There has been a noticeable slowdown in video surveillance spending in the more established markets of Western Europe, the United States of America and Japan. The retail and banking verticals are forecast to be hardest hit as consumer spending slows and financial institutions remain ‘shaky’.
The traditional verticals of transportation and Government fair somewhat better as video surveillance is often viewed as essential for ensuring public safety. That being the case, substantial Government funding still exists.
Overall, the video surveillance market in Western Europe, the US and Japan is forecast to grow by a little over 4% in 2009. On an equally positive note, market growth is forecast to recover significantly in 2011 and 2012 as what IMS describes as “the relentless trend” towards network-based surveillance continues.
Guilty of overstating the case
“Analysis of the video surveillance market has been subject to considerable exaggeration.” said market analyst Alastair Hayfield. “Perhaps this is understandable given the high level of growth seen in the network video surveillance sector, but a more measured approach is needed in these uncertain economic times.”
Hayfield continued: “It’s imperative to realise that the global financial crisis is affecting particular market verticals and geographic regions in different ways. The aim of our latest video surveillance report is to outline exactly how and where the economy is impacting the market, and which regions and products can expect to see continued growth.”
Manufacturers of video surveillance equipment should take heart. The markets in Eastern Europe, Russia, the Middle East and Latin America are forecast to remain strong. Combined growth for these regions should be maintained above 20% for the foreseeable future, with the combined value of these regions expected to near the $2 billion mark in 2012.
A number of manufacturers – and, in particular, network video surveillance vendors – are moving to take advantage of this rapid growth by expanding their sales efforts in these developing regions.
Buoyant times in the Asian market
Japan aside, the Asian market for video surveillance continues to be buoyant and, as a whole, IMS suggests that it’s unlikely to see any major slowdown next year. China is the powerhouse behind video surveillance growth in Asia, while the Indian market is also described as being “hot” at the present time.
There are several factors causing the high growth in China. For starters, Government investment in Safe City projects remains very high. Some 660 cities have been earmarked for development, and projects employing thousands of cameras have continued to appear over the last year. China is also set to play host to two major international events over the next two years – the World Expo in Shanghai and the Asian Games in Guangzhou, each of which will require substantial infrastructure investment.
On top of that, there’s a vast replacement market in China. Many of the first wave of DVRs now need substitution, and the IR day/night cameras so popular in China require replacement on a regular basis due to the relatively short lifecycle of the IR LEDs.
IMS feels that, far from it being a case of complete market downturn, only select regions and verticals will see flat or negative growth in 2009. The world market is still forecast to grow by over 10% and, if vendors are savvy enough to survive “some bad weather” and expand into developing regions, then 2010 onwards promises a return to higher growth.
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