Axis CEO: Selling Their Own VMS In The Mid-Market

Axis VMS partners rejoice lament.

In an interview with SED, Axis CEO affirms:

"You’ll also see us put more effort into our own VMS. We are strong in the enterprise market and we see a need to further target the low camera-count market but there is also the mid-sized market to consider. Some of these mid-sized solutions have requirements similar to the small camera-count market but some are more enterprise-like. So you will also see us selling and promoting more of our own software towards the mid-sized market."

As growth slows and IP cameras become commoditized, this is a common counter move. However, with Axis, this is more controversial, given their long-standing partnerships with third party open VMSes. On the other hand, Axis has slowly been expanding their VMS capabilities over the years.

The mid-market though could cause a lot of contention as heretofore Axis has purposely handicapped their products to not appeal nor be marketed there. This will cause more issues with big VMSes like Exacq and Milestone, though in fairness those two are now owned by camera companies themselves...


But wait! "Our sales staff doesn't push camera station."

Axis is canibolizing a key differentiator, their partner ecosystem. These are the the same partners who add value to their brand through new capabilities ultimately justifying to customers why they should buy more expensive cameras. Their partner ecosystem has historically been an accelerant for innovation in IP video. Who will be the next Axis???

Let me play devil's advocate here.

Their partner ecosystem is falling apart anyway, right? Each time a major VMS gets bought out by a conglomerate and every time the Chinese manufacturers make inroads and Avigilon expands, that's less and less of the world for an open partner ecosystem. Agree/disagree?

1. VMS companies represent an open/independent position in the market which fosters innovation and competitiveness that is lost once acquired (Exacq/Tyco, Milestone/Canon).

2. Demand for independent VMS solutions won't go away and will only accelerate as silicon valley enters the market.

3. Ecosystems by definition "are subject to periodic disturbances and are in the process of recovering" which Axis seems to be abandoning for short-term gains.

Axis should rebuild their partner ecosystem if they want to maintain their position in the market. Otherwise they are just a camera manufacturer with low reseller margins.

"Demand for independent VMS solutions won't go away and will only accelerate as silicon valley enters the market."

From your lips to....

The problem is that if the sellers push solutions (and make more money that way), that's a lot of resources and effort going against the 'demand'.

Is Silicon Valley entering the video surveillance market? I don't see it.

How about from your lips?

Prism Skylabs - http://ipvm.com/prism

Eagle Eye - http://ipvm.com/eageleeye

Google - http://ipvm.com/dropcam

Kuna - http://ipvm.com/updates/2749

Bublcam - http://ipvm.com/updates/2460

Blink - http://ipvm.com/updates/2685

Novi - http://ipvm.com/updates/2685

Define who the "seller" is please.

Of what use to Axis are the companies on this list? Outside of Eage Eye, who is going to help Axis sell cameras?

The only really big one of your list is Dropcam and they dumped Axis to build their own cameras and are a closed solution, the Avigilon of the home.

My examples reflect the silicon valley entry, per your request... Both Prism and Eagle Eye leverage Axis cameras. Axis has/had the opportunity to position their cameras to be the first to emulate the largely successful Appstore model.

Returning to your original point: "Demand for independent VMS solutions won't go away and will only accelerate as silicon valley enters the market."

What I am saying is that Silicon Valley is not doing much of anything to reinvigorate the professional VMS market. Most of those companies are consumer focused anyway (as your list above attests). And as wonderful as Eagle Eye and Prism may eventually become, a retail add-on and a new NVR is not going to counter balance two of the biggest VMS companies in the world being take out by conglomerates.

In closing...

David Underwood sold Integral for $43M and he didn't go away, in fact he started Exacq. There are many examples of reincarnation in the surveillance industry and I don't see it going away. Independent solutions will always exist and Axis should embrace, not abandon that fact.

