OnSSI Acquires VMS Company Seetec

The dominoes continue to fall.

One of the biggest VMS providers in North America, OnSSI, has bought [link no longer available] one of the biggest VMS providers in Europe, Seetec.

In this note, we break down the strengths and weaknesses of this combination, and how it matches up against Axis/Milestone/Canon.

Background

OnSSI is a private company based in New York, USA and has approximately 70 employees. OnSSI says they are 100% owned by their two co-founders Gadi Piran [link no longer available] and Mulli Diamant [link no longer available].

Seetec is a private company based in Bruchsal, Germany and was previously owned by 2 institutional investors.

VMS Offerings: OnSSI's VMS is called Ocularis [link no longer available] and consists of their own internally developed software plus Milestone's 'recorder engine'. Seetec's VMS is called Cayuga (watch Seetec Cayuga overview video).

OnSSI has not disclosed any details about the transaction.

Strong Complements

OnSSI and Seetec complement each other well.

• OnSSI is strong in the Americas but weak in Europe. Seetec is strong in Europe but has no presence in the US.
• OnSSI has been dependent on OEMing Milestone's 'recorder engine'. Seetec has their own VMS that can eliminate this.
• Both are medium sized companies individually (70-80 employees each). Together, they likely can do more and reduce overlap.

No 'Solution' Offering

Neither company makes nor sells cameras, so this does not create a 'solution' offering. On the positive side, this allows them to continue to tout themselves as being one of the few sizeable independent VMSes left. On the other hand, this does not solve / eliminate the pricing / sales disadvantage they have against companies bundling cameras and VMS together (e.g., Get Your Free Exacq Licenses).

Vs Axis / Milestone / Canon

We believe the Canon's acquisition of Milestone and pending acquisition of Axis helped drive these deals. Both OnSSI and Seetec have significant risk in the impending goliath that Canon is building, as Milestone was a key rival and Axis a top partner of both.

OnSSI / Seetec makes for a bigger, more complete competitor to Milestone. OnSSI can legitimately end the criticism of 'OnSSI is just a Milestone OEM' and the two can eventually combine features / functionalities. On the other hand, we believe that Milestone will sooner rather than later be cross-sold with Canon/Axis, increasing their advantage.

Challenges for OnSSI / Seetec

For any independent VMS company, the key challenge is: what is next with VMS?

VMS innovation has been slow for a few years with mostly incremental advances. The 'cloud' is the closest thing to a 'next big thing' but adoption has been weak.

How can independent VMSes like OnSSI / Seetec compete against the growing number of 'solution' providers who can give away VMS licenses? What unique or differentiating features can they offer to clearly seperate themselves?

The OnSSI / Seetec deal should help boost each other in the short / mid-term but they still need to solve this.

Poll - Vote

OnSSI Plans

Here is a statement from OnSSI:

"OnSSI plans to continue fully supporting Ocularis and the current recorder, with v4.2 being released at the ISC West and additional releases being planned. Plans for the new recorder will become more clear next week at ISC West."

Seetec CEO Statement

Here is a statement from Seetec [link no longer available]:

"Through the acquisition SeeTec will get access to the American markets in two ways: The server component of SeeTec Cayuga will be the basis of new OnSSI products and replace their current supplier over time. Furthermore, we will be able to offer our BVI solution in the Americas together with our new colleagues and global partners. Both steps provide a long-term perspective for SeeTec as well as for Cayuga. OnSSI gains access to our technology. Together we form one global company. The acquisition will not result in changes regarding contact persons or responsibilities. With OnSSI we’ve found a partner, who is a good match and is similar to SeeTec in many aspects. OnSSI is sized and structured similarly, both companies are software companies dedicated to VMS. SeeTec benefits substantially from this transaction – both from a commercial and from a technological point of view. With the new setup we are prepared for convergence and globalization in the VMS industry and become the no. 2 player in this market worldwide."