Is Axis IP camera dominance coming to an end?

Author: John Honovich, Published on Oct 05, 2008

IP video is becoming mainstream but Axis' IP cameras may lose their dominance in the process. Six critical issues may undermine Axis position and in the process provide consumers with more options and lower prices.

The six issues are:

  • Lower cost, good enough, IP cameras from competitors are maturing.
  • Multi-megapixel cameras from competitors are maturing.
  • Axis' new features overshoot the needs of mainstream buyers.
  • Now, traditional CCTV vendors are committed to moving into IP.
  • Industry interoperability specifications are coming
  • The recession will force buyers to prioritze low cost.

Low Cost, Good Enough Cameras Maturing

Numerous manufacturers are now providing products that offer good enough alternatives to Axis main products.  Since I have made this point before, I suggest you read my Axis vs ACTi comparison report for details.  I will only add that I have received numerous unsolicited reports (even from rival camera manufacturers) about how well ACTi is doing.  As more mainstream security buyers go to IP and expect similar pricing to analog, the lure of low cost IP cameras will become even stronger.  I do believe the costs of IP cameras is a significant issue and in an informal conversations with IP surveillance integrators from around the world, all of them cited the higher costs of IP as a key sales barrier.  If you believe that the TCO of IP overcomes this issue, see my IP cameras problem report for a rebuttal of this vendor sponsored claim.

Multi-Megapixel Cameras Maturing

Multi-megapixel cameras are the hottest segment of the IP video industry right now yet Axis has a very limited lineup for this.  Expect strong competition from specialist vendors like Arecont Vision (H.264 cameras up to 5 MP) and IQinvision (with a broad range of housing and body options). As customers continue to specify more megapixel cameras, Axis will have challenges.  While I expect Axis to respond in this area (it's premium applications like this where Axis has historically focused), Arecont Vision and IQinvision with 5 to 10 years experience focusing on megapixel will be strong competitors.

Axis Overshoots the Mainstream

Axis new product development is focused on H.264 and video analytics.  H.264 will not be very appealing for standard definition cameras as the savings relative to MPEG-4 are not terribly significant (maybe $50 or $100 reduction in storage costs). The situation is different for megapixel cameras, however, Axis' offering is currently only for standard definition.  While Axis support for video analytics is generating good interest for vendors such as Agent Vi, all the market statistics make it clear that video analytics is a small niche.  Video analytics support will be a weak factor in overcoming the significant price premium for Axis cameras.

Traditional CCTV Vendors Moving In

For the last 5 years, Axis' growth has been enhanced by traditional CCTV vendors offering limited or no IP cameras. 2008 has demonstrated that all of the big vendors are now seriously motivated to fight for IP camera market share.  Ironically, because Axis kept prices so high (while generating huge profits), other vendors now have the opportunity to undercut Axis on price, grow revenue and still make a profit. The IP camera market is also big enough now that the revenues generated justifies the opportunity.

Industry Interoperability Specs are Coming

While we may not have standards for a long time, vendors are coming together to promote interoperability.  It is clear to me that members of the PSIA are extremely motivated to implement support for a common IP camera specification.  They correctly, in my mind, realize that this is important for them to clear a barrier to entry and to attack Axis.  I would not be surprised to see many camera and video management vendors implementing the PSIA specification next year. Such support will bolster competition and reduce Axis advantage.

Recession Prioritizes Low Cost

It's clear we are in for a significant, if not severe, recession. Such conditions forces most buyers to more carefully examine and compare pricing. In recessions, buyers are more keen to make sacrifices and it's reasonable to believe many will forgo Axis advance features for lower pricing of competitor's products.

Fundamentally, it looks like Axis could wind up 'stuck in the middle' - too expensive for the mass market that wants cheap, good enough product and not strong enough in the high end market where customers want specialized products.  All the while, they will be under attack from huge companies that have finally committed to ensure that their position in the overall security camera markets is not undermined.  While I think Axis makes quality products, their strategic moves to keep prices high and focus on areas of innovation with lower customer value, could result in a significant shift in customer choices as the IP camera market matures into the mainstream.

2 reports cite this report:

Top 5 Disruptive Surveillance Companies 2012 on Dec 15, 2011
What companies are driving changes in the video surveillance industry? What companies are the toughest competitors? In this new report, we answer...
Axis Financial Results Points to Market Slowdown on Oct 17, 2008
Axis 3rd quarter results demonstrate signs of a market slowdown, most strongly in Europe but with leading indicators globally. Worldwide video...

