IP cameras are fine. Many companies have gone to IP. If you are going that route I would lean toward the H.264. Try to find one made in Taiwan, South Korea or a country other than china. You will find that the quality and software will be much better. Only problem with ip cameras is if your network goes down you have no recording unless you get a camera that has some onboard storage. Make sure you get one that has good resolution. I just had a police department that came to me about a lady that was stabbed and raped. The video from the unit they used was so poor that the guy got away. Also do your self a favor. If you record back to a pc, have a second hdd separate from your operating system that holds the video.
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