The Biggest Surprises in the Video Surveillance Industry 2015

Author: John Honovich, Published on Nov 13, 2015

100+ integrators told us what the biggest surprise in the video surveillance industry in 2015 was for them.

Inside, we share dozens of comments and reveal the 3 key themes.

3 Themes

The big 3 themes were:

***+ *********** **** ** **** *** ******* ******** ** *** video ************ ******** ** **** *** *** ****.

******, ** ***** ****** ** ******** *** ****** *** * key ******.

3 ******

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

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

  • *** **** / *********: *** *** **** **** ******** ** ** many *********** ***** ********* *** *** **** ********
  • ** ******: *** **** ** **, ** ******, ******** ** its *** *****.

Not ******

* *** ****** ********* *****, **** *** ****** ********* *.***, no *** ********* ***, ** *** ********* **, ** *** mentioned ********* / ***** ******, ***. ** *** ********* *** *** really ******* ** **** ** **** **** *****.

Low ****

*** **** / *** **** ** ******* *** *** ******* overall *****:

  • "****** ******* ** ***** ***** ** *******."
  • "*** **** ** ***** **** ****** ***** ****** **** ************* has **** * ***** *****. * *** ** *** ********* are ***** ********* *** ******* *** **** *** ******* *******."
  • "***** ***** **** *******." [****: ******* *** **** ***** **** 25% **** **** *** ********** **** ***** ******* *** *******, see ******* *** ****** ******]
  • "***** *** **** *** **** ***" [*******, *** *** *** ******** - ***** ** *********]
  • "*** *** *******. ****** ** ** * **** ** *** bottom *** ******* ** *******. ********* *** **** ********* **** low **** *** *********** ** ***** *************. * ********** ******* better ******* *** ********* *** ******* ** ******** **** ***** cameras *** ****** *************** ** ****** ********** ********."
  • "***** ****** *** **** *** ****** *** ********. ********* *** existing ************* **** ************ - ** ******* ***** ******* "****" lower ******. **** ***** ******* **** ******* ** *** **** just ** ***** ******** ***** ***** *******"
  • "*** ******* ** ** *** **** *** ************* ** *********** low *****, *** *** *******. ** *** ****** ***** * toll ** *** ****** ** ****** *** (****, *****) ******* we **** **** **** ** ******. *** **** ********* **** been ********* ** *** ********* ****** **** ************* ***** ****** lines. ** **** *** ** **** **** ****** ** ******* our ****** ** ******* ****** '***** *****' *******."

*********

** *** ******* ************ ** *** *****, ** ** **** **** they ***** ******** **** *** ***** *** **** **** ***** low ****** ********** ***. ********** ********:

  • "****** ******* **** *** ********* ** **** *** ****"
  • "*********, ******* ** *****/*******."
  • "********* ***** ********* ** ***** **. ***** ***** ****** *** crazy. * *** ** *** ********* **** **** **** **** do *** ***** *** ********* ****."
  • "********* ****** ***** ******* ** ****."
  • "*** ********** **** ** ** ********* **** ** *********"
  • "***** ****** ** *********** ********* (*** **** ****** *********) *******.**** are **********."
  • "********* ********* ** ******** ** **** *** **** *******, *** cost ******* ****, *** ***** ********** **** ** ** *** US ******."

*** *********** *** *** ****** ******* *** ****, **** **** noted ***** ********** *** *********** *******: 

  • "***** ********** ** *** *** ******* ********"
  • "********* - ** ********** ** * **** *** *** ****** product - ** *** * ***** ******* ********** & ** were ********* ** *** ******** *********** & *****"
  • "*********** ****** ******* ** ************ **** ******** ** ****/*****."
  • "*********-* **** ******* *** **** ********** ******* *** ******* ***** cameras."

*******, *** ********** **** ** ****** ***********:

"********* ** *** **** *********** ***** ** ******** ********* ******* each *****."

** *** **** ** * *****, ********* *** **** **** rare ** ****** *********. **** **** ** ** *********** ******* as ********* ***** **** ***** ******* ***** ** * **** risky *** ***** ******* ****** **** **** ***** ** *** many *********** *** ******** *** **** *****.

HD ******

**** ** *** ****, ** ****** *** *** **** **** common ***** *****:

  • "******* ********, ** *** *** ******* ** ** ****** ****** images."
  • "*** ****** ** *******. ********* ** *** ******** ***** *** market ******* ** **."
  • "*** ******* **** * ******** ********. *** **** ** *********** for ****** *** ** ***, **** ******* **** ** ** on ******** *** *** ****** ****** ** *** *** ** systems."
  • "******** ** ******* - *** **** *******!!! ******* ** *** crushed *** ****** *** ******. ***** ******** ****** ** **** and **'* ** **** ****."
  • "******** ** ****** ******* *** ********, ** **** *** **** rapidly **** ** ********"
  • "* *** *** ****** ** **** **** ** **** *** as ** *** ******* ***** ****** **** **** ** ************* of *** ************. * ***** ******* ***** ** ***** ** eventually ** * ****-*** ** **-*** ** ******* ** *** type ** ********* ****** ****."
  • "****** **. ******* *** *********** ***** **** **** ******* & this **** **** **** *********** *****"
  • "***/** ** *******, ***** ****** *****"

