In 2022, the majority of the 50 largest international security companies in the video surveillance and access control sector posted significant market growth. Despite these positive overall results, experts predict that the industry will struggle in the coming year.
According to the market report ‘Security 50’, the top 10 companies will be able to maintain their sales figures. Thus, the ten largest manufacturers in the video surveillance and access control sector (sales comparison to 2021: Hikvision Digital Technology, Dahua Technology, ASSA ABLOY, Axis Communications, Motorola Solutions, Uniview Technologies, Tiandy Technologies, Allegion, Hanwha Techwin and Aiphone will not record any losses. Hikvision’s market leadership becomes particularly clear when one realises that in 2021 the 10-billion-euro sales mark was exceeded. This represents a growth rate of 16.9 per cent compared to 8.7 billion euros in sales in 2020.
Hikvision sees itself in this prime position by pushing technological innovations, which are the key elements for business success. According to Frank Zhang, VP of Hikvision, the continuous development of products and market position supports the customer relationship and builds long-term trust.
Six companies were newly included in the 2022 Security 50: China’s Dnake (intercom), Jovision (video) and EVETAR (lens), US-based Evolv, a screening provider, Australia’s Ava Group with risk management solutions, and Korean video surveillance provider Webgate are now among the top companies. Fifteen companies in the top 50 come from China alone. And four in the top 10 alone: Hikvision, Dahua, Uniview and Tiandy.
Due to the COVID situation in China, Chinese companies had to absorb revenue declines in the first half of 2022 compared to 2021. US trade sanctions on Chinese companies and products have less impact. Taiwanese manufacturers such as Dynacolor, Hi Sharp and GeoVision are doing well and by focusing on niche solutions, the market position has been stabilised. The economic outlook is heavily dependent about OEM orders to Taiwan, which cannot yet be conclusively assessed.
Review 2021-2022: In biometrics, access control, video analytics and digital intelligence, companies all recorded significant growth this year. This is due to increased demand for security and network video solutions and dynamic technological development. Thus, new, and more innovative products and solutions are in demand, replacing old technologies.
Forecast 2023: The security industry faces recessionary threats. The post-COVID era holds a multitude of problems:
- For example, component and raw material shortages are causing problems in the supply chain. And pandemic-related closures have also led to losses. The supply chain crisis slowed growth in 2020 and 2021, but market leaders like Axis now see a return to double-digit growth. Diversification of supply chains by some manufacturers led to shifts in the market.
- Strong inflation is affecting the prices of services, labour costs and raw materials. Thus, price increases for security products can also be expected in 2022 and 2023. At the same time, relationships with customers have changed and both payment and service models have changed. Customers are thus not overcharged but can continue to do business in a planned manner.
- Of course, the conflict between Russia and Ukraine is also influencing the economic situation. In both countries, the economic activity of global security manufacturers and providers is currently at a standstill.
- The impact of data protection regulations on video surveillance and AI-enabled technologies is interesting. Thus, the industry is challenged to respond to the regulations and take them into account in software developments.
According to the Top 50 report, 2023 could hold bleak growth prospects for physical security. in 2022, the security industry saw growth again. According to industry runner-up Dahua Technology, Asia Pacific, Africa, Latin America, and the Middle East will be ‘relatively’ optimistic, however, relatively weak growth will occur according to the Chinese manufacturer’s forecast.
The global market for video surveillance hardware and software is expected to grow by 11.7 per cent in 2022. In 2023, it will grow by 6.4 per cent. In the longer term, there will be sustained and significant growth in the high single-digit percentage range.
Due to the economic problems already mentioned, fewer investments in safety technology will be realized. This makes relationships with existing customers more important, as replacement investments can be implemented here to reduce the costs of existing (security) management, among other things.
Trends continue to be dominated by artificial intelligence (AI), edge computing, cloud solutions and cyber security. From the market leader’s point of view, visualization solutions will be increasingly used. Especially multidimensional technologies such as radar, thermal imaging, X-ray fluoroscopy, temperature measurement, moisture measurement and gas leak detection will be given more space. This will make safety solutions more efficient. In general, the role of sensors in security applications is becoming more and more important.
[The article is based on information on www.asmag.com]
