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INSIGHTS

Joint report sees near-term growth for physical security equipment, services

Joint report sees near-term growth for physical security equipment, services
The security industry has clearly recovered from the devastating impact of COVID and is expected to see continued growth in the near term, according to a recent joint report by the Security Industry Association (SIA), ASIS International and Omdia.
The security industry has clearly recovered from the devastating impact of COVID and is expected to see continued growth in the near term, according to a recent joint report by the Security Industry Association (SIA), ASIS International and Omdia.
 
The report, titled “Complexities in the Global Security Market: 2024 through 2026,” also finds the security industry is a major employer in the jobs market and will continue to be impacted by technology trends such as AI and cloud. This article takes a closer look at some of the key findings in the report.
 

Physical security equipment market

 
According to the report, the physical security equipment market is expected to hit a value of US$60.1 billion in 2024, up from $51 billion in 2022 and $56 billion in 2023. Furthermore, the value is expected to rise to $70 billion by 2026, translating into a compound annual growth rate of 8.2 percent from 2022 to 2026.
 
The report divides the equipment market into five categories, namely video surveillance, access control, intrusion alarms, fire detection and other security equipment. Video surveillance accounts for around half of the security equipment market globally, with China being the largest country market in terms of revenue, the report notes. It adds access control is the second largest equipment market, with North America estimated as the largest regional market and Latin America and the Middle East and Africa forecast to be the fastest growing.
 
The fire detection equipment market is a close third in terms of estimated market size, with North America again being its largest regional market, while the intruder alarms market is the only equipment market forecast to grow slower than the fire detection market, the report states.
 

Physical security services market

 
The report also shed light on the physical security services market, which is much larger than the equipment market and is also experiencing an upward trend: it had a size of estimated $298 billion in 2022, $319 billion in 2023 and a forecasted $389 billion by 2026, translating into a CAGR of 6.9 percent from 2022 to 2026.
 
The report divides the security services markets into the following: security services, fire detection services, alarm monitoring and guarding. Security services refer to the services provided by security systems integrators and installers – a market that is impacted by several trends, including demand for predictive maintenance and building management systems (BMS), according to the report.
 
As for fire detection services, the report points out that fire system integrators in many regions are constrained by regulatory requirements, and, consequently, the pace of evolution, both in terms of fire equipment and services, is slower than in other industrial markets.
 
According to the report, the remote monitoring of intruder alarms and other physical security equipment is a large business, a market that is primarily driven by the need to protect end user sites – in some cases, an alarm monitoring contract is a requirement of their insurance plan. The report adds North America remains the dominant regional market.
 
Meanwhile, the report finds guarding is the largest services market in contract security, and the role of guarding companies has changed in recent years. “Traditionally, security guards would protect buildings and campuses by conducting regular patrols. The requirements are now more sophisticated, leveraging technology to augment and enhance the guarding operation,” the report stated.
 

Major provider of jobs

 
The report also points out the security industry is an important employer across the world. It cites Omdia as estimating over 30 million people (full-time equivalent) are directly employed across the physical security and fire detection channel. The figure breaks down into 35,000 employees in distribution, 210,000 in equipment and software, 980,000 in security services, 28.55 million for frontline security, and 900,000 for CSOs, managers and consultants.
 

Technology trends

 
In terms of technology trends, AI and cloud continue to dominate in security, according to the report.
 
“AI is increasingly prevalent in the video surveillance market. Distributed architectures mean that the processing can be done on the camera, on a recorder or dedicated device, or in the cloud,” the report said. “Video surveillance as a service (VSaaS) is an increasingly important business model. Many end users are seeking a blend of on-premises and cloud-based surveillance to address security and compliance requirements. Hybrid setups offer flexibility, allowing organizations to retain critical data onsite while leveraging the scalability and accessibility of the cloud for non-sensitive information.”
 
The report also cited sustainability and 4G/5G as trends to watch for. In terms of sustainability, a potential application would be to use video surveillance cameras to provide the sensor input for more sustainable smart city solutions, the report said. For the latter, there are several possible use cases across the market, specifically around machine vision, smart cities, and fleet management solutions, it said.


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