ENGLEWOOD, Colo. – The total installed base of access control readers, panels, credentials and electronic locks is expected to reach 2.3 billion by 2016, up from 1.8 billion in 2012, according to a research note by IHS Markit.
“Approximately 95% of the installed base in 2016 was credentials, which is not surprising due to the requirement that each user have a card or pass,” says IHS Markit Analyst Alexander Derricott. “However, the growth of credentials is slowing, even though it makes up a majority of the market, because the turnover of credentials is much higher, as employees move jobs and people accidentally misplace them.”
Panels make up the smallest portion of hardware, with less than 1% share; however, this category comprised 32% of revenue in 2016. Due to the ability for panels to cover a large number of readers, the quantity required is far lower than the number of readers, which are needed at each entry point. If credentials are removed from the installed base, panels make up nearly 19% of all installed hardware and about 38% of revenue.
The continued growth of electronic locks has started to affect the overall access control market, according to Derricott. Previously, readers made up the second-largest segment of hardware, but in 2016 they have finally be overtaken by electronic locks. Electronic locks will make up 16.7% of the installed base, while readers will make up 16.6%.
“The growth of electronic locks, especially in the residential and utilities sector, will continue its upward trend. The installed base growth may start to slow, as the mechanical nature of the locks shorten their life cycles, in comparison to readers,” he says.
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Within the various vertical markets examined by IHS Markit, the commercial sector holds the largest portion of the installed base in 2016, with 495 million units or 21.6% share. The governmental sector is the second largest, with 17.1% of the total installed base in 2016. Both vertical markets have been the earliest adopters of access-control products, since they share a growing need to secure their premises and properly audit entry and exit.
The residential sector is expected to rise the fastest from 2012 to 2016, growing at a compound annual growth rate (CAGR) of 7.4% from a small base of 47.6 million units installed in 2012. There will be continued growth in this sector as the use of electronic access control products has started to gain momentum.
The residential sector does, however, suffer from more frequent replacements, since a greater portion of this market is electronic locks with mechanical moving parts that can wear out. Consequently, as replacement shipments rise, the installed-base growth will begin to slow sooner than it has in other markets.
