A great interview!

This is a great interview with the CEO and Chairman of Avigilon on MF Canada. It’s a 40 minute interview and I can’t post much of it, but if you have access to MF Canada (i.e. MF One), I strongly suggest you read the whole transcript. Here’s how it starts.

Saul

…If you could just give us a brief rundown in your own words of what Avigilon is going to be able to do to attack that $20 billion market, with you guys expecting to be a $500 million company, sales wise, in just a couple years.

Fernandes: Absolutely. For the benefit of your viewers and readers, many may not realize that the vast majority of video surveillance cameras and systems that deploy today are still reliant on analog technology. More than 90% of the install base of surveillance cameras today; when you go into a bank, a retail shop, an airport, so on and so forth, they’re still all running on basically 20th century technology. Whereas most other markets in the world; consumer electronics, medical imaging, machine vision, so on and so forth, have all migrated to digital HD.

There are some reasons; some technical and economic and historical legacy issues, that have prevented the adoption of HD in surveillance. At Avigilon we’ve uniquely overcome those barriers. What we’ve done that’s ground-breaking and revolutionary is, we’ve designed the world’s first — and to our knowledge only — end-to-end surveillance solution, designed from the ground up, uniquely for HD surveillance.

We use camera lenses with the world’s broadest range of IP megapixel surveillance cameras, from one million pixels up to an unmatched 29 million pixels, and multiple increments in between, as well as our own video management software, recording hardware and accessories, including mobile apps for smartphones, tablets, laptops — all designed for HD.

The technology — the “glue,” if you like, or the secret sauce that ties that all together — is a patented and proprietary technology that we call HDSM, which stands for High Definition Stream Management. This allows us to capture the highest resolution surveillance footage in the world, but compress it in a very clever way, in an intelligent manner that utilizes less bandwidth and less storage, which results in a lower total cost of ownership for the end users.

From a performance perspective, it produces the highest-quality video surveillance footage possible. That’s of value or of importance because, as you’ve probably seen on the 5:00 news, conventional surveillance systems often produce grainy, low-resolution images that, to a large extent, are unusable in terms of identifying people and reading license plates of vehicles.

We’re able to capture that critical data, and then produce a better-performing system that in fact costs less, in many cases, than an analog system. That’s really our secret. Really simplified in a nutshell: Our solutions work better, cost less, and are easier to use and install than alternative technologies…

http://www.fool.ca/stock-advisor/2014/09/03/exclusive-qa-wit…

For FAQ’s and Knowledgebase
please go to Post #3326

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What Saul meant to say was:

For FAQ’s and Knowledgebase
please go to Post #3325

:wink:

Jeb

Re: Avigilon Interview

Unfortunately I cannot post this interview here, but I read it last night and got even more excited about the company. It’s obvious the CEO doesn’t like what is happening to the stock price. He is blaming greed and folks that just follow the herd – either selling or buying. He is very focus on delivering and I believe he will be successful. My two main concerns with this company were addressed and so at 9:00PM last night I added a limit order so I would not have to think about it this morning in the office. I am now at 7%.

Concern 1: Adding too many employees too quickly. They are very prudent with their hiring and just don’t want to add head count for the sake of it. I like this.

Concern 2: Why some senior folks left? Accounting issues? The CEO is a man on a mission. If he thinks an employee can’t perform, he will get rid of them. However, he has added hundreds and promoted a lot for within. He is purging the weak and keeping the best – not the other way around.

LegoAbs

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Hi Saul
I tried to look at Avigilon but it shows as either AVO.TO (Toronto Exchg?) or as AIOCF. The prices are different for the two.

Any idea what that’s all about?

Bluedog

I tried to look at Avigilon but it shows as either AVO.TO (Toronto Exchg?) or as AIOCF. The prices are different for the two.

One is in Canadian dollars and the other is in US dollars.

Andy

2 Likes

Re: Avigilon Interview …I read it last night and got even more excited about the company. It’s obvious the CEO … is very focus on delivering and I believe he will be successful. My two main concerns with this company were addressed and so at 9:00PM last night I added a limit order so I would not have to think about it this morning in the office. I am now at 7%.

Hi LegoAbs, I also added to my Avigilon position after reading the interview. I wish all my companies had CEO’s that are so focussed.
Best,

Saul

1 Like

Hi LegoAbs, I also added to my Avigilon position after reading the interview. I wish all my companies had CEO’s that are so focused.

Saul and LegoAbs,

I also added to my position yesterday. I love big markets, well-positioned next generation technologies, focused/proactive management, and short-term irrationally priced share prices. I am now up to 4% with this one, and quite excited about the future.

Vic

1 Like

For whatever reason I couldn’t log on to the Motley Fool.ca interview but I did google and found another video interview of the CEO/Founder if anyone else is interested: http://www.bnn.ca/News/2014/6/27/Avigilon-staving-off-compet…

And an article from ‘Canadian Business’ giving an overview of Avigilon and its competitors came up in my search as well. The article is dated November 2013, but much of it is still current.

http://www.canadianbusiness.com/technology-news/theyre-love-…

Avigilon seems like a great opportunity on one level, but my concern is the increasing competition. I don’t quite understand what truly sets it apart. Any thoughts?

J.

