Literally, by a little bit, and figuratively, by an order of magnitude for me.  A couple of folks from Envysion went with me to ISC West this year and personally it felt a lot smaller than in years past.

On the literal side, it actually wasn’t as much smaller as I had expected it to be from a pure attendance standpoint.  I don’t have the actual stats, maybe they will be posted somewhere, but one of my colleagues that is on their planning board told me that attendance was down 5-10% depending on whether you were talking about exhibitors or attendees.  An even less formal source (my cabbie) said that all of the trade shows were way down this year and that ISC West seemed down to he and his peers as well.  To be honest, you couldn’t really tell that much walking around the halls as it is such a big show that there were people everywhere.  While Stanley and Cisco were some big names that didn’t make it and a couple of booths were notably smaller than in years past, it didn’t seem too different as a ton of companies were represented there.

The big difference to me was how much smaller and more manageable it felt to me personally.  ISC West has a very strong place in my Envysion memory, as I went to my first one just about a month after starting the company.  I didn’t come from the security or video world, we hadn’t even started to develop the new MVaaS platform that our customers are using today, and I was still trying to figure out where we fit in the market.  My first hour at the show 3 years ago resulted in a mild coronary and early signs of an ulcer – I was completely overwhelmed at all of the different providers, almost every one of which was demoing some kind of video, many of which were touting web-based solutions.  I kept asking Rob Hagens “remind me again why we are different?”.  I left that first show a little frazzled and without a very clear understanding of where we fit.  Although I was confident in the idea and approach we were pursuing I couldn’t be sure that someone else wasn’t already doing it in the vast security and video market that I had been exposed to.

We have worked hard over the last few years to both better understand and better communicate how Envysion and MVaaS differ from what other providers are doing.  My quick two day trip to ISC West this year was evidence to me that after all of our efforts, I finally understand the industry well enough that to know exactly where we sit and why we are different.  It was this understanding that made ISC West feel a lot smaller to me than it ever has.  I understood who the majority of the players were and what they did.  I had spoken personally with or at least looked into most of the major players there.  I now knew enough about the big hardware guys and big security integrators and knew where there core focuses were.  I had a sense for a lot of the smaller players and knew who was getting traction and who wasn’t and in what type of markets.  I don’t claim to understand the industry better than anyone else, but for me it was a very different experience going to this massive conference and really being able to put everything in its place.

I’ll write another post this week on the two key takeaways I had on our major differentiators in the market that became incredibly evident to me at the show.

Dan Caruso has an interesting blog series on Unintended Consequences (“UC”) (I, II, III, IV, V).  With Star Trek as the backdrop, he challenges the recent governmental interventions designed to help the current economic situation.  Great posts and also great comments.

This got me thinking about UC in other contexts.  Take MVaaS, for example.  By merely introducing video, certain things change.  Employees may work harder.  Customer may feel safer.  Would-be bad guys may target other stores.  Operators may utilize the system to improve profitability.  These, of course, are the intended benefits.

But are there UC to consider?  Any suggestions?

I am somewhat of a twitter user. I have an account, I tweat once in a blue moon. Personally, I find facebook status updates to be much more compelling than twitter. Dennis Stevenson has an interesting blog entry about how twitter helped him get customer service issue resolved.

The facinating thing about his story is that you can search the Twitterverse (all tweats) for specifc phrases. Twitscoop is a site that lets you do this. Trolling the Twitterverse for mentions of your company … an interesting way to find your customers with issues!

Other thoughts for twitter might be to use it to send alerts about video events. Anyone looking at that?

The Envysion team recently hosted a Texas Hold’em tournament.  All employees were invited, along with a couple of special guests.

Congraulations are in order for Dan Caruso, who took first.  Dan got to the final two with a commanding lead, and he never let up.  Perhaps his blogging on the Telecom Texas Hold’em paid off. 

Second place went to Steve Wilson (no relation), who recovered from some early disappointments to dominate the rest of the field.  I specifically remember this early moment from the tournament.  “Ok Steve, what do you have?”  Steve – “Just the six-seven-eight.”

As for me, I placed 11th.  Out of how many?  That’s not really important.  What is important is that the event was enjoyed by all, and my early exit provided me with ample time to catch up on my pizza consumption.

