Pascal, thanks for sharing this, though I do not see how this addresses the real issues in their report:
- Their growth projections are radically out of line with any one else who has any sense of this industry. How do they account for that? What do they know or what are they projecting that enables them to project a CAGR of 2x more than anyone?
- What experience do they have in this market? Who is doing this report?
If you want to sucker outsiders with this 'research', maybe it's worth a try but the report has no grounding in reality.
This figure is very important to our business and I went straight to Allied Market Research to challenge them about this figure. It was part of a thread on LinkedIn and they allowed me to reproduce their answer here. Tx for your feedback based on this.
The report published by Allied Market Research titled- IP Video Surveillance and VSaaS Market (Technologies, Applications, Services, Geography) - Industry Analysis, Trends, Share, Opportunities and Forecast, 2012 - 2020 provides information about growth potential of the market for global players and researchers. The report delivers key intelligence about future trends in IP surveillance market. Traditional surveillance systems are not competitive with respect to capabilities of flexibility and scalability and ultimately results into increasing cost of the systems. Moreover, the capacity of conventional storage device is also less. IP surveillance system eliminates the problem of flexibility and scalability due to its compatibility with existing infrastructure of the companies. Additionally, the storage capacity of the cloud based solutions currently used in IP surveillance systems is comparatively high. IP surveillance system delivers system intelligence facility with the help of video analytics and video management software. Requirement of higher bandwidth to transfer HD real time data and cost of IP camera are acting as restraints to increase adoption of IP surveillance. This report segments the IP surveillance market based on products, applications and geographies. This report encapsulates company profiles of ten leading companies dealing in IP Surveillance systems namely, Avigilon Corporation, Axis Communication AB, D-Link Corporation, Genetec, March Networks, Milestone Systems, Panasonic Corporation, Mobotix AG, GeoVision Inc. and Arecont Vision."
Agree, and thank you for your kind comment, John.
Peter, what March is doing is adding a cloud interface / layer to their 'regular' hardware / recorders. See: March Cloud Service Reviewed. They are not alone. The concept is to simply take the traditional architecture and add a 'phone home' component to make it easier to access video from wherever the user is (instead of VPNs or holes in firewalls, etc.). Ultimately, there will be mixed offerings, with video primarily on site but with cloud access and optional cloud storage. But as you said, given bandwidth limitations and storage costs, 100% cloud storage is something that is far far off for the mainstream market.
Thank you, John.
I thought it had more of the flavor of hosted services like Axis Hosted Video Service. I do not hear much about managed video surveillance as a service. On the other hand, I hear a lot on the managed access control service, etc.
I know MarchNetwork provides Managed VSaaS, but it looks almost like out sourcing video surviellance as a whole. Maybe I am wrong.
Peter, it depends what we count as VSaaS. There are some obvious things, like monthly fees that (very few) people pay to Axis Hosted Video Service partners. Then there are more questionable ones - like if a DVR/NVR manufacturer adds cloud connectivity for remote viewing, do you count the whole cost / price of the appliance itself?
From the context of your question, I believe you are referring to hosted video, not managed. I believe IMS was saying it was over $100 million but that most of that was coming from China, some huge Chinese government type offering.
For regular hosted video, things like AVHS, Dropcam, etc., I think the numbers will remain very inconsequential compared to the rest of the market.
Then what would be the realistic estimation on the VSaaS in the near future?
I am rather skeptical VSaaS in general, mainly due to the reason that there is no way ISP is letting this happen because of the liability on the network going offline, and the bandwidth consumption on their network backbone.
Correct answer for 44.3% per year, every year for 7 years is a 13x increase in size.
Let's assume Asia / Pacific is a $3 billion surveillance market today. By 2020, it would need to grow to $39 billion for the projection to be accurate. Even assume it is $2 billion today, it would still need to grow to $26 billion. That type of immense growth (for that long) is only possible for totally greenfield markets, where hardly anyone has any type of the product.
If you want to see another crazy CAGR / market size example, see: PSIM to be Worth $2.79 Billion? Tricks Exposed
No, not at all. The good news is that we now have a new champion for the most outrageous projection, topping ABI's 2007 project of the video surveillance market being $46 Billion in 2013 (yes, that did not come true).
This new report, from Allied Market Research, is a joke. It's wildly beyond anything that anyone is projecting and is from a company who has zero track record in this market.
One really crazy element is this:
"Asia Pacific is expected to grow with highest CAGR 44.3% during analysis period 2013-2020."
To grow an average of 44.3% per year, every year for 7 years, means that market will increase by how much?
Need a calculator, try this. I'll leave the correct answer in the comments later. Bottom line, though, is that it is assuming growth far far beyond and far longer what anyone else is projecting or even wishing. It's essentially impossible.
Contrast to IMS, see our discussion on them here. At least, they have (very junior) people in the market, trying to get accurate and realistic numbers.
Bottom line, the only people who should use this $57.3 figure are vendors who want to impress the ignorant.