Axis Enters Thermal Camera Market (Q1910-E)

Author: John Honovich, Published on Jan 17, 2010

Axis has entered the thermal camera market with potentially disruptive pricing and positioning. Axis's first thermal offering - the Q1910/-E (indoor and outdoor options available) is an IP camera with an MSRP of $2,999 for the indoor and $3,499 for the outdoor model. The camera supports H.264, PoE, ONVIF and will be compatible with the broad base of 3rd party VMS that integrate with Axis. These cameras also support the Axis Camera Application platform allowing video analytics to run on-board.

Compared to FLIR

FLIR is the 800 pound gorilla in the security thermal camera market with a very extensive product portfolio - fixed, PTZs, low resolution, high resolution, numerous lens options, analog, IP, cooled, uncooled, etc. However, FLIR's IP offerings have limited 3rd party VMS support and tend to be quite expensive.

Axis's thermal cameras have their own limitations -- a single lens option (17 degrees), a single low resolution (160 x 120) and a single form factor (fixed box). While Axis entry is inexpensive and benefits from its extensive VMS support, use of these cameras will be constrained by lack of product options. Axis plans to introduce new thermal cameras and may release 1 to 3 lens options in 2010.

Update Feb 2, 2010: FLIR has announced matching low priced thermal network cameras.

Market Impact

We think this move should be carefully watched. While thermal cameras are certainly a niche within video surveillance, Axis's entrance could provide meaningful options, expand the market and spur incumbent thermal manufacturers to accelerate product enhancements and lower pricing options.

Use of Thermal Compared to Other Camera Types

The most common benefits / reasons for using thermal compared to IR or color cameras are:

  • Longer distance detection at night: Because thermal cameras depend on heat rather than visible or near IR light, thermal cameras can view far greater distances that traditional security cameras. While high end 850 nm IR cameras can detect people at about 100 meters, even low end thermal cameras can detect people at double or triple that range. Mid to high end thermal cameras can detect people and vehicles multiple kilometers from the camera. See FLIR's range chart for examples of common detection ranges. We view longer distance detection as the most common and economically quantified benefit for surveillance applications because it can reduce total camera count and associated infrastructure costs.
  • View people through moderate obscurants: Traditional surveillance cameras depend on light which can be obscured by glare from windows, smoke, fog, light vegetation, etc. Since thermal cameras do not 'see' light but only heat, they can provide better detection through common obstacles for traditional surveillance cameras. This is important in higher security applications and for minimizing false alerts for video analytic applications.
  • Fully covert: Since thermal cameras need no light, they can be used in total darkness. By contrast, the most common form of IR cameras (850 nm) produce a visible red glow. In higher security environments, this can be detriment or prohibited as this glow can provide attackers with information on camera positioning. However, this is not commonly required in the commercial market.
  • Low power consumption: While not commonly cited as an advantage by traditional thermal vendors, we believe the use of PoE for thermal IP cameras will provide important cost savings in deploying infrastructure. 850nm or 940nm IR cameras require substantial power, even for surveillance at modest ranges (100 meters or less) - 20 - 30 watts is not uncommon. By contrast, thermal IP cameras can eliminate the pulling of power cable, an often costly expense for outdoor surveillance.
For a general value proposition of thermal cameras from a vendor's perspective, see FLIR's security brochure.

Current State of Thermal Market

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The use of thermal cameras is quite broad and extends far beyond security.

FLIR's 2009 Investor Relations presentation provides a market size segmentation table:

While FLIR's annual revenue is over $1 Billion USD, only a fraction of that comes from video security/surveillance. The surveillance market is a part of the commercial division at FLIR recording approximately $200 Million USD in 2009 revenue.

The use of thermal cameras in video surveillance is quite small. Statistically speaking, it's certainly less than 1 out of 100 cameras used and could be as low as 1 out of 1000 cameras. The number one constraint overall is certainly cost. The number two constraint for the IP video surveillance market is likely the need for 3rd party encoders which adds more complexity and cost (though relatively small given the high price of thermal cameras, in the first place).

Contrast Products / Pricing Between FLIR offerings and the Axis Q1910

FLIR offers a very broad portfolio of cameras for the thermal market. While a proper treatment of FLIR's portfolio requires a future dedicated report, readers should note some of the key categories:

