Big Brother's business is booming

MANHASSET, N.Y. — Video surveillance is suddenly "the fastest-growing market for [digital] video chip providers."

The top executive at one such company, president and CEO Chris Day of Mobilygen (Santa Clara, Calif.), made that comment shortly after wrapping up a trip to China, where video surveillance applications are proliferating at an alarming rate.

Indeed, according to a China Security Market Report issued last year by the Security Industry Association (Alexandria, Va.), China's security and protection market, which includes fire and safety monitoring along with security surveillance and access control is projected to jump from $6.3 billion in 2005 to $18 billion in 2010.

That should come as no surprise to many in the U.S. financial community, which has been closely following the growth of companies that install and operate surveillance systems at banks, police stations, Internet cafes and other public places in China. The International Herald Tribune last year reported that American hedge funds have put more than $150 million into Chinese surveillance companies.

Surveillance cameras are becoming ubiquitous, driving requirements for digital video silicon.

Hoping to seize the burgeoning opportunity, a host of video chip vendors, from established companies such as Texas Instruments to startups like Stretch Inc. and Mobilygen, will descend on International Security Conference (ISC) West in Las Vegas this week, toting video surveillance solutions for digital video servers (DVSes), digital video recorders (DVRs) and Internet Protocol (IP) video cameras. Many are aiming squarely at the growing Chinese market.

Mark Kirstein, president of market research firm Multi- Media Intelligence cited four technology drivers for video surveillance gear: "high-performance codecs, analytics, megapixel cameras and all underlying [technologies that facilitate] the migration from CCTV [closed-circuit television] to IP/networked video surveillance."

The surveillance industry is undergoing a transition, said In-Stat principal analyst Michelle Michelle Abraham. It's estimated that more than 90 percent of surveillance video cameras in use today are analog. Analog surveillance systems run coaxial cable from CCTV cameras to centrally located videotape recorders or hard drives.

Increasingly, the resultant video footage is compressed on a DVR to save storage space. The use of DVS systems is also increasing; here, the analog video is digitized, compressed and packetized in IP, then streamed to a server.

But the endgame envisioned by many in the industry is an IP-networked digital system, in which surveillance video can be directly encoded in H.264 on a digital camera and sent over Ethernet at a lower bit rate. "There will be no need to run coaxial cables, and [the solution] hogs less bandwidth in the network," said In-Stat's Abraham.

Video chip vendors are jockeying to supply digital video surveillance solutions at all levels. Stretch (Sunnyvale, Calif.) claims its novel processor architecture, with embedded FPGA, offers greater flexibility by supporting various compression schemes and a number of proprietary video analytic technologies in one solution. TI, with the most experience, leads the pack in offering higher-image-quality video surveillance camera reference designs at low cost. Mobilygen (Santa Clara, Calif.) touts a system-on-chip with a carefully partitioned architecture, hardwired but with some level of programmability built-in, to allow higher-image-quality encoding at low power.

Stretch, whose initial market focus is on video surveillance, has been an investment community darling. The startup announced a further $15 million in Series B funding last week, bringing the total it has raised thus far to $100 million.

By embedding an FPGA in its processor, "we can add instructions based on the application we are solving," said Stretch president Craig Lytle. "With FPGA, it's completely programmable through C code, but it can be altered and optimized." The chip reportedly can run compute-intensive video analytics simultaneously with video compression schemes such as H.264.

Lytle claimed the Stretch processor is more powerful than other programmable solutions, such as TI's DSP/ARM core combination, while coming in "at a lower price point, about a quarter of the cost." He added that Stretch's C-based programming environment "is comfortable to traditional engineers."

Most video content analysis today occurs in the central office. Danny Petkevich, video surveillance and imaging business manager at TI, said that 50 percent of video analytics is still done on PCs but the rest is done on DVRs, the majority of them using TI's DSPs.