Notable ***** ********

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

  • "**** ********* ** *** **** **** ***** ******* ***** ** rollout ** *****" - ** **** ******* ** ***** ************ Dahua ** **** *** **** ***** ** ******. *** **** will ** * *** **** *** ****. ** **** ****** get ***** *** ******** *******, ** ***** ** *** **** for **** ** ***** ******* **** ********* ********.
  • "*** **** **** **** ** *** ******* ** **** **** [low ****] ***** ** * **** ******** *** **************." - We ***** ** **************, ****** ***** ***** ******* ***** *** slow ******** ****, ** *******, **** ** ********* ****** *** hard ** *** *** ****.
  • "***** *** ****** ******* **** ********* * *** ******. ***** a *** ** *** ******* ******* ******* ** *** ***?" and "******** ** ****** ******* ********* *** ****** *********." *******, ***** *********** ****** **** **** ****** *******
  • "***** *** ****** *** *** ***. ***** ******* *****-**** ** the ****** **** ******* "***** *****" *** **** *** ***** installations ******* * ***** **** ***** *******. **** ***** ***** managers ***** *** **** * ****** ********** ****** ** ******* either ******** ** *****, ******* **** ** *** ***. *** support *** ******** *** ****** ******* ** ****** ****. *** seriously *********** ********* ****** **** ********* ** ********* ****. ******'* have ******** **** * **** ***..." *******, *****'* *** *** - **********

Comments (12)

Well I guess for me the biggest surprise in 2015 is the fact that the biggest surprise in 2015 is rise of the low cost Asian cameras.

We've been talking about the feature parity, increased capability, quality, compatibility and low cost of Chinese offerings for years, haven't we?

At least a couple of years. I think the surprise, and I share this, is how far it has gone.

I certainly underestimated Hikvision's willingness to spend on sales and marketing at mega Western brand levels yet sell at Chinese off the boat prices.

I know we've talked about this a lot, but how cheap are these guys really? Aren't customers concerned at all about local warranties and support? System integrators make little profits from these Chinese brands, are they just quoting because they had no other choice when competitors are quoting Hik/Dahua?

"Aren't customers concerned at all about local warranties and support?"

Nic, good question.

As an example, Hikvision has over 200 employees in North America - sales, support, engineering, trainers, marketing people, inventory in local warehouses, etc. It's a lot like Axis but just 30 - 50% lower price.

So, yes, traditionally, those prices came with poor to no local warranty and support but Hikvision has broken this model. How long they continue to do this combo (Western support and Chinese off the boat prices) is a key question. I don't see how this combo is sustainable since the Western expenses (200+ local employees, etc.) are the same for them as they are for any Western incumbent.

I don't see how this combo is sustainable since the Western expenses (200+ local employees, etc.) are the same for them as they are for any Western incumbent.

I suspect the cost structure is not the same given "only" 200+ employees at their current/potential sales volume. Their cost of supply chain/production is very very low so there are some margins, and I believe even with local support their cost of that is driven down by their very high MTBF and the commodization trend that says "it will run until it's obsolete." The cost of sales is driven down somewhat by the lack of friction given the price. Marketing/warehousing is spend but doesn't require corporate employee overhead.

An analogy would be ASUS vs Dell here in the US.

ASUS sells the same spec'd laptop for 50% less than Dell? I'd be fascinating to see the details on that.

Because Hikvision is routinely selling cameras for 50% less than Axis.

My point is ASUS had/has a business model that was sustainable even at low prices.

Where I think the analogy is different is Dell was/is still able to drop prices to at least be competitive. Whereas Axis apparently isn't as willing/able to do so.

I always suspected ONVIF was going to be suicide for Axis. But convinced myself Axis was trying to increase the entire size of the pie, and was confident they could still own a big piece of that pie. Apparently that wasn't the case if they cannot come down in price. Whether that's their overhead, production costs, need to preserve margins in the channel or what.

"Whereas Axis apparently isn't as willing/able to do so."

Neither is (in alphabetical order), Avigilon, Bosch, Panasonic, Pelco, Sony, and pretty much every established company except for Hanwha Techwin (formerly Samsung).

Hi John, Thanks for the response.

I think they have the ability to drop prices (their gross margins are way above 50%), but it will mean their margins will be harmed - and also it's easier to drop price than to raise it again. It's a catch-22 where they will harm existing products' profitability at the expense of winning market share in the low-mid end market. The ultimate outcome is they will be a higher niche player in the future - unless if they launch a cheap product under a different brand name (and hide it really well - like how Hikvision TRIED with Ezyview). They will have to disrupt themselves or be disrupted.

To what extend are our trade agreements to blame is the real for this surprise? We have a client with a location in Brazil, and buying the items in the US, and shipping them to their location resulted in a 60+% tariff, plus taxes on all items based on local MSRP pricing of the items.

The bigger scam is that Asian Distributors are shipping volumes of items to the US, with the participation of the recipient, as evaluation or gift items, avoiding all tariffs.

While I'm not an isolationist. However, I do believe they need to index the tariffs based upon the trade imbalances, and with some adjustments for the economic size of the countries. I also think places like EBAY with these pseudo gift / trial imports is a good place to start investigating... My .02 on that...

The bigger scam is that Asian Distributors are shipping volumes of items to the US, with the participation of the recipient, as evaluation or gift items, avoiding all tariffs.

To be clear, it's the recipient first who desires to avoid the tariffs.

I am humbly corrected, and completely agree.

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

Exacq Improving Technical Support, Responding To Integrator Complaints on May 21, 2018
Exacq had been a long-term favorite of integrators, but since their 2014 Tyco acquisition, Exacq has fallen in IPVM integrator studies (though...
Best Manufacturer Technical Support 2018 on May 21, 2018
While 5 manufacturers made the worst technical support 2018 list, only 3 stood out as providing the best technical support to 190+ integrators in...
Stealth / UCIT - Remote Video Monitoring Provider Profile on May 18, 2018
Can 2 remote video monitoring companies, Stealth Monitoring from the US and UCIT from Canada combine to impact the market and compete in a changing...
Cybersecurity for IP Video Surveillance Guide on May 18, 2018
Keeping surveillance networks secure can be a daunting task, but there are several methods that can greatly reduce risk, especially when used in...
Forced Entry / Duress Access Tutorial on May 17, 2018
Even though access control normally keeps people safe, tragedies have revealed a significant issue. If users are forced to unlock doors for...
Worst Manufacturer Technical Support 2018 on May 16, 2018
5 manufacturers stood out as providing the worst technical support to 190+ integrators in new IPVM results. These integrators answered: In the...
Top Benefits Of Attending Trade Shows (Statistics) on May 15, 2018
150 integrators told IPVM: What are the top benefits of going to trade shows? The clear top 2 responses in order: (1) Networking (2) New...
Access Visitor Management Systems Guide on May 11, 2018
"Who are you, and why are you here?" Facilities that implement Visitor Management Systems hope they never need to ask that question to anyone,...
March Networks Targets Cannabis Market on May 10, 2018
Will the next March Networks customer appreciation event be held a steakhouse or at a Taco Bell at 2 am? Can March sell the types of systems to the...
Canon Acquires Briefcam, Now Owns Briefcam, Milestone and Axis on May 09, 2018
Canon already owns two of the biggest names in video surveillance, Axis (acquired in 2015) and Milestone (acquired in 2014). Now, Canon...

Most Recent Industry Reports

Stealth / UCIT - Remote Video Monitoring Provider Profile on May 18, 2018
Can 2 remote video monitoring companies, Stealth Monitoring from the US and UCIT from Canada combine to impact the market and compete in a changing...
Cybersecurity for IP Video Surveillance Guide on May 18, 2018
Keeping surveillance networks secure can be a daunting task, but there are several methods that can greatly reduce risk, especially when used in...
Forced Entry / Duress Access Tutorial on May 17, 2018
Even though access control normally keeps people safe, tragedies have revealed a significant issue. If users are forced to unlock doors for...
ADT Stock Drops 50% Since IPO on May 17, 2018
It has been a brutal 4 months for ADT. They first expected to IPO at ~$18. They IPOed at $14, dropping immediately to $12.39 And now, not even...
Dahua 12MP Fisheye Camera Tested (NK8BR4) on May 16, 2018
Continuing our coverage of 12MP sensor fisheye cameras, we bought and tested the Dahua NK8BR4, examining: Default vs. Optimized...
Worst Manufacturer Technical Support 2018 on May 16, 2018
5 manufacturers stood out as providing the worst technical support to 190+ integrators in new IPVM results. These integrators answered: In the...
Installing Cameras in Plenums Tutorial on May 15, 2018
There is often confusion about plenum ceilings, with misinformation about what is required when running cables through them and mounting cameras...
Top Benefits Of Attending Trade Shows (Statistics) on May 15, 2018
150 integrators told IPVM: What are the top benefits of going to trade shows? The clear top 2 responses in order: (1) Networking (2) New...
Measuring For Security Installation Guide on May 15, 2018
Accurate measurement is a fundamental skill, yet many installers do not know how to do it. Using these tools are a key skill needed for security...
Arecont Files Ch.11, Agrees To Sell To Turnaround Specialist on May 14, 2018
The long-anticipated sale of Arecont Vision is finally happening. After raising $80 million in debt in 2014, a failed sale in 2017 and the...

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