Motorola Solutions, the world's largest provider of police two-way radio and dispatch equipment, is acquiring VaaS International Holdings, which produces cameras and software for license plate recognition and analysis. Headquartered in Motorola, the company paid $445 million in cash and stock for the company.
VaaS International, based in Livermore and Fort Worth, USA, has sales to police agencies and private companies of approximately $100 million. The company uses artificial intelligence to collect and analyze license plate images and builds a vast database through its vast network of license capture cameras.
Previously, Motorola acquired Avigilon, a Vancouver-based video surveillance equipment and software company, for about $1 billion. Avigilon and VaaS will help Motorola keep up with the explosive growth of video created and used by police, as well as from a growing network of dashboards and body-worn cameras, as well as videos connected to utility poles and buildings.
"Video is part of the data puzzle we are working on," said Andrew Sinclair, general manager of Motorola Software Business. “As video enters, the amount of data generated grows exponentially. You have to deal with it.
“The police department has introduced body-mounted cameras, they have to store and use it. If you think YouTube is a video platform, the only thing they can do is stream. They don’t do image recognition, edit it and store it again. It is a big problem."
Motorola CEO Greg Brown said the company turned part of its business into software and services. More than half of Motorola's revenue comes from radio and other devices. But after nine acquisitions in three years, services and software accounted for 31% of revenue.
"They are changing the company," said Keith Hausum, an analyst at Cleveland-based Northcoast Research, which called Motorola "buy." “Is the software and service acquisition strategy defensive? Maybe. I don’t know yet who else has enough big stuff to get and gain market share. I think more is where they think technology needs to go.”
Software will become even more important as FirstNet is the first nationwide public safety wireless network that will carry pictures, data and other information from mobile phones, computers and other digital devices. State-of-the-art dispatch centers are now able to interact with the public through social media, not just on the phone.
Motorola's next step is to introduce a new web-based record management software system. Like private sector companies, public safety is increasingly using data to do business more efficiently - and store it on a network disk computer system or on most off-site and/or computer-maintained computers.
"Record is the platform," Sinclair said. “We have the ability to combine all workflows: transcribe voices via call or radio communication, now search and link them to other records and analyze them.”
This calculation is best done in the network disk, accessing data stored elsewhere. Public safety agencies, such as banks and airlines, have long used computers. But most of them are built on older systems, and now these systems are connecting or migrating to a network drive, such as Microsoft's Azure, which provides computing power that can be quickly taken offline as needed.
"What we have built over the past year is the big data platform for web computing. In the next year or so, we will start getting people into it," Sinclair said.
Becoming a more software-focused company can increase Motorola's profit margins and provide more predictable recurring revenues, eliminating the boom and bust of selling large hardware systems and upgrades.
"The radio will never go away - the software has changed from being added to the radio to its own category, a major growth area," Sinclair said. Software and services revenue increased 22% in the third quarter, while other businesses grew 10%.