A Conversation with Alastair Hayfield
As editors in the security industry publication
trade, we often get updates from several
research companies that make it a practice to
report on industry conditions and analyses for
the future. IMS Research is a supplier of market
research in a wide range of global electronics
markets, including the security industry. IMS
regularly publishes detailed research on electronic
physical security products such as CCTV
and video surveillance, access control, intruder
alarms and fire detection and suppression
equipment. We sat down with Alastair Hayfield,
research manager of video surveillance and VCA
group, to ask a few questions.
Q. What was the top market driver for the
purchase of security products and services
in the United States in 2010?
A. This is a difficult question to answer
because arguably there are several
drivers that could be considered equally important
for the video surveillance market in
the United States.
If we take the retail industry as an example,
it is one of the largest consumers of video
surveillance equipment, and the driving force
is generally loss prevention -- either by reducing
theft or reducing staff fraud. However,
the retail industry was struck hard by the recession,
particularly with regard to new store
expansions.
Investment in video surveillance equipment
for infrastructure protection -- transport
systems, government facilities, critical
infrastructure -- remains strong. With government
stimulus money finally starting to trickle
down, it is foreseeable that these verticals
will drive the market for some time.
The education vertical also is a very strong
sector for video surveillance and access control
solutions in the United States. Active
shooter scenarios are prompting many school
boards to install security equipment to help
prevent and deter such events. Security equipment
is also seen as a way of reducing gun
and knife possession and antisocial behavior
within schools.
Q. What were the top five end user purchasing
preferences for 2010?
A. Typically, large scale enterprise security
projects are now using either full
IP systems or some element of hybridization.
The benefits of using IP on projects of
this scale are well understood by the larger
end-users and systems integrators. In terms
of technology, HD resolution cameras and
H.264 encoding technology are gaining traction
and IMS Research forecasts significant
growth in this particular product area.
The VCA market is still recovering from
the recession and the over-expectations (hype)
of a few years ago. That said, IMS Research
tracks project tenders. We are observing that
more large-scale projects have VCA specified
from the project start. There also seems to be
a better sense of realism within the industry
and an understanding that getting the right
support from systems integrators -- in terms
of setting up the analytics on site -- is key to a
successful deployment.
DVRs and analog cameras are still popular
with small-scale customers and many deployments
in the mid-tier of the market. Although
the low-end of the market is commoditised,
within the mid-tier market consumers are
less concerned with price -- although it’s still
important -- than they are with product reliability,
image quality and storage volume.
The DVR/analog camera combination is still
more cost-effective for consumers with a low
camera count than a full IP system. That said,
falling IP camera prices (typically driven from
the far East) might help to drive the increased
adoption of IP in this particular segment of
the market.
Q. Where are some of the growth sectors
of the security industry? Any sectors
declining/holding steady?
A. Government, transportation and
education continue to perform above
the market average. In the short term, commercial,
banking and retail applications have
struggled through the recession. However, in
the longer term -- 3-plus years -- we expect to
see growth recover in these sectors to prerecession
levels.
Q. What are the trends in the IP video surveillance
market? When will IP finally
overtake analog surveillance?
A. Globally, sales of network video surveillance
equipment -- IP cameras,
NVRs, s/w, encoders -- will be about comparable
to sales of analog video surveillance
equipment -- analog cameras, DVRs, matrix
switches -- in 2014. However, it is worth noting
that shipments of analog cameras will
still outstrip shipments of network cameras
in 2014 by a considerable margin.
Q.In what regions of the world is the security
industry growing the fastest?
What about the European/North American
markets?
A. The emerging markets of Brazil, China,
India and Russia are all forecast to
grow quickly. Europe, and Western Europe in
particular, is forecast to grow comparatively
slowly. Western Europe is more mature, closer
to market saturation and, as continues to be
observed, still struggling through economic
recovery. North America is performing better
than Western Europe -- the U.S. economy
is buffered slightly by being a single, unified block in comparison to the individual,
smaller economies of Western Europe. The
United States also has a slightly stronger
focus on funding for Department of Homeland
Security projects.
Q. Will we continue to see both ONVIF
and PSIA battle in 2011? What is the
market share of companies adopting each
group’s standards?
A. In July 2009, IMS Research conducted
market share analysis for the
two major proponents of open standards for
network video surveillance equipment. This
analysis revealed that the member companies
of the ONVIF standard commanded a
significantly larger share of the total video
surveillance equipment market than the
member companies of the PSIA standard.
Since then, there has been rapid progression
of both standards, with both bodies announcing
a raft of new member companies.
To reflect the rapid development of both
network video surveillance standards, IMS
Research has re-analyzed the relative market
share positions of the two network video
surveillance standards bodies.
This new market share analysis revealed
that, despite both standards bodies having
gained market share since the last analysis,
the member companies of ONVIF still
command a greater market share than the
member companies of the PSIA. When considering
the total video surveillance market,
the member companies of ONVIF represent
61.1 percent of the market compared
with the 31.5 percent of the PSIA member
companies. Again, as in July 2009, the difference
continues to be more pronounced when
considering the network video surveillance
equipment market. The member companies
of ONVIF hold 72.1 percent of the market,
compared to the 29.3 percent of the PSIA
member companies.
“There is a strong and accelerating movement
toward open standards for network
video surveillance within the industry -- currently
35.1 percent of the market is neither a
member of ONVIF or the PSIA,” said Gary
Wong, a video surveillance research analyst at
IMS Research. “Whilst there has been some
trepidation that the introduction of open
standards may increase competitiveness in
an already highly competitive environment,
there is now strong belief that standards will
be a key driver in significantly expanding the
network video surveillance marketplace.”
At the recent ISC West show, ONVIF announced
that they would be expanding the
original scope of their organization.
“Having established strong momentum
in creating an open standard for video products,
ONVIF has decided to expand its scope
to also include access control,” said Uwe
Thym, vice president of marketing for Bosch
Security Systems. “We (Bosch) believe that a
common standard across these segments will
have significant advantages for a large number
of applications, where effortless integration
of access and video products is of great
benefit.”
“With a high level of support from network
video surveillance manufacturers and a
high volume of ONVIF-compliant products
scheduled for release later this year, it is not
surprising that ONVIF is now focusing on establishing
another standard that offers synergic
benefits for its membership,” Wong said.
This article originally appeared in the issue of .