The video surveillance market remains extremely strong, both according to SDM’s 2025 Industry Forecast, where 94 percent of security professionals consider the state of the video surveillance market to be very good or excellent, as well as multiple manufacturers and integrators contacted by SDM for this report.

While 2024 wasn’t a banner year for everyone — with comments generally consolidating around the election uncertainty and inflation/interest rates as a drag on sales last year — individually almost everyone noted it was still overall a good year in the video space, with technologies such as analytics, AI and cloud cited as the driving force.

“The U.S. election created some uncertainty in certain segments of the market, with business decisions occasionally slowing down or speeding up in response,” says Tim Palmquist, vice president, Americas, Milestone Systems, Lake Oswego, Ore. “But what has really stood out to me is how resilient our industry has proven to be, maintaining stable growth even in the face of these various economic headwinds.”

What’s more, one of the biggest issues from 2022 and 2023 — supply chain challenges — was no longer a factor in 2024, allowing companies to focus on the normal design and procurement process without the worry of not being able to deliver on promises.

What video solutions are capable of now are better than last year and will be better next year than this year.

“2024 was a better year than 2023,” says Brad McMullen, president of products and solutions business, 3xLOGIC, Pacom and Sonitrol, Fishers, Ind. “We are seeing continued growth in the video market. I would call it cautious optimism right now. A lot of customers are looking to upgrade, even still moving from analog to IP. We know the power of video continues to get better and better and that has to do with analytics. What video solutions are capable of now are better than last year and will be better next year than this year.”

McMullen and others cited uncertainty over the election as something that many were watching and waiting for in 2024. With that outcome now clear, that is freeing up businesses to plan for what they want to do next.

“A lot of it had to do with America’s economy and folks in larger companies sitting on their capital and waiting to see what was going to happen,” says Tim Hobbs, director of video sales engineering, Owl Services, a Gaylord, Mich.- based integrator that specializes in the gas station and convenience store space. “We are excited. We feel a positive outcome with the new administration. We have already felt the pendulum shift a bit with Q1 orders gearing up compared to last year’s Q1.”

Josh Dice, president and CEO of Security Alarm Corp., Salem, Ill. (featured on this month’s cover) says his video-related business grew about 5 percent over 2023, with a “fair number of large upgrades.” He cites AI as a big piece of that drive. But like Hobbs, he also says there was a cautionary note that has now gone away.

“Last year at the beginning of 2024 there were concerns about a recession and none of that really panned out. I would probably say I am more optimistic now than last year at this time. Maybe I shouldn’t be, but with the new administration I think that will be great for our industry and the economy in general. We even saw right after the election our business spiked to another level. People had been holding onto their cash to wait and see what would happen.”

Tom Cook, executive vice president of sales, marketing and operations, North America, for Hanwha Vision, Teaneck, N.J., calls 2024 “a conservative year overall,” but notes that in spite of that the video market is probably the strongest growing market overall compared to other security technologies such as access control and intrusion. “One factor is the advancement of AI technology, which is causing manufacturers in those segments to change their design practices. … We’re definitely seeing a lot of positive marketplace behavior and we expect that to continue,” Cook says.

“We expect 2025 to be an extremely good year,” he adds. “The economic conditions are right, and if the trends with interest rates continue, then that bodes well for us, because it’s going to bolster new surveillance projects. From our company’s perspective, we’re also confident that the new products we plan to launch in 2025 will resonate with our customers and the industry overall.”

This optimism is evident in the 2025 SDM Industry Forecast as well, with nearly three quarters — 73 percent — citing video analytics/artificial intelligence as the technology most likely to increase in revenues this year. Video surveillance systems overall (including both on premises and cloud-based solutions) were the second most cited, at 70 percent.

“We see 2025 growing over 2024 due to the continued increase in crime; prior capital projects that were placed on hold; lower cost of advanced hardware and AI software; as well as the increasing ability to address operational needs with existing security infrastructure,” says Mark Barbaric, senior vice president, Prosegur, Herndon, Va.

Read on to see how these trends and others are driving the video space in 2024 and 2025, and beyond, as well as the top challenges and opportunities that surround these trends. This article will be presented online in three parts over the next weeks, so be sure to check back for the next installment.

Top Trends & Technologies Driving the Video Surveillance Market

There are many trends impacting the video surveillance space today, but a few truly stand out, according to those polled for this article, as well as a number of outside surveys.

For example, the 2025 Trends In Video Surveillance Report, released in December by Eagle Eye Networks identified six key trends, including more remote video monitoring; more proliferation of cameras in general; multi-sensor cameras; gun detection using AI; low light capabilities to enhance AI and other recognition; and more cameras with built-in AI.

