The Biggest Surprises in the Video Surveillance Industry 2015

By: 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:

  • *** **** / *********: The *** **** **** together as ** **** *********** cited ********* *** *** cost ********
  • ** ******: *** **** of **, ** ******, assisted ** *** *** price.

Not ******

* *** ****** ********* cloud, **** *** ****** mentioned *.***, ** *** mentioned ***, ** *** mentioned **, ** *** mentioned ********* / ***** codecs, etc. ** *** ********* did *** ****** ******* as **** ** **** were *****.

Low ****

*** **** / *** fall ** ******* *** the ******* ******* *****:

  • "****** ******* ** ***** range ** *******."
  • "*** **** ** ***** down ****** ***** ****** many ************* *** **** a ***** *****. * lot ** *** ********* are ***** ********* *** require *** **** *** quality *******."
  • "***** ***** **** *******." [Note: ******* *** **** their **** **% **** year *** ********** **** lower ******* *** *******, see ******* *** ****** ******]
  • "***** *** **** *** with ***" [*******, *** *** *** ******** - Dahua ** *********]
  • "*** *** *******. ****** it ** * **** to *** ****** *** pricing ** *******. ********* are **** ********* **** low **** *** *********** or ***** *************. * understand ******* ****** ******* but ********* *** ******* to ******** **** ***** cameras *** ****** *************** on ****** ********** ********."
  • "***** ****** *** **** the ****** *** ********. Difficult *** ******** ************* with ************ - ** improve ***** ******* "****" lower ******. **** ***** selling **** ******* ** the **** **** ** match ******** ***** ***** numbers"
  • "*** ******* ** ** has **** *** ************* of *********** *** *****, WDR *** *******. ** has ****** ***** * toll ** *** ****** of ****** *** (****, Bosch) ******* ** **** been **** ** ******. And **** ********* **** been ********* ** *** competing ****** **** ************* lower ****** *****. ** have *** ** **** much ****** ** ******* our ****** ** ******* better '***** *****' *******."

*********

** *** ******* ************ ** the *****, ** ** hard **** **** ***** surprise **** *** ***** big **** **** ***** low ****** ********** ***. Commentary ********:

  • "****** ******* **** *** Hikvision ** **** *** NVRs"
  • "*********, ******* ** *****/*******."
  • "********* ***** ********* ** amaze **. ***** ***** points *** *****. * few ** *** ********* have **** **** **** do *** ***** *** Hikvision ****."
  • "********* ****** ***** ******* of ****."
  • "*** ********** **** ** IP ********* **** ** Hikvision"
  • "***** ****** ** *********** Hikvision (*** **** ****** Hikvision) *******.**** *** **********."
  • "********* ********* ** ******** me **** *** **** quality, *** **** ******* line, *** ***** ********** ramp ** ** *** US ******."

*** *********** *** *** simply ******* *** ****, they **** ***** ***** acceptance *** *********** *******: 

  • "***** ********** ** *** and ******* ********"
  • "********* - ** ********** it * **** *** end ****** ******* - we *** * ***** systems ********** & ** were ********* ** *** products *********** & *****"
  • "*********** ****** ******* ** surprisingly **** ******** ** Axis/Bosch."
  • "*********-* **** ******* *** many ********** ******* *** quoting ***** *******."

*******, *** ********** **** an ****** ***********:

"********* ** *** **** integrators ***** ** ******** Hikvision ******* **** *****."

** *** **** ** 2 *****, ********* *** gone **** **** ** nearly *********. **** **** be ** *********** ******* as ********* ***** **** early ******* ***** ** a **** ***** *** where ******* ****** **** much ***** ** *** many *********** *** ******** the **** *****.

HD ******

**** ** *** ****, HD ****** *** *** next **** ****** ***** cited:

  • "******* ********, ** *** the ******* ** ** analog ****** ******."
  • "*** ****** ** *******. Surprised ** *** ******** speed *** ****** ******* to **."
  • "*** ******* **** * pleasant ********. *** **** of *********** *** ****** was ** ***, **** clients **** ** ** on ******** *** *** analog ****** ** *** new ** *******."
  • "******** ** ******* - and **** *******!!! ******* IP *** ******* *** higher *** ******. ***** customer ****** ** **** and **'* ** **** sell."
  • "******** ** ****** ******* was ********, ** **** off **** ******* **** we ********"
  • "* *** *** ****** HD **** **** ** take *** ** ** has ******* ***** ****** some **** ** ************* of *** ************. * still ******* ***** ** going ** ********** ** a ****-*** ** **-*** or ******* ** *** type ** ********* ****** soon."
  • "****** **. ******* *** manufacture ***** **** **** product & **** **** have **** *********** *****"
  • "***/** ** *******, ***** beyond *****"

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

**** *** * *** other *********** ******** *******:

  • "**** ********* ** *** fact **** ***** ******* their ** ******* ** badly" - ** **** learned ** ***** ************ Dahua ** **** *** most ***** ** ******. But **** **** ** a *** **** *** them. ** **** ****** get ***** *** ******** quickly, ** ***** ** too **** *** **** to ***** ******* **** Hikvision ********.
  • "*** **** **** **** is *** ******* ** with **** [*** ****] trend ** * **** surprise *** **************." - We ***** ** **************, though ***** ***** ******* focus *** **** ******** time, ** *******, **** is ********* ****** *** hard ** *** *** side.
  • "***** *** ****** ******* have ********* * *** lately. ***** * *** of *** ******* ******* started ** *** ***?" and "******** ** ****** ******* customers *** ****** *********." Related, ***** *********** ****** **** With ****** *******
  • "***** *** ****** *** the ***. ***** ******* about-face ** *** ****** line ******* "***** *****" has **** *** ***** installations ******* * ***** path ***** *******. **** their ***** ******** ***** not **** * ****** compelling ****** ** ******* either ******** ** *****, besides **** ** *** new. *** ******* *** existing *** ****** ******* is ****** ****. *** seriously *********** ********* ****** with ********* ** ********* else. ******'* **** ******** that * **** ***..." Related, *****'* *** *** - VideoXpert

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.

