The global credit crisis took everyone by surprise, leaving many industries still crippled. Security was no exception, but there are glimpses of light for certain technologies. A&S highlights the areas to heed in the new year.
While most economies around the world are seeing signs of recovery, forecasts for physical and electronic security are still somewhat obscure. According to IMS Research, the global video surveillance market grew by roughly 3 percent in 2009, which was significantly lower than historical double-digit growth. The overall revenue (manufacturers level) was estimated at US$8.8 billion, with IP growth at 15 percent. Given the overall delays in construction in the commercial and residential sectors, access control and intrusion detection systems are believed to have suffered severely in terms of sales performance. Earlier forecasts indicated near-flat growth and pegged the markets at approximately $2.1 and $2.8 billion, respectively.
2009 did not bear witness to any brand new innovations as sales of previously launched products stumbled and budget freezes (even in R&D) were seen across the board. Our own "Products of the Month" (which showcases industry firsts) and findings at the various trade shows were equally telling. There are, however, disruptive technologies brewing on the horizon, and we expect to see some mature over the next couple of years. Our collection of predictions for 2010 is as follows.
1. John Honovich, founder of IPVideoMarket.info , suggested that "IP video surveillance product sales will increase by 200 percent between 2010 and 2012, significantly disrupting and overtaking analog CCTV sales," thanks to falling prices of IP-based devices and increased performance and availability of cost-effective offerings. IP growth, however, depends largely on the availability of IT/IP-savvy channel partners. The status quo is not very promising, as A&S has been approached by many to recommend such in the various markets it is active in and competent candidates are scarce. Fortunately, increased involvement from players like Cisco Systems and Ingram Micro and increased training funding will likely improve this, albeit slowly.
2. Adoption of hybrid solutions will continue to rise when more users look to extend their old security investments with tightening budgets. Research firm In-Stat sees DVR shipments growing faster than camera shipments, with hybrid DVRs increasing at the highest rate. What HDcctv can or cannot deliver will be tried and tested in niche applications.
3. In a post-credit crisis world, price/performance and cost-effective claims will be examined more rigorously. No-frills offerings from Asia will see increased market share, and value adds like video-alarm verification and basic analytics will be demanded more.
4. Megapixel and panoramic cameras deliver TCO advantages, but their low-light performance and compression/transmission methods will continue to be challenged, resulting in slightly curbed growth curves (65 to 100 percent according to IMS) and diluted market shares with new entrants. H.264 will see a lot more usage, but providers that “cheat on” profile/resolution differences will suffer and be weeded out gradually.
5. The reliability (especially outdoors), ease of use/configurations, pricing and feature flexibility issues of video analytics cannot be solved overnight and will hinder its growth and widespread adoption. The current market size is estimated at between $50 and $145 million by research companies and high-end vendors, with IMS forecasting that more than 450,000 channels of analytics will be embedded in cameras, encoders, DVRs and NVRs by 2013.
6. IMS predicts the overall security management market to be $728 million by 2011, whereas Frost & Sullivan predicts that to be $2 billion by 2012. Physical security information management will continue to see integration and interoperability problems as common standards and protocols still require years to establish. In the short term, only MNCs and government facilities, with bundled purchase orders, can see such implementations through.
7. Remote video monitoring and surveillance and software as a service generated product sales and recurring service revenues worth $300 million in 2008 according to IMS, and their proliferation will only be gradual. As such, IMS predicted that analog cameras and DVRs will remain the preferred solution for low-end applications for many years to come.
8. Technical specifications from the ONVIF, PSIA and HDcctv Alliance will continue to develop and reel in more supporters, but integrators and users will demand more details as various, nonparallel network technologies clash and new compatibility issues crop up. The dust shall settle a bit in 2011, though.
9. Sales of fiber-optic and wireless technologies will grow rapidly, with more video, access and intrusion systems riding on one common infrastructure. Wide-area applications like the education vertical and infrastructure projects (air/sea/land transportation, power generation, city surveillance and border control) will reap most benefits. Given the upcoming global sporting events, the recreation vertical (gaming, large venues and retail) will also enjoy healthy growth and receive our continuous attention over the next year.
10. Biometrics will finally turn the corner, with IMS forecasting the global market for fingerprint devices to reach $650 million by 2013. Frost & Sullivan predicts the EMEA market to recover and reach $1.7 billion by 2015 (from $351.4 million in 2008, at an annual rate of 25.5 percent). Both the low- and high-end markets (in terms of accuracy requirements) will grow significantly, with many construction and government projects (including national IDs/e-passports) back on track and logical/physical integration gaining traction.