Avigilon Acquires All ObjectVideo Patents for $80 Million USDBy: John Honovich, Published on Dec 18, 2014
Now, Avigilon has acquired all of OV's patents for $80.3 million, and all of their licensing agreements with a who's who of surveillance manufacturers.
Good for Object Video
OV never succeded as a product company, despite being the first major provider and raising tens of millions. Finally, in 2011, they pivoted, raised $27 million in 2011 to fund a patent litigation / enforcement campaign. Now, they get to cash out. A good move for them.
OV also retains its services / R&D business, which is not part of the deal.
Good for Avigilon
This is very good for Avigilon as they now get to control who uses analytics and how much they have to pay Avigilon.
Avigilon is a fierce competitor to those companies and now those rivals need to pay Avigilon and ensure that they do not violate any OV / Avigilon patents.
This builds on Avigilon's acquisition of VideoIQ a year ago. Though the OV deal does not give them any new technology, it secures them the underlying patents to video analytics in general.
A half dozen OV employees who deal with patents / litigations will come to Avigilon as part of the deal.
This deal uses a little more than half of heretofore Avigilon's cash in the bank (~$150 prior to this acquisition).
Revenue for Avigilon
The direct way for Avigilon to generate revenue from these assets is the royalty payments that their rivals will now have to pay them. From what industry sources have noted, this averages a few dollars per camera running analytics. Avigilon says that currently OV's licenses generate 'millions' in revenue and that more specifics will be revealed once they file a business acquisition report.
The indirect way for Avigilon to do so is to use those patents strategically to block rivals and/or increase the costs of those rivals licensing from Avigilon. Also, from a marketing standpoint, Avigilon can surely emphasize that buying analytics from them is the best way to ensure that they violate no patents and will not be sued.
Bad for the Industry
These patents, in general, were bad for the industry, as they are so broad, many have felt that this was patent trolling from the very beginning.
Now, with Avigilon owning it, it is much worse for the industry. Avigilon does not have a culture of playing nice or sharing with others (nor should one expect them to). They will seek to use these patents to maximize their competitive advantage of their end to end solutions beating their rivals, who now need to pay Avigilon for the right to compete against them in video analytics / surveillance.
Analytics have been the 'next big thing' almost every year for the past decade. Though analytics has not yet delivered, it eventually will.
And unless manufacturers rise up and spend the money to try to invalidate these patents (which is probably too late tactically at this point), they are now stuck with Avigilon dictating terms of using analytics.
For those looking for more information on Avigilon and Object Video analytics, see:
- Avigilon Analytic Cameras Tested
- Testing Avigilon / VideoIQ Rialto Analytics Unit
- ObjectVideo News and Events Directory
- Avigilon News and Reviews
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