Milestone VMS Lawsuit

Author: John Honovich, Published on Sep 16, 2012

The biggest brand in Video Management Software, Milestone Systems, has been sued by rival VMS developer JDS for patent infringement. The patents cover fundamental aspects of video management that might apply to many VMS developers. In this report, we dig into the issues involved.

The Case

JDS filed a lawsuit against Milestone this May. The following key legal documents provide background:

The case is currently making its way through the legal system and has not been decided.

The Patents in Question

Two patents are involved in this case:

The patents describe fundamental means of connecting IP cameras to software, displaying them and identifying them by MAC addresses.

The patents overall date back to March 2000. The first patent continues from an application in 2000 and the second patent continues from the first. The origin date is key because the US is a 'First to Invent' country requiring patenters to prove that no prior art exists more than a year before the date of first filing.

The Background

Both JDS and Milestone were early VMS developers. JDS reports that they have developed VMS software since 1999. Additionally, Milestone says that they shipped their first VMS version called "Surveillance PRO" in 1999. It supported 5 cameras maximum, licensed by unit (camera/encoder), used MAC addresses and included motion detection.

Like the OV Lawsuits?

Get Video Surveillance News In Your Inbox
Get Video Surveillance News In Your Inbox

This may all sound familiar to those tracking Object Video's ongoing litigation campaign for video analytic patents. While both companies (JDS and OV) are claiming to have fundamental patents to their respective domains, important differences exist.

On the one hand, OV is far more aggressive:

  • OV has a war chest of millions (perhaps tens of millions) to spend on suits; JDS does not
  • OV has sued 4 companies so far and issued a ridiculous 60 day ultimatum.
  • OV is pushing for all companies to sign patent licensing agreements; JDS is open to that but has not unleashed any campaign

However, the stakes are much higher for the VMS market:

  • VMS is mainstream and well accepted by customers
  • Relative to the tiny analytics market, VMS software is far more widely used (We'd estimate ~10x as much)
  • More Money at stake: VMS software total annual revenue is likely ~$500+ million already and will continue to grow significantly more than the overall market

Outcome

With the dysfunctional US patent system, it is hard to guess what will happen. That said, if JDS wins, we do not see this having a significant negative impact on the VMS market overall. Even if a patent license fees needs to be paid, given the value proposition of VMS, it should not significantly impact buying decisions. However, a loss could hurt Milestone itself, and their investors, significantly undermining their already minimal profitability.

A key element will be proving prior art. Many of the claims in JDS patents seem so obvious to us (even for the year 2000), that it is quite feasible that Milestone, other VMS providers or IP video developers may have prior art that could invalidate the patents.

Fairness?

Like Object Video, JDS was very early and had a great opportunity to lead their respective market. Neither capitalized on it and we do not think the 'fault' was others stealing their 'technology'. This underlies one of the most controversial issues in patent litigation - unsuccessful early companies using broad patents as tools to punish rivals who outexecuted them. All that said, if or until the patent system is reformed, we are stuck dealing with ongoing litigation across the industry.

Related Reports

Directory of Video Surveillance Startups on Jul 18, 2018
This directory provides a list of video surveillance startups to help you see and research what companies are new or not yet broadly known entity...
Axis ~$100 Camera Tested on Jul 17, 2018
Axis has released their lowest cost camera ever, the Companion Eye Mini L, setting their sights on a market dominated by Hikvision and Dahua. Can...
Axis Perimeter Defender Video Analytics Tested on Jul 12, 2018
Axis 'high security' video analytics offering is Perimeter Defender, OEMed / developed with Digital Barriers. But how good is Perimeter Defender?...
Drops Dahua, Fenner Becomes ISS CMO on Jul 09, 2018
Hired to improve Dahua's miserable marketing just last year, Janet Fenner has quit Dahua, joining VMS manufacturer ISS as Chief Marketing...
UK VSaaS Startup Ocucon on Jul 03, 2018
Decreasing exposure to fraudulent slip-and-fall insurance claims and lawsuits is one of the oldest selling points of video surveillance for retail....
Digital Watchdog Low Cost 4MP Camera Tested on Jul 02, 2018
Based on member 4MP testing requests, we bought and tested Digital Watchdog's low-cost 4MP DWC-MTT4Wi to see how it performs in real world scenes,...
Panoramic Fisheye Camera Shootout - Avigilon, Axis, Dahua, Hanwha, Hikvision, Oncam And Vivotek on Jun 27, 2018
IPVM tested Avigilon, Axis, Dahua, Hanwha, Hikvision, Oncam And Vivotek 12MP panoramic fisheye cameras head to head, as shown in the test setup...
Snap Surveillance Profile on Jun 26, 2018
There are not a lot of video surveillance companies that survive 9 years with only one feature that makes their product stand out. In the case of...
OpenEye Apex VMS Tested on Jun 26, 2018
OpenEye is a US company, founded nearly 20 years ago. In the past few years, OpenEye has been one of a few VMS providers that have pivoted to being...
Most Wanted Improvements In Manufacturer Technical Support (Statistics) on Jun 21, 2018
5 key areas of improvement and 1 clear wanted support feature were voiced by 140+ integrator responses to: What improvement in manufacturer...

Most Recent Industry Reports

Axis ~$100 Camera Tested on Jul 17, 2018
Axis has released their lowest cost camera ever, the Companion Eye Mini L, setting their sights on a market dominated by Hikvision and Dahua. Can...
Amazon Ring Alarm System Tested on Jul 16, 2018
Amazon Ring is going to hurt traditional dealers, and especially ADT, new IPVM test results of Ring's Alarm system underscore. IPVM found that...
Hikvision Wins Chinese Government Forced Facial Recognition Project Across 967 Mosques on Jul 16, 2018
Hikvision has won a Chinese government tender which requires that facial recognition cameras be set up at the entrance of every single mosque...
Installing Dome Cameras Indoors Guide on Jul 16, 2018
IPVM is producing the definitive series on installing surveillance cameras. This entry covers one of the most common scenarios - installing dome...
Security Sales Course Summer 2018 on Jul 13, 2018
Based on member's interest, IPVM is offering a security sales course this summer. Register Now - IPVM Security Sales Course Summer 2018 This...
US Tariffs Hit China Video Surveillance on Jul 13, 2018
Chinese video surveillance products avoided tariffs for the first two rounds. Now, in the third round, many video surveillance products will be...
Last Chance - July 2018 IP Networking Course on Jul 12, 2018
Registration ends today, Thursday. Register now. This is the only networking course designed specifically for video surveillance...
4 Most Difficult Camera Installs (Statistics) on Jul 12, 2018
Heavy housings, cumbersome brackets, heavy ladders required, and tricky field of view requirements will cause difficulties no matter the camera...
Axis Perimeter Defender Video Analytics Tested on Jul 12, 2018
Axis 'high security' video analytics offering is Perimeter Defender, OEMed / developed with Digital Barriers. But how good is Perimeter Defender?...

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