Driving IP Video Growth: Both Technology and Geography
The SIA Security Industry Research Update for the fourth quarter of 2011 reveals that video surveillance continues to exhibit growth opportunities. Both the average number of installations and gross profit margin ascended as a result of increases in IP camera installations, megapixel cameras and video analytics.
A report from IMS Research, an independent supplier of market research and consultancy to the global electronics industry, has identified the latest in a long line of evolving trends in the enterprise and IP video surveillance storage market.
Megapixel network security cameras gained a foothold in the market in 2008. Despite the fact that these cameras had more efficient compression standards, the extra data produced by utilizing high-resolution images was significant when compared with standard-resolution images. With this increase in data came the requirement for higher capacity storage products.
Sam Grinter, market analyst at IMS Research and the author of the IMS report, said “By 2015, IMS Research forecasts that megapixel security cameras will account for over 70 percent of network security cameras shipped.”
What are the factors at play that will drive the growth of megapixel technology? According to Fredrik Nilsson, general manager of Axis Communications Inc., Chelmsford, Mass., “Better image quality is probably the biggest driver from analog to IP cameras, and the advent of 720p and 1080p HDTV network cameras, supporting 16:9 aspect ratio, color fidelity, H.264 compression and guaranteed 30 frames per second was really what made high resolution video take off.
“The next thing is very light sensitive cameras — more light sensitive than an analog camera ever was — which will drive growth in 2012,” Nilsson said.
Due to the large size of surveillance video files, there is a disproportionate load on computing resources and large data storage requirements. In 2010 the use of IP and fiber channel storage area networks (SANs) began to have an impact on the video surveillance storage industry. SANs offers the benefit of using virtualized pooled storage, which has the advantage of increased performance over the file based storage systems often used in attached storage systems that are either directly attached or are attached through a network. Even greater efficiencies can be achieved through hosted video solutions.
Nilsson said he sees hosted video bringing IP cameras to smaller systems. “Typically systems with fewer than 16 cameras have been analog up until now,” he said. “With hosted video you can easily and cost-effectively install a few cameras on smaller sites, such as small offices and retail outlets, and enjoy the best quality video surveillance can offer.”
IMS Research remains confident that demand for video surveillance equipment will remain strong through 2012, and growth for network video surveillance equipment sales is forecast to exceed 25 percent.
Cloud-based video surveillance storage will likely see the largest traction of enterprise solutions by providing centralized off-site storage for critical surveillance footage,” Grinter said in the IMS report. “Companies in the video surveillance storage market will need to carefully consider the latest trend towards cloud-based storage solutions, so as not to lose out in this highly competitive market.
While the impact of the economic downturn over the past few years was felt internationally, not all countries were affected equally. For example, Brazil experienced significant economic growth during the downturn and has seen dramatic growth in its security industry. SIA will debut its New Product Showcase Brazil (NPSB) at ISC Brazil, April 24-26, 2012 to give industry participants an opportunity to reach this growing market.
As a result of this inequality in terms of economic slowdown internationally, the technology transition from low-value analog video surveillance equipment to higher-value network equipment continued during the downturn and bolstered total video surveillance sales. Throughout 2011 this trend continued to hold, with analog equipment sales remaining muted and network equipment sales continuing to flourish.