  • Lower cost analog thermal fixed cameras from their SR series
  • IP thermal fixed cameras with a variety of resolution and lens options from their F series
  • Dome thermal cameras with pan / tilt capabilities from their D series (indoors and outdoors)
  • Cooled thermal cameras providing multiple mile detection ranges from their HRC and Ranger series
  • A mini-thermal camera that is designed for the automotive market but is sometimes used in the security applications though not recommended (the PathFindIR)
  • A real-time monitoring system that provides advanced capabilities and integration (the Flir Sensor Manager)
This is only a partial list but it should show how extensive their product portfolio. In some sense, it might be fair to say FLIR has a similar breadth in thermal cameras to what Axis has in IP cameras.
Clearly, Axis's 2 models of thermal camera cannot replace the breadth of FLIR's numerous series.
On the other hand, despite FLIR's drive to reduce the price of thermal cameras they remain expensive. While most of FLIR's product pricing is not disclosed, the prices of their least expensive cameras can be found on-line.
The lowest cost FLIR security product is the VSR-6, a 160 x 120 resolution, 52 degree horizontal FoV analog camera. On-line pricing is approximately $3500 USD. In contrast to the Axis Q1755, the camera has a much wider FoV, better for surveillance of a close area but worse for perimeters or longer distances. Since it is an analog camera, it requires an encoder.
The next lowest cost, comparable FLIR security product is the SR-19, a 320 x 240 resolution, 36 degree horizontal FoV analog camera. On-line pricing is approximately $5,000 USD.
For a pure IP camera, FLIR's F Series products are the best comparison. The F series provides extensive options (lenses, resolution, exchanging of camera bodies).
FLIR's lower end F series camera match pricing to Axis's. Read our report on FLIR's thermal cameras including detailed pricing and comparative analysis.

Good and Poor Applications for the Axis Q1910 Thermal Camera

The two main constraints of the Axis Q1910 are:

  • 17 degree horizontal Field of View
  • 160 x 120 resolution
Applications will need to be capable of handling these constraints.
A 17 degree horizonal FoV is fairly narrow and is best for imaging perimeters or narrower areas that are at least 30 meters (100 feet) from the positioning of the camera. For instance, a person standing 5 meters (about 18 feet) from a camera with this FoV would barely have half their body captured in the image. As a practical matter, this FoV will make it practically impossible to see a room or an area directly in front of the camera. Integrators may be able to work around this if the camera can be positioned farther back from the target area.
The 160 x 120 resolution is low even for thermal camera standards. 320 x 240 is more 'standard' and common in thermal. For instance, only a few of the very lowest end cameras in FLIR's lineup are 160 x 120. Most are 320 x 240 and some are 640 x 480 (though this drives expense up considerably).
The practical impact of 160 x 120 resolution is that seeing details of a person or vehicle will be difficult if not impossible. For instance, users should not expect to see facial features or be able to distinguish what a person is carrying, etc.
Axis has shared a few sample videos from the Q1910. We have embedded them below. Note that the details of people and object are difficult to see. Also, factor in that the camera in these samples is positioned fairly far away (at least 10 if not 30 meters from the area captured).

How this Can Help the Video Analytics Market

Thermal cameras improve video analytic performance by eliminating many of the common causes of false alerts (caused by lighting variations) and by increasing the contrast of humans to the background.

The major historical drawback of using thermal is the cost and complexity of deploying video analytic solutions using thermal cameras. With the Axis thermal cameras, at a price point not significantly higher than IR cameras and with broad 3rd party support, it should make it a lot easier to use thermal.

As we noted in our examination of the Axis camera application platform, important questions exist as to the processing power of running video analytics inside Axis current cameras. However, this may be offset by the 'improved' images thermal offers for video analytics. Ultimately this is a question of testing. Even if the analytics are not run inside the camera, the lower price point and simple integration will make it easier to use with server based analytics.

What this Means for Axis's Overall Strategy / Competitiveness

Entering the thermal market allows Axis to be a low end disruptor in a traditionally very high market. Already a fairly sizable market (perhaps $100 Million annual sales in surveillance thermal cameras), we think Axis has an opportunity to not only rapidly increase sales but to grow the overall market size by providing a simpler and less expensive solution. We think it is unlikely that Axis can steal market share from FLIR in the mid to high end of the thermal video surveillance market. However, this may be more than offset by Axis's ability to grow the thermal market by motivating new users of thermal cameras.

Given Axis's annual revenue of approximately $300 Million USD, we think thermal cameras can provide a significant but not huge growth opportunity of perhaps 10% total revenue in 3 years. They may also be able to maintain profitable growth as they will be primarily competing with large providers accustomed to high prices and high margins from large security operations.

On the other hand, we believe this is another sign that Axis is content to allow the low end IP camera market to be controlled by Asian manufacturers. We think this poses significant long term risk as these competitors can continue to move up market and, in the long term, threaten Axis strengths in the mid to high end of the market. From a financial perspective, Axis may be able to offset those losses from gains in disrupting higher end markets (like thermal). However, as a practical matter for integrators and users looking for budget IP cameras, we see this as a sign to continue to look outside of Axis.

3 reports cite this report:

Testing and Analysis - Free Premium Preview on Feb 12, 2010
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FLIR Thermal Network Cameras Examined on Feb 01, 2010
FLIR has announced the availability of network thermal cameras starting as low as $3,495 USD MSRP. These cameras are additions to the F (fixed) and...

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