#1 Manufacturer Complaint Revealed 2013

Author: John Honovich, Published on Sep 12, 2013

Low-cost competition, particularly from China, is overwhelmingly the #1 complaint and the #1 fear of video surveillance manufacturers we surveyed. In this report, we share their concerns and analyze them.

Cost Pressures

Manufacturers are increasingly feeling pressure to cut prices:

  • "Saturated market place, costs driven through the floor."
  • "Accelerating lower cost pressures decreasing profitability while increasing acceptance of IP video. This is happening many times faster than the same trend in Analog."
  • "Instead of solving problems with proper technology they patch things due to limited budgets"
  • "Decreasing budgets, doing more with less, may be forced to compromise on quality and being tempted by promises that do not deliver true benefits"

China's Impact

They are fairly clear who is driving this:

  • "Chinese manufactures are getting stronger with improved performance levels at very aggressive pricing"
  • "Price leading by Chinese manufacturing"
  • "Strong competition from Asian companies."
  • "Chinafication: western markets being taken over by efficient and technology hungry Chinese manufacturers. The huge & low-cost manpower availability, combined with having evolved beyond 'copying technology' may allow China to take over a lot of Western manufacturer market share."

Quality Objections

However, at the same time, they are objecting to the quality of the offerings:

  • "The influx of cheap low performance products."
  • "Customers who "accept" crap solutions with crap service."
  • "People are comparing apples with pears. Everyone claims to have the best price AND quality."
  • "Low-cost manufacturers going direct with similar spec, but different quality products."
  • "Constant pressure to increase feature sets and specifications, while unit prices are falling."
  • "Companies can sell sub-par products,and many customers would not know that there a big differences."
  • "Dwindling budgets and cutthroat competition by far…causing resellers and end users to focus mainly on price rather than on the solution that addresses the problem(s)."
  • "We're faced with trying to offer high quality equipment/services when our customer base does not want to pay for the higher quality. There is significant pressure towards lowering our prices and this can only be done if we lower the quality"

Examples

IPVM has tested a number of low costs products recently including:

Of course, this matches up perfectly with integrator's #1 IP camera problem - high cost.

UPDATE 2015

These concerns have proven to be true / impactful: The $100 MP Era is Here

3 reports cite this report:

Why is Avigilon's Stock Falling Like a Knife? on Oct 08, 2014
A week ago, a prominent Avigilon investor admitted, "Nobody wants to hold [Avigilon stock]. Everybody wants to sell it." He then recommended buying...
The Bloody HD Camera Wars Are Coming on Aug 25, 2014
The most important emerging trend in video surveillance today is the emergence of non-IP HD cameras. But the conflicting go-to-market strategies...
How Manufacturers Compete Against Low Cost on Jul 29, 2014
"I'll take whatever's cheapest" is perhaps the most hated phrase any salesman could hear. Yet high cost is the biggest complaint of many security...

Comments (12)

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How can anyone tell for sure if a camera is OEM or not? Where could anyone find out? Or is it unlikely that you can figure it out?

Here's our guidelines to determine if a manufacturer is phony (i.e., whether a camera is being OEMed/rebranded).

One other thing you can do is scan the camera with an IP scanner. A lot of them will check the MAC address, which is normally registered to the original manufacturer. This screen from Advanced IP Scanner shows this; the last camera most definitely not labeled DynaColor on the housing, but there it is via MAC address.

That's a great tip. Even if you don't have an IP scanner handy, there are several websites that reveal the same MAC details:

Happens in every industy - adapt or perish.

what is the name of the camrea and that will tell you some of the details

I agree with undisclosed integrator. Adapt or die. If a manufacturer wasnt planning on the Asian Invasion of this market, well then thats pretty poor planning on that particular manufacturer. From the article above I get the sense that some manufacturers have the attitude of "We have higher quality products but our customers cant tell the difference between our products and the ones from China that costs alot less" Again, this is just poor communication of their product to their customer. Either that or their product is simply overpriced compared to a similar product from China.

I kind of think the major manufacturers here brought it on themselves, too. When a mini-cam has built in IR, 2 way audio and SD all built in, that attracts potential buyers. So it's a cheap Asian camera that doesn't work very well or last very long. The big manufacturers should have already been on that front and doing it right, so when the cheaper version comes along, customers are already aware of and used to the quality. You'll always have customers who only look at price, but if you don't even have a product that matches a customers interest you're more likely to loose them.

Another common thing I hear from manufacturers when it comes to innovation is "We're working on that, but we don't want to release it until it's ready because we want to do it right." We'll, you should have done it right AND done it first.

Do you think Apple's iPhone would have had as much of the market share it has today if it had waited to release a capacitive touch screen to the point it came out after someone else did it first? If some cheap manufacturer had done it first, even if Apple came out soon after with a btter verison, they probably still would have taken over the lead from the originator, because they are Apple, but they would not have had as much market share than if they had done it FIRST and done it RIGHT.

Do it FIRST AND Do it RIGHT needs to be the mantra of the "high grade" manufacturers.

currently most cameras when connected via ONVIF reply with the name of "real" vendor.

Is it possible that maybe only a part of the camera, the PCB with the NIC on it, was OEM'd, but the rest of the camera is made by the manufcaturer...? Or maybe different parts OEM'd from different places? An OEM Frankenstein.....?

On the camera side, it's possible that the firmware / software was custom for the OEM (i.e., the hardware is the same but the camera 'manufacturer' added their own firmware / software). Of course, even then, it depends how much customization they did. Is it simply changing the logo on the camera's web interface or did they develop real features.

To expand on what John is saying, even with an OEM, ONVIF can report the brand customer. Same for mac addresses, active-x, digital signatures, etc. Just depends how deep the OEM customer wants to go to hide who they OEM from.

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