IP video is here and it’s now

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Tuesday, February 1, 2005

Have you heard about IP video yet? If you haven’t, welcome back from the deserted island you must have been stranded on! IP video is the fastest growing segment of the surveillance market with near-term revenue estimates approaching $500 million.

But like many other new products in the security market, it hasn’t been an easy road for IP cameras. They have gone through the same growing pains as other new technologies. If you compare the evolution of IP cameras to DVRs you can find many parallels. You probably remember when DVRs first came into the market, everyone wanted to test drive them but only a handful of early adopters were buying them.

After the gee-whiz effect of DVRs wore off, people realized that the early DVRs were giving them slower frame rate and lower quality video for a lot more money than their analog system. DVRs were also ahead of the infrastructure curve. The cost of storage and bandwidth was still relatively high and a majority of businesses in the 1990s did not have the broadband connectivity required to take advantage of all the DVR features. Eventually the cost of DVRs came down, the quality of the storage improved and the features became more attractive. Once the cost of storage and bandwidth dropped, DVRs offered a compelling value proposition and they quickly dominated the market.

The early days of IP cameras were very similar. The early models were really cool but not practical. First, the infrastructure was not in place to support them. Expensive, low capacity hard drives, 10M bit internal networks and low speed Internet connectivity were the norm. The early users of IP cameras, especially those accessing the Internet over a phone line, discovered that the picture quality was either unusable or the speed of the video was ridiculously slow so the number of applications where IP camera were used were very limited.

As bandwidth became more affordable, so did the practicality of IP video; however, it remained significantly higher in cost. There was also competition from CCTV video servers. These devices converted CCTV quality video to TCP/IP digital video and were becoming a commodity, so in most cases it was cheaper to use a CCTV camera with a server than use an IP camera.

IP cameras clearly needed a breakthrough to start gaining market share. IP camera manufacturers realized they were competing against a very mature market in CCTV cameras and that they could never win a cost war. So, they needed to differentiate their products.

The breakthrough came in 2001, with the introduction of high-resolution megapixel IP cameras. Many users were disappointed with the quality of the video they were storing and began developing alternative solutions. Since CCTV/DVR systems were still using traditional low-resolution NTSC/PAL cameras and compressing those images to maximize storage, the resulting images were so compressed that when you tried to restore them the video was unusable. You could get lots of video onto a hard disk, but the video was unusable for the clients. But with the emergence of megapixel and multi-megapixel imagers, the sky is the limit.

Before megapixel IP cameras, IP cameras were only being compared to the equivalent resolution CCTV cameras. Once the NTSC/PAL barrier had been broken, megapixel IP cameras were being considered in place of several CCTV cameras. Today, the multi-megapixel IP cameras with wide-angle lenses are beginning to replace traditional mechanical pan/tilt/zoom cameras.

The final barrier for IP cameras was in many ways the same final barrier that DVRs had - infrastructure. With DVRs it was storage and bandwidth. In the last two years storage and bandwidth have become a commodity so these have not been hurdles for the IP cameras. What was missing was the “back-end” system to support IP cameras in larger systems. Many IP camera manufacturers have integrated video motion detection and recording/playback software directly into the camera, but for systems greater than 10 cameras, on-camera recording/playback software was not always practical. Enter the final piece of the puzzle, video management systems. These are software packages that can manage hundreds of IP cameras. Basically they are the DVR management software without the hardware expense of proprietary DVRs.

All the pieces are in place and high-resolution IP video systems are quickly replacing the traditional low-resolution NTSC/PAL DVRs. But megapixel IP video systems aren’t being selected because they are cool, they are being selected because they offer the users something that they never had before, crisp clear images in an affordable system.

Paul Bodell is vice president, business development for IQinVision, Inc. He can be reached via email at pbodell@iqeye.com.