Strong Outlook For 2019

Author: IPVM Team, Published on Nov 29, 2018

Integrators are bullish for 2019, with nearly 80% showing a positive outlook in our integrator results from 160+ respondents:

integrator outlook 2019

This is almost exactly in-line with the 2018 outlook we reported last year.

Business Health and Strong Pipelines Lead Perceptions Again

Similar to last year, many projections were based on business analysis, citing growth, pipelines, backlogs and forecasts:

  • "Positive. Expansion into Texas in 2019, getting traction in Ontario finally."
  • "Positive we have bid large amount of grant dependent work"
  • "Positive, even if an economic downturn hits there is enough need and long term projects in motion that we should see a good 2019."
  • "Positive. We have a large backlog of projects and strong pipeline heading into the year. The general economy continues to expand."
  • "Positve, its only a matter of much work we can handle from an operational standpoint"
  • "Positive - we are growing and seeing more and more people wanting high end security in commercial and industrial spaces."
  • "We have a very positive outlook on sales for 2019 just based on the budgeting we have been doing in the last few months for our customers. We have a 50% increase in budgetary pricing over last years which leads us to believe a big increase in projects for next year."
  • "Very positive, cameras are increasING job wise"
  • "Positive, business is booming. New construction is way up in our area."
  • "There is a lot of work in the pipeline that will eventuate"
  • "Positive. Each year we grow by 20-30% and add more staff, more trucks, more customers. We are exploding on every metric possible. Partly the industry as a whole is expanding, partly we are doing a great job! :)"
  • "Positive, larger projects signed into the 3rd quarter of 2019 and many more requests for upgrades from existing clients"
  • "Positive. A lot of large projects coming on the horizon."

Technology Providing Opportunity

Overtaking economic optimism only slightly, the anticipation of new technology whets the appetites of many integrators seeing new opportunities with new products.

  • "Positive. Gotta think that way. New products and technology coming out."
  • "Positive, technology is on the uprise and there is a trend for higher quality systems."
  • "Positive. New staff is coming out with solutions and for reasonable price, people have many for testing it."
  • "Positive, security is becoming a much more acknowledged industry - people can see direct benefit of the products, and instead of reactive work a lot of it is going to be proactive, New GPU generation out and GPU's are becoming cheaper which means we will be getting more horsepower out of analytics"
  • "Positive. Technology is always evolving which gives us more opportunities reach a broader client base."
  • "Positive! Resolution increasing, options such as intelligent analytics gaining ground, all while prices are decreasing."
  • "Positive Looking forward to continued advancements in IP cameras with larger imagers and low light performance. If we did residential, we'd definitely be all negative with all of the DIY options."
  • "Positive growth as stated newer technology in wireless and analytics"
  • "positive I am a specialty company working with emerging technologies and some of the investments done a year ago are now trending mostly in interactive remote video"
  • "Positive: Technologie is growing fast and the need of security too."
  • "Positive. Every year brings new and exciting products and opportunities. This year we will focus more on hardwired & wireless networks."

There were detracting opinions about technological development being stagnant or requiring validation that led to a number of neutral outlooks:

  • "Positive we want to grow but we are limited by the quality of tech available"
  • "neutral as i don't see any major products or technology emerging"
  • "Neutral, progression is not growing by leaps and bounds anymore. Until the department of defense allows some of the military tech to trickle down to civilians our growth will stay constant."
  • "Neutral. Just some background, I am a System Integrator. While i’m excited about the new technologies, i feel that more testing will need to be done to validate these marketing claims."
  • "I think the last couple years introdcued the next focus areas around analytics for the next couple years and there will be a neutral 2019 while the top players are cultivated."
  • "Neutral. I do not see anything new in trade shows."

Enthusiasm Over Economy

As with last year, the economic outlook was a large influence on integrators' own outlooks for the coming year.

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  • "POSITIVE - THE LOCAL FINANCIAL AND COMMERCIAL CONSTRUCTION MARKET IS BOOMING"
  • "Positive, it seems like the market is increasing and the economy is good. Also, unfortunately constant threats of mass shootings linger, which is causing more folks to increase there efforts for protective measures."
  • "Positive. Business growth is creating more need. We have discovered a few niche markets which are currently underserved and feel that we can meet these needs."
  • "Very Positive especially if there is a Red Wave on election day. Tax cuts mean more spending and more spending means better economy."
  • "Positive. unless some cataclysmic event disrupts it, the economy will continue to expand and the demand for better security systems will, too."
  • "Positive, business is booming. New construction is way up in our area."
  • "Positive... Strong economy floats all boats..."
  • "Very positive. As the local economy is travelling well there is a continuous stream of greenfield sites being developed and security is a major item. We are still busy migrating analogue systems to IP. We have seen no downturns in the last 12 months."
  • "Positive. I'm always positive :) Our economy is growing, so we will have more orders."
  • "Very positive economy is booming"
  • "Positive. Business has been great and our local economy is great."

Tempered With Some Skepticism

There are some that don't see the economy through the same scope and express differing opinions:

  • "Positive in terms of my own business, but worried about overall economic conditions. Think the ecomomy is due for a sharp downturn within the next year or so."
  • "Neutral. We're having a great run but it can't last forever. I'm anticipating a decline in economic fundamentas by the end of 2019."
  • "Neutral. With indications of a global recession, the market will become tougher. Whilst clients will have less money to spend, concerns/crime rates may increase, meaning clients will have to spend. Makes selling into the market more difficult as client expectations increase without increasing budget."
  • "Neutral. Economic conditions are mediocre."
  • "Neutral. Too much uncertainty in the economy."

