As a young Chinese entrepreneur at the helm of the top US home security brand, Peter Wang, CEO of Foscam is – even today – a rare breed. But with his stellar business and technology credentials, the future is bright.
“I always forget my birthday. It's only when my colleagues are celebrating for me that I realize it's my birthday again.” Wang may forget his birthday, but he certainly recalls the day he set up Foscam on December 26, 2007, at the age of 30.
Coming from a semiconductor background, the avid opportunist was frequently in touch with electronics and power-supply manufacturers when he served as sales person for a semiconductor company. He came to realize that the finished product was the business he wanted to devote to.
In its early stages Foscam churned out series of UFO-styled IP cameras for small-scale projects in Europe. But like all rookies on a batting field, it was not always smooth sailing. One of the issues it had to encounter was wireless integration.
“Foscam started out specializing in 2.4G wireless technology. It was only when a client in Europe lamented ‘no Wi-Fi, no market!' that I decided to reconsider our priorities,” Wang said. “We eventually went into developing Wi-Fi-based cameras. It was tough at first because we encountered many stability issues with our Wi-Fi camera.”
Thanks to the client and the experience, Foscam now dominates the Wi-Fi camera market in the United States. Wang further revealed his plan to launch Wi-Fi 802.11ac version cameras.
“To me, designing a Wi-Fi 802.11b/g/n- or Wi-Fi 802.11ac-version camera isn't that difficult. The right question would be what the market wants.” According to Wang, 11ac is in its initial stage and as of yet is not in real demand. But when the time comes, Wang wants the Foscam team to be ready.
Solutions, rather than products
On revealing the two popular cameras in the Foscam lineup, Wang explained: “Now smart home is our main market, and it cannot be overlooked. For example, a babycam should be different from the general home camera. We did a survey and observed the demands in detail.”
According to Wang, the network camera market is currently transforming the spec competition to application differentiation. Since key components such as SOCs or ISPs have been determining the performance on most cameras, “Camera makers like us should focus on mastering what the market wants and then turn it into a real ‘solution.'”
Consumers today carry the “Olympic torch of experience,” given the need to put customers at the heart of marketing activity. In light of that, Wang prefers using ‘solution' to describe what Foscam offers, rather than ‘product.'
User experience is of paramount importance for competitive advantage in the smart home business. Integrating software and hardware development throughout its life cycle is a basis for successful market development, thereby achieving user satisfaction and in turn successful businesses.
“Ensuring the customer experience is great across every business function,” Wang said. Foscam attends no fewer than a dozen trade shows each year to study and exchange views with their customers and distributors.
To date, Foscam has over 20 types in its entire lineup and has sold products to more than 60 countries. “With a multitude of products and international branch offices, we carry out our strategy of localization business around the world.”
Localization, Localization, Localization
“Americans are more open to the new ideas, new suppliers and new offerings. That why the smart home market there grows in a faster pace than other regions of the world,” Wang commented, adding that such beneficial market scenario, and maturity of the US smart home sector – prevalence of online shopping and higher per capita income, their DIY cameras can be sold mostly through online retailers such as Amazon, Best Buy, e-Bay and the likes.
Although having gained a strong foothold in the US market, “being successful now does not mean we will always be successful. As a matter of fact, we are seeing more threats and challenges coming from this end. One key threat is the saturation of the US market itself. The foreseen demand lies only in renewing markets,” Wang explained.
In retrospect, Foscam sees more potential in Europe. The company currently has a strong customer base in the Netherlands with some loyal customers. “In Europe, we have been working closely with distributors in several countries to promote the Foscam brand for specialized local DIY retailers.” Wang believes offline-type retailers reflect more prospects for Foscam in Europe. “We are looking to open up our first branch office in Europe,” he said, although the actual location has yet to be disclosed.
Only the locals can understand amongst themselves. Wang said personalized interactions between the consumer and the company occur on a day-to-day basis. Foscam's 60-staff branch office in Houston was set up to primarily survey the local market, such as understanding consumer needs and applications. Similar actions are taken in Europe and Brazil.
Focusing on video
According to Wang, his current focus rests mainly on the home security front with an emphasis on software development. 2/3 of R&D resources have been poured into the software part. “We want our solutions to closely bind to users' smartphones.”
However, when asked if Foscam is going to develop a full smart home lineup that includes detectors, smart plug, and so forth, Wang quoted the meaning of “Foscam” – Focusing on camera. “In the smart home era, video is irreplaceable and a necessity. We will have to focus on playing the role of camera solution provider well.”
Concerning all-in-one IP cameras (with smoke/motion/temperature sensors embedded) that are vastly popular in the home DIY market, Foscam said it has no plans on embedding these features in their cameras. “Embedding all these functions into one single unit only defies the principle of an IP camera because its primary function still lies in the collection and retrieval of images. We aim to provide the best video professionalism in the smart home arena.” However, Wang added that developing more connections and compatibility with the sensors and other smart home devices is a must-go for Foscam.
Wang is aware of the dazzling choice of wireless standards in smart home connectivity (Z-Wave, ZigBee, and so on) but plans to adopt them in the coming Foscam cameras. “Wireless transmission is an inevitable trend and will be commoditized in home cameras. Just like mobile phones, now every smart phone is Wi-Fi-enabled.” Wang further noted that Wi-Fi has its limitation on transmission distance. To achieve a practical home camera, makers should utilize different wireless technologies to facilitate seamless transmission. Even for an outdoor camera without the outdoor Wi-Fi router, GSM should be considered.
“When you offer a real easy-to-use solution to users, you are truly accepted by the market. ‘Easy-to-use' is not equal to easy design. In fact, the most easy-to-use products require the most difficult R&D efforts behind.” Wang added that there is still lot of improvement to be done for home cameras, such as the setup issue.
Wang affirmed that adding “eyes” to all home electronics such as refrigerators, water filtration units, and other home appliances will only expand the scope of smart home application. However, makers would have to factor in “simplicity and ease of use” in order to make every smart home application more attainable for the masses.
Combining small-form factor and beautiful design with innovative application is the concept that smart camera makers need to seriously consider, and not just price competition.
Defining the market
This year, Foscam has toppled RMB200 million in sales revenue. Wang projects a 30% growth next year. Putting the figures aside, Wang shared his insights to leading the company. “It is not possible for us to do everything. The challenge for me is to steer the company in the right direction because so far there are no 100% successful business models in IP cameras.”
According to Wang, the home camera market goes in two directions: consumer electronics (CE) and semi-professional. The IP camera plays the role as toy-like computer accessory in the CE market, while in the semi-professional market, the camera is still very easy-to-use but has more integration capabilities such as storage or connected control. “As a professional supplier and not a device manufacturer, we have to clearly define the market and set the corresponding strategy or tactics for future developments. Frankly speaking, Foscam works on both markets now. We are keeping a watchful eye on the market,” said Wang.
Last but not least, Wang appreciates the teamwork at Foscam. “Like the leader guiding a flock of cranes, when it becomes tired or ill, another takes its place and continues the journey. Metaphorically speaking, I would like to see Foscam in such spirit, sharing ideas mutually and jointly pushing the business forward.”