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Everyone knew it was coming, and now the use of IP cameras in the security industry is moving at full speed. Three years ago, the IP trend was a lot of talk, but players in the industry have ensured that these cameras offer a dawn from the dour days of analog.

IP cameras also have heralded the arrival of better equipment—though most experts agree that there is more work to be done, including improved resolution and intelligence inside the camera. The megapixel camera is evolving quite nicely in the high-resolution market, as well as the video surveillance business. According to John Monti of Pixim, cameras with output resolutions greater than 720 x 480 will drive adoption of IP cameras once the current issues of poor low light, low-dynamic range, marginal SNR, cost and image performance are addressed.

So, what’s to come in this market niche that will improve the IP video camera? For starters, the speed of the network will increase, multiplying the range and ability of the camera. The application of megapixel technology will only serve to improve visual quality, and future technology will improve the processing speed of the IP camera.

I recently spent a couple days in Lund, Sweden, and Copenhagen, Denmark, with Fredrik Nilsson of Axis Communications to learn more about the technology and what’s coming to the marketplace in the future.

Axis knows a thing or two about developing and selling IP cameras. They’ve been doing it since 1996, and they surpassed the 1 million mark in sales in October 2007. Selling that many cameras certainly carries some weight in the industry. You might as well know that Axis officials plan to hit the $10 million mark in sales in the next 10 years.

Nilsson, the general manager of North American operations for Axis, said the market for network video products is accelerating at about 40 percent a year. No question—there is enormous interest in the IP product, which has helped Axis and many other camera companies become technical and market leaders.

At Security Products magazine, we feel so strongly about the future of the network and IP video that we’ve created a new magazine Network Centric Security, which details the trends in market convergence and the applications of IP systems over the network.

Analog cameras have pretty much done what they can, and until today, they have filled a genuine and important role. CCTV systems are giving way to open systems, like network video, that can be fully integrated. Let’s face it—security projects are increasing in scope, especially at installations in train stations, schools, retail stores and airports.

Who is interested in IP video solutions? This is an interesting question, but the answer is even more intriguing. Developers and government officials in Dubai, part of the United Arab Emirates, are building a city that resembles the future. Everything new in Dubai is juxtaposed with the ancient, including the Burj Dubai, which will be the world’s tallest tower, and the Burj al Arab, a resort that redefines what a hotel can be. Officials in the country are only interested in IP cameras. They are completely skipping one product generation and integrating the newest of the new. In fact, Dubai’s growth represents an exploding emerging market.

Companies are realizing the added benefits of network video, such as scalability, remote access and, probably more important than anything else, cost-effectiveness. Many companies are transitioning from analog to digital technology, and, according to Nilsson, projects and installations are increasing in scope.

IP solutions also have the ability to deploy artificial intelligence within the camera. Axis co-founder and president Martin Gren said his company will approach the intelligence question cautiously, but company research and development will continue down that path. Gren said intelligence will become an integral part of the solution at some point.

Artificial intelligence is already used by a few select venders, such as Verint, Lumenera and ioimage. Monti said pervasive and flexible AI will require many more embedded CPU cycles in the camera, which may take another three years to hit commodity price points.

Some providers, including ioimage, have managed to package IP cameras with built-in analytics, and according to Dvir Doron, the company’s vice president of marketing, it has been deployed for some time now. The majority of traditional IP manufacturers have yet to release a mainstream intelligent video for their IP cameras, but Doron expects that this year will be the time when some level of analytics will be included on many IP cameras.

Use of the IP video solution is only going to grow in popularity, especially when commodity price points settle at comfortable levels. According to IMS Research, the growth of IP cameras is pegged at a compound annual rate of 40 percent. I suspect that nearly 10 percent of video surveillance cameras shipped in 2007 were IP cameras. This only heightens the prospects that IP solutions will continue to grow.

The use and practicality of IP solutions touches more than the security market. Jumbi Edulbehram, director of strategic channels at Axis, said the integration of IP video with other systems, such as access control, gives the solution a higher level of intelligence. He also pointed out that IP video can be used in a retail application to assist in merchandising and store operations.

Storage capacity also is part of the big picture. IP video cameras currently use the MPEG-4 compression scheme and stream video in this format, which is the industry standard. However, as H.264 standards become more prevalent, manufacturers will incorporate this technology, probably this year.

IP video is growing fast, and the analyst community’s view is unanimous about its future. Within the next three years at the latest, it will be more common than not for video analytics functionality to be requested in project specifications for major institutional or commercial video surveillance systems. As soon as the mainstream security channel—systems integrators, dealers and installers—buys into the deployment of IP video-based systems, their skill sets of installation and sales will push integration forward.

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