Singapore and Malaysia, two of the leading economies of Southeast Asia, are rapidly embracing IP. Demands for security are increasing, and hybrid systems have become more popular in the last year. IP-based products are now widely available and increasingly affordable.
According to financial reports, Singapore's GDP is expected to grow 5 to 6 percent this year. However, most companies seem to be recovering from a sharp drop in business, rather than experience any actual growth.
Security tends to be more resilient, or at least less turbulent, than other industries. In spite of this, a look at the industry shows that few security companies are expecting significant growth for 2010.
Small businesses are suffering the most. Similarly, smaller security businesses are facing extreme pressure. It is not uncommon to see a significant number of them closing shop. At the same time, mergers and acquisitions should be happening among medium to large players, as the security market consolidates. These happenings will occur as they did during the 1997 and the early 2000 recessions.
Singapore is a global city, and like others, it is subjected to the threat of global terrorism. This will continue to be a key factor for governments around the world to continue to spend on infrastructure protection. During and after a recession, crime rates tend to rise. These factors have an undeniable impact on the security market.
Importantly, the government's push for greater productivity will urge companies to review and reinvest more in systems and managed services for greater ROI and lower TCO. In this way, the security market will benefit. In particular, security companies with strong technological and service offerings will improve.
Infrastructure projects such as oil and gas, transportation and education are growing vertical markets in Singapore.
The tourism industry is booming, with the Resorts World Sentosa currently embarking on the project's final phase. Security requirements for the gaming industry are extremely stringent and demand sophisticated electronic systems.
Due to its size, complexity and the variety of components and equipment used in the Resorts World Sentosa operations, traditional security systems were not suitable. The resorts include hotels, casinos, retail chains, and a world-class theme park, among other leisure offerings. The project has more than 1,000 readers and several thousand sensor points, with complex high-level integration to many subsystems and operating systems within. The complete solution is also designed for almost 100-percent uptime, redundancy and resilience.
By product, video surveillance will grow roughly 30 percent. Access control and electronic locks follow, growing at 25 percent and 15 percent respectively. Access control systems will see more growth in the mid-end market, whereas electronic locks will grow in high-end markets. Intrusion alarms, public address and intercoms should grow at 15 percent, and mostly in the high-end sector.
IP infrastructure is growing fast. Singapore is currently building a new nationwide high-speed broadband network. This will mean easier implementation of IP-based security devices and a wider market acceptance. Currently, IP-based security systems are already out performing analog systems in growth. Going forward, as price lowers and more standards formalize, IP-based systems will continue to grow.
Even in newer markets such as China, security providers are utilizing secured IP networks to transmit alarms, video and data. This is sometimes done over a distance of thousands of kilometers. However, vendors and users in developed economies such as Singapore, tend to be skeptical and have not fully harnessed this yet.
Two barriers remain for the full embrace of IP-based systems in Singapore, and likely all of Asia. The first is a product problem. Although there are many IP-based products in the market, not all are created equally. The extreme technical details, in why one product performs so differently from another, are something users generally cannot understand. The standardization of video quality, together with grading or surveillance-specific certification, will help users choose appropriate products.
The second problem is the cost of network bandwidth. An industry expert once said, "Telecommunications providers build networks like highways; they charge you a price to get into a traffic jam." In reality, a secure and dedicated IP network is still very expensive. Telecommunications providers are still unable to provide good bandwidth for video at an affordable cost in most countries. That has restricted the growth of IP-based solutions within a LAN environment.
The expectations and awareness of security have increased across the globe, and the potential of growth is very positive. Demand for security systems is greater now than the past two years, and it is forecasted to grow at a rate of 13.5 percent from 2010 to 2011.
Major contributors will be government, especially homeland security and city surveillance, and commercial, particularly for gated communities and high-end hotels. The Malaysian government has invested a great deal of effort in enhancing homeland security, to improve public confidence and safety.
"In the next two years, the video surveillance market will see more IP-based and hybrid systems. The potential growth for analog providers is still present; however, the percentage of growth will not be great compared to those who focus on IP-based systems," said Carerina Yap, GM of Prisma Bytes. Nowadays, people are very open to IP-based video surveillance, as the features and functionalities are better, and the reliability, higher.
There are many IP-based products available on the market, even for smaller applications such as home and retail. Systems are becoming more affordable. Enterprise level video surveillance is becoming more robust than ever before, with flexible system capabilities and lower TCO compared to analog systems. Hybrid systems are a popular option for upgrading systems, as they allow the majority of the system to still be maintained.
Finally, intelligent video surveillance is in the spotlight, as needs are increasing. Video analytics drive the surveillance software market forward. It is becoming very useful in public safety, aviation, perimeter protection, naval-base protection and border protection.