Proactive Business of Prevention

Concerns about crime, terrorism, and liability were mentioned in a lot of positive outlooks:

  • "Improved, the lack of trust in the country is driving more people to security"
  • "Positive, time are getting bad with unlawful people."
  • "Positive, it seems like the market is increasing and the economy is good. Also, unfortunately constant threats of mass shootings linger, which is causing more folks to increase there efforts for protective measures."
  • "Positive. The increase of attacks throughout on public and private entities has seemed to increase and it has prompted companies that may not have had a need for security to now budget for it."
  • "2019 looks positive. Our fed and municipal gov business is looking better with requirements for updated technology, tax base increases providing room, cyber awareness driving fears, and it seems general increased awareness of technology/manpower offsets."
  • "Positive. The culture of fear being pushed by the U.S. Government will have people seeing threats behind every bush."
  • "Positive, as security continues to be a major concern for many companies."
  • "The outlook for 2019 is positive. Home and business owners are more aware of the value of having video surveillance cover their properties to monitor traffic and deter or detect potential problems. The advancement in video analytics and imaging capabilities allows integrators to better meet their clients expectations and the cost of equipment to provide the features and functionality customers are looking for are leveling out. The industry is growing and bringing more scrutiny along with new regulations but that’s healthy for the industry as a whole because it provides structure, stability and consistency."

Price Concerns In Retail & DIY Segments

Downward pricing was mentioned by a handful of respondents, most commonly associated with retail and DIY segments of the market:

  • "Neutral to Negative. The DIY market will explode making it difficult for many Dealers to convince clients that "Service", still means something. Also, Customers have many resources to shop around.Even if they are not DIY personalities, this will impact profits more than it already does. Taking a job because it will keep your team busy usually costs you. However, retaining Clients and keeping them updated on new technologies is paramount."
  • "Neutral. Seeing lots of pressure from some customers on pricing. The race to the bottom has been seen by the consumer side also. We are seeing a real division between customers now"
  • "Neutral. Opportunities are there but increasing prevalence of bean counters in virtually all large projects means there is little scope to demonstrate quality and well-engineered solutions. Brexit is a big unknown and the arsehole globally known as Trump is creating massive trade barriers internationally that affect raw supply costs and currency instability."
  • "Positive Looking forward to continued advancements in IP cameras with larger imagers and low light performance. If we did residential, we'd definitely be all negative with all of the DIY options."
  • "Neutral. We will balance our residential losses by increasing commercial sales and doing hybrid DYI."
  • "Neutral - Security cameras are desired and required more now than ever but the cost to provide this is sliding down while overhead costs are rising."
  • "Positive, that said, prices continue to tumble"
  • "Positive, technical security market is expanding in Serbia. We are focused in delivery only of quality and renominate brands. Though invasion of chines brands, AHD and cheap systems are also overflowing our market."
  • "Negative. Prices dropping too much. Build out reaching peak utilization, just leaving new construction/upgrades, and upgrade are averaging a 50% price reduction. Example: we just upgraded a school district's DVRs for the second time in 6 years. The original install was $250k about 11 years ago; the first DVR upgrade 6 years ago (about 30 units) was $50k. The one this year was (34 units) $23k."
  • "Positive, although I see downward pricing pressures."

However, there are some who see the light at the end of that tunnel already:

  • "Neutral. There's a mix of very positive and negative trends, netting out as probably neutral for those companies large neough to have both trends within their business. There will be more equipment sold at slightly higher prices due to the Hikvision, et al, debacle. There will be shift in focus of what equipment is included in security projects. The K-12 video, access, intercom mix will continue. There will be increased scrutiny and competition of project proposals, measurable performance results which will favor integrators with solid / tested product offerings and have higher level solution designers on staff. IPVM's technical evaluations is in part a stimulus to this trend."
  • "Very positive. Trend has been that clients are already thinking big picture and less driven off a cost model."
  • "Positive. While overall the market seems to be trending towards cheaper and cheaper technology, there is still a contingent of people ready to spend money for quality, which is keeping me optimistic."

China Fallout

Finally, a handful mentioned positively the fallout of the US ban and overall China issues:

  • "There will be more equipment sold at slightly higher prices due to the Hikvision, et al, debacle. There will be shift in focus of what equipment is included in security projects."
  • "Positive, hopefully cheap Chinese cameras will go away."
  • "2019 is looking like a great year. With the negative light shed on Dahua and Hikvision, as well as the companies they OEM for, we have a better chance of getting into small business."
  • "Positive. The move away from Chinese manufacturers will be good for American companies."

With a few expressing positive sentiments towards Chinese products:

  • "I think we will continue to see growth of Video Surveillance, outpacing Intrusion and Access control. The only negative thing I see is how S2 will blend with Lenel and how far the HikVision Anti-Gov issue will run."
  • "Positive, hopefully the tariffs will go away..."
  • "Positive. With Hikvision, I can make money, sleep at night and configure remotely."

2 reports cite this report:

The 2019 Video Surveillance Industry Guide on Dec 10, 2018
The 300 page, 2019 Video Surveillance Industry Guide, covers the key events and the future of the video surveillance market, is now available,...
AV Tech Company Profile on Dec 07, 2018
Taiwanese manufacturer AV Tech's revenue declined ~70% since 2012. Planning a comeback, AV Tech spoke to IPVM about their opportunities and...
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