Why Consumer Surveillance Will Flip to IPAuthor: John Honovich, Published on Nov 19, 2012
The last still strongly analog segment is the consumer market. Cost is king for home use and the marginal increase in value with IP for their needs has not yet been enough. However, an emerging technology will fundamentally transforming the consumer surveillance market.
The Impact of Edge Recording
Edge recording changes the competitive positioning of the consumer market as it enables IP to eliminate the recorder appliance (i.e., DVR/NVR).
IP benefits twice from eliminating this:
- IP recorder appliances (like NVR NASes or PCs) are more expensive than analog DVRs. IP had a significant deficiency here.
- Without a recorder box, IP not only eliminates a deficiency but it builds an advantage as even 'cheap' analog recorders are still ~$250 USD.
Cost, the number #1 objection to IP, is significantly reduced.
[UPDATE 2014: Analog HD Beats Edge Storage]
Edge storage has been significantly undercut by the emegence of super low cost analog HD, eliminating the resolution advantage of IP for consumers and providing it at much lower cost than IP. See: HD Analog vs IP Tutorial, Testing Dahua HDCVI, Testing Analog HD and Hikvision HDTVI Cameras Tested.
The rest of this article remains as is for historical purposes.
Simplicity Gains for IP
While IP is historically and rightfully viewed as more complex than analog, the shift to edge recording will make IP the simpler solution. Now there is no need for setting up any box nor home running coaxial cables to a central place. Widely available ethernet cables or even WiFi will be sufficient (remember, with edge recording, bandwidth demands are no longer an issue).
The Market in 2015
Forget 5 years, in less than 3 years, the competitive market is very likely to look like far different than today:
- IP: 1080p resolution + edge storage + cloud access for $150 per camera
- Analog: Resolution stays the same, add cloud access, low end 4 camera kits ~$300 (excluding cabling and installation)
Here's the advantages of IP then:
- Massive video quality advantages (1080p to SD)
- Much simpler to setup (No box vs box and coaxial cables)
- More flexible - need 1, 5 or 10 cameras, just add cameras as you need, no additional boxes or constraints
Here's the disadvantages of IP then:
- Product cost likely still more expensive (50 to 100%) over 3 cameras
- IP edge recording proprietary - can still use multiple manufacturers but will need different apps/UIs for monitoring
While analog may remain cheaper for larger consumer use, IP will offer far higher video quality, simpler setup and more flexibility. Buying analog will have all the attraction of buying a VHS recorder today.
The Need for Kits?
The growth of edge storage undermines one of analog's greatest strengths in the consumer market, pre-packaged kits of 4 or 8 cameras sold with a DVR. Once you record inside the camera, there is no need for anything but the camera. Each IP camera with edge storage can be sold by itself and consumers can simply buy as many or as little as they need. Buying multi-camera kits actually becomes a disadvantage as it reduces flexibility and increases costs for consumers who want more or less cameras than come in the kit.
Lack of Suppliers?
The last major strength cited for consumer analog surveillance is the range of suppliers. IP consumer offerings have been constrained by a compelling low end offering. With edge storage proving its value, we fully expect a surge in the number of consumer IP cameras with built-in recording. 2013 will likely be to edge storage what 2009 was to megapixel IP cameras.
IP use is about to explode in the consumer market, at the expense of analog, driven by the disruptive value proposition of eliminating recorders through edge storage.
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