A lot of people (friends, family, even the police!) ask me about my security camera setup. I've refined it for a couple of years, and have built several systems. The requirements follow.
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The Motion package will send email whenever a camera is 'tripped'. I've modified it to send a link to the video, to include a JPEG preview, and many other little things.
For price and quality, I prefer analog video cameras (i.e., a camera with a RCA plug). I prefer to have them powered from the "remote" end. Otherwise, figure you'll need a wall wart whereever you mount the cameras. This isn't practical, especially for a multi-camera setup.
I started out using the X10 Anaconda. These are cheap cameras, both in price and quality. However, they are easy to run and are easily hidden. I've evaluated an even worse option from ebay. Buyer beware.
I've switched to an infared day/night camera. What does this mean? The night shots are illuminated with infareds, and it can sense images in very low light (basically equivalent to a cloudy moonless night).
There are three factors to consider when you are choosing a camera. First, a high-quality CCD. Most of these cameras share the same CCD- a 1/3" Sony. Still, the lower-priced cameras will use a smaller CCD from a no-brand source. Second, a high-quality lens. Cheaper cameras have fixed lenses- both fixed 'zoom' and fixed focus. The latter can be a problem, especially if the space is very small or very large. Third, extendable cables. Some cameras have built-in cables with proprietary connectors, or a power source already connected to the extension wire. This isn't good. Fourth, night capability. This may be infared, low-lux capability, or a combination of these. Nearly all of these cameras autoswitch to black/white and turn on the infared when it gets dark.
Having said that, I bought my most recent camera from discount-security-cameras.net. It was a HR49 IR camera for $200. In reality, calling it a 'bullet' camera is a little off, unless you are shooting mortar rounds. Still, it is a great camera for a decent price.
Wireless cameras end up being somewhat silly, because of video quality (transmission errors), camera quality, and logistics- they must have power at the camera, so they usually aren't meant for outdoor use unless you spend $800 or more for each camera.
The standard card is called a 'bttv', based on the BT848 chipset. These are PCI cards. I usually buy them off ebay as 'Hauppauge WinTV' cards. As long as they have an RCA input jack, you are good. I typically pay about $25/card. Cards are also available with 4, 8, and 16 inputs per card. That should give you an idea of how many cameras can be set up.
These cards handle the video decoding, so 'recording' video simply involves writing a file. That means it doesn't tie up the processor on the computer.
Computer and Operating System
Since this isn't CPU-intensive, any decent PC hardware will work. I've used a small form factor PC with a 400mhz processor. Disk space isn't a huge issue either- I can generally store a month or so in 1GB.
The only thing I've had trouble with is heat- I like to put the server in the top of a closet, and the bttv cards (5 in my current system!) add heat. I've had some hard drive failures- hard drive coolers ($10) fix this, though they are a bit noisy.
To fire off the video cameras, I use the very excellent Motion package. This is a fairly mature product with many options and abilities. It runs on Linux, which is a plus for me, and works very well on dedicated hardware.
Lately I've been using Fedora Linux, an evolution from RedHat. I like this because it is fairly easily configurable. Any major distribution should work fine.
Since the cameras are hard-wired, the video/power cable must be run. Since the server is in the top of a closet, I just punch a hole in the ceiling and stuff the wires down. My current installation is a little more sanitary than that, but some expanding foam seals the hole just fine.
I didn't want four or five wall-warts at the server, so I soldered their power connectors into a PC power connector so they are powered from the servers' power supply. Each of the cheap X10 cameras only takes a few watts. I use a wart for the newer camera; if I was hooking up 16 of the high-quality cameras, I'd probably get a high-amperage switching power supply just for the cameras.
Okay, so I didn't cover the software installation and configuration, because that changes with Motion releases and is very specific to your setup.
A footnote on obscurity
In some cases, having hidden cameras is wise. However, I feel it is like a home security system- by the time the system goes off, the burglar is already in the house. A visible camera may act as a deterrent.