As I was about to deliver a SaaS overview to a large partner sales force, the SVP used this quote during his introduction of Envysion’s MVaaS technology to the team. It has stuck with me ever since and as Enysion continues to evolve, the impact of this statement gets stronger and stronger.

I’ve had the opportunity to mindshare with many of our competitive representatives who have been in the business for, in some cases, decades. I love getting the backhanded question, “Envysion, hmpfff – isn’t that some kind of web thing?” I explain our approach to the market, technology, benefits, etc… and I usually get looked at like my nose is on backwards. Following one lively debate that started with “MVaaS, that won’t work”, I was actually asked if we were hiring.

Calling MVaaS disruptive is sometimes an understatement as we are clearly seeing the fear in the traditional competition’s eyes and actions. We are disruptive because we’re not just selling boxes. We’re not just selling a service. We’re not simply trying to become a part of an LP budget. Our consultative approach becomes part of a larger organizational solution that leverages managed video to mitigate risk, improve operational efficiencies and increase profitability. We aim to become a partner, not simply a vendor.

Like so many other industries before it, security and surveillance is experiencing an IP transformation. We’ve seen what happens to companies that don’t get ahead of the curve or just hunker down and hope the fad will pass. Just open up the business section – they’re dead.

Business data (meta-data) needs to be constantly scanned and reported onto to maximize it’s value.   It’s important that there are many ways to scan, slice and dice this data because each business is different and the information sought also frequently changes.

Storing video and business intelligence separately allows Envysion to have more flexibility as well as reliably scale to larger and at lower cost that systems which store business data embedded into the same database as video.  Storing business or “meta” data in it’s own, separate database really helps give one a lot of flexibility to run all kinds of analysis using regular database and analysis tools as opposed to specialized tools that have to deal with a proprietary video database format.  In addition, the meta data is much, much smaller than video data, so the business information database is much less costly to scale up to support a lot of data.

Salient Systems makes a good argument that video management systems should store video and meta data separately for reliability’s sake in their whitepaper on Modular vs. Dependant Design.

Taking a cue from Brad Feld’s blog about daily data, we’ve come up with our own daily data template. For those of you who didn’t take the bait and click thru the previous link, the idea of daily data is a short email based summary of significant metrics about a service business. It is meant as a short daily pulse on the service. Here are a few that we are using here at Envysion:

Reports defined: Total Number of reports defined
Myclips #clips saved: Total number of clips saved
Myclips hours saved: Total number of hours of clips saved
# groups created: Total number of groups created
# group members: Total number of members of all groups
# videos saved to group: Total number of videos saved into groups
# POS events stored: Total number of rows in the database table that stores POS events
# users: Total number of users that have accounts
# logins yesterday: Total number of logins yesterday (logging in twice counts as 2)
# distinct logins yesterday: Total number of unique logins yesterday (logging in twice counts as 1)
Event Agent Online: Total number of EnVRs that have received POS data within the last 24 hours
EnVRs Provisioned: Total number of EnVRs configured (less those in RMA and Inventory domains)
EnVRs Online: Total number of EnVRs with an active openvpn connection into the datacenter
Open tickets: Total number of trouble tickets open
New tickets yesterday: Total number of trouble tickets created yesterday

This list will change as certain metrics become more or less important.

Thanks Brad! (And Dan, who pointed out Brad’s post!)

I haven’t seen or heard of a lot of folks beyond some of the dollar stores and McDonalds that are growing revenue these days. Seems like everyone is doing some sort of aggressive discounting/promotions to try to get people into their restaurants and stores to combat lower visits, but this is killing their per visit revenue and % profits and isn’t increasing their cash by as much. Subway is a great example with their 5 dollar footlong blitz, which is definitely driving up revenue (although profit is another story). With all of the layoffs and everything I don’t see how this changes anytime soon as it seems like you’ve got the 8-10% unemployed that are going to conserve spending out of necessity and you’ve got the 70-80% employed but not set for life folks that have seen their portfolios drop 40% (not everyone saw it coming like John did and moved to cash 1 yr + ago) so aren’t spending as much either out of caution. I have no unique or insightful thoughts here really, I just don’t see anything that improves retail revenue in the next 2-3 quarters.

