What Happened To Panasonic?

Panasonic is still one of the most respected brands both in electronics and in surveillance. However, the company as a whole, has struggled greatly over the last few years. The companies overall revenue has been flat for years (at ~$70 billion USD), and they have eliminated 71,000 positions as they fought to stem losses.

During the same time, Chinese and Korean rivals have grown tremendously. Compare to a similar discussion / analysis on Samsung.

Strategically, the company is evidently shifting focus away from traditional areas to housing and automotive (one prominent recent deal was with Tesla for up to $7 billion USD in batteries).

The NYTimes has an interesting and detailed profile of Panasonic's attempts to reset itself. Key points:

  • "Announced plans to stop making plasma televisions and consumer smartphones and to scale back output of digital cameras"
  • Showcasing 'clean energy' technologies in their "PanaHome" division, "including solar power systems, LED lighting and sensors for reducing energy consumption."
  • "Plans to continue making LCD televisions [and] more expensive [digital camera] models, along with a variety of home appliances."

While the Times does not mention Panasonic surveillance offerings, given the major changes underway, it is hard to imagine that surveillance will be unaffected.

Panasonic Surveillance

In our testing, the challenge that we have seen for Panasonic is similar to what happened in consumer electronics. They have been caught in the middle. There's lots of solid quality, far less expensive IP cameras competitors now plus Panasonic's cameras are generally not the best for those that are willing to spend the most. Because of that, it's harder to choose Panasonic. Over the past few years, Panasonic has tried to push 'solutions' where people buy bundles of their cameras and recorders but there recorders are not really competitive.

I know Panasonic still has brand. Indeed, given those expectations, when we first started testing Panasonic against competitors, we were surprised to see how mediocre Panasonic did.

Now, it seems that Panasonic's brand is in decline, especially with less focus on the consumer electronics market and its inability to be player in smartphones and tablets where a company like Samsung has made such major gains.

What do you think?


I have been using Panasonic cameras for the past couple years now and both my end-users and me have been more than satisfied with the combination of: price point, quality, reliability and brand recognition. I'm well aware that Panasonic has some holes in their line and have used other manufacturers in those cases (i.e. Bosch and Vivotek).
I'm curious what you and other integrators would recommend as replacement brands with similar qualities if Panasonic is truly declining/disappearing??
Thank you kindly

Alon,

I do not think Panasonic is disappearing. They are most certainly declining relative to the overall market, as they were early in IP but have not kept up with the rapid incursions of newcomers.

It ultimately depends on what Panasonic corporate management decides to do. On the one hand, at a few hundred million in revenue, Panasonic surveillance business unit is not trivial. On the other, compared to the company's overall ~$70 billion in revenue, it's relatively inconsequential. I don't suspect Panasonic will prioritize surveillance that much more simply because the upside is relatively low. Even if they could somehow 'beat' Axis, that would only mean a few hundred million more in revenue, not much for their overall scale / growth needs.

In terms of strong surveillance companies, there's a few areas I see:

  • High end / bells and whistles / price is no object - Axis
  • Low end / good enough / lowest price - Dahua / Hikvision
  • End to end solution - Avigilon

The analogy of being caught in the middle is probably a good one. Panasonic always seemed to have an interesting camera line, particularly with their indoor, wall mounted PTZs. And their tech support was very knowledgeable and helpful one time we called them on a matrix switch. But we avoided their products for awhile when they were common on the Internet. By the time Panasonic got that cleaned up, we were already getting better pricing with our top lines and Samsung looked to be making a decent comeback in IP CCTV. Went to a training class few years back for Panasonic’s enterprise recording systems and they were looked like they’d be horrendous machines to work with. You had to use separate software utilities that looked like they were written in the late 90’s to configure devices and there was no clear concept on how they actually worked.

Now it’s going to be a hard comeback for them or to maintain within a heavily competitive and fragmented market.

Hello, we have tight relationship with Panasonic. What I heard from them that they will start focusing on the enterprise sector instead of the consumer sector. One time I asked them why they are behind the leader of the IP cameras manufacturers and they said they will not invest on features unless these features will become mature and needed by the customers. Anyhow, they are very flexible; as an example, one of our projects require the cameras to be manufacture in USA, Europe, or Japan but their cameras were manufactured in China so they move the product line to Japan just for our project and then they will close it again.

"They are behind the leader of the IP cameras manufacturers and they said they will not invest on features unless these features will become mature and needed by the customers."

I believe that. The problem is that makes them consistently late. For example, 2 years after a competitor rolls out a product, proves its successful, then Panasonic comes. That's a significant competitive disadvantage. It would be ok if they were positioned as a low cost provider (like Samsung, Dahua, Hikvision, etc.) but they are not.

... one of our projects require the cameras to be manufacture in USA, Europe, or Japan but their cameras were manufactured in China so they move the product line to Japan just for our project and then they will close it again.

That was awfully nice of them :). (Maybe you can get them to fire up the old Sanyo line!).

Is that a common restriction now days, to insist on manufacture in USA, Europe, or Japan? What is driving that, trying to provide selective economic stimulus or quaulity issues or legal/other?

