Report: 2008 Forecast Cut for U.S. Network Video Surveillance
Despite its prominence as one of the electronic security industry’s fastest growing segments, a new study reports the U.S. market for network video surveillance solutions has slowed in 2008 and is not expected to eclipse last year’s pace.
The main reason for the downturn is the struggling U.S. economy, according to IMS Research. The market research firm recently estimated the U.S. market for network cameras, video servers and network video recorders increased by roughly 45 percent in 2007.
However, in the current climate of economic uncertainty, many companies are now delaying capital expenditure and several major security projects have been put on hold, says Simon Harris, a senior research director at IMS Research. Still, the sector is thriving.
“In spite of the stagnant economy, the U.S. market for network video surveillance products is still growing strongly, albeit at a reduced rate from 2007,” he says. “We anticipate that the market will grow well above 30 percent in 2008 and may even top 40 percent, particularly if the economy picks up in the second half of the year.”
The retail industry, which is the largest spender on IP-based video equipment in the U.S., has been particularly hard hit. Soaring energy and food prices, coupled with a credit crunch, have curbed consumer spending. In the first quarter of 2008 consumer spending rose a just 1 percent, the slowest pace since the second quarter of 2001. As a result, many retailers are scaling back new store expansion plans, which are affecting video surveillance equipment sales.
Even though 2008 may prove a more challenging year for suppliers of network video equipment, the long-term outlook for the market remains positive, according to Simon.
“The trend from analogue CCTV to network video surveillance is still in the early stages, and last year network video surveillance products accounted for less than 20 percent of total video surveillance equipment sales,” he says. “IMS Research anticipates that the trend to network video surveillance will be ongoing over a number of years, ensuring high growth for the long term.”
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