Europe's physical security market is seeing growing demand for cloud-based platforms, artificial intelligence and integrated security systems in 2026, as organizations seek to simplify operations across multiple locations while navigating increasingly complex data protection and cybersecurity requirements.
According to Mark Coates, Vice President of Sales, EMEA, at Verkada, customers are moving away from managing individual security installations toward centralized platforms that combine video surveillance, access control and other building security functions.
This shift is creating opportunities for manufacturers and systems integrators, particularly as organizations explore how existing security infrastructure can support applications beyond traditional surveillance.
Cloud adoption drives market demand
Verkada estimates that Europe's physical security market represents an opportunity exceeding €21 billion, with demand supported by growing interest in cloud-connected solutions.
Coates said the company is seeing strong adoption despite cost pressures affecting the wider industry, including rising global memory costs.
One of the most significant changes is the growing interest in centralized security management among organizations operating across multiple sites.
"We're meeting more and more organizations of all sizes – from multinationals operating across the continent to national players with vast footprints – that want a simpler way to manage security across all their locations, rather than having to handle each site separately," Coates said.
For these customers, the appeal of cloud-based systems lies partly in reducing the complexity of overseeing multiple facilities.
Instead of managing separate installations at individual locations, security teams can use centralized platforms to monitor operations and access information across their portfolios.
The trend also reflects the broader movement toward integrated physical security architectures, where video surveillance, alarms and other systems are managed together rather than through separate applications.
AI moves beyond traditional surveillance
Artificial intelligence is emerging as a major area of investment in Europe's physical security sector, with applications extending beyond incident investigation into workplace safety, compliance and operational management.
According to research cited by Verkada, 75 percent of European organizations are already using or piloting AI in their security operations.
Coates said AI has traditionally helped security personnel investigate incidents more quickly by making recorded video easier to search and analyze.
However, interest is increasingly shifting toward proactive applications that can identify situations requiring attention before they develop into more serious problems.
"The bigger shift and opportunity that we are seeing is that AI is becoming a proactive partner for more broad business use cases where visual intelligence can add value," Coates said.
Verkada's research found that 88 percent of European organizations either use or plan to use camera data for purposes beyond security.
Safety and compliance monitoring was the most frequently cited application, at 58 percent, followed by operational insights at 18 percent.
Examples include video analytics that identify workers who are not wearing appropriate personal protective equipment in warehouses or detect employees entering restricted or hazardous areas in manufacturing facilities.
These applications illustrate how video surveillance infrastructure can serve multiple operational purposes.
For systems integrators, this broadens the potential scope of projects beyond security departments, particularly where camera analytics can address requirements related to safety and workplace operations.
It also places greater importance on understanding the operational problems customers want to solve rather than concentrating exclusively on camera specifications or surveillance coverage.
Integration becomes a priority
European customers are also showing greater interest in bringing video surveillance, access control, alarms and other security technologies onto a common platform.
Coates said demand is moving toward natively integrated solutions that reduce the need to operate and maintain separate systems.
Verkada's own customer data illustrates this trend. According to the company, 80 percent of its core customers use at least two Verkada product lines, while more than half use three or more.
The potential operational benefits become clearer when different security functions can share information automatically.
Coates cited British luxury apparel brand Belstaff as an example of how integration can change incident investigations.
The company previously operated separate systems for cameras, alarms and footfall counting. According to Coates, investigating a shoplifting incident could take approximately three weeks.
Following the move to an integrated Verkada platform, its security team can access relevant video directly when an alarm is triggered, allowing personnel to determine whether an incident requires intervention.
The ability to connect alarms with video footage can reduce the time operators spend switching between applications and manually gathering information.
At the same time, Coates emphasized the importance of APIs that allow security
platforms to exchange information with other building systems.
This suggests that customers may increasingly evaluate integrated security platforms not only on their native capabilities, but also on their ability to connect with third-party technologies.
Regulation shapes purchasing decisions
While cloud and AI adoption are creating opportunities, European privacy, data protection and cybersecurity requirements remain significant considerations in technology procurement.
Verkada's research found that regulation influences physical security purchasing decisions at 84 percent of European organizations, with 40 percent reporting that it has a significant influence.
Data privacy was among the most commonly cited barriers to technology adoption, identified by 36 percent of respondents.
Regulatory uncertainty followed at 31 percent, while 30 percent identified cost and 29 percent cited cybersecurity.
These findings indicate that technology capabilities alone are unlikely to determine purchasing decisions, particularly for organizations considering cloud platforms and AI-enabled surveillance.
Coates said privacy and data protection must be incorporated into security technology design rather than treated as secondary considerations.
"Customers must own their data and have clear governance and controls to understand exactly who is doing what in their systems," he said.
For systems integrators, this reinforces the importance of addressing data governance, user permissions and cybersecurity during the design and implementation of security projects.
It also means suppliers must be able to explain how their systems handle information and provide customers with appropriate administrative controls.
Outlook for 2027
Looking ahead, Verkada expects retail, education and manufacturing to be among the strongest growth sectors for European physical security, although Coates anticipates demand across a wider range of industries.
The company's research indicates continued willingness to invest, with 79 percent of surveyed physical security leaders expecting their budgets to increase over the coming year.
AI is expected to be an important driver of that spending, particularly as organizations seek to use security infrastructure for safety, compliance and broader business applications.
Nevertheless, purchasing decisions will continue to be influenced by concerns over privacy, regulatory uncertainty, cost and cybersecurity.
For European systems integrators, the opportunity lies in helping customers consolidate security operations, connect previously separate technologies and implement AI applications that deliver identifiable operational benefits.
The market's direction suggests that successful projects will increasingly depend on balancing new capabilities with the security, governance and integration requirements of the organizations deploying them.
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