“AI technology will contribute to growth in 2025,” says Dean Drako, president and CEO, Eagle Eye Networks, Austin, Texas. “In particular, we will see weapons detection becoming pretty significant in 2024 and people willing to pay money for it. That will contribute to growth in the industry. Cloud connectivity and the fact that I can interconnect more things and get value out of that interconnection will also contribute to growth … all these things where video and access control in our industry get intertwined in to the additional corporate IT infrastructure.”

Let’s take a closer look at a few of the most talked-about trends in the video industry: AI, cloud, and edge computing.

Artificial Intelligence (AI) & Business Intelligence.  Anyone who attended any trade show or conference in 2024 would be hard-pressed to identify a more popular technology trend. It was difficult to find companies not talking about AI in some way.

Yet while it is easy to get lost in the weeds of who offers which new, cool AI feature on their camera or software, it is what can be done with AI — particularly business intelligence — that is the real game changer.

“AI is definitely on a trajectory to transform our industry, though maybe not in the way people expect,” Palmquist says. “What is interesting is how we’re starting to think differently about the massive amounts of data we collect. Our industry has always been focused on security as the primary objective, with recorded data being a byproduct that is typically thrown away every 30 days. But that’s changing. Leading data insights tech companies are showing serious interest in our industry because they see the potential value in all that data.”

Hobbs agrees. “More analytics tools are coming to the market for things like people and object recognition, allowing companies to be more proactive instead of reactive,” he adds. “It gives you tools to say, ‘My store is too busy; I am understaffed,’ or ‘get to spills faster.’ AI, smart and edge tools will drive the continuous growth.”

Cook says nearly every conversation with customers these days involves AI. “Everyone from the CSO and CEO level down is asking how their organization can take advantage of the cameras they already have in place that are gathering data to do more than security. The big question on everyone’s mind is, ‘How do we go beyond security and turn that data into analytics that can generate real business insights about the future direction of our organization?’”

Eric Salava, chief revenue officer, Verkada, San Mateo, Calif., says, “Applied AI and advanced analytics extend beyond basic monitoring capabilities and offer advanced, AI-powered analytics to make security and safety professionals more efficient and productive in their roles. And as visual data and intelligence are being used across more parts of the business, AI transforms those data points into strategic tools — for instance, tracking occupancy patterns to optimize a real estate decision or linking production equipment to video footage to manage quality control on a production line and identify defects.”

This rising interest in AI has opened up new business avenues for manufacturers and integrators who are incorporating the technology into their solutions, says Fredrick Nilsson, vice president, Americas, Axis Communications, Chelmsford, Mass. “We have a very optimistic look for the video market in 2025,” he adds. “We anticipate the market’s increasing investment in the technological solutions that enable people to perform more efficient and impactful work. This move will focus on delivering greater value as businesses recognize the significance of leveraging AI to optimize operations and gain business intelligence.”

AI is tipping the value proposition of video surveillance in the direction of visual intelligence and proactive response, says Chuck O’Leary, vice president of sales, video systems and solutions – North America, Bosch Security and Safety Systems, Fairport, N.Y. “Application-specific offerings for edge-based AI are making it easier for integrators to deploy the technology to solve customer pain points around building security, perimeter security, traffic monitoring and more. With the ability to accurately detect, classify and count objects, opportunities exist to use AI-enabled cameras for advanced intrusion detection in and around buildings, the detection of brandished guns and gunshots to facilitate faster response to risks, and for long-distance detection of perimeter breaches at energy facilities and other critical sites.”

i-PRO Americas, Houston, with global headquarters in Tokyo, is approaching AI in this way, SDM was told by CEO Masato Nakao during the global press tour last November. “AI used to be utilized for post-event forensic searches. We are actively promoting the technology for use in preventative situations.”

This is a future Barbaric sees as well. “Clearly, AI and machine learning will have a large impact on the market. They will enable video cameras the ability to make intuitive decision-making on security protocols, such as dispatching law enforcement, voice-down commands, etc. Quick and accurate assessments will help security officers and law enforcement respond faster to criminal activities or life safety emergencies.”

Cloud & Hybrid Cloud Solutions. Another recent survey, The Genetec 2025 State of the Physical Security Report, published in December, found that a growing number of end users are interested in cloud solutions, particularly hybrid cloud, with 43 percent of end users saying hybrid will be their preferred approach within the next five years.

“Adopting cloud is not necessarily easy for most organizations,” says Charles Nguyen, product marketing manager, Genetec, Montreal. “Different organizations have different aspirations. Some want it from infrastructure and others from storage or economies of scale. We are there for them in any of those cases. We are not pushing them to the cloud; we are just there marching in lockstep with them.”

