Avigilon Massive Growth Continues

Author: John Honovich, Published on Feb 28, 2013

Bucking an industry trend, Avigilon's massive growth continued in calendar Q4 2012, with revenue growing ~73% year over year, even higher than their 2012 overall growth rate. The note below details the key financials details and most interesting comments made on management's call.

First, key details from Avigilon's 4th quarter financial report:

  • ***** **** ******* ***** $*** ******* (***), ** **% **** 2011's $** ******* (**** *** **** *******, **, ****** **** the ****'* *******).
  • *** ****** ** **** *** ~*%, *** **** ** *** quarter **** **** **** *** ****** **** ******* ******** ** 2012.
  • ********* ******** *** *** **** ********* ***% **** ~$* ******* in **** ** ~$*.* ******* ** **** *** ** **** was **** ** ~**% **** ** **** ** *** '***' program **** **** ******** ** ********* ******* ** ** ****
  • ******* ******** ********* * *** **** ****** **% **** **** year **** "******* ******** ** * ********** ** ******* **** fallen ** **% **** **%."
  • ******** **** ************* ************** *** *** ******* $***+ ******* *******

Massive ******** ****** *********

***** ******** ***** **** **% **** *** ** *** **** over ****. ********** **** **** ***** **** ******* *** ** more ********* **** ****.

R&D *********** ***

***** *&* ******** **** **** ** ~**% **** ~$*.* ******* in **** ** ~$*.** ******* ** ****. ****, ** * percentage ** *******, *&* ******** ** **** *-*%, **** ***** competitors. *******, ******** *****, "** ****** ** ******** ** ******** expenses, ** * ********** ** *******, ** * ***** **** typical **** ******** ***** ** ** ***** ** ********* *** expanding *** ******* *********." **** ** ***** ********.

Aiming *** ********** ******

******** ********** ****** ** *** ********** ******, ****** *****, ** contrast ** **** ** ********* ** '*** **** ********', *** mid ****** ***** **** ** **** ** ***** ******** *****.

Casino *********** ******

******** ******** ****** *********** **** * ****** **** **** **** recently *******: "** ** ******* *, **** *** ****** *** been ********* ** ** ****** ********* ** ** ********** ****** the *****, **** * ***** ** **,*** ******** ** ***** running ***** *** ***. *** ******* ****** **** ** **** was ** *** **** **** ****** & ***** ** ***********, New ******, ***** ******** *** *** ***, *** ******** *-******* analog ***** ******** *** *** ******** ****-********** *******."

****

* ***** *********** ** ** *** ******* ** ****-********** ****. In **** ** ******, ******** *****,"******** *** * ***** *********** to *** **** ********, ** ********** **** **** **** ********** to * ******* ********** ** *** ******* ** **** *** forward ** ** ******* ******* ** *** *****. *** ***** team ** ******* ******* **** ****’* ********* ****** ** ******* their **** **** **,*** ********* ** ** ********* ***** *** advantage ******** *** *** ********, *** ** *** ****** ** increasing ****** ** ****** **** **** ***** ****."

************, ****** *** ****, ******** ****** ***** **** **** *********** like **** *** ******* '**** **** ********* ***********' **** **** up **** ** ****** *** ********** ***** **** ** **** through *** *** ****** ******* ** ***** ***********.

Inside *****

******** ** ******* ** ****** ***** ****:"** **** ********** ** inside ***** ********** ** **** ****, ***** *** ** *** Dallas ******, ***** ********* ***** ******** ***** ** ***** ***** that **** ******* *** *******, ***** *****, ************** *** ****** mail *********. ** **** **** *** **** **** ********** ** generating *** ***** *** ********** *** ******** ***** *****. ** will ******** ** *** ********* ** ****** ***** ****** ****."

UK ***** ***********

*********, ** ****** ** *** ***** *********** ** '****' **%. Avigilon *****, "*** ** ****** ** *** ** *** **** highly *********** ********, *** *** ********** ** ************, *** ** experiencing * ********* ******* *********. *******, ** ** *** ******* that *** ******** ** *** ****** ******* ** ********** ** a ******** ** *** ****** *** ************ ** *** **, nor ** * ******** ** *** ********* *** ******** ** this ******, ** ** **** **** * ****** ** *** delayed ***** ***** ** *** ***** ******* ** **** *** anticipate *** ******** ** *** ****** ** ***** ****** *** end ** *** *******."

Asia *******

* *** **** ***** ***** ** *** **** / ******* region. ******** ***** **** **** *** ******** ***** *** ***** force, ****** **** ***** ******, ****** **** ** ***** **** longer ** **** ** ****** ** ** ***** ***. ***** Asia / ******* **** **% ** $*.* *******, ** ** still **** */**** ** ** *******, ** ** *******.

Future ********

******** **** ********* **** ***** **** *** *******, *** *.*, is ******** ** ** ******** ***** **** ****.

Competitive ****** **** / *** ****** ***** ***

******** ****** *** *********** ****** ******* ********* **** **** **** except **** * ******* ** ********** ********* **** *** *** year *** *** ***** ***, *** ***** ********* *** ***** choosing ********. **** *** *** ******* *** ******** ********* ** that ******* *** ** ***** ******* ******** ********, ********* ******, NICE, ******, ***.

