The processing can happen within the camera, and it's nice when it does...but that doesn't mean that the only other option is something cloud-based, like some might assume.

Open-source NVR software like Frigate can do things like the object-detection/license plate/face recognition game on local hardware, with the cheapest available IP cameras. It's just a program that runs on a computer with a network and some storage and some processing ability like a GPU.

Those cheap cameras don't have to be trusted; with things like VLANs, they can hang out on the Group W bench where they have no access to anything important or the outside world. :)

(But yeah, it does represent much more of a DIY effort than something from UBNT does.)