For almost a year, the team at Envysion has been striving to evangelize the unique benefits of applying SaaS technology to the video surveillance market.  An initial step in the process was coining a term for the market segment.  This is where MVaaS was born.

Initially there was little proof that the term was catching on.  But we persisted, established this blog, highlighted it in our press relations, described it to customers…

Then, slowly, we started seeing it here (a competitors website) and there (a hallmark industry on-line publication).  It was taking hold!  Now it is commonplace to find it mentioned prominently by those who are well-versed in the industry, and who may have an influence on decision-makers.  Jeff Gannon compiled examples of this in his recent post.

Here’s the presentation from which Jeff Gannon found the quote from Severin Sorensen, CEO of Sikyur, a security advisory firm.  The presentation was delivered at the ASIS International Workshop on Advanced CCTV in August 2008.  It is truly exciting to see the momentum building behind this technology!

In a prior post, I asked you to ponder the “Let’s Make a Deal” problem.  For those of you who thought it through and answered correctly (without the Google-crutch), congratulations to you!  Perhaps your quick mind could make you some money at the casinos.  My simple explanation would be as follows:

You select door #1.  The probability that the car is behind this door is 33 1/3%.  When the goat is revealed behind door #3, the probability that your first choice was correct is still 33.3%.  But because one of the options has been eliminated, changing to door #2 yields a probability of 66.7%. 

If you are more like me, your ”gut” led you to the incorrect answer, and you refused to give up your original selection.  This may be due to the fact that we assume that we have a 50/50 choice left, and since our initial selection is ”in hand”, we are somewhat programmed to avoid changing.  Why do we view it as more painful to change and lose than to just lose?

A couple weeks ago, I watched the movie 21.  The film’s protagonist, Ben Campbell, is a student at MIT.  Even though MIT is filled with intelligent people, Ben stands out.  In fact, his intellectual prowess is so impressive that he is recruited by a professor to join an exclusive club.  The club’s weekend activities?  Counting cards in Las Vegas.

In one of the early scenes, the professor, played by Kevin Spacey, asks the class to consider the following question:

You are playing Let’s Make a Deal, and Monty Hall shows you three doors.  Behind one of the doors is a brand new car.  Behind the other two doors are goats.

You select door #1.

Before showing your selection, Monty reveals door #3, and there is one of the goats.

He now gives you the opportunity to change your initial selection.  In other words, do you want to stay with your initial selection (#1), or change it to door #2?

What would you do, and why?

Social networking sites are everywhere these days, from myspace and facebook to twitter and linkedin. What I find interesting is the unique culture beheld by each, even with a largely identical user community.

Even more interesting is how the social networking concept has permeated into mainstream media and business applications. Major news outlets have revamped their websites to allow self-registered users the ability to comment and share thoughts about specific news topics. Businesses have created blogs and facebook pages encouraging clients and prospects to provide feedback on products and services.

It’s the latter of these two that, if executed properly, can create a living and breathing business model that’s highly adaptable to the customer’s needs. Imagine a business application user community that is encouraged to provide feedback on how the application can better be shaped AND the business responds with seamless upgrades to the application across its entire base. Enter agile development.

That’s what we’re up to here at Envysion. Our convergence of SaaS and video surveillance has broken the mold of the point-in-time purchase model and end-of-life asset concern. We’ve taken enterprise-class software off the clients network and put it in the cloud so they can focus on their business and not worry about straining IT resources. Our application is ever-developing as we react and shape our unique video solution to our valued customers.

Feedback encouraged.

I’m tired of the term ”bailout”.  While the origins of the term are varied, in 2009 it has become synonymous in the U.S. with a government-led cash infusion into troubled businesses.  We could debate whether the recent government actions should have occurred.  That notwithstanding, I have grown weary of hearing about them.

So you would understand my dismay at seeing the following headline:  Google Employees Get A Bailout.

I had to read this.  Thankfully it wasn’t what I thought.  With the market slide, many of Google’s employee stock options have become “underwater”.  This means that the strike price of the option to purchase Google stock is below the current market price.  The options are worthless unless the stock price improves.  So the company has offered employees another “option”, to trade-in their current options for others that have a strike price equal to the current market price of Google stock.

The conversion is not free to the employees, as they must agree to a new vesting schedule.  But it is refreshing to see a “bailout” without governmental involvement.  Well, until the tax bill comes…

The topic of the infamous car crash was touched on in a meeting today.  To my surprise, someone on our team was not aware of its existence.  So here’s the link to YouTube.

I was not at Envysion when this occurred (Nov. 2006), but this must have been an interesting way to break up the day.  Kind of gives new meaning to the phrase, “yea, I’m at a stopping point.”

As an aside, my understanding is that the driver was not injured, but rather startled by the experience.

I’m feeling good about 2009.  Does this mean that I’m predicting a broad and dramatic economic upturn?  No.  But there is so much opportunity still present for MVaaS companies, and other industries, if they just look.