IPVM's ********

*********, ** ********* ****** *******, **** **** **** ********** ******* (1) ***** ******* ****** **-*********** (**** ** ** **%) *** (2) ***** **** **********'* ******* ****** *** ****** *** ************ (i.e., *****************'* ****** *******). *** **** ******** **** ** *** ** the ********* *** ********** ** *&*. ** **** ** *********** to *** **** *** ** ******** ******* ******* ** ***** plans ** ******** *&* ** '******** *****', ***** ***** **** more **** ******** ************, **** ******* ********* ** *** ********* growth.

*** ** ***, ********'* ***** ********* ********* ***** **** *********** slow **** ** **** ******.

Comments (13)

"As of January 1, 2013 our system has been installed by 53 casino operators in 67 properties around the world, with a total of 10,420 channels of video running under our VMS. Our largest casino sale in 2012 was to the Hard Rock Casino & Hotel in Albuquerque, New Mexico, which included our ACC VMS, 250 Avigilon 4-channel analog video encoders and 200 Avigilon high-definition cameras."

As I've stated many times about Avigilon - maybe suitable for small venues but not for large-scale casino use. According to one source, Avigilon has supposedly fixed some of the issues that we dinged their system for in December (we tested them in July):

Released December 14, 2012
New Features
•Substantially reduced latency from video capture to display for analog PTZ cameras
•PTZ pattern execution support added to Kalatel protocol
Issues Fixed
•Potential camera time sync issue resulting in a streaming error is resolved
•Pan/Tilt speed in Pelco P and Pelco D protocols is fixed
•Menu button support is removed from Kalatel protocol
•Frame rate is not changed when encoder is rebooted without an analog camera connected
•Various web user interface issues resolved

10420/53=196 = small casinos.

Carl, they mentioned that some projects are in the middle of a staged rollout, so the average total count per casino is likely high - how much I do not know.

That said, getting 50 casinos in their first year or so is an impressive rate.

Yes, but then again, Sanyo sold a boatload of their DSR-M8xx "Casino DVR"s for one reason: they were the cheapest system per channel available. Never mind the 25 second latency (later reduced to ~5 seconds) or the fact that if one user was playing back from a DVR, no one else could at the same time.

Corporate casinos (and some others) are notorious for not wanting to spend more than is absolutely necessary on Surveillance. That's why there are still casinos using VCRs in this day and age. And that's where Avigilon comes in. Their system is among the lowest cost and that's what casino management wants to see.

No doubt, the cost advantage is very important for Avigilon, more so than the overdone and misleading claims of higher quality. However, the question is whether casinos will find it good enough or complain. As you note above, they claim their latency has diminished with the December 2012 release. Obviously, PTZ control is key to casinos so it will be interesting to see how much better it now is.

Casinos will shove nearly anything down the throats of their users (Sanyo is proof of that) to save a buck. In fact, I designed and helped install a ~120 channel system for a tiny casino (349 slots, a bar and a small restaurant). I used the Sanyo single and 4-channel DVRs (4CIF total for either, so 1x 4CIF or 4x CIF). We had to fit the entire Surveillance Department, including fixed and PTZ cameras, a Pelco 9760 matrix switch, monitors, two workstations and even UPS and HVAC into a $200,000 budget.

I've had a couple of people question why we didn't re-test Avigilon after their "fix" was released. We can't keep inviting vendors back every time they claim to have fixed an issue. We would still be testing systems years from now, instead of enjoying the new system.

Carl, It would probably be worth your time to evaluate again since the modifications. Based on extensive experience I think you will be pleasantly surprised. From a business perspective it's good to stay on top of the game...

Joshua, I'm not an Integrator. I am a casino end user. If I was an integrator, I would possibly consider Avigilon for some projects although I almost certainly would also sell a higher-end solution for more sophisticated end users. Avigilon just had too many negatives.

[IPVM Editor's Note: Carl's review has been moved to its own topic so that members can focus on financials here and consider technical reviews there. See: Casino End User Avigilon Review.]

Let's return this topic to Avigilon's financials. Anyone interested in technical issues can go to and comment on Casino End User Avigilon Review.

just a stellar company. a great product with a great sales team equals success.

Check this out. Quite a testament to the impact Avigilon has had - PSA is running a seminar session on beating Avigilon:

I think Avigilon is covering the segment of the market that Cisco always dreamed about getting into but never could pull it off. If Cisco of the year 2000 was still around, they would have bought these Canadians up in a heartbeat. However today is different and the market will be fragmented for a while. Looks like they wiped out the IQEYE, IndoVisions, Verints of the world. In order for Avigilon to take the next step from a 2nd tier company, they need to go to distribution or they will be stuck in the 150 million range forever. Also, end users should be wary about security intergators falling in love with this company. They may end up getting not as good as system they could have. If and when Avigilon releases a mediocre product, the intergator will still sell it to the end user because they are so loyal to the company. They just want to sell because it has the Avigilon name on it. I mean how many 3rd party cameras are deployed on Avigilon sites? (For historical references see Pelco) Nice product, but a young company that still needs to prove itself.

I am curious to see how they scale up and what changes this brings to their channel. I don't know if the number is 150 or 200 or 250, but at some point, it appears that they need to broaden their channel. How they do it will be key - expanding dealer base, selling through the ADIs of the world, etc.? It will be interesting to see how that plays out.

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