Here's What Avigilon Should Do Now

Author: John Honovich, Published on Aug 24, 2015

An Avigilon partner asked:

"What would be your Goal if you run Avigilon?"

Given Avigilon's 60% stock price drop since last year, the continued executive exits / ousters, the declining growth, and weak profitability, Avigilon needs to change. However, the company has a strong product offering that can help in a turnaround.

To answer the Avigilon partner, here are the top 4 things I would do:

  • Fire Schmode, Hire Nilsson
  • Divest or RAND the Patents
  • Launch a Low-Cost Line
  • Push Video Analytics Development Hard

Inside, we break them down, including polls / voting on each one.

********** ******* *****:

"**** ***** ** **** **** ** *** *** ********?"

***** ********'* **% ***** ***** **** ***** **** ****, *** continued **************/*******, *** ********* ******, ******* *************, ******** ***** ** ******. *******, *** ******* *** * strong ******* ******** **** *** **** ** * **********.

** ****** *** ******** *******, **** *** *** *** * things * ***** **:

  • **** *******, **** *******
  • ****** ** **** *** *******
  • ****** * ***-**** ****
  • **** ***** ********* *********** ****

******, ** ***** **** ****, ********* ***** / ****** ** each ***.

[***************]

The *******

*** ******* *** ******** ** **** ***** **** *** ************ management ***** ******* ****** *** *****. ***** ***** ********* ** high ****** ******* *** *********** ** **** *** *** **** Avigilon ** *********** *,*** ********* ** * ****** **** *** matured / ******, **** **** ** ******.

Fire *******, **** *******

*** ***** ********* *********** *** **** ****** ** ***** **** *** ************ management *****. ** ******* ** ******** ****** *********, *** ********** negative ***** ** ******* *** *** *******. ** ********, *** CEO ********* ******** ********* ******** ********.

******* *********, *** ******* **** **** ***** *** ***** ***** Schmode *********** **** ***** ** ***** *** ********* ** **** ****. ******* ******** ******* *** has *** ****** ** ******* *******. ** *** **** ****, the ********** **** ****** ******* ** ****** ******** ** ***** ousted, ********* ***'***********' ** *** ****-**** ********** / **** ***** ******.

******: **** **** ***** ********** ****,******* *** **** ******. *** *** **** **** **** *** *** ****, ** least *** ***.

****' ***** ******** ********* ********* *** ********** ** ******* - *********** *****, ********** *** charming. ** **** ** **** ** ****** / **** * mature, ********** *******. ******* ***********, ** ******* ******* ** ************ (Axis ***** *******) **** $*** ******* ****** ******* ** ** has *****-***** **********. ****, ** **** ***** ******** *** ************* with ********, ** *** *********, ** ********* ********* *** ********.

**** **** *** * ***** **********, **** ***** ** ** attractive *********** *** ***. *** ** ***** ** *************, **** *** of ********'* * ***** ******** *****. 

****:

Divest ** **** *** *******

**** **** ********** *******, *** ***** ************ ******** ******* *********** ********* '*********' (**** ********'*)**** **********. **** ******* *********** ****** *** ********. ******* *** risk ** *********** ****** ** ********** ******** ******* (**** ****** because **** **** ******** ** * ******), ******* **** * campaign ** ******** *** ********'* *********, ********** *** ********** ********.

****, ** *** ****, ******* ****** *** ********* ** *** want ** ** ********** **** ****** ******** *** ***** ******** between *********. **** *** *** **** **** ****** *** ******** Avigilon ********* *** **** ** ****** ** ******* ******* ******** people (*** ********* ** *** **** ** ** ** ** adversarial ******** ******* ***** ********* ****** ********* ** * ********** small ********). ********, **** ********* (**** *********** *** *************) **** not **** ** ******* / ********* **** ********* **** *** doing ****.

******** ***** ** **** *** ****** ********* *** *******, ** if *** ********, **** ** ***** **** ** '********** *** ***-************** *****' (****), ****** **** ** *** ******* ******** ** *** positioning ****.

****:

Launch * ***-**** ****** ****

********'* ******* ********* ** **** ** *** ***-***, ***-**** ******* (see ******** ** ***** **** ****). ****** ******** ***** ** ****** / **** *** ****** of ***** ***-**** ******* ********, ** ** ******* ********* *** Western *********.