Is it really just a polite way of saying No Pacific Rim (except Japan)?

If it was for quaulity reasons, were you at all concerned in that moving a product line and starting it fresh might introduce some risk in the early lots, just because of typical 'first run' calibration/alignment/material substituion and worker unfamiliarity issues?

This must have been a huge order for a company like Panasonic to move production from China to Japan. I'm sure it wasn't cheap to get done and margins must have taken a hit. Never mind all of the other considerations and issues you just raised.

About a year ago, Panasonic reorganized their sales staff. Instead of a dedicated factory rep for video surveillance now they have reps than can sell everything (video displays, ToughBooks, PD body cameras, etc.). Perhaps their recent performance is a result of that. Enterprise IP video surveillance requires dedicated sales and technical staff in order to be successful in the market.

Not to slam Panasonic, but the only major new item (aside from "me too" stuff) they have released recently was incorporating the SituCon "eyelid" into a few models of their domes, which seemed totally assinine to me.

In my region they are dedicated security reps with no toughbooks on their lineup ... but I havent really asked them recently.

I still miss Sanyo. Saw some real innovation in the last three or four generations of product they came out with. And you still can't find a 1080p camera with zoom lens and HDMI output with edge recording, especially not in a camera smaller than a soda can, and double especially for less than (if I recall correctly) $600. Thanks, Panasonic, for buying them out and shutting them down without incorporating any of their R&D.

Agree completely. Sanyo had always been the little engine that could, and they really pushed the industry tech. I was always surprised on how small their market share was, considering how advanced and well priced the product was. I know that we pushed a LOT of Sanyo analog when I was in Distribution, and I saw how their IP line was maturing as a competitor, so I always kept a watchful eye on what they were doing. When Panasonic just killed the line without integrating it into theirs, I knew they had a serious problem in management.

Sanyo's projectors were the huge value. Panasonic's sales in projectors were behind Sanyo's. I was upset by the buyout and shutdown because Panasonic never came out with similar priced products where Sanyo left off. This led me to look for other manufactures for projectors. Panasonic did not gain a customer due to them purchasing Sanyo.

I'm happy to say I work for Panasonic security division in Australia. Our team is expanding rapidly here and concentrates just on security products. I know the security division is one of those that is seen by Panasonic as a growth area and im proud to be a part of that.

Here we sell what suits the customers needs, not just a Panasonic end to end solution, we have great relationships with the VMS companies and work with them on deals on a regular basis.

What we are observing with Panasonic is the behaviour of a very large global Japanese manufacturer that has not been completely able to reinvent itself. The company for so many years dominated every industry sector it went after. While performing at its best both smaller and new start-up companies managed to bring to market technology that fit holes and proved to be superior. Combine this with the Japanese corporate dislike for partnering with the software giants (i.e. Microsoft) and you get left falling behind. In the case of Panasonic they had such momentum the effects of this took 10+ years. Now add this together with the Korean/Chinese domination of the flat panel market (a sector Panasonic invested heavily into) and you get large corporate losses. The direct reaction to losses is cuts across all sectors (whether you are performing well or not).

Panasonic may not be building its products with the features everyone want. This said, the features they do put in work well and the quality is second to none.

Another shift taking place at Panasonic is they are now developing analytics. Watch for their facial recognition software. This is being offered stand alone and today is working on 3rd party hardware. We are currently testing it and early performance is rather good.

Curtis, Thanks for the feedback and for bringing up the facial recognition software.

Actually, the face rec offering is especially confusing to me. I get they are marketing variants of this across their product lines in different business units but I don't understand what they expect to do in surveillance.

Facial recognition in surveillance has and continues to be a novelty but an overall market failure. Is Panasonic claiming they overcome the fundamental technological barriers that facial recognition in general face or?

From what I've seen it requires their cameras and their VMS software. Is that not the case?

Our test environment using the Panasonic software for facial recognition is on a 3rd party server (not a Panasonic device). You do need to be using the Panasonic cameras at this point but it is very early on so will it work with other cameras? Not sure right now.

Panasonic does very well with surveillance in Canada. It is a strong brand which continues to meet the needs of the end user. In the US Panasonic has struggled for years. Their go to market strategy was and is much different. I suspect there was some complacency in management over the years and this caused the numbers to be much lower than forecast. We all look at Panasonic as a technology company but really they are no different than any manufacturer, they want to move boxes.

I wouldn’t under estimate this companies’ ability to survive and be back on top with products that the market wants.

I mean, though, it's Panasonic's VMS software that does the facial recognition, right?

For Panasonic, they certainly have the resources, I am not sure if they have the will. They have no really demonstrated it. Face recognition is neat but wouldn't they be better served by focusing more on keeping their camera lines up to date to advances in technology and reductions in price from Chinese competitors?

Hi John,

The facial recognition does require the Panasonic cameras and a server from panasonic, however the VMS does not have to be from Panasonic. This is new to us at the moment, but I understand that Genetec already supports it and other VMS's will have the ability to do this, they just need to work with us to make it work.