3 Likes

Avigilon seems like a great opportunity on one level, but my concern is the increasing competition. I don’t quite understand what truly sets it apart. Any thoughts?

Increasing competition from whom? Could you tell me what companies you see as competition?

Andy

1 Like

Isn’t Ubiquity in the same field as well?

UniFi Video, a new line of video surveillance camera control software, accompanied by a new generation of cameras.

Not sure if you can compare the two in this area. In any case, there is enough room for more than one in this growing field I guess.

1 Like

Hi, andy,

Both the article and the video I posted talks about Avigilon’s video surveillance HD competition. Here’s an excerpt that shares a few names:

“Then again, many of Avigilon’s competitors have greater resources. Axis Communications of Lund, Sweden, the current market leader, has been around since the 1980s and did six times more business than Avigilon last year. Last year Axis dedicated 500 employees and 15% of its revenues to R&D, and has committed to what it calls an “offensive release rate” of new products and services. “They are still a dominant force,” says John Woodhouse, an analyst with IMS Research. Axis is active in North America, reporting strong interest from retailers and the public sector in Canada. Many competitors enjoy widespread brand recognition—Panasonic, Bosch and Samsung, for instance.”

A quick google search of ‘HD Video Surveillance’ brings up Lorax, Western Digital, Axis, Optica, etc. I don’t know if these compare apples to apples with Avigilon’s products, but Avigilon doesn’t appear to be the first mover or market leader just from my quick review. I did read somewhere that Avigilon sets itself apart from the others with its high resolution features and it boasts a wide range of interfacing capabilities. I don’t really know if that is true or not or how those attributes compare to the others’ products.

I continue to be interested in Avigilon and will do more google-ing to see what I can come up with.

Fool on!
J.

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Thank you J, I need to look into its competition and I apologize for not reading your article first. In my opinion when you look at any competition for Avigilon you must look at the high end of the market. They are going after big commercial players and companies that take their security very seriously. (I am thinking of stadiums, global business’s)

Andy

Hi easyfix,

Isn’t Ubiquity in the same field as well?

Yes Ubiquiti does sell surveillance camera’s but I wouldn’t put them in the same league as Avigilon. While UBNT does some really amazing things with wireless capabilities I see Avigilon as the Rolls Royce of security cameras and UBNT is going after the smaller business’s, Not to say that UBNT could not eventually become a much better provider of security capabilities. That is just my thoughts and I am long both Avigilon and UBNT.

Andy

Hey, Andy,

FWIW I was reviewing the CC transcript of Ambarella, another stock I own, and I came across this interesting overview of the Security Camera industry from Fermi Wang’s (the CEO of Ambarella) POV. He mentions several of his customers and gives a little more ‘color’ to who’s out there giving Avigilon a run for the money:

Fermi Wang states:

We are continuing to see strong growth from IP security cameras, driven by increasing demand for higher resolution and higher featured cameras in the professional camera market as well as increased demand for cloud-based home monitoring and security cameras.

Volume growth continues across all geographic regions, with the strongest growth in China, driven by market leaders including Hikvision, [unintelligible], and [unintelligible].

During the second quarter, many of our leading professional IP camera customers began volume commercial shipping of the 4K or ultra-HD cameras that were announced at ISC West 2014 Security Exposition in April. These cameras are based on our S2 camera SoC. In addition to its 4K capabilities, the S2’s ability to dewarp images, to enable 180 degree or 360 degree panoramic viewing, is proving very popular for the latest generation of cameras.

For example, Bosch, the leading suppliers of IP surveillance cameras based in Germany, introduced its new DINION IP ultra 8000 MP family of cameras, featuring 4K ultra-HD, 12 megapixels, and high dynamic range capabilities.

Additionally, we are seeing strong interest in our new S2L IP camera SoC family, which was introduced during the ISC West Exposition. The S2L includes a wide angle lens dewarping, high dynamic range processing, and Ambarella’s SmartAVC low bitrate streaming technology.

During the second quarter, we expanded the S2L product range with the new S2LM, a small form factor low power solution focused on home monitoring and security camera applications.

The demand for home monitoring and security IP camera applications continues to grow, enabled by cloud-based video storage and remote viewing via smartphones or tablets. In addition to cameras already in the retail market, including those from Dropcam, Philips, and Swann, we continue to see new opportunities with service providers in the U.S. and Europe.

This market is being driven by the requirement for HD video remote monitoring via smartphones and advanced analytics, such as activity detection. We are well-positioned to provide SoC solutions that meet all of these requirements.

In summary, we anticipate continued growth in the IP security camera from both the professional and consumer markets. We expect that the transition from the older generation of standard-definition analog cameras to HD IP security cameras to continue as prices converge. Additionally, based on the strong demand for higher resolution and advanced features, we expect continued revenue growth for our S2 and new S2L camera SoCs that enable ultra HD, panoramic viewing, and advanced analytics capabilities.

Read more: http://www.nasdaq.com/aspx/call-transcript.aspx?StoryId=2472…

In any case, Wang makes it sound like Amabarella is doing a band office business this year.

Cheers!
J.

6 Likes

Hi J,
That is very interesting and it doesn’t surprise me that Amabarella is involved. Thank you for the leads J.

Andy