Canon and Milestone Discuss Acquisition in SSI’s Exclusive Q&A
Its acquisition of video management systems leader Milestone Systems positions Canon as a big-time player in the new IP world.
Canon had had a high profile in analog video surveillance for quite a while, especially with lenses, but seemed to be less visible and prominent the past several years. I’m sure IP coming in maybe has something to do with that, but from your perspective what was going on within Canon relative to video surveillance during that time?
Jacco Leurs: You made a strong point. Of course, we were present in the analog time. However, with the move to IP products the focus inside Canon increased quite a bit, recognizing the growth opportunities in video surveillance, but also in the market beyond video surveillance that is expected to grow rapidly over the next coming years. This is a market where we as a brand and our technology background can be a relevant player, and therefore let’s say the focus now has increased dramatically. Of course, the acquisition of Milestone is one example of that.
Canon Fast Facts
- Began 1933 in Tokyo as Precision Optical Instruments Laboratory
- Became Canon Camera Co. in 1947; Canon U.S.A. established in 1965 in Melville, N.Y.
- Number of employees worldwide in 2013 was almost 200,000
- Net global 2013 sales topped $35.5B
- Had more than 250 consolidated subsidiaries as of 2013
- As of July 21, 2014, ranked No. 211 for net income in Fortune Global 500
- Ranked third among U.S. patent holders (3,817) as of 2013
When we think about the move from analog to digital, this happens much faster in the consumer product area within Canon, compared to the surveillance product area. The consumer product area is where we have placed a lot of the attention the past few years. Now also within the surveillance market the switch to digital is accelerating, with 2014 probably the first year where we can see that IP will be bigger than analog. And as I said, the growth opportunities are beyond security applications only.
We have a strong commitment to the video surveillance industry, and we are increasing the focus on the security part of our business quite dramatically over the next coming years, in order to deliver on our ambitions.
Do you see 2014 as being a historic year in that IP finally surpasses analog? Is that how Canon views it?
Leurs: I think in that sense it is a milestone. Everybody expected it to happen maybe earlier, but it took a bit more time. Now I think it will only accelerate. There is a market tendency within Canon already to switch to IP a bit faster.
Looking at Canon’s business for surveillance specifically, what regions are hottest now for growth?
Leurs: Our biggest region at the moment is Japan, which takes about 50% of our business. Then there is the U.S. and Europe with each about 25%. That’s more or less the split. From a growth perspective, I think the growth opportunities in EMEA and in the U.S. are the big ones we are chasing now.
Let’s talk about the big deal that prompted our dialog today. From business and technology perspectives, what did Canon find appealing about Milestone, and what makes it a good fit?
Leurs: If you look at Canon and its heritage, of course we have a strong technology background in hardware. If we think about our lens legacy, when we think about the image processing, when we think about the image sensors, these are all the areas where we have lots of technology development, and have invested and will keep investing a lot of our R&D resources in.
The area where we haven’t had a lot of focus is on the software side, and if we look to Milestone, they’re the leader within their respective market. They have a very strong portfolio. What we also appreciate a lot and where we see similarities with Canon is the drive for innovation. And last but not least, there is the corporate culture, which we believe is a very good fit between the two companies.
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About the Author
Scott Goldfine
Scott Goldfine is the marketing director for Elite Interactive Solutions. He is the former editor-in-chief and associate publisher of Security Sales & Integration. He can be reached at [email protected].
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