Terms of the deal are not being disclosed, the companies say. Milestone, founded back in 1998, had raised $25 million from Index Ventures, and according to its latest financials, it posted net income of €4.6 million ($6.2 million) on revenues of €54.6 million ($74 million). The acquisition is being made through Canon’s European subsidiary.
While publicly traded Canon has a recognisable brand in the consumer market for things like cameras and printers, it also has a strong line in enterprise products, covering things like imaging devices for particular verticals like the medical industry. The Milestone purchase will be used to build out a new market in this latter category.
“Canon is aiming to take a leadership position in network video surveillance and we are making an important strategic investment today to realise our objective to expand in this market,” said Rokus van Iperen, President & CEO, Canon Europe, Middle East and Africa. “Together with Milestone, we can accelerate our growth by delivering new advanced products and solutions for new sectors, through new channels, to offer greater customer value. We are very excited about working with such a talented and innovative company and we welcome Milestone into the Canon Group.”
It’s a fragmented market that Canon is entering. Although Milestone is considered one of the leaders in the space, its market share according to IHS is only at around 8.2%.
It’s perhaps because of that small share, even in leadership, that Milestone decided the exit was the right move.
“Milestone is extremely excited about the huge potential that being part of a global group will provide,” said Lars Thinggaard, President & CEO, Milestone Systems, in a statement. “Canon respects how we built our business with our partners and supports our strategy of providing open platform solutions and therefore the need to remain a standalone company within the Canon Group. We feel this step is right for taking both our business and support for suppliers and partners to a new level.”
But as a sign of the times we are living in — with the rise of ubiquitous IP networks and a whole lot of ways for our every move in the virtual and physical worlds to be watched and recorded — the video surveillance market is growing, a lot. IHS forecasts that it will have a total market value of $13 billion by 2017.
More generally, there has been more of a shift to enterprise video services of late. Earlier this year Rovi acquired Veveo; both Ustream, Animoto pivoted to focus on business users, and even Waywire (formerly known as Magnify before it took the branding of the company it acquired) launched Waywire Enterprise.