quality images in all lighting conditions, system ease of use even by non-security personnel, availability of images both locally and remotely, and scalability over time. For small business customers, networked systems can provide superior image quality in a small system environment - and growth with the business.

5) SecurityStockWatch.com: It is safe to say that Panasonic is one of the most respected and well-known brand names in the world. Panasonic brand recognition is second to none. What kind of advantage do you give your customers?

Bill Taylor: Panasonic provides core expertise related to the video surveillance market. We have earned our reputation as an imaging leader in multiple markets, from consumer electronics to broadcast technologies, and our research and development in these fields provide a wealth of usable technology innovation in the arena of video surveillance equipment. Our customers tell us that the initial price of a camera is only part of the cost equation. Dependability of cameras over time can more than offset a higher price tag, and less expensive camera models may be unlikely to perform as well or as dependably over time. Panasonic cameras, DVRs, NVRs and other system components are designed to work seamlessly together while providing a range of best-of-breed solutions for any security application.

Combining technologies from multiple suppliers into a system may seem like a smart plan, but such an approach can complicate the integration process unnecessarily. A single supplier with a broad product line can provide a "pre-integrated" system that will work right out of the box. At the same time, Panasonic strongly supports open systems operability and the development of industry standards. Panasonic's Solution Developer Network (PSDN) encourages and strengthens development of open systems with other leading suppliers around the world. Begun in 2006, the PSDN program promotes interoperability and partnerships related to Panasonic's professional security and video surveillance products.

6) SecurityStockWatch.com: Can we drill down a little deeper into Panasonic technology? Higher quality images with a smaller data size are an important feature of the new 3rd generation of i-PRO. Without divulging any proprietary or confidential information, of course, please tell us about 1.3 MOS Sensor and UniPhierŽLSI .

Bill Taylor: All the power of Panasonic's high-definition video processing ingenuity comes together in the proprietary UniPhierŽ computer chip used inside each of the company's i-PRO Smart HD network video cameras. The extra computer processing inside the camera provides superior performance, image quality and efficient H.264 High Profile compression. The latest generation of the UniPhier LSI (large-scale integrated circuit) is made possible by a high-density microstructure processing technology that incorporates 250 million transistors on a single, low-power-consumption chip to provide unsurpassed image processing and better interoperability among system components. UniPhier is a key component that differentiates i-PRO Smart HD network video cameras provided by Panasonic for the security and surveillance market. The same technology is used across Panasonic's wide video and network product line - including the demanding high-definition digital broadcasting industry. UniPhier's high performance capabilities and low power needs drive a broad range of Panasonic products. In the case of Panasonic's i-PRO Smart HD network video surveillance cameras, UniPhier technology supplies superior digital signal processing and provides multiple H.264 High Profile and JPEG video streams to enable simultaneous real-time monitoring and high-resolution recording. More efficient H.264 video compression enables high-definition (1080p) images to maintain superior quality using up a third to a half as much data. The UniPhier processor works with a new 1.3-megapixel MOS image sensor that enables high light sensitivity (0.3 lux in color) and lower power consumption. The MOS sensor realizes vivid and detailed images while dramatically improving low-light capability.

7) SecurityStockWatch.com: Please comment on the value proposition Panasonic brings to these demanding environments: healthcare, retail, hospitality and the Government space.

Bill Taylor: Panasonic offers cost-efficient best-in-class solutions that address the particular needs of each of these verticals. For healthcare facilities we can solve application challenges that include variable lighting, a need for indoor and outdoor coverage and the use of vandal-proof cameras where indicated. Recent technology advances play especially well in the hospital and healthcare setting by expanding the video surveillance capabilities needed to protect these institutions.

In the retail environment, we mentioned previously Panasonic's advantages and opportunities for face-matching technology to provide an alarm when a habitual shoplifter enters the store. Also in the retail environment, POS (point-of-sale) terminals and video recording technology can work together to enable retail store managers and loss prevention professionals to search and retrieve key loss prevention metrics and to easily access video recordings of transactions of interest.

The ease of use of Panasonic systems is welcome in the hospitality environment where there may not be dedicated security personnel on duty at all times. Employees anywhere on the property can access the system from a Web browser. Another benefit of the IP-based system is the ability of hospitality management to access the system from home or from any laptop computer.

Also in Homeland Security and other government applications, our smart cameras on the edge can increase system functionality and minimize bandwidth needs. Additionally, there are rugged models available that offer high-impact resistance for more hostile environments. Built-in software functionality can also identify objects left behind, an important application for this market.

8) SecurityStockWatch.com: Retail Information Systems is an important business segment for PSNA and congratulations on the recent announcement regarding the debut of a new dealer program for the point-of-sale (POS) and Drive-Thru product sales channels. Please tell us more.

Bill Taylor: The new dealer program for the point-of-sale (POS) and drive-thru product sales channels is a three-tiered program that will provide the sales channel with marketing resources, technical support and enhanced service to improve customer satisfaction and increase customer loyalty. The new program is one of our key building blocks for helping our channel partners capture additional market share. It was formulated to enable Panasonic partners to access and leverage the business-to-business market leadership of Panasonic and, in turn, to help them develop business strategies that will resonate with end-users and help push sales. The program is divided into three categories - gold, silver, and bronze - and offers authorized resellers targeted tools based on their commitment level and business activity. The flexible B2B program includes sales rebates and competitive pricing and also enables dealers to sell to almost all major accounts. Program partners can also take advantage of Panasonic financing solutions, deal registration, dealer advisory councils, and authorized service center certification to help promote sales.

9) SecurityStockWatch.com: Let's turn to Panasonic Document Management Solutions for a moment such as Panaboards, the Panasonic version of an electronic whiteboard. May we have an overview?

Bill Taylor: Our interactive whiteboards provide a cost-effective and productivity-enhancing advantage for businesses. Our selection of whiteboards can increase engagement and promote effective communication for business meetings, classrooms and gatherings of all types. The boards can be used for remote PC operation, using an electronic pen like a mouse; to interact with computer programs such as PowerPoint and Excel; or as a standard dry-erase whiteboard with the ability to print notes on an integrated plain paper printer. Board image capture and handwriting recognition enable our whiteboards to preserve information from meetings in real-time to be saved in a computer file or emailed to meeting participants. They truly do provide the next level of communication for business.

10) SecurityStockWatch.com: What resources are available for end-users and integrators at Panasonic System Networks Company of America .

Bill Taylor: Our Web site (www.panasonic.com/security) lists a wealth of resources for integrators and end-users. Our National Technical Support Center provides comprehensive support for all Panasonic security products, and we offer a full range of online and classroom-based product training. Also on the Web site, customers can submit a technical support request, access PDFs of operating manuals, view warranty information and access software downloads. We also provide calculators and estimators to help with product selection and system design, and video demonstrations of Panasonic technologies such as Auto Back Focus and Megapixel Super Dynamic range.

11) SecurityStockWatch.com: Thanks again for joining us today, Bill. Are there any other subjects you would like to discuss?

Bill Taylor: It's an exciting time for the security and video surveillance marketplace, and Panasonic is proud to be a part of it.