IP Camera Market Size and Growth Examined

Author: John Honovich, Published on Jul 04, 2011

One of the most hotly debated topics is the size and growth of IP cameras - both because of future potential and the corresponding fear of analog's death. In this note, we examine various growth projections and provide recommendations on how to best make use of these forecasts.

Let's start with a review of key data points:

  • Approximately 2 Million network cameras shipped globally in 2010 (Yano Research)
  • Approximately $1 Billion USD global network camera sales in 2010, growing to $2.8 Billion USD in 2014 (IMS)
  • By contrast, analog projected for 4.6% CAGR globally and -2.6% CAGR in America from 2010-2014 (IMS)
  • We estimate that IP camera revenue is approximately 30% of the total camera revenue, implying that analog revenue is $2 - $2.5 Billion for 2010
  • In 2009, we projected a 200% increase in IP camera sales between 2010 and 2012 (for a CAGR of 44.2%).
  • Pure play IP camera companies including publicly traded Axis and Mobotix as well as privately held Arecont, Avigilon and Vivotek growing at 30%+ rates (IPVM financial updates)

Currently, we are in the middle of a major shift to IP cameras with sales and market share moving from a niche status (i.e., 2008-2009) to mainstream status - today.

One other important point in analyzing the market is the impact of China which heavily skews the overall sizing and recommendations. For instance, the Wall Street Journal, citing IMS, reports China surveillance market size as $1.7 Billion in 2010 and growing at 23%, far ahead of the single digit growth in the US and Europe. The $1.7 Billion figure is for overall surveillance, not just cameras. However, that is still approximately 20% of the global market that is deploying a far greater percentage of analog than the rest of the world.

Factors to Consider

Projections on IP camera growth are difficult because they embed important and, often, controversial assumptions. Here are the key ones to consider:

  • How successful are IP cameras in replacing analog?
  • How much is the overall demand for cameras growing?
  • What is the general economic outlook?
  • What region of the world are you considering?

Here's our advice on navigating them:

  • Regions: Since most of our members are in (or sell primarily to) the US or Europe, we will focus here.
  • Replacement Success: We view this as high. The clear majority of new projects in both Europe and the US are choosing IP cameras and almost always including megapixel in those deployments.
  • Overall Camera Demand: We see this as weak, slightly better than the overall economy's growth but likely to remain in the single digits. Cameras are relatively saturated in most of the US and Europe. Plus, anti-terrorism initiatives and support are generally declining.
  • General Economic Outlook: We see this as weak with high votality. Ultimately, this will depend on one's own view. However, it is very likely that a new recession would trigger a major drop in camera sales (10-20%) and disproporitonately so for IP cameras.

IP Growth Rate Must Fall

In the next few years, it is essentially inevitable that IP camera's growth rate will fall. More precisely, it will converge with the overall camera market growth rate as IP becomes the dominant camera type sold.

Unless the global market for surveillance camera starts growing at 20%+ rates, IP camera growth rates will start declining under 20% by the middle of the decade. This is inherent due to saturation. When IP camera sales were a small portion of the market, it was easy to grow 40-50% annually. Now that IP camera sales are approaching 50% of all camera sales (in the US for instance), it will not be able to grow that fast by simply replacing analog. There's only so much left to replace even if you could replace all of it (which is not feasible).

Outlook

As long as the global economy holds up, we believe IP camera sales will remain solid (20%) for the next few years. However, the 2010-2011 will likely be the peak growth years with IP camera growth rates steadily declining as market saturation and replacement occurs.

Comments : PRO Members only. Login. or Join.

Related Reports

Security Sales Course Summer 2018 on Jul 13, 2018
Based on member's interest, IPVM is offering a security sales course this summer. Register Now - IPVM Security Sales Course Summer 2018 This...
Eastern and SavvyTech Merge, Form ENS, Targets ADI on Jul 09, 2018
ADI, ENS is coming for you. Or, at least, they hope. Two US distributors, NY based EasternCCTV and California based SavvyTech have merged, to...
Arlo IPO Filing Reveals Key Financial and Competitive Details on Jul 09, 2018
Arlo is going to IPO at a projected valuation greater than Axis. Now, Arlo has released their 175-page Form S1 Registration Statement for its...
Drops Dahua, Fenner Becomes ISS CMO on Jul 09, 2018
Hired to improve Dahua's miserable marketing just last year, Janet Fenner has quit Dahua, joining VMS manufacturer ISS as Chief Marketing...
Pelco Is For Sale on Jun 27, 2018
Pelco is for sale, being shopped by an investment bank, IPVM has confirmed from multiple sources. The company, acquired by Schneider Electric in...
Snap Surveillance Profile on Jun 26, 2018
There are not a lot of video surveillance companies that survive 9 years with only one feature that makes their product stand out. In the case of...
ASIS GSX Show Struggling Getting Exhibitors on Jun 26, 2018
The show formerly known as ASIS, now GSX, is less than 3 months away. And it is struggling to get exhibitors to go back to Las Vegas, just...
Buy Arecont: Top Bid $10 Million Cash on May 22, 2018
Last year, Arecont had a deal for a purchase price of $170 million (see Failed Arecont China Acquisition). This year, Arecont has a deal for a...
Stealth / UCIT - Remote Video Monitoring Provider Profile on May 18, 2018
Can 2 remote video monitoring companies, Stealth Monitoring from the US and UCIT from Canada combine to impact the market and compete in a changing...
ADT Stock Drops 50% Since IPO on May 17, 2018
It has been a brutal 4 months for ADT. They first expected to IPO at ~$18. They IPOed at $14, dropping immediately to $12.39 And now, not even...

Most Recent Industry Reports

Amazon Ring Alarm System Tested on Jul 16, 2018
Amazon Ring is going to hurt traditional dealers, and especially ADT, new IPVM test results of Ring's Alarm system underscore. IPVM found that...
Hikvision Wins Chinese Government Forced Facial Recognition Project Across 967 Mosques on Jul 16, 2018
Hikvision has won a Chinese government tender which requires that facial recognition cameras be set up at the entrance of every single mosque...
Installing Dome Cameras Indoors Guide on Jul 16, 2018
IPVM is producing the definitive series on installing surveillance cameras. This entry covers one of the most common scenarios - installing dome...
Security Sales Course Summer 2018 on Jul 13, 2018
Based on member's interest, IPVM is offering a security sales course this summer. Register Now - IPVM Security Sales Course Summer 2018 This...
US Tariffs Hit China Video Surveillance on Jul 13, 2018
Chinese video surveillance products avoided tariffs for the first two rounds. Now, in the third round, many video surveillance products will be...
Last Chance - July 2018 IP Networking Course on Jul 12, 2018
Registration ends today, Thursday. Register now. This is the only networking course designed specifically for video surveillance...
4 Most Difficult Camera Installs (Statistics) on Jul 12, 2018
Heavy housings, cumbersome brackets, heavy ladders required, and tricky field of view requirements will cause difficulties no matter the camera...
Axis Perimeter Defender Video Analytics Tested on Jul 12, 2018
Axis 'high security' video analytics offering is Perimeter Defender, OEMed / developed with Digital Barriers. But how good is Perimeter Defender?...
Hikvision Fights Ban - Claims 'Red Scare', Hires 14 Term Ex-Congressman on Jul 11, 2018
Hikvision is fighting back against the House Bill Ban of their products. Hikvision has hired one of the biggest lobbying firms, led by a 14 term...
Arecont Acquisition By Costar on Jul 11, 2018
Arecont Vision acquisition by Costar Technologies has been approved by the court, concluding the bankruptcy process triggered by Arecont's...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact