Memoori’s latest global report “The Physical Security Business 2019 – 2024” estimates that investment in Access-Control-as-a-Service (ACaaS) in 2019 was about $620 million and of that approximately 40% was installed in North America. Demand is expected to rise to $1.6Bn by 2024 at a CAGR of 20%. By 2024 demand for VSaaS will have reached $2.4Bn. This excludes investment in China.

Whilst ACaaS started later than Video-Surveillance-as-a-Service (VSaaS) it has already achieved a higher penetration. The main reason for this is that it requires less bandwidth, but both services have met resistance from within the traditional routes to market of access control and video surveillance products. Growth has been driven by specialist companies such as Brivo and sister company Eagle Eye Networks that provide the total service from within.

There is also evidence to suggest some integrators prefer to offer remote access control management services rather than a full ACaaS service; they claim that not all customers like cloud solutions because of high charges and doubts about security.

Managed services give them the ability to take care of the customer’s needs while they still hold “ownership” of all equipment they supplied. You can see why System Integrators would want to promote the hosted version of ACaaS, because providing the total service would require them to invest much more capital. Nevertheless ACaaS is now an attractive proposition for end user and this is the most important factor that will drive growth.

As more IP Networked Physical Access Control Systems (PACS) are installed and the technology surrounding identity validation increases its penetration, the attraction of ACaaS and Managed Services has become more appealing to end users particularly those who don’t have IT skills onboard.

With ACaaS end users no longer need to involve internal IT departments to build up and maintain servers and infrastructure at the business facility, which incurs a high price tag. With cloud-based solutions, onsite servers and appliances are eliminated; this should reduce the total cost of ownership while not losing any functionality.

ACaaS is penetrating the small to medium building sector where tenants favour a regular monthly rental payment, including service and maintenance of hardware and software, rather than pay up front the total cost. However this is a very price sensitive market and costs will have to come down if growth is to continue here.

The general consensus in the market is that end users of both video surveillance and access control as a service are now more confident that security in the cloud can be just as secure as on their premises. In addition enterprise companies are now favouring ACaaS over ownership because it is offering a much more flexible service that can keep pace with the fast moving developments in data analytics and AI Technology.

Finally the major Cloud Data Storage companies such as Amazon Web Services, Microsoft Azure and Google are investing billions of dollars in cloud services. These companies provides customers with not just storage but computing power on a pay-as-you-go basis that will analyse the data through all types of AI Analytic software delivering actionable data. This eliminates the need to pay for the storage and maintenance of servers and the high cost of labour. It should not be surprising that these companies are now targeting Video surveillance opportunities.

For more information, take a look at our latest global report on The Physical Security Business 2019 to 2024 covering Access Control, Video Surveillance and Perimeter Protection technology.