Get Your Free Exacq Licenses

Despite Tyco employees protesting to the contrary, Tyco has now confirmed there is a program in place to give away free Exacq licenses.

However, Tyco tells us it is a 'time-limited program'.

In this note, we look at the terms of this program and how it will impact the competitive positioning of Tyco, Arecont, Avigilon, Axis, Genetec and Milestone.

The Program

Tyco / Exacq is offering free Exacq licenses with 'Pro' Illustra cameras and 50% off for Illustra 'Flex' cameras when purchasing Exacq's NVR appliances, through a number of distributors, as shown from this promotional excerpt:

The Turn

Just two months ago, Tyco emphasized that:

"There is currently no program to give free Exacq licenses for AD cameras. We will look at ways of incentivizing a full portfolio sale, but not a formal program to give free licenses."

Evidently, they looked at ways and found a program to give free licenses.

Technically, Tyco is claiming that it is not a 'formal' program because it is 'time-limited.' From what we have seen, the current term is 2 months, covering April and May.

That noted, numerous integrators have reported free license offers prior to this period and we have little doubt, that unless partner pushback is very significant, that such promotions / discounts will continue.

The Savings / Opportunity

The effective percentage of savings depends on the camera model selected and the Exacq version used. However, for minidomes, like the Pro compact one we tested with Exacq Professional version (MSRP ~$150), the savings could be ~50% of the camera price.

As a rough rule of thumb, Illustra Pro cameras will typically save ~$100 on Exacq licenses.

One other element is the requirement to buy Exacq NVRs, which, on the one hand, restricts the offer, but also includes 3 year's software license updates (something that many users do not like to pay for separately / additionally) .

Competitive Impact

Undoubtedly, this helps Illustra greatly. Tyco has had IP cameras for years yet were never a significant player nor did we see sizeable demand / interest from integrators.

Now, having Exacq, the overall 'favorite' VMS in IPVM's 2014 survey behind Illustra, with significant financial savings, Illustra is going to get a lot more exposure / consideration. Plus, our tests show Illustra's cameras are decent, and given the slow innovation in the IP camera market currently, we suspect a fair amount of Exacq integrators will take the combination / savings.

Arecont is the competitor most likely to be hurt by this, simply because Arecont is most commonly used and sold with Exacq. Tyco has no equivalent for Arecont's multi-imager cameras but for the more commonly used domes / bullets / boxes, Tyco has credible alternatives plus the significant savings from bundling now. The wild card is that almost all of the Exacq reps who sold Exacq and Arecont have been fired by Tyco.

Milestone also has significant exposure, especially since Milestone is trying to ramp up sales of their own NVR appliances. Beyond Exacq having an advantage in NVR options and NVR product maturity, now Exacq has an even more significant cost advantage when bundling with Illustra.

Avigilon is facing increased 'solution' competition. Surely Avigilon would emphasize its analytics (Illustra does not really offer true analytics) and its super higher resolution cameras (Illustra is generally limited to 1080p HD). However, Tyco's advantages include selling more broadly (through distribution) and offering free VMS licenses (Avigilon's licenses are expensive and only discounted for encoders). It will be interesting to see how Avigilon's tightly controlled internal sales force matches up against Tyco's numerous distributor, manufacturer reps, etc.

Axis and Genetec have comparatively less to be concerned about with this bundling, given both companies overall focus / strength in bigger / more specialized projects. The types of customers who will buy a whole package tend to be smaller and have less complex needs than those who really favor Axis or Genetec.

That noted, Axis will likely soon be a subsidiary of Canon, and the sibling company to Milestone. Though Canon has denied any cross-selling categorically, the strength of Avigilon and moves like Tyco / Exacq will put more pressure for an Axis / Milestone 'solution' in the next few years.