A useful list of the top 11 benefits of a recession was compiled at SandHill.com.  I believe these types of reminders are important, especially when confronted with the constant drumbeat of negative economic indicators.  I actually read a recent headline purporting that gold was at a two week low.  This is certainly a “glass half empty” headline, which fails to highlight the potentially positive underlying causes noted in the article (e.g., strengthening dollar in response to the Obama stimulus plan, and lessened concerns about inflation).

Envysion Chairman and Zayo CEO Dan Caruso, in a series of posts (I, II, III, IV), retells an interesting story from his early days at MFS.  Jim Crowe, then CEO of MFS, introduces the “internet” to his senior executive team.  Dan describes the event as career-altering.  Think about when this meeting occurred – only13 years ago!  Mr. Crowe was right, so many things have changed.

I also have a “career-altering” story to tell.  While an analyst at one of the “Big 3″ automakers, I was getting a tour of one of the development facilities.  The building was decidedly non-descript, brick and mortar, few windows.  But behind the well-guarded walls the company was developing the prototype vehicles that would form the basis for style and design at the company for years to come.

The workers at the location were specialists, and included engineers and hourly workers.  As was explained to me, these were the ”best of the best”, especially with regards to the UAW workers.  I recall my guide referring to them as ”skilled tradesmen”, since they had acquired specialized knowledge in operating certain machine tools.

While happening through a work area, I was initially impressed by the relative lack of ambiance.  It was the mid-nineties, and I guess I was expecting a little more “space-age”.  Instead it was much more pedestrian, with the feel of an elementary-school cafeteria.

The activity level was also low.  It was mid-morning on a standard work-day.  The lead over the competition this company had enjoyed evaporated long ago.  I expected to see feverishly-paced activity to regain the advantage.

I asked, ”Where is everyone?”

“They are sitting around the corner,”  said my guide. 

“Must be their coffee break, I guess.” 

“Nope.”

We turned the corner and there they were, at a table next to their locker spaces.  Five or so guys, playing cards.  How could this happen?  It was explained to me that part of the negotiated union contract included quotas for each of these workers.  When they filled there quota, they were done.  And since the quotas were remarkably low, they often had ample free time to kill.

To add insult to injury, this site utilized “contract” workers to help control costs by enabling a more flexible workforce.  However, the union contract stipulated that if the facility used contract workers, the union workforce had to be guarenteed OT.  So they guys had low quotas and OT.  Good work if you can get it.

This was the moment that I knew that my career in the auto-industry would be short-lived.  I sometimes look back at what might have been, and it is this moment that I credit with providing clarity.

Not sure if you get Security Systems News, but one of yesterday’s headlines grabbed my attention.  The article described the death of a leading technology innovator, Steelbox.  To summarize the already short article, Steelbox had an amazing technology solution (see their website – they have some cool overviews and the obligatory technology awards – even a recent Frost & Sullivan product innovation award) but had no market so ran out of cash, were forced to let all employees go, cease operations and had their intellectual property seized by their lendors.

I know both their bank and their equity investors so I can definitely imagine how hard it was for them to come to this conclusion and take these drastic steps.  So what’s the lesson here?  I am not close enough to Steelbox to armchair quarterback their specific situation.  Let me just generalize from it a bit.  A key measure of a company’s success is whether there are enough customers willing to buy the service at a price that makes the company’s investment worthwhile (says Captain Obvious).  If you have a tremendous product technology that is absolutely unique, incredibly differentiated, and drives tremendous value to a target market of 10 companies, then you had better hope that you can charge them a fortune and that those industries are doing well so your customers don’t go out of business.

The article reminded me of the last ASIS show I attended where I think Steelbox had a rather large booth and a lot of cool marketing material.   There were probably a hundred other companies there also showing off the latest technologies around facial recognition, object detection, megapixel cameras etc.  Many of them had very clear value propositions and I could understand their markets.  Others were less clear to me.  Cool technology for certain, but I couldn’t get my head around who would actually use it.

Innovators in the video market will be successful if they innovate in ways that are valuable to a meaningful market.  If you try to go too narrowly down the needs of a specific market or a specific user group, you had better be confident that it is a big enough market.  If you are looking at the emerging technologies in the video world right now (as customer or investor) and are overwhelmed with all the PR and marketing hype around the latest and greatest, just make sure you see some customer wins in addition all of the technology awards.

Image via Wikipedia

While perusing my blog reader, I noticed an interesting headline on A VC, Bustup Not Bailout.

Certain that the post was related to the current issues facing GM and Ford,  I read on.  I worked briefly at one of the large U.S. automotive companies, so the topic is of particular interest to me.  Also, as the title suggests, there are options to a pure bailout, and they should be considered.  If we, the taxpayers, choose to allow our government to subsidize a failing business or industry, shouldn’t the monies come with significant conditions?   

Most striking to the post was the quote “too big to fail means too big to exist”.  Although it’s origin is unknown to me, it was at least uttered recently by Sen. Bernie Sanders of Vermont.