When does his contract with Tyco end? ;)

"are a closed solution, the Avigilon of the home"

I'm relatively new to the industry and I hear this a lot. I'm hoping to understand the basis for the perception of how a company that writes support for a substantial number of their competitors; Axis, HikVision, Bosch, Samsung, etc. on cameras and Amag, Lenel, Hirsch, etc. on Access Control can reasonably be considered a closed solution. Meanwhile, companies like Exacq and Genetec, who call themselves ONVIF compliant, intentionally do not support ONVIF cameras from the 16th largest company in the security market. Are they considered closed as well?

Thank you undisclosed Avigilon employee.

When I compare Avigilon to Dropcam I meant primarily their growth and their lack of interest in partnering with others.

And please don't compare Exacq and Genetec's openness to Avigilon, Avigilon is not close to Exacq and Genetec. That said, obviously, Avigilon is far more open than Dropcam.

Didn't Axis essentially give away the "low camera-count market" by releasing Axis Camera Companion?

Given all the issues with SD card storage and now all the cheap IP / analog HD options, not sure how relevant / impactful Axis Camera Companion is.

I believe camera companion does work with cameras recording to a NAS.

Tyler, thanks, yes, that's true. Make sure you have a powerful enough NAS or that will ground to a halt!

I actually like the NAS over on-board storage but if you are going to have box there anyway, at this point, it's got strong competition from the analog HD offerings.

Hey John, I get your point, but a decent NAS box is relatively easy to get now and the entire system is far more powerful if the recording engine is distributed in the cameras. Just my (slightly biased) opinion.

After Exacq was purchased by Tyco it wasn't long before you were able to buy the Exacq VMS with free IP camera licenses for Tyco cameras. I understand Tyco does want to push their own Brand but when you are a company like Axis how do you respond. Also how long before we see Milestone take a similar approach to selling Canon cameras if they haven't already. We are not a Milestone dealer so I don't know if this has happened already?

Don't know if the situations are exactly similiar. Canon has exactly 22 models available for sale, many of which are only slightly different than the other. Axis, however, has a camera for pretty much any situation. Canon couldn't push Milestone even if they wanted to, but if Axis decided to use their cameras to drive their VMS sales, it could end up hurting the other VMS manufacturers.

Getting a free Milestone license with every Canon purchase would be nice but unless Canon has a ton of R&D up their sleeve and is going to unveil 40 new camera models at ISC West, that won't drive much Milestone sales.

What I will never understand is why Canon didn't buy Techwin. If they had, CanTechStone would have been a force to be reckoned with. Maybe Samsung never approached them?

What I will never understand is why Canon didn't buy Techwin.

Never say never. :)

One thing almost certainly preventing such an acquisition is the fact that Canon is a Japanese company and Techwin is a Korean company. The relations between the two countries have deteriorated over the years to the point of 79% of South Koreans having a negative perception of Japan's influence, making it the most anti-Japanese populace of any country in the world.

Add on top of that the numerous territorial disputes and the fact that Techwin is a major defense weapons technology manufacturer equals "it ain't gonna happen."

Finally employees working in the chaebol structure are fiercely loyal to the 'family' and are resistant to being move even between Korean conglomerates, as the Techwin strikes against Hanwha demonstrate, no pun intended.

Not to mention that, not only do they provide free licensing, but the Exacq sales team have AD camera quotas too.

So theyre going to position their hardware that isnt competitve mid-market (in their own words), by selling a VMS that isnt competitive in the small market... to the mid-market. None of this sounds or looks good to me unfortunately. They seem to be shooting into the dark; Access Control, Free VMS, Thermal, Coverts, Refocused-VMS... and then their 4K entrance in the market, underwhelms.

This is Axis' strategy that they have used in the past.

Their IP solution was underwhelming (VGA) when it came out and stayed that way for a long time. They were one of the last to come out with MegaPixel, etc.

This was deliberate. Their infrastructure couldn't handle it and hard drives and switches were still very expensive when burdened with MegaPixel video.

I agree that their latest trends are chaotic and seemingly unfocused, but this might be intentionally obscure to keep their 'partners' from freaking out until they have a solid footing. They have the cash to be patient and being conservative is the Scandinavian way.