Avigilon 5.0 Upgrade Plan and Costs Reviewed

Author: Sarit Williams, Published on Jul 02, 2013

One of Avigilon's key differentiators has been the lack of upgrade charges for new VMS versions. Unlike the controversial annual licenses that many of their competitors push, Avigilon rightfully emphasizes how they are free. Now, Avigilon's new VMS Version 5.0, first announced last fall at ASIS 2012, is available. However, unlike previous releases, most existing Avigilon customers will need to pay to upgrade to 5.0. In this note, we dig into the details and compare to Milestone, Genetec and Exacq approaches.

Upgrade Approach

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Upgrade ****

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Competitive **********

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Change In ********?

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Comments (3)

Yeah, but still, manufacturers should make it clearer, and dealers/integrators need to be very careful when selling a system... no upgrade, continual costs NOW does not mean there won't be any LATER. I'm sure a VMS trying to make it in the market knows this can be an attractive benefit and help them gain a good foothold. But seriously, long term if you end up saturating the market, what happens then? You're going to continue writing and developing software for free while few, if anyone, has to buy anymore?

An Avigilon investor asked us how significantly the software upgrade would increase AVO revenue. Our estimate is $1 - $2 million total and a <1% increase in 2014 revenue.

While this depends on the percentage of customers who elect to upgrade, the upgrade cost is fairly minimal and is based on servers (which can be running many cameras each). Even if 10,000 servers were upgraded (strikes me as high but let's say), and the average version was the mid tier Standard, that would be $1.85 million (minus the cut to dealers).

I think with ONVIF coming more into play, they'll all charge per camera eventually. Only a few will be exceptions who are simply hungry for market share.

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