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    1. Video Surveillance

    Report: Installed base of security cameras in North America expected to reach 62M in 2016

    Aug. 31, 2016
    Despite increased camera shipments, many suppliers are experiencing erosion in their profit margins

    Source SecurityInfoWatch.com

    (Graphic courtesy IHS Markit)
    This graphic shows the growth of the installed base of security cameras in North America over the past five years.
    This graphic shows the growth of the installed base of security cameras in North America over the past five years.

    According to new data from IHS Markit, the installed base of surveillance cameras in North America is expected to grow from just 33 million in 2012 to nearly 62 million by the end of 2016. The research firm notes, however, that the security camera product mix is changing.

    For example, network cameras, which accounted for only 17 percent of the total installed base in 2012, are expected to account for 34 percent of the market by the end of this year. In addition, high-definition CCTV cameras, including HD-CVI, AHD and HD-TVI, have seen a significant rise in adoption, growing from less than 1 percent of the installed base in 2012 to almost 13 percent in 2016.

    According to Niall Jenkins, consulting manager for building technologies at IHS Markit, the shift if the market was primarily driven by several factors including:

    • Camera price erosion is driving up shipments in North America. The average selling price of a network camera in 2015 was estimated at around 45 percent of the historic peak, which means buyers can afford to purchase more cameras per installation and expand camera installations more frequently.
    • The emergence of HD analog products is engaging a new, lower-end market. Retail and commercial installations are now able to install small video surveillance systems more cost effectively while still benefiting from HD resolution.

    Jenkins said that despite the increase in cameras shipments that it is still a challenging time for the video surveillance industry. As would be expected, lower priced products have eroded some suppliers’ profit margins, especially when it comes to IP products. In addition, while annual camera shipments are expected to increase through the end of the decade, Jenkins said some regional markets are becoming saturated. For example, he said the North American market has moved from having a rate of 11 people per installed camera in 2012 to six people per camera in 2016.

    “There is a growing realization that the industry needs to identify new use-cases, technologies, customers and emerging markets, in order to continue to grow the installed base of security cameras into the next decade,” wrote Jenkins in a research note.