Related Reports

Anyvision Presents AI Facial Recognition and Mask Detection on Jun 08, 2020
AnyVision presented its AI facial recognition and mask detection at the May...
Sunell Panda Cam Body Temperature Measurement Camera Tested on May 14, 2020
Sunell is far less well known than its gargantuan domestic competitors Dahua...
Fever Camera Sales From Integrators Surveyed on Jun 01, 2020
Fever cameras are the hottest trend in video surveillance currently but how...
Favorite VSaaS Providers 2020 on Apr 17, 2020
VSaaS is starting to become mainstream but who are integrator's...
Worst Camera Manufacturers 2020 on May 06, 2020
Which camera manufacturer have integrators had the worst experience with in...
Oyla Presents Low-Cost 3D LIDAR Alternative Camera on Jun 23, 2020
Oyla presented its low-cost LIDAR alternative camera at the May 2020 IPVM...
Milestone Presents XProtect On AWS on May 04, 2020
Milestone presented its XProtect on AWS offering at the April 2020 IPVM New...
Hanwha and Hikvision Selling H.265 Without HEVC Licensing on Aug 19, 2020
IPVM has confirmed that Hanwha and Hikvision do not have H.265 licenses from...
Taiwan Lilin NDAA Compliant Cameras Tested on Aug 13, 2020
Taiwan-based manufacturer Lilin is taking direct aim at Dahua and Hikvision...
Hikvision Salespeople: We Don't Need A Blackbody on May 13, 2020
Dahua jumped out on its cross-town rival selling fever cameras but Hikvision...
Uniview Deep Learning Camera Tested on Jul 14, 2020
Uniview's intrusion analytics have performed poorly in our shootouts. Now,...
Uniview Heat-Tracker Temperature Screening Series Examined on Apr 22, 2020
Uniview is marketing #UNVagainstCOVID19 with their Heat-Tracker series,...
Camect Presents Residential Market Smart NVR with AI Analytics on Aug 19, 2020
Camect presented its AI video analytics enhanced NVR at the May 2020 IPVM...
US Startup Fever Inspect Examined on Aug 03, 2020
Undoubtedly late to fever cameras, this US company, Fever Inspect, led by a...
Integrator Acquisitions 'A Good Market' During COVID-19, Says Greybeards on Jul 28, 2020
Industry broker Ron Davis of the "Greybeards" says that the integrator and...

Recent Reports

Virtual ISC West and GSX+ Exhibiting Contrasted on Sep 17, 2020
Both ISC West and ASIS GSX are going virtual this year, just weeks apart, but...
X.Labs Sues FLIR on Sep 16, 2020
X.Labs, the maker of Feevr, has sued FLIR, the publicly traded thermal...
Video Surveillance 101 September Course - Last Chance on Sep 16, 2020
Today is the last chance to sign up for the Fall Video Surveillance 101...
No Blackbody Mistake, Half Million Dollar, Hikvision Fever Camera System in Georgia on Sep 16, 2020
A Georgia school district touted buying Hikvision fever screening "about...
Costar Technologies / Arecont H1 2020 Financials Examined on Sep 16, 2020
Costar's financial results have been hit by the coronavirus with the company...
Startup Cawamo Presents Live Alerts With Edge AI and Cloud VMS on Sep 15, 2020
Cawamo, an Israeli edge-to-cloud analytics and VMS startup, presented its...
Favorite Access Control Credentials 2020 on Sep 15, 2020
Credential choice is more debated than ever, with hacking risk for 125kHz and...
Dangerous Hikvision Fever Screening Marketing In Africa on Sep 15, 2020
A multi-national African Hikvision distributor is marketing dangerously...
New Products Show Fall 2020 Announced - Register Now on Sep 14, 2020
IPVM's sixth online show will feature New Products from over 25...
Hanwha 8K / 33MP Camera Tested on Sep 14, 2020
Hanwha Techwin has released an 8K / 33MP resolution camera, the TNB-9000 with...
Gait Recognition Examined on Sep 14, 2020
Facial recognition faces increasing ethical and political criticisms while...
Comparing 2020 Reality To 2010 Expectations on Sep 11, 2020
What can we learn from where the industry was in 2010 and what was believed...
China Dali Fever Cameras and Booming Sales Examined on Sep 11, 2020
Zhejiang Dali, one of China's original thermal technology developers, has...
Risks Of Managing End User Passwords (Statistics) 2020 on Sep 11, 2020
Alarmingly, most integrators used spreadsheets to manage passwords, IPVM...
Dedicated Vs Converged IP Video Networks Statistics 2020 on Sep 10, 2020
Running one's video system on a converged network with other devices can save...