– Demarcation between a large and a small system –

What constitutes a large system and a small system respectively? There is no absolute answer and only a relative one based on the market economy. To begin with, let’s base it on well-published pricing information. We know that analog cameras are much cheaper than IP cameras. We know that DVR (digital video recorder for analog cameras) is cheaper than NVR (network video recorder for IP cameras). Can we use analog cameras and DVRs for large systems?

Analog cameras are cheaper than IP cameras due to the lack of high resolutions and features that rely on IP technologies such as compression and Power over Ethernet. Resolution is a key quality criterion, but a good analog camera for a large system has no lower resolution than the same camera if installed in a small system. This is an important assumption. If it is not true, then the proposal in this document will not work. That is, the resolution of analog cameras will not deteriorate when the number of cameras in the same system increases.

Why is DVR cheaper than NVR? This is most likely due to a cost called R&D payback. The DVR has been around for a long time and the DVR vendors should have made enough revenue to pay for the initial investments in research and development. NVR is a relatively new and more powerful beast. Presumably NVR prices have included an R&D recovery premium.

The DVR has advanced over time to become a hybrid machine, half analog and half digital. It takes analog video footage from cameras and converts the signals to digital for storage and display. Due to the need for video signal conversion, DVR products are typically built for 4, 8, 16, or 32 cameras.

You’ll find that an 8-camera DVR is priced at less than half that of a 16-camera DVR, and similarly, 16 is cheaper than half of 32. On the other hand, an 8-camera DVR is likely to be less than double the price of a 4-camera DVR. This situation will make the 8-camera DVR the “sweet spot” and the most popular size among the various capabilities of DVR products. Any system with more than 8 cameras will fall into the category of large systems. Of course, the number of 8 here is arbitrary. The number can be 4, 16 or 32 because it is dictated by the market economy and time.

In summary, there is a small advantage for a larger system within the limit of DVR technologies and there is a higher premium for a larger NVR-based system with more powerful features.

– Large low-cost systems –

The word hybrid as used in DVR gives us the clue. DVR accepts video signals from analog cameras and converts the signals to digital for further processing. Hybrid DVR maintains its low-cost appeal but paves the way for large systems through its digital processing capabilities.

Suppose a sweet spot DVR takes 8 cameras. Instead of using a more expensive DVR to take 16 cameras or a much more expensive DVR to take 32 cameras, we can implement 2 or 4 inexpensive 8-camera DVRs. We can even implement 6, 8 or 10 inexpensive DVRs for 48, 64 or 80 cameras respectively. We will then use a PC-based software package to provide a unified view of all cameras by connecting all DVRs to the PC. There is a hierarchy with the PC in the central station, DVR in various regions and cameras in dispersed locations. We usually refer to PC software as Central Management System (CMS).

To your surprise, the biggest cost savings comes from the wiring for the above approach. Analog cameras require point-to-point cabling to the DVR using coaxial cables that are run by technicians in the well-paid AV industry. If we divide a large area into 2, 3, 4, or any number of small areas, obviously the distances for wiring will be substantially reduced and so will the cost of wiring.

We can install a large system using low-cost subsystems. In theory, there is no limit to the number of DVRs that will be connected to the Central Management System. The limit will be imposed by the bandwidth of the connections and the processing power of the PC.

There is a cost for the CMS and the PC running the CMS. This additional cost would not be substantial in most cases.

– What are the functional limitations? –

The limitations here are in a relative sense. The limitations of analog cameras and DVRs relative to IP cameras and NVRs carry over to large systems made up of analog cameras and DVRs.

This system will remain at the VGA resolution level (640 x 480). Of course, there are high definition analog cameras available, but they are not cheap. We can implement them with the same approach if we want.

Analog cameras are not capable of producing dual streams that power the central station and a mobile phone simultaneously, for example.

DVR is certainly not as flexible as NVR due to the self-imposed culture of closed architecture. In the NVR world, there are independent software developers who develop NVR software for all brands of IP cameras. Their software features have to be better and in fact they are better than those produced by IP camera vendors. Some examples are the most efficient footage storage arrangements and the fastest search facilities. This situation is not seen in the DVR world.

The PC or the top level of the hierarchy is an additional layer. It incurs in latency, which is the time it takes to transfer videos from the DVR to the PC. You do not incur quality loss unless you require higher video compression for economic reasons. We can assume that the CMS does not add any more functional limitations to the system.

– Does this approach change the world? –

Not so, but the CMS approach allows analog-based systems to be larger while maintaining low-cost benefits. It doesn’t change the world, but it gives the world a good choice.

When a system is large, the user would have higher expectations of it than smaller systems. The CMS approach may or may not satisfy the user depending on the individual definition of fitness for purpose and the results of the cost-benefit assessment.

As time goes on, IP cameras and NVRs will get cheaper and will eventually fetch the same price as analog cameras and DVRs, respectively. This will happen as this has happened steadily when it comes to technological development. When this happens, the CMS for analog camera focus will become redundant. In other words, it is a plug-gap approach for the next 3 years (2011-2014).

Nothing has changed the world yet.