Exacq Increases Enterprise VMS Prices 2015

By John Honovich, Published Oct 20, 2015, 12:00am EDT

Tyco / Exacq is bucking the trend.

With rivals offering major discounts (see moves by Milestone, Video Insight and ipConfigure), not only is Exacq holding firm, they are increasing prices on their Enterprise VMS software.

In this note, we examine the increase, how it impacts their competitive positioning and the hardware price decreases that Exacq says will offset this.

Enterprise Price Increase

Exacq has 3 fundamental tiers of VMS software: Start, Professional and Enterprise. Previously, Professional and Enterprise had the same per camera license price ($150) but Enterprise had an additional $500 per server license fee. Now, Enterprise has a $225 per camera license fee (up 50%) but drops the $500 per server fee. Since most Enterprise users have dozens of cameras, this is a net price increase. For example, 40 cameras old Enterprise software price - $6,500, new price - $9,000.

Annual SSA Price Impact

Exacq requires a Software Support Agreement (SSA) to install software updates, ~20% of the initial license price. Those buying Exacq's own appliances have 3 years of SSA included.

The price increase of Enterprise will also carry over to SSA pricing, with the per camera SSA fee for Enterprise rising from $25 to $45. Exacq notes that they are "grandfathering enterprise software prices on systems quoted prior to October 1 2015" and to contact them "to register your project for this price transition."

Enterprise Functionality Increase

Exacq has steadily added Enterprise functionality over the years, starting out as a low to mid end offering and maturing into more of a large scale VMS. Exacq's Enterprise version now includes enterprise management of cameras, users and servers, network video wall, LDAP integration, failover, and case management.

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The increase in functionalities is a key reason behind the increase in Enterprise's price.

Hardware Price Decrease

At the same time, Exacq is decreasing the price of many of their hardware NVR appliances. Exacq noted, "on average we lowered all A, Z and S series prices by 8-15% with some models being reduced as much as 25%. LC and ELP series reductions average in the 3-4% range."

They emphasized that since Enterprise is most commonly used on A or Z series NVRs that the net price impact would be neutral or even lower than before. On the other hand, hardware pricing (for a given capability) decreases regularly so some of that simply reflects the state of the server market. In addition, those using Enterprise on COTS hardware will not benefit from any hardware savings.

Competitive Impact

We believe this will moderately increase challenges for Exacq selling Enterprise VMS, though it likely should be offset by increased revenue per sale (and for annual upgrades. Also helping is that Exacq's largest competitors for enterprise deals (Genetec and Milestone) have always had higher Enterprise pricing for their versions. It is also healthy for the industry for companies to charge more for enhanced functionality / value. On the other hand, we expect smaller Exacq rivals to use this price increase as a selling point for their reduced price alternatives.

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