VSaaS Usage Statistics 2011

By Ethan Ace, Published Dec 27, 2011, 12:00am EST

Video Surveillance as a Service, also known as VSaaS for short, has been a topic of interest in the past year with Axis, along with well known incumbent integrators using Axis's AVHS platform, promoting VSaaS especially hard. In order to find out what integrators are seeing for themselves, we asked the following question of respondents in our Fall 2011 survey:

The Responses

A clear majority of integrators (77%) answered that they were not offering any VSaaS services. This was not surprising, as we have heard little aside from curious inquiries about VSaaS from integrators and end users. The reasons for not deploying VSaaS were varied, but bandwidth restrictions, pricing models, and security concerns were common.

On the other hand, given the relative short time VSaaS has been marketed by large vendors, having 23% offer it is pretty good. Of course, how well it is selling is an equally important point (examined at the end of this note).

Bandwidth Restrictions

VSaaS is often cited as being a prime solution for very small installations, in the 1-4 camera range, which typically fall into the category of small retail. However, many small retail establishments do not have spare upload bandwidth to dedicate to this service, as many still use slower DSL or cable connections. This can lead to decreased performance (resolution, frame rate, and otherwise) or the need to upgrade internet service, neither of which are favorable options.

  • "A good percentage of my commercial client base still have DSL for their internet connection."
  • "Low res due to bandwidth cost to the customer end."
  • "Bandwidth cost in NZ is too high."
  • "Love the idea but we had bandwidth issues when we did a test about 3 years ago. All 3 test customers received letters from their ISPs stating they have excited their monthly bandwidth and service would be terminated."
  • "I live in a region where the network infrastructure (internet service) is expensive and not fast enough. So the customer will pay more to the ISP rather than to our company."

Pricing Concerns

We have previously expressed concerns over the pricing structure of VSaaS offerings. These concerns were echoed by a number of integrator respondents. As we examined a year ago, many VSaaS offerings, at current pricing levels, have questionable ROIs. Exceptions to this concern, such as Alarm.com's video services, have been gaining some ground.

  • "Haven't felt that the price/performance metric was there yet."
  • "Still dont see the viabilty of the business case"
  • "We tried about 2 years ago, but the feedback we received was too expensive. We decided to table the offering until a later date."
  • "Many just don't want to pay the extra cost right now."

Security Concerns

Another concern raised by integrators was the potential security risk of storing a customer's video off-site. Indeed, many end users have cited this concern, as well, preferring to keep video from their premises in-house, where they can guarantee chain of custody, instead of storing it off-site.

  • "Clients prefer in house"
  • "Most customers are sensitive to video recorded at their facilities remaining under their direct control."
  • "Customer fear of data in 'cloud'"
  • "Customers still want their video in their hands. So no on the commercial side. On the residential side we have quoted it for a few clients who wouldn't couldn't afford a DVR with a few analog cameras. Nice option for a pet cam, nothing more at this time."

Limited Acceptance

Among those who said yes to this question (23%), the majority explained that yes, they do offer VSaaS, but it has seen limited acceptance among their customers. A number also expressed issues with positioning and selling the potential benefits of VSaaS vs. traditional systems.

  • "We use it as another tool in the tool box. Limited applications as of this time within our markets."
  • "Just beginning...the jury is still out"
  • "Yes, but have not had more than 2 or 3 customers take advantage of the opportunity."
  • "We have experimented with it - it's not a big seller by any stretch, but that's probably a positioning problem."
  • "Offered yes, sold no. I don't believe our sales staff was educated in how to sell it properly."

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