IMS Research: State Of The Industry 2012
By Gary Wong, senior analyst and Blake Kozak, senior analyst, IMS Research
Last year, IMS Research presented a snapshot of the video surveillance industry. The article highlighted two key points: The adoption of network video surveillance equipment in North America was growing quickly, and the video surveillance market represented a solid opportunity for IT systems integrators and other IT channel partners. Twelve months on, is the video surveillance market still an attractive proposition for IT systems integrators?
Despite the unstable economic environment, the demand for network video surveillance equipment has remained robust. IMS Research estimates that 37% of all video surveillance spend in the United States in 2011 was on network video surveillance equipment, an increase of almost 5% on the previous year. In addition to robust growth, network video surveillance solutions are generally increasing in size and complexity. Two protagonists for this increase in complexity are megapixel resolution cameras and the advent of situational awareness.
Megapixel resolution cameras have been the key driver for the growth of network video surveillance. Megapixel cameras offer end users a choice of resolutions beyond that offered by traditional analog CCTV cameras. While there are a broad variety of megapixel cameras, ranging from 1 to more than 29 megapixels (single sensor), the mass market has settled on 720p and 1080p format resolutions. As the market migrates away from standard definition (VGA [video graphics array] or less) network cameras and toward HD or greater network cameras, the impact on, and the management of, bandwidth will become increasingly important. By 2015, IMS Research forecasts that more than 70% of all network cameras sold will be megapixel resolution.
There has been increasing buzz around situational awareness, or PSIM (physical security information management), over the last 12 months. This concept promotes the move away from simple alerts to generating an “image” of an alert via the convergence of data from multiple physical security sensors and systems (of which video is one). While PSIM is a product primarily targeted at enterprise and critical security, some of the features and functionality of PSIM are beginning to trickle down to other solutions (e.g. VMS [video management system]). VMS vendors are increasingly looking to transition their products from video management applications to video-centric security management platforms. While the trend of convergence between logical and physical security remains debatable within the enterprise market, the convergence within the individual components of the physical security market is already under way as individuals seek to achieve situational awareness and enhanced operational efficiency. Trends such as the increasing complexity of network video surveillance solutions, in terms of convergence and bandwidth management, could make the market opportunity offered by the video surveillance industry to IT systems integrators increasingly attractive in the coming year.
The access control industry is poised for an exciting year ahead as the fog of global economic stagnation begins to lift. Trends that once seemed a mere pipe dream will be provided with a new opportunity to flourish as access control projects bounce back on a much larger scale.
The terms integration and convergence have been tossed around for a number of years but are expected to receive more interest in 2012 with their ability to help lower costs and improve efficiency. Fewer systems are being installed that don’t have some level of integration, whether it be video, intruder alarms, time and attendance, or building management. With regard to convergence, more open, user-friendly devices will be seen in the future. IMS Research expects to see logical/ physical access control and NFC (near-field communications) to have a significant impact on the market in the medium term.
Many trends currently occurring in the physical access control security industry are not independent of each other. If NFC takes off, which still remains to be seen, there will likely be more in the way of convergence. Some of the industry’s largest suppliers of access control technology are unlikely to build a completely agnostic hardware platform. Integration and convergence are how many suppliers will differentiate themselves in the near future. Although not all hardware is created equal, software is the true source of value, especially for large system installations, because it controls the user interaction and helps the user make better decisions. It remains to be seen if a mass adoption of NFC will occur worldwide, but as the technology finds its niche its use could become more commonplace over the medium to long term. One barrier is that NFC adoption has lagged in America. Once it’s embraced by banking institutions and other applications where it can be better understood and proven, the security industry will be more likely to follow suit.
Overall, the access control industry is poised for strong growth, especially in emerging markets. The global access control market is estimated to top $2.2 billion in 2012, with electromechanical (EM) locks expected to be the fastest growing market. The verticals set to invest the most in electromechanical locks include hospitality, commercial, government, airports, and banking and finance. Electromechanical locks are seeing greater uptake because they are less expensive to install, allow more doors to operate online, and are somewhat easier to deploy as part of a wireless network versus traditional access-control hardware. EM locks have come a long way in recent years, transitioning from offline to wireless online, offering faster install and less wiring. Although there are still questions in how to power these devices, they certainly offer a truly diverse opportunity, used completely stand-alone, as a virtual network, or wireless online.
Every year new technology trends come to pass. Excited by what 2012 will bring, I expect to see more in the way of acceptance and the making of a new access control industry moving forward, full of innovation and opportunity.