A German Shepherd or any dog for that matter is a good first responder in terms of alarming (barking) that "someone" is entering their pack's territory. It's in their DNA. However, how the GSD will respond to an intruder depends largely on how he is trained and how the intruder reacts to the 4 legged threat. With no training, the GSD or any dog that is considered a protection dog will trigger fear by the average intruder and that fear alone can trigger aggression and a bite. However, when you get a dog, family comes first and especially a family with children. Most dog owners give a dog a basic training where aggression is excluded or corrected. In other words, most dogs are trained to be non aggressive in most environments or situations.
The GSD has all the DNA to be a good protector, but it all comes down to training and consistency by the handler (owner/owners). As you saw in the video, the GSD reacted "normal". He didn't bite, most likely because the intruder stayed calm and he was not afraid. What we didn't see was how the GSD would have reacted if the intruder had started running or attacking for that matter. That is when prey or herder instinct comes into play and again, the level of this is also depended on how the dog is trained. Yes, instinctive reactions are involved, but the question is how the GSD has been trained or corrected in the past and how this has developed or underdeveloped the prey or protective instinct.
A GSD is a high energy dog and require a lot of training and exercise. Personally and based on my own experience with GSDs, I recommend the breed highly if you have the time to give them what they need..... and to be a good and consistent pack leader.