On retailer spending…

Bad news for all people that target retailers in 2009. 2009 budgets were set during the worst market panic in 75 years.  While the resulting lower revenue targets are likely to be achievable and in some cases ridiculously low, the budgets/cash targets were pegged and approved at a time that was probably the most conservative in our lifetime. We saw this with both very healthy companies and with sick ones – budgets got whacked. Question now is what it would take to get them to change their budget, even if the top line went up unexpectedly. My guess is that 2009 is now somewhat predetermined to be low because only a few companies will have positive top-line surprises and of those not all of them will relax their budgets as a result.

On Envysion’s opportunity in Retail…

Good news for MVaaS providers.  We have a couple of rays of hope in this environment. One, we are a small company and it doesn’t take much to grow for us. For example, we talked to one major retailer with 3000+ sites and he said “I’m not spending anything, no money to spend, not buying. Oh, but I do expect to replace 10% of my sites this year as they end of life.” A 300 site opportunity is still interesting to me, but he thinks he’s got no money b/c he can’t make a 3000 site decision this year. Two, back to the ROI argument – if you can demonstrate a strong ROI and minimal capital and IT impact, you at least get a shot at the CFO to make the case. Retailers that aren’t in a panic (freezing all spending despite the obvious perils of doing so on customer retention, etc) will still make sound business decisions, even in a crappy market. If we can prove we have a quick payback and strong ROI, we’ll do fine. Our sales, our funnel and our pilots are strong for exactly these reasons, even though the aggregate market spending is down.

At least that’s what it looks like from here… 

If you are an investor, you likely have had a tough year.  After closing at 1,427 on May 19, 2008, the S&P 500 Index has generally gone one way – down.  The closing mark for the Index on March 9th was 677.  This is a stunning 53% drop!

If you foresaw this and moved appropriately, hats off to you.  For the rest of us, though, it’s been painful.

Among their benefits, stock markets, as measured by various indices, act as leading indicators of what is expected from the underlying companies.  Since the overall economy impacts business results, the market is also a measure of where investors see the economy going (not where it is now).   To this end, the U.S. market started its fall as the asset “bubble” burst, bank failures were witnessed, more were expected, and a recession seemed inevitable.  Even though the U.S. economy grew the first half of 2008, investors, and by proxy the market indices, anticipated problems ahead.

If you haven’t stopped watching, the U.S. stock markets has gone dramatically upward in the past seven trading days.  From its low, the S&P500 Index has returned 17% to investors in this very short period.  Did we hit bottom on March 9th?  Is this the start of a significant move upward?  I’m not so brazen to make this call.  But some government officials and market experts are expressing cautious optimism about the future.  The outlook seems to have improved a bit from one month ago.

We have repeatedly explained how the value proposition for MVaaS solutions improves in a tough economic environment.  Still, it would be a welcome development to see the economies of the world improve in the 2nd half, and return to growth in 2010.

In 2008, nobody escaped the traumatic effect of the corn-bubble. The ill-conceived and panic-driven notion of putting food in our gas tanks caused not a ripple, but a disastrous avalanche of food inflation unseen in nearly thirty years. I’ll guide readers to my July 2008 post for the details around this. In the end, our country saw a 6.6% jump in food inflation during 2008 causing consumers to tighten their wallets and annihilating our restaurant industry.

There is a direct correlation to the 2008 panic and fuel prices. As oil futures and retail gas prices escalated, so did that of corn, thus resulting in a corn bubble. Farmers were planting plenty of ethanol-doomed corn and not much of anything else. I say “doomed” as much of the corn sat in silos against a refining bottleneck and ultimately became rancid.

Now that the oil bubble has burst, so has the corn bubble. We can expect to see the results of this in 2009 as farm fields are freed up to again plant some of the other commodity staples. We have already observed the following commodity price declines:

Corn: -33.6%

Soybeans: -39.3%

Wheat: -68%

While we’re still seeing major food manufactures hold the line on pricing, we should see some softening on the wholesale and retail front in the near future. This means lower costs and improved profits for our struggling restaurant industry AND lower prices at the grocery store and more discretionary money in every one’s pockets.