This tracks with what many other SMEs interviewed for this story told SDM. “More customers are looking to adopt cloud-hosted video versus on-prem,” McMullen says. “Traditionally, it was small and medium businesses, but we are starting to see the enterprise looking at hybrid cloud. … What still remains to be seen is what things the customers will pay for and how quickly will the adoption of cloud continue? We have customers still electing on-premise systems, which is great. I think it depends on the use case.”

Drako says Eagle Eye (a cloud-first company) saw solid growth in 2024. “Cloud adoption is accelerating and becoming more mainstream than it has ever been,” he says. “In 2023 people were still debating on prem or cloud? In 2024 it was, ‘I think we need to go cloud’ from the majority of our customers.”

Palmquist calls this “decision friction,” when it comes to the debate between on-prem and cloud delivered solutions. “We’re seeing some very interesting shifts in the industry, particularly in how new technologies are reshaping traditional approaches,” he says. “The ongoing evolution between cloud-delivered and on-premises VMS solutions continues to create interesting dynamics in the marketplace.”

Salava sees this trend in a similar way to AI, unlocking more business value from video. “There is a lot of enthusiasm in the market for cloud-based solutions and AI capabilities. … It’s exciting to see more organizations embracing the value of cloud-based solutions and the integrations, features and capabilities we are building for them.

“It’s clear that CIOs and CSOs today appreciate the power of cloud-enabled video security cameras,” he adds. “Cloud-based solutions are transforming how organizations use video data, unlocking new and deeper levels of visual intelligence and insights that empower organizations to make faster, smarter, data-backed decisions for applications outside of traditional security.”

Cybersecurity issues are also helping drive cloud — and perhaps also hindering it at the same time. It’s a bit of an ironic joke in the industry that customers tend to adopt or avoid cloud in fairly equal numbers, and for the same reason: their perception of whether it’s cybersecure or not.

For those whose perception is that cloud helps with cybersecurity, Nilsson says, “Cybersecurity tools and features have become increasingly important, with a growing emphasis on cloud-based tools for easier device management. These tools are crucial for ensuring the integrity and security of systems as they become more complex and interconnected. The cloud is also playing a pivotal role in simplifying the use and maintenance of security devices and systems. Though, to fully capitalize on its benefits, cloud solutions need to be open and channel-friendly to ensure flexibility and scalability.”

The Edge & Beyond. Nilsson continues, “Apart from the obvious drives like artificial intelligence and cloud-based solutions, stronger edge computing will play a crucial role in transforming the industry. By enabling faster processing and decision-making at the device level, edge computing will reduce latency and improve efficiency across a wide range of applications.

“The improvement of deep learning capabilities at the edge are enabling smarter, more efficient processing of data directly on the device itself,” he adds. “This advancement has accelerated the adoption of edge devices like network video cameras, where real-time processing is essential, as well as physical access control systems, audio devices, intercoms and radar.”

He is not alone in this assessment. I-PRO is also continuing to explore the “edge of AI,” and help integrators to implement that. “We are promoting real-time AI, of course for security and safety, but also vertical-specific,” Nakao says.

“I think edge computing or device computing is becoming more and more apparent, with stronger processing at the edge,” Nguyen says. One reason for that, he says, is that customers tend to shop for the camera first, and focus on how they perform in their particular setting. “If I were putting myself in the skin of a partner I would seek to understand the differentiations of all these camera choices and partner with the right software solution to match what the customers are looking for in terms of capabilities.”

McMullen agrees. “Customers are ready to do video upgrades and are looking to add more video, or add to an existing system. And one of the biggest drivers of that is some of the edge processing and what video can do beyond just traditional security. They can use it for compliance, health and safety and more as they add it on to their existing video systems. They are looking for ways to add to their existing infrastructure to drive operational benefits.”

Dice says customers are thinking differently about video than they did in the past. “The way people think about security now is not an intrusion system like in the past. Now they think of video first. That is what is going to provide the level of protection that they need,” he says. “I don’t know how much they are specifically thinking about all the benefits or technology specifics; they are just thinking video in general. They know it will do lots of things and they are figuring these things out from Ring and other DIY cameras they are using themselves.”

Jon Adams, vice president of sales, DMP, Springfield, Mo., sees a trend for video moving into the intrusion space. “Video as-intrusion is what I’ve heard it called. Companies are putting more resources into selling video in markets where they traditionally would have led with intrusion.”

Next week we will take a look at three main challenges and headwinds in the video surveillance market, including adoption rates, cybersecurity and privacy, and changes to the channel.