Milestone shares its market growth data at partner event

March 4, 2011, San Antonio, TX -- At its own integrators and partners event held this week in San Antonio, Danish video management software (VMS) company Milestone Systems provided a company update that could be representative of the IP video industry. The "Milestone Integrated Platform Symposium" (MIPS) event brought together around 200 attendees who were mostly resellers for training sessions and then general sessions with company executives and key partners as well as end-users sharing VMS case studies.

If Milestone's growth rates are any indication, this is a good time to be in the world of IP video. The company's President and CEO Lars Thinggaard noted that Milestone had seen an average compounded annual growth rate of 41 percent since the company was founded in 1998. He said that he felt he had already seen Milestone bounce back from the global economic recession of 2008 and 2009, and he reported 56 percent growth in revenues for 2010 over 2009. That growth number, he noted, was over and above the expected average growth rate for all VMS companies, which had been estimated by market research firm IMS as being 30 percent CAGR.

Thinggaard also measured the company's progress in the video management software market by the number of installations. Milestone Systems, he said, had itself reached a milestone recently with an estimated 100,000 installations of its software products. Thinggaard said a full quarter of that number could be credited to the launch of XProtect Go, a free license download of the VMS that supports up to eight cameras. This free version was launched approximately six months ago as a way for the company to proselytize the benefits of networked video to extremely small-scale installations.

Even though a full quarter of the company's installation are non-profit creating installs from the free XProtect Go software, vice president of marketing and product management Christan Bohn said that level of free adoption does not undercut the company's profitability. Bohn noted that those customers were not customers that Milestone was able to reach before; they typically were buying small DVR systems instead. By moving them onto the XProtect Go video surveillance recording platform, he said they are able to introduce IP video to a new market segment. The hope is, of course, that those users might upgrade to an actual pay-for product like the XProtect Essential software which supports up to 26 video cameras.

Milestone also offered additional numbers which could be used to measure the firm, but which also paint the picture of today's IP video industry. Milestone is now reporting that at the end of 2010, they had 4,300 integrators and some 7,440 certified partners (individuals trained on the software). Thinggaard added that the solution is sold through 230 distributors. On the development side, Milestone reports over 80 manufacturer alliance partners (manufacturing companies whose products have direct driver support within Milestone's software) and more than 380 solution partners (companies who have used Milestone's API or SDK to create product integrations between outside technologies.)

As to the overall market, Milestone's Chief Sales & Marketing Officer Eric Fullerton said that the last few years have seen the addition of a high number of new companies offering video management software for IP video, but he questioned as to whether the market would be able to support the continued existence of all of these software companies. Part of what Milestone does at its annual MIPS event is to share its product roadmap to its resellers. Fullerton said the reason the company is able to plan such aggressive product-release roadmaps is that they reinvest between 16 and 22 percent of revenues back into R&D. In fact, the firm just announced the establishment of a new operations location in Bulgaria specifically for product development. Fullerton said that he would expect some companies which aren't able to devote significant resources to R&D to eventually fall by the wayside in the VMS market -- effectively creating some consolidation in the industry.

Also during its event, Milestone recognized some of its partners with awards. Recipients included Axis Communications, BriefCam, Communications Supply Corporation (CSC), Johnson Controls, Convergint, and Stone Security (for installation of the year).