[IMAGE]11928[/IMAGE]IP Cameras Are on a Steep Climb
According to SSI
’s latest annual Installation Business Report (IBR)
, published in the 2011 Gold Book
, the average growth in networked IP-addressable camera installations was 22 percent in 2010. In installations involving IP cameras, 25 percent included megapixel models. Those numbers are primed to increase in 2011.
A major shift that began to be observed in 2010 and is expected to only grow in prominence this year is new video installations that are increasingly IP-based.
“Two and three years ago you would see most new installs would go analog. Now you may see half or a majority of new installs are IP. That is really a changing world,” says John Honovich, founder of IPVideoMarketInfo.net. “You certainly are going to do service and upgrades with the analog systems, but more and more in the midmarket in North America you are seeing people going IP.”
Analog products and systems are expected to achieve a small amount of growth at best in 2011, according to Dilip Sarangen, a senior industry analyst for research firm Frost & Sullivan.
“IP-based products are definitely where the growth is and it will grow at a pretty rapid rate in 2011,” Sarangen says. “I would say it will grow at about 20 percent, whereas as analog products will be between 0 and 2 percent.”
Systems integrators, especially the larger companies, are helping fuel IP video growth by doing a much better job nowadays of explaining to the end user what the video can be used for, says Jeff Kessler, a New York-based managing director of Imperial Capital, a security market research and advisory firm.
“Integrators are getting down to focusing on those select functions and select analytics that make sense to the enterprise,” he says. “If a CSO or even the COO of a company begins to understand better what that proposition is, it makes a lot more sense to them to install this stuff for more than just perimeter protection, which in the past has been the security sale.”
After bottoming out in 2009, IP camera sales in particular are forecast for a very robust year globally, and especially in North America. Product improvements, continued progress in camera standards and a stabilizing economy tell only part of the story why IP is gaining fast on analog sales.
“There are so many lower cost megapixel cameras on the market and so many manufacturers offering them,” Honovich says. “Support is really now widespread. The barriers over the past five years have continued to drop. Just like 2010 was great for IP camera growth across the board, 2011 looks to be every bit as strong.”Economic Numbers, Market Niches At a Glance
At press time, The Conference Board, a private research group based in New York, announced its gauge of future economic activity rose in November at the fastest rate (1.1 percent) since March (1.4 percent), suggesting the U.S. economy will strengthen early this year.
The Conference Board measures data that has mostly already been released about real estate, manufacturing, employment, consumer confidence and financial markets.
Of the 10 measures used to calculate the index, nine increased in November. Building permits, which have been slow to come back in the sluggish housing market and construction, pulled down the final average.
Construction of new homes in the U.S. remained at a low level in November, while permits for new construction fell, according to government data released at press time.
Housing starts rose 3.9 percent to a seasonally adjusted, annualized rate of 555,000 in November, the Commerce Department reported. However, that’s nearly 6 percent below the year-earlier period. Thus, despite housing starts making some progress, any recovery in housing is expected to be agonizingly slow.
The mixed bag of economic news also translates to the electronic security market where analysts interviewed for this story expect overall growth in the industry to remain slow.
“Our view is that we are still pulling up out of the recession. We can see the light at the end of the tunnel, we just don’t know how long the tunnel is,” says Bill Ablondi, director, Home Systems Research, for Dallas-based Parks Associates.
Following are brief 2011 forecast outlooks for a handful of market niches in North America based on comments by from analysts interviewed for this story:
State and local projects — Growth will lag unless entities can find other funding sources, such as a lease or a low-down model where they pay a recurring fee. This option is becoming increasingly feasible for capital-constrained entities, whether they are in the public or private domains.
Education — Will continue to be a lucrative market; however, growth has slowed as schools and universities wait to receive or can identify new funding sources. Some universities are utilizing a lease type of model faster than private industry since campuses already have networked infrastructures.
Large enterprise — Video is forecast to become especially strong for multiple-site enterprises that find it increasingly difficult to handle vast amounts of video information at a central headquarters.
Casinos — The bottom has been reached in the U.S. gaming market although recovery remains elusive. That in itself is considered good news; the rate of revenue decline has abated sharply.
Health care — Compliance requirements such as the Health Insurance Portability and Accountability Act (HIPPA) continue to fuel growth. Other technologies primed for growth in the market are network security and asset tracking solutions to thwart hackers from accessing protected data.
Mass-Marketed Home Controls
In the residential space, product and service providers from outside the security industry will bring to bear new offerings in 2011 that are expected to feed consumer demand for home management controls. Consequently, alarm dealers will be pressured to keep pace and expand their own portfolios, according to market analysts.
Mergers and acquisitions activity in 2010 presents a clear picture of the impending shift coming to the residential marketplace. Consumers will increasingly be offered a variety of Web-enabled mobile applications, home management and monitoring solutions.
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