*** **** **** ** **** ******** *** ****** ****** ******* this, ** ********* ***** *****, ********** ** ********* *** *******, basic ********* **** **** *** **** ******** **** ******. ** further *************, **** *** *** ** ***** *********. ** ****** these ******* ***** **** **** ********'* *** ***, **** *** offer * ****** **** ***** *** **** ******** ********* *** using **** ***.

Push ***** ********* ***********

*** ** *** **** ****** ***** *** ******** *** **** their*********** ** ********** ***** ***** ** ***** *********. *** ********* ****** ** maturing *** **** **** **** ******* ******** ********** ******, ** is ****** *** ****** ** *** ** **** ******. 

******** ** ******* ***** * **** ***, ******** *** **** of ********* ************* ******** ** *******, ******* ******* *********** (*** ******** ******** ******* ******).

******** **** ** ********* ***********, ******* ** ** *** ********, new ************, *********** **** ***** **** *******, ****** ** ******* to **** **** ****** ********** *********, ***. ***** ******* ******** with ***** *** ********** ************** **** *** **** ** ***** as ********* *** ** *** *****.

What ***** *** **?

******* ** *** ******** *****.

Comments (29)

With the only game in town (Wetsern hemisphere) being the Chinese and possibly Samsung with their China beater range (Their words), it does and doesn't make sense for them to launch a "low cost" camera range. Will the Chinese let them and others produce tooling and marketing, then just come back in with an even more aggressive pricing strategy.

The future is analytics. With the money that Avigilon has "invested" in this technology lately, it looks like they are trying to own the this space. They should draw a line and stop trying to make money on copywright infringements and making lawyers even more money.

Prove that their offering works and be one of the first companies to launch a truly root to branch offering at a price that makes everyone feel happy about looking in the mirror each day.

"then [The Chinese] just come back in with an even more aggressive pricing strategy."

How much lower can they do? Will they give cameras away for free? :)

I do not think that Avigilon (or Axis) should price match. There's no need nor benefit to chase them that hard.

However, they need to keep the gap to defensible levels. For example, if you have an integrated IR fixed focal minidome at ~$150 dealer pricing, that's still 50% or so more than 'the Chinese' but at least you are in the ballpark and can justify a modest premium based on service / support / deep integration, etc.

Low cost camera solution. Partner with the China provider for a hardware solution. Off the shelf. Change nothing.
Add in house developed software completely replacing the OEM software.

It's highly unlikely they can make hardware cheaper than a mass producer. Yet they could retain the unique product aspect with compatibility on their own exisiting lines and have minimal development time.
They control the features, functions, integration and cyber (I hate that word) security.

Low cost camera solution. Partner with the China provider for a hardware solution. Off the shelf. Change nothing.
Add in house developed software completely replacing the OEM software.

Please NO Keep all the hardware inhouse. Like John said all we need is a fixed dome and bullet with IR that is lower cost but it doesn't need to be as cheap as china gear.

There is such disincentive for the major (and even minor) VMS platforms to embrace Avigilon until any chance of patent infringement pursuit by Avigilon is eliminated it would be prudent to focus first on establishing trust before work on anything else. Dump or neuter the potential for patent actions, then begin rebuilding from the disasterous current state of affairs.

Nilsson could be the first step in rebuilding, but it will be a Herculean effort.

Given Avigilon's focus (revenue growth, revenue growth, revenue growth), that they are alienating the rest of the industry is not much of a concern. Ultimately, I think in the next year, slowing revenue growth will eventually be connected to the cultural / management problems, which might then lead to a change in overall industry positioning.

However, there is a good chance that the more Avigilon struggles, the more it will lean on the patents as a way to generate profits quickly.

Fire Schmode, Hire Nilsson

This would be tricky to actually do. Nilsson undoubtably has been handcuffed to the deck of the ship by the recent Canon acquisition. Non-compete's are standard here, lasting 3-5 years, if not more. In the shorter term, there are presumably financial incentives in place that would be forfeited by an early departure as well.

