IP Laying in Wait to Deliver Knockout Blow

June 30, 2007 SSI Staff

The Demise of Analog Is Projected

The working life of a security camera tends to be about eight years. However, there is significant variation around this number since it is a pure average. At the long end of product life, the average takes into account the thrifty security user who decides to stay with an analog system until a serious malfunction occurs. And at the short end, the user may be instructed by concerned management to convert even a fairly new analog system to a completely new IP video network. The long-term picture, of course, is for analog video equipment to eventually disappear as IP equipment replaces it for the capability to provide complete remote visibility and event records of all vital areas in any secured environment. Therefore, the question: When will this new champion claim the belt and begin the new era?

We presented the issue to video manufacturers and asked them to predict the shape of this evolution looking out a few years, and to detail an industry-wide estimate of just what this trend will look like. To do this we included the tendency of users to take the half-step of building a hybrid system that retains their investment in analog cameras by adding encoders to convert video to digital signals. As illustrated in the chart below, video manufacturers estimate 10 percent of the video systems sold in 2006 were comprised entirely of IP equipment; 7 percent of the systems were of the hybrid variety; and 83 percent remained installed with analog video products only.

Looking at their predictions for 2011, manufacturers apparently feel it is going to potentially take until 2020 or so for all the analog video equipment to completely disappear in favor of IP systems. This is based on their forecast that IP video system sales will only account for 36 percent of all video sales by 2011.

This growth of 10 percent to 36 percent over five years is not to be minimized, of course, since this is within an industry environment that’s already growing by slightly more than 15 percent per year overall. The reason for the trend is not just the availability of security department budget funding. IP systems nowadays typically involve coordination with the user’s IT executives who want to integrate the security network with the information network. But that involves the issue of convergence, which is a separate subject loaded with other considerations.

Joe Freeman is founder and president of J.P. Freeman Co., a company widely known for its security market reports and business consulting since 1983. In 1995, he founded J.P. Freeman Laboratories LLC, which provides technical services to clients worldwide. He can be reached via e-mail at secsales@bobit.com.

Previous Pages 2 of 2