Im not the greatest fan of analytics, however, I have seen this working in BETA mode and was impressed enough to recommend it to a couple of customers for testing, as they had a requirement. I can assure you, I only recommend solutions that work.

fraser

For facial recognition or detection? I forwarded this to Genetec to ask for their explanation.

Hi John,

The software is from Panasonic that does the recognition, it sits on a separate server, it isn't it's own VMS too, but it will push out to a VMS if it recognises a face from the database you set up.

Of course you can use Panasonic's VMS if you like but we do realize that there are many others out there, and we partner very closely with these as they are a very important part of a customer solution.

fraser

Pushing out alerts for facial recognition is a problem unless the alerts are extremely accurate, which will not be the case unless Panasonic has solved a huge problem in computer vision.

This would be like the problem with perimeter violation alerts, but 10 to 100 times more difficult, because it is a lot harder to be consistently right about whose face just passed by then if there is a person crossing a line.

And if you are just pushing out to a VMS that means you cannot do searches, like show me all the people who look like John that entered the building last week, which is more likely to be usable than real time alerts.

Hi John,

Sorry, I was just giving that as a way of it working, you can certainly search the database of people, but again, this piece is a part of the Panasonic face recognition server. this can be written into the VMS so that it can search the Panasonic face recognition server, which I believe Genetec have done.

i suggest having a look at the following link and having a read of it.

fraser

That link says nothing about integrating with Genetec or any other VMS.

What I am getting at is that Panasonic, like it or not, is a camera company, not a VMS or video analytics one. So having this proprietary face rec system, which is unlikely to work well at scale, and is specified to work with only 3 Panasonic cameras, with maybe some light integration with one VMS is not a huge draw.

Hi John,

I have to disagree that we are only a camera company, we do have some good products and I believe have a unique advantage of being able to use other business units who do have some amazing analytics which we can use to our advantage.

one of the great things about Panasonic, and why I like working for them, is that we have this ability to utilise other business units products which can enhance our security offerings.

the word proprietary is not one I could use in this case, we have an open policy with all VMS venders who can write this product into their software. Yes, it's a seperate server, but the reasons for this are simple, we need to control how much is running on the server as we don't want to compromise the face matching.

Im sure you have seen examples of people running too much on a server that was supposedly just for running the VMS, I certainly have, and this can compromise the security system. By having a dedicated server just for the face matching takes this element away, you get a more stable product. I've worked in the IT industry for many years prior to security and have recommended this type of "appliance" many times, to ensure the stability of the customers requirements.

Panasonic, in the surveillance market, lives and dies by its cameras. Take the NVRs/VMS/analytics alone and really, who would buy them? I am sure you could find a few, but it wouldn't be close to a top tier offering.

My point is that Pansonic should focus on maximizing their camera performance and competitiveness. Things like facial recognition will do very little to compensate to fundamentals holes on the camera side.

Hi Fraser / John,

I confirmed that Panasonic has integrated their facial recognition solution into Security Center. I will let Panasonic confirmed the general availability of the integration, but their different solutions such as Face Search, Face Matching and Age and Gender Statistics are available within Security Center as a dedicated task in the Security Desk client application.

It does require a server for Panasonic to run the back-end analytics, but the front-end operations are done inside the Genetec Security Desk.

Francis Lachance

Genetec

Hi all, I am Tijmen Vos, COO of Panasonic Cameramanager, a recently acquired cloud surveillance company in Europe. I can add to the discussion that in Europe we're already following a quite successful cloud strategy, currently focussed on home and SME. So the cmaera is not the driver, but the service / cloud software is. We aim to expand to US later in '14 with a few competitive offerings. In Europe we follow an open (cloud) strategy which means that we're working with Axis and Hikvision closely too. We're looking what the customer needs and choose hardware based on customer requirements, which is not per definition Panasonic hardware. It's basically a move from hardware only thinking to solution / services thinking and in our case focussed on cloudbased solutions. And we see this fits the overall Panasonic strategy in any product area.

Hello, still Panasonic cameras perform well in our projects and we are talking about mega projects with thousands of cameras. I hope there will be some tests to compare their performance against other manufacturers. I came across a case study of Texas correctional facilities, they are utilizing 4600 Panasonic cameras so far, and they are planning to roll out more cameras in 5-10 years in 111 prisons in Texas. What I am saying is that there should be a good reason why they are using non-American cameras. Again, I hope to see Panasonic cameras in future comparisons. Thanks

Tariq,

Well unfortunately for us Americans, US cameras are not exactly the best. Who's our top dog? Arecont, Pelco, Honeywell.... oh brother... That's why foreign IP cameras, whether it's Axis, Avigilon, Sony, Panasonic, ACTi, Vivotek, etc., etc. do so well here.

We have done tests. Here's the Panasonic panoramic, here's the Panasonic Full HD box. They are OK. It's just that they are not keeping pace with the overall rate of advance in the market. For example, I am no 'fan' of Samsung but you look at what they have done this year, and it's better video quality, same features at half the price of Panasonic.