On the flip-side, one would have to imagine someone as shrewd as Schmode would have put in place an expensive golden parachute for himself, adding to costs.

Maybe an amicable trade could be worked out, after all, one could argue that Axis needs to have an 'Alec Baldwin' type to come in and motivate the overly content and complacent sales organization. Ok, now that's far fetched...

Counterexample: Fullerton went straight from Milestone to Vicon.

However, evidently Massachusetts does allow some non-competes. As you know, in CA, not allowed.

Schmode got $2.5 million in total compensation in 2014, so they should be able to slot Nilsson in at the range...

As you know, in CA, not allowed.

Except when the agreement is part of the sale of the entire company and the employee is viewed as part owner and gains significantly from the sale.

Nilsson's million dollar payday would give such an agreement teeth in any state.

Fullerton, seemed to be at odds with management over the years, so may not have been bound by an airtight agreement, on purpose. In any event, coming in 8 years later than Nilsson and given the price paid for Axis vs. Milestone, his 'liquidity event' may have been a good deal less.

According to the Axis 2014 annual report, Nilsson has 23,5000 shares, which is ~$1 million USD, or as Schmode likes to call it, January through May pay.

In terms of agreements and the terms of them, neither of us know, so hard to guess.

Nix Nilsson and give Rance a chance...

Rance is an 'end-to-end solutions' man!

Might really not be a bad idea! Rance was ahead of his time for Panasonic, and he's generally well respected. Not quite as jarring as a jump to Nilsson. I'd buy that.

Rance is also unemployed so that, in itself, makes it easier...

With Avigilon stock already depressed and now the market under pressure, is there potential that a stock deal acquisition could be made? Not sure what their debt position is but I suspect it is a detractor but could the patent assets offset that?

Avigilon has a strong name and channel, just needs some better execution and something that will tell the market that the product is stable for the foreseeable future. Stability is something I worry about when choosing a long term strategy for an enterprise.

An acquisition? Could be.

The barrier will be Avigilon's board. They clearly, rightly or wrongly, believe Avigilon is worth way, way more than the current stock price. Their market cap is~$600 million right now (stock price at $13.30). If someone offered say a billion, surely they would have the fiduciary responsibility to consider it but their position so far has been that they are on the fast track to $500 million in revenue, so they should be worth 3 times, 4 times or more that.

VideoIQ was the king in the "virtual guard" domain. Guard companies in order to stay competivie will have to offer a combination of "vitrual guard" and onsite security officers or replace onsite officers with a "virtual guard" solution. That means the demand for their product will increase. The VideoIQ camera was a stand alone solution that worked. They need to bring back the videoiq model where the license was included with the camera purchase and no need for a VMS. They also need to either sell directly or through distribution.

I would recommend you contact your Avigilon RSM. The HD Edge Recorder is what you are looking for.

I was told at ISC West that the VMS was needed in order to send notification to a central monitoring station. That means another piece of hardware.

I will find out tomorrow as our first unit comes in though I don't see why it couldn't compunicate with center stations on it's own.

Mike, No other hardware is requred, the VMS is built in as always. Of course you need a workstation to run the client and Gateway if desired.

Gateway meaning WAN/LAN router?

Gateway meaning the Avigilon Gateway. which is used for smartphone access to the system

Thanks! I think I've got it:

You are saying that the Avigilon HD Edge Recorder can communicate directly to a remote Central Station, over a WAN, without needing the Gateway?

Confirmed no other hardward is needed besides a WAN/Router connection.

"Fire Shmode" as a poll on IPVM is a significant statement about the state of things in our business. There are other polarizing figures in our industry (I can think of one or to at Arecont, Sony, Vicon, etc.) but this "cartoon" character takes the cake. I have heard pretty bad stuff about Alex too, but hey, he likes a guy like Shmode and didn't like a lot of quality people that didn't last very long at Avigilon. Not naming names. Alex seems to likes having vicious people around him.

If you are going to use acronyms such as RAND, please define them up front in your articles. What makes you think that your typical subscriber/reader can decipher such arcane abbreviations?

Whenever I fail to understand the terminologies I just sacrifice a few chickens.

Login to read this IPVM report.
Why do I need to log in?
IPVM conducts unique testing and research funded by member's payments enabling us to offer the most independent, accurate and in-depth information.