Related Reports

4MP Camera Shootout - Axis, Dahua, DW, Hanwha, Hikvision, Uniview, Vivotek on Sep 24, 2018
4MP usage continues to climb, especially for low cost fixed lens models. To see who was best, we bought and tested seven 4MP models from Axis,...
Avigilon Announces AI-Powered H5 Camera Development on Sep 19, 2018
Avigilon will be showcasing "next-generation AI" at next week's ASIS GSX. In an atypical move, the company is not actually releasing these...
Vivotek 4MP Camera Tested (FD8379-HV) on Sep 13, 2018
Next in our series of updated 4MP testing, we bought and tested Vivotek's FD8379-HV, and entry level 4MP model claiming "top-notch quality video in...
VMS Export Shootout - Avigilon, Dahua, Exacq, Genetec, Hikvision, Milestone on Sep 13, 2018
When crimes, accidents or problems occur, exporting video from one's video surveillance system is critical to proving incidents. But who does it...
US DARPA Investing $2 Billion In AI on Sep 11, 2018
The US Defense Advanced Research Projects Agency (DARPA) is granting more than $2 Billion to companies developing new AI technologies. The money...
Dahua Low-Cost 4MP Camera Tested (N44CL52) on Sep 10, 2018
4MP use continues to increase, especially in low-cost models, according to integrators in our 2018 Resolution Usage Statistics. We bought Dahua's...
Hikvision Value Express IP Cameras Tested Poorly on Sep 05, 2018
Even lower cost Hikvision products? Their new Value Express line is marketed for applications where "budgets are limited and performance is...
Luxriot VMS Profile on Aug 23, 2018
Luxriot is more popular than Hikvision and Milestone products according to ASMAG which was probably even surprising to Luxriot. The company has...
Video Analytics Integration Guide on Aug 16, 2018
Video analytics is hot again (at least conceptually) but integrating video analytics with VMSes can be challenging. This is especially significant...
ISS VMS / Video Analytics Company Profile on Aug 16, 2018
Who is ISS? In the past few months, they had one of the craziest ISC West promo items in years. Then, they hired industry veteran and ex-Dahua...

Most Recent Industry Reports

Genetec Takes Aim At 'Untrustworthy' 'Foreign Government-Owned Vendors' on Sep 24, 2018
Genetec is taking aim at 'untrustworthy' 'foreign government-owned vendors'. This is not a new theme for Genetec as nearly 2 years ago, Genetec...
4MP Camera Shootout - Axis, Dahua, DW, Hanwha, Hikvision, Uniview, Vivotek on Sep 24, 2018
4MP usage continues to climb, especially for low cost fixed lens models. To see who was best, we bought and tested seven 4MP models from Axis,...
Alexa Guard Expands Amazon's Security Offerings, Boosts ADT's Stock on Sep 21, 2018
Amazon is expanding their security offerings yet again, this time with Alexa Guard that delivers security audio analytics and a virtual "Fake...
UTC, Owner of Lenel, Acquires S2 on Sep 20, 2018
UTC now owns two of the biggest access control providers, one of integrator's most hated access control platforms, Lenel, and one of their...
BluePoint Aims To Bring Life-Safety Mind-Set To Police Pull Stations on Sep 20, 2018
Fire alarm pull stations are commonplace but police ones are not. A self-funded startup, BluePoint Alert Solutions is aiming to make police pull...
SIA Plays Dumb On OEMs And Hikua Ban on Sep 20, 2018
OEMs widely pretend to be 'manufacturers', deceiving their customers and putting them at risk for cybersecurity attacks and, soon, violation of US...
Axis Vs. Hikvision IR PTZ Shootout on Sep 20, 2018
Hikvision has their high-end dual-sensor DarkfighterX. Axis has their high-end concealed IR Q6125-LE. Which is better? We bought both and tested...
Avigilon Announces AI-Powered H5 Camera Development on Sep 19, 2018
Avigilon will be showcasing "next-generation AI" at next week's ASIS GSX. In an atypical move, the company is not actually releasing these...
Favorite Request-to-Exit (RTE) Manufacturers 2018 on Sep 19, 2018
Request To Exit devices like motion sensors and lock releasing push-buttons are a part of almost every access install, but who makes the equipment...
25% China Tariffs Finalized For 2019, 10% Start Now, Includes Select Video Surveillance on Sep 18, 2018
A surprise move: In July, when the most recent tariff round was first announced, the tariffs were only scheduled for 10%. However, now, the US...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact