More and more Chinese companies, including DVR, network camera and DVS manufacturers, are using H.264 comparing with MPEG-4. In this issue, we encompass major DVR manufacturers for international buyers to have a better understanding on their R&D capabilities of H.264 DVRs.
H.264 presents a huge step forward. Without compromising image quality, an H.264 encoder reduces size of digital video files by more than 80 percent over Motion JPEG and as much as 50 percent more than MPEG-4 Part 2. With far less network bandwidth and storage space required, users save money and achieve much higher video quality at a given bit rate.
Experts predict that H.264 also known as MPEG-4 Part 10/AVC for Advanced Video Coding will become the compression standard of choice. The technology has already been introduced in the latest mobile phones and digital video players, and is quickly gaining acceptance by end users. Service providers, such as online video storage and telecommunication companies, are beginning to adopt H.264, and from all indications, the video surveillance industry will be no exception.
Most Asian manufacturers are also looking to H.264. At SecuTech 2008 in Taipei the most international, professional security exhibition in the region ,many DVR providers were showcasing DVRs that featured H.264."There are going to be more and more applications with H.264," said Zhang Haifeng, Chief Technical Officer at Hanbang Technology. "In security, H.264 will soon become mainstream; no one will talk about MPEG-4."
Zhang pointed out that H.264 saw early adoption in China. "In overseas markets, providing long recording time and massive data storage are not as important as in China. Since H.264 offers better compression rates, most Chinese users prefer it. H.264 also delivers higher pixel rates (over 720)."
While H.264 has been around for four years, some manufacturers have not been able to come up with their own H.264 algorithms; instead, they have gone with modified versions. "Companies have to expend greater resources on modified H.264 algorithms," said Maria Xiao, Overseas Market Director at TVT Digital Technology.
According to Xiao, decisions to go with modified or standard H.264 are based on R&D capabilities. Standard H.264 enables users to download decoding from the Internet to guarantee image resolution. Moreover, standard is not like MPEG-4 or MPEG-2, which usually use one to two key or reference frames; standard H.264 allows up to 16 reference frames to ensure picture quality in low bit rate environments.
Key Chinese Players
Generally speaking, main Chinese DVR manufacturers are mostly from two areas Hangzhou and Shenzhen where enjoy 34 percent and 30 percent of market share respectively. Especially manufacturers in Hangzhou specialize in embedded DVR which enjoys 62 percent of whole DVR market share while other 38 percent is by PC-based DVR. Among these Hangzhou DVR manufacturers, Hikvision is the most noticeable one.
Hikvision was the first to use DSP Chips for video capture cards. Outstanding performance and stability gave Hikvision a name in China's DVR card market. Since then, it has moved from MPEG-4 compression to H.264, and from single board card to multiple solutions, including standalone DVR. Hikvision is now at the leading place in DVR manufacturing in terms of production and revenue as well as the most ambitious company expanding their business to overseas market. Other big names in this area include Dahua and Dali that also have robust R&D capabilities.
Go down to the south, TVT, Lan Castle, Tmvideo and Coship are also enlarging their overseas market year by year and invest more and more on their R&D. More key players from other areas in China are Beijing Blue Star, Shanghai Chenova, Beijing Hanbang and Wuhan HighEasy.
These companies above might not be able to compete with those manufacturers in Hangzhou in terms of revenue. But it does not mean these manufacturers could not provide the high quality products with robust R&D talent as Hangzhou players do. Currently, most H.264 DVRs are based either on DSP or SoC platform, both solutions require advanced research and development. Therefore, manufacturers need R&D talents to enhance their solutions suited for different applications.
Lan Castle entered the security industry in 1998. According to Yang Yanfei, General Manager of Lan Castle, "We not only have our own molding equipment and SMTs but also IC chips, which we developed in cooperation with a Taiwan - based IC chip company. With more than 100 R&D experts, we offer inhouse designs from external housings to software customization. Monthly DVR production is 15,000."
The company's position has been to deliver software at an affordable price. "We are gradually transitioning to high-end markets," said Yang. "Even though H.264 may make MPEG-4 or MJPEG low end, I believe that MPEG-4 will retain market share. There are so many H.264 DVRs that do not support real-time, multiple-channel playback. While Lan Castle can do this for four channels, there is still room for improvement."
Since 2003, Chinese DVR manufacturers have been working with H.264 - longer than those in Taiwan or Korea. "Chinese products are better than Taiwanese and Korean," said Xiao, while admitting that Korean DVRs have better ID and interface designs. She is confident, however, in TVTˇs abilities.
"I have not heard any negative comments about our new DVR," said Xiao. "On the contrary, customers like our design. We have received very positive feedback from customers in North America, Latin America, Europe and Asia. Most have been impressed with the picture quality and functionalities. New H.264 DVRs will be our main product line in 2008."
Future R&D Directions
HighEasy s tar ted producing PC-based DVRs in 2003, jumping into H.264 standalone DVRs in 2004. Some 100 R&D personnel are integrating IP solutions and intelligence in embedded DVRs. "HighEasy has embedded TI Da Vinci DSPs into our DVRs," said Cow Yong, Senior Engineer at HighEasy. "We are developing products with IP solutions to suit various markets and applications."
According to Zhang, intelligent software is also Hanbang's focus. "By year end, we will come out with an H.264 DVR with intelligent software for financial and transportation applications. Two of our R&D managers are specialized in video analytic software. They have come up with devices that count people and provide crowd density analysis."
Xiao had a word of caution. "It is an issue of timing. Intelligent codecs will receive more attention when H.264 is more popular," said Xiao. "Many think that H.264 is connected to intelligence; that is not true. Once future intelligent codecs can encode data for analysis, this will help leverage performance."
There are different H.264 DVR profiles: baseline, main, extended, high, high 4:2:2 and high 4:4:4 predictive. Most manufacturers provide baseline.
TVT is working on a high-profile product for the high-end market, said Xiao. "Many digital television broadcasting systems, such as the British Broadcasting Corp. (BBC) and Direct TV-USA, use H.264 high profile for video compression," she continued. This kind of product, however, is not yet available in the security market. "We are developing a high-profile, 16-channel H.264 DVR with D1 resolution, but it requires high-performance processors and better hardware."