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grabs among thousands of other
companies.
Focusing in to the equipment
market shows a similar story, with
a very shallow curve to the market
share table. In all, about 40 players
in the space achieved revenue in ex-
cess of $100 million a year in 2012.
"It's extremely competitive
in every vertical, product and
region," Green explained. "You
have several companies that are
offering virtually the same product
in specification and price, yet the
highly personal nature of security
sales means that each company
can claim its own little niche
within the market."
Fragmented
With the split of Tyco Interna-
tional one of the largest compa-
nies represented in the 2012 data
into ADT, Tyco and Pentair Ltd
as separate publicly traded compa-
nies, the service market is also set
to become even more fragmented
in the near-term
future.
All this means
that consolida-
tion of the mar-
ket may not be as
inevitable as one
might expect.
"True, mergers
and acquisitions in the physical
security market are inevitable and
will happen, especially on the prod-
uct side of things, but not with
the impact you might see in other
markets," noted Green.
For a company to make
significant moves up the market
share table, it would realistically
need the combined share of five
or more existing manufacturers.
"That's just not going to happen
overnight this is not an industry
where one acquisition propels you
straight to the top."
There is still a general expecta-
tion that in the long-term future
the industry will start to become
dominated by a select few, but it
will be a much slower process than
traditional market economy stud-
ies predict.
"Yes, it defies accepted market
logic to some extent," Green
concluded. "But then at $110 bil-
lion and beating the recession, it's
hardly a typical industry anyway."
total industry revenue to reach
$170 billion a year by 2017, even
though growth rates will probably
peak before then."
Competition Rules
As the market matures, questions
are arising on whether the indus-
try will consolidate. Convention
says that as markets age, manu-
facturers will consolidate until a
select few dominate the supply, a
theory supported by many within
the industry. IHS, however, is
not convinced that this will occur
because of the huge level of com-
petition and the current fragmen-
tation of the market.
Only two entities, for instance,
broke the $2 billion level in an-
nual revenue, with both account-
ing for a combined market share
of 10 percent. Behind them,
only five other companies possess
a market share of 1 percent or
higher. In fact, the Top 15 to-
gether only just managed a market
share of just above 20 percent,
with the remainder of the market
more than 78 percent up for
Generating $46 billion in revenue
last year, North and South America
combined made up 41 percent of
the worldwide trade for physical
security equipment and services.
Asia was next with $33 billion,
followed by the collective Europe-
Middle East-Africa (EMEA) region
with $29 billion. Strong growth is
predicted in all the markets for the
next few years, predicts a find-
ing contained in the new report
entitled "Total Physical Security
Equipment and Services 2013."
At its current level, the indus-
try's annual revenue is double the
budget of the U.S. Department of
Homeland Security, and is also on
a par with the global revenue of
giant corporations such as Nissan
Motor Co. of Japan, the U.K.'s
Tesco or IBM from the United
States.
"This is an industry that man-
aged to stay strong during the re-
cession," said David Green, senior
analyst for video surveillance and
security services at IHS. "Now
with the general improvement in
the global economy, we expect
security
technology market
Competitionwillrulein$110billion
physicalsecurityequipmentandservicesindustry
The global industry for physical security equipment
and services was worth a massive $110 billion in
2012 with the Americas accounting for more than 40
percent of the overall market, according to the latest
research from IHS.
Despite the weak economic
climate worldwide, the global
market for audio and video
door phones will be bolstered
by Asia, especially through the
region's large-scale projects sector
comprising of 50 or more indoor
units, reveals the findings in the
report entitled "The Market for
Audio and Video Door Phones
World 2013."
"Growth, not just from the
emerging markets but also the
established markets in Asia, is
expected until 2017," said Oliver
Philippou, report author and IHS
market analyst for video surveil-
lance and security services. "The
expansion will be driven by the
increasing rate of urbanisation. As
lower and middle-class popula-
tions move to the cities, cheap
mass housing such as high-rise
flats will be needed. Such types of
buildings lend themselves well to
audio and video door phones, re-
sulting in an increase in large-scale
projects for these markets."
Building sector
The audio and video door phone
market is closely linked to the
construction industry, specifically
the residential building sector.
However, the tough global eco-
nomic environment has negatively
impacted the residential construc-
tion market worldwide with a
knock-on effect spilling over onto
the audio and video door phone
business as well.
Economic instability has par-
ticularly impeded growth in the
mature markets. Several regions
within the Eurozone are expected
to suffer negative growth during
the forecast period, while Japan
and North America are antici-
pated to see half the growth of the
emerging markets.
Commercial fastest
"Although large residential mar-
kets in general are expected to see
an expansion, the fastest-growing
space will be the commercial
market, driven by an increase in
investment from the private sector
as economies begin to improve.
Even so, government-funded mar-
kets are very likely to experience
tough times as austerity measures
being imposed will inhibit growth,
especially within the Eurozone,"
Philippou noted.
"The World Market for Audio
and Video Door Phones 2013
Edition" forecasts the growth of
analogue door equipment and
network door phone equip-
ment while also examining other
relevant topics related to both
audio-only door phones as well as
video door phones in greater de-
tail. IHS also produces a detailed
region- focused, audio and video
door phones report on the China
market.
Large-scale projects of audio and video door phones
in Asia are forecast to grow in excess of 9.8 percent
from this year until 2017, according to a new report
by IHS.
Marketsopentovideodoorphones