EMEA and APAC are growth markets as end users continue to spend on security both for security and non-security purposes.
According to the World Bank, EMEA economies are set to grow 2.7 percent in 2020 for Europe and 3.2 percent for the Middle East and North Africa. This growth is reflected in companies’ performance in the region. “Whilst it varies between countries, on average we hit 8 to 9 percent growth in the region with some locations growing by up to 18 percent,” said Thomas Lausten, CEO of
MOBOTIX.
The need for solutions that maintain the security and
cybersecurity continues to be a driver. “The topic of security and cybersecurity has gained significance in 2018 due to the introduction of insecure hardware, as well as in response to the worsening geopolitical situation. I think the situation described above will pose increased challenges to the security industry over the coming years but will also help the security market to achieve double-digit growth rates,” Lausten said.
Closely related to cybersecurity is the issue of privacy. With the adoption of GDPR, suppliers whose products and solutions are GDPR-certified can better compete and stand out in the market.
“We've invested a considerable amount of time making sure that our VMS is GDPR compliant, and I am pleased that we were the first major video management software product to obtain the highly sought-after EuroPriSe GDPR-ready certification,” said Malou Toft, VP of EMEA at
Milestone Systems, whose XProtect Corporate 2019 R2 recently obtained GDPR-ready certification issued by the independent EuroPriSe – European Privacy Seal institute. “With the GDPR-ready certification end users can be confident that they have the right foundation to build a GDPR compliant video surveillance installation. We are also making an effort to make sure that the surveillance operators out there will know how to plan and deal with GDPR. We have offered trainings, so that if you are a security operator who does not necessarily know how to go about this, we’ll provide support for all your operating managers to learn what to be aware of.”
Beyond security
Security aside, more and more end users across verticals have realized the value of using security for non-security applications. “The end users are, in general, becoming more aware of the options they have and that the ROI is no longer based on just security but instead takes data usage, information sharing and converged solutions all into consideration,” Lausten said. “As well as the increased security needs, using high-quality imaging with a device can assist in increasing your sales or limiting your losses in terms of productivity and intelligence.”
Toft illustrates this with various examples.
“In many countries for example, the way you make schedules for public transportation, for example train timetables, is based on historic or small sample information often collected manually. With anonymized video metadata you could track where and when people density is high and thus plan train schedules much more effectively and data driven. That’s just one of the processes you could automate and make more accurate,” Toft said.
She added: “In our region, there's a
retail chain where they are testing a new concept in its stores. Obviously it’s a huge cost to redo your entire layout of a store, so what you would do is to have two, three pilot stores where you'd do alternative layouts and then you would use sensors and cameras available to test the flow and how customers are responding to your new design. Basically, the video data helps you experiment and test your prototypes before rolling out a nationwide new concept. This way you would have more confidence in the decisions you’ll make which obviously will have great impact to your bottom line.”
APAC
APAC, meanwhile, is another growth market, even though the scale of growth differs from country to country. "We see low double-digit growth fueled by high-growth markets such as Vietnam, Philippines, India and Indonesia. Established markets like Singapore will have fairly low growth,” said Patrick Lim, Director for Group Strategy for
Ademco Security Group. “Hong Kong will be a strange phenomenon as their economy is likely to take a big hit from the internal problems, but with many infrastructure damages, replacement projects for security may actually give the security industry a mild boost.”
“In the APAC region, our revenues grew by 22.5 percent. More specifically, we have had good success in transportation, data centers, public safety and law enforcement in Australia. In India, we are increasingly working with buildings and industrial customers, while in ASEAN, we have enjoyed much success with BPO, oil and gas, hospital and airports. We are also seeing a growing trend in safe cities/smart cities and an increasing number of airport upgrades and new construction,” said Daniel Lee, Managing Director for APAC at
Genetec.
Main growth drivers include efforts by regional governments to build smart cities, various infrastructure projects and a general construction boom in the region. Government regulations requiring buildings and facilities to follow certain standards play a key role, too. “The main growth drivers of security are the government rules and regulations set for high-rise buildings and public areas like community malls. We have lots of high-rise buildings, hotels and residential development projects on hand,” said Sovan Hok, GM of S Era Automation. “With the growth of high-rise buildings, hotels, community malls and government office buildings, constructions are key players for security demands.”
While the consensus is that security will continue to grow in the region, there are certain influencers that may affect security negatively. “The U.S.-China trade war as well as a possible global economic slowdown are the factors that might have impact on the growth of security business,” Hok said.
“The U.S.-China trade war is a key issue as that has growth impact on the security market in China. If there is an increase in socio-political unrest and trade tensions, investment confidence will be low and it will have wide ranging impact across Asia,” Lim said. “From mid-2019 onwards, there were a lot of hesitations due to the U.S.-China trade dispute. Uncertainties certainly slowed the market down significantly. For 2020, I believe there will still be much uncertainties as more Chinese products are under scrutiny, which will have an impact on cost and procurement dilemmas for projects.”