Axis Founder: "We Are Not In This Market To Win A Price War"

Key quote from an interview:

"We are not in this market to win a price war but to provide our partners and customers with quality products and extensive long-term support."

They can't win a price war so that's reasonable.

However, the justification of why they won't is:

"Quickly though, reality is catching up with component failures, high maintenance costs or important details missed due to poor quality images"

This is not reasonable. The Siliconization of Surveillance Cameras and the Chinese government has closed the gap.

So if Axis is not in it to win a price war and they are not going to offer a solution with Milestone, what will they do?

Do what they've always done, I guess: offer features no one else does and market the hell out of them.

That's a good way of putting it, but as those features become more and more niche, what do they do?

IP horns, video door intercoms, PTZs that angle somewhat up, etc. are all neat but that's a small part of the market.

If Axis can't win on resolution, WDR, low light, IR, etc., what does that leave them with?

Well, resolution, WDR, and low light have all become "me too" features, thanks to DahuaVision. They aren't going to win on any of those, and squeezing another decimal point out of their lux rating isn't going to the the head of the average integrator anymore, so it makes no sense to dump all their R&D cash into a low ROI spec race.

Manufacturers have three choices, all risky. They can figure out how to make their product cheaper, but that eats up their margin. They can figure out how to make their products more user friendly and easier to use, and maybe attract the end user market by selling their products direct over the web. Or they can make products that are increasingly niche, ensuring that in certain specific situations, their product is the only realistic option.

Hikvision and Dahua already won the race to the bottom, so pursuing that path is dumb and doomed to failure. Turning your surveillance manufacturing company into the next Apple is really, really tricky- for every Nest there's a half dozen orphaned Kickstarter projects. And selling direct to the end user is hard to do, you have to come up with effective marketing and create a tech support capability that can actually communicate effectively. FLIR is being successful here selling Lorex, but it's a lot of work. Or you can create a product that is a solution for problems integrators didn't know they had- but that requires imagination and vision.

This is a weird time for the surveillance business.

...thanks to DahuaVision.

You may be the only authorized DahuaVision dealer in the country. :)

Rule number one of retail; you sell what the customer wants to buy.

Rule number one of retail; you sell what the customer wants to buy.

Got Hoverboards?

There are some notable exceptions to this rule. Steve Jobs claimed and proved that "customers don't know what they want until we've shown them".

Yes, we have brought in lines and categories for which there is no obvious demand and done well with them after creating a demand. But if there's a demand for an existing product or line, there's little downside in me bringing in that product or line most of the time and lots of potential problems with not bringing in the product or line.

We can't all be Steve Jobs. The best we can do is to try and avoid being John Sculley.

Fujio Mitarai Corporate Strategy Conference 2015 - Probably, it is reasonable to expect that Axis will use optical and imaging technologies (and maybe R&D) from Canon to create better/new/advanced products.

What I do not understand is if Canon had such powerful R&D, why did they not sell / market it through their Canon video surveillance group over the past decade?

Now we know why Fujio Mitarai paid so much for Axis, just look at how sales capability is ramping up:

Though he doesn't think much of Axis optical/sensor technology:

At least they have 3 VMSes.

Poor Canon thinks 20% growth rate:

Ex-China, 2% is closer.

Couple other things,

Our Thinserver technology is known around the world today as the Internet of Things (IoT).

I might think that's an ambitious claim, but at least I see where he's coming from, but

Equally important was our decision to retain our indirect sales model, revolutionizing the way the CCTV industry operates.

what is meant by this, did Axis introduce indirect sales to the industry, or?

I am not sure how to take the sales model issue, but if he means letting anyone re-sell anywhere and everywhere, it did 'revolutionize' the industry but not in a good way for incumbents and integrators, e.g., Axis, Avigilon and Hikvision Markups Revealed

Gren: The future is Asia?

"We aim to have one-third of our total revenue stemming from Asia-Pacific markets by 2020, up from the current 12%," said co-founder Martin Gren, who invented the world's first network camera in 1996.

Ironically, that would only be possible if Hikua continues to beat the living crap out Axis in the western markets...

I hadn't heard they are not going to offer a solution with Milestone. Where did that come from?

Steven, it has been their consistent position from day 1, Canon, Axis, and Milestone all say repeatedly that they will not offer a combined nor cross-sold solution, e.g., Canon Declares Itself Largest Surveillance System Company In the World. Also, Why Milestone, Why? Axis Vs Arecont

I think that Canon will have to do so at some point in the future but there is no indication whatsoever that they are taking steps right now.