The Exacq / Tyco Solution Is Here

By John Honovich, Published Feb 16, 2015, 12:00am EST

And there it is folks.

Exacq is in the SOLUTION business, 20 months from independent VMS to Tyco package.

In this note, we examine the 'solution', the transition and how it impacts Exacq, Exacq dealers and competitors to Tyco / Exacq.

Exacq has started a marketing campaign, touting a "complete high definition solution". The partner to Exacq's VMS are Illustra IP cameras, now featured on Exacq's homepage, like so:

What is Illustra?

You may be wondering "What is Illustra? Is Illustra new?"

Illustra has been around for nearly 5 years, under Tyco's American Dynamics (AD) brand.

Don't remember AD? Their Intellex was 'Exacq' before Exacq. Tyco has milked and slowly destroyed AD.

Illustra offers a fairly basic set of IP cameras, with the typical minidome, dome, box, bullet, PTZ, fisheye but limited overall options (e.g., higher resolutions, advanced form factors) compared to Exacq's two most common partners, Axis and Arecont.

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Why Illustra and Exacq?

On the technical side, Tyco / Exacq is pitching the tight integration and easy setup of Illustra cameras with Exacq. Here's their marketing video pitch for that:

Business Drivers of the Solution

As we examined in Exacq Fires Rep Firms, this is part of a larger, more strategic reorganization to align Exacq with the Tyco 'family'. Related to this, Tyco has eliminated a number of Exacq's traditional rep firms, enabling a single rep in each region to sell both Exacq and Tyco / AD cameras, i.e., the whole 'solution'.

Additionally, while Tyco says they are not offering standard discounts for buying both, there are clearly project incentives and sales targets to sell Exacq and Illustra combined. As discussed in the comments, we believe that Tyco is offering Exacq license waivers when buying Illustra cameras, fairly widely based on discretion of mid-tier sales managers.

Exacq To Favor Tyco Cameras Over 3rd Party Cameras

The inevitable outcome of this 'solution' approach is that Exacq will favor Tyco cameras over 3rd party ones. The only debate will be by how much, i.e., how far will they go to undermine cameras from Axis, Arecont, Sony, Bosch, etc.

The other major element of this is the third leg - Tyco, the mega-integrator. That is the ideal outcome for Tyco, an all Tyco offering from recorder to camera to install.

The End Game of Acquisitions 

As we opined when Tyco acquired Exacq:

"Tyco will most likely ruin Exacq. They are Tyco, after all. However, what exactly happens depends on how Exacq is integrated and whether the Exacq management team will remain long term."

Now, the integration is under way and the compromise of Exacq's place as an independent leader has begun.

Tyco will ruin Exacq - the Exacq that so many respected and benefited from.

But Tyco will make their money and this will be a good financial deal for them, as they boost up Illustra sales and drive more Tyco integration business.

The upside? As each independent leader goes away, the field is cleared for the next generation of surveillance startups.

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