Related Reports

Sales Turnover At Anyvision on Feb 13, 2019
Anyvision raised a $43 million Series A and according to their newest investor: what you need to do is push the gas pedal and build an...
Solink Raises $12 Million - Company Profile on Feb 12, 2019
Most industry professionals have never heard of Solink, a company whose tagline is: It's time to revolutionize the way business uses...
Barnes Buchanan 2019: Despite 'Strange Narrative' Great Time To Be In Security on Feb 11, 2019
A "strange narrative" is being spun, said Michael Barnes at the 2019 Barnes Buchanan Conference. However, despite that narrative, it is a "great...
Hanwha Techwin Favorability Results 2019 on Jan 31, 2019
Hanwha Techwin's favorability results surged, in IPVM's 2019 study, going from barely neutral in 2016 to strongly net positive, as the results...
ONVIF Video Surveillance Tutorial on Jan 29, 2019
ONVIF is well known within the surveillance industry as an interface to connect IP cameras and VMS systems. However, new users may find it...
Vivotek Favorability Report 2019 on Jan 29, 2019
Taiwanese video surveillance manufacturers, even relatively large ones like Vivotek, have lost ground in the PRC-China-driven race to the bottom....
Genetec Favorability Report 2019 on Jan 25, 2019
Genetec's favorability moderately strengthed, in new IPVM integrator statistics over their results from 2017, with 2019 results showing solid, but...
Turnover at Arcules on Jan 24, 2019
Canon / Milestone are putting tens of millions into Arcules - their bet on the future of the VMS market (see IPVM's Arcules test report). But over...
Huawei: Hikvision / Dahua "Strategy Is Just To Provide Cheap Cameras" on Jan 24, 2019
At the Intersec 2019 show in Dubai, IPVM spoke with the show's "exclusive artificial intelligence sponsor" Huawei who recently declared their...
Bosch Favorability Results 2019 on Jan 23, 2019
Bosch's favorability moderately strengthed, in new IPVM integrator statistics over their results from 2017, with 2019 results showing strong net...

Most Recent Industry Reports

Exacq Raises VMS Software Pricing Twice in Less Than a Year on Feb 18, 2019
Most VMSes regularly release new features, but rarely increase their prices. For the 3rd time in 4 years, and 2nd time in 8 months, since being...
Axis IR Multi Imager Camera Tested (P3717-PLE) on Feb 18, 2019
Axis has released their first IR multi imager, the P3717-PLE, a repositionable model listing 360° IR illumination and flexible positioning,...
Ubiquiti Favorability Results 2019 on Feb 18, 2019
Ubiquiti has quietly grown into a $1+ billion annual revenue company, with offerings across wireless, wireline network and video surveillance (see...
Casino Surveillance Pro Interview: James Lathrop on Feb 15, 2019
James Lathrop has been working in casinos for almost 25 years. During that time, he says he has held "just about every job you can do in the...
Hikvision 2018 Revenue Tops $7 Billion USD But Growth Slows To Low on Feb 15, 2019
Hikvision's annual revenue topped $7 billion for the first time in 2018, although growth slowed sharply. In this post, we analyze the latest...
Hanwha Smaller Multi Imager Tested (PNM-9000VQ) on Feb 14, 2019
Hanwha's first repositionable multi imager PNM-9081VQ tested well, but was huge, over 12" wide and weighing in at over 10 pounds. Now, they have...
ADT And 'The Defenders' Silent About Massive Complaints on Feb 14, 2019
ADT's largest dealer, "The Defenders" has been the subject of a massive number of complaints over many years and many forums, most recently a CBS...
Hikvision Chairman Praises United Front on Feb 14, 2019
Hikvision’s controlling shareholder held a meeting last month praising the United Front, a Communist Party organization known for its secretive...
Sales Turnover At Anyvision on Feb 13, 2019
Anyvision raised a $43 million Series A and according to their newest investor: what you need to do is push the gas pedal and build an...
Cisco Meraki Cloud VMS/Cameras Tested on Feb 13, 2019
Cisco Meraki says their cameras "bring Meraki magic to the enterprise video security world". According to Meraki, their magic is their management...

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