Video surveillance and access control suppliers have continued to build up VSaaS (Video Surveillance as a Service) & ACaaS (Access Control as a Service) services over the last decade and recently major IT companies have invested heavily, targeting the physical security business. Now the supply structure is in place, these services are poised for significant growth and mainstream success.
The technology required to deliver these services has overcome limitations and reduced total cost of ownership. At the same time suppliers are winning over system integrators to adopt cloud services and this has also provided a significant boost to growth. Product manufacturers also see this route as one that could help to alleviate some of the pressure on margins.
Existing owners of video surveillance and access control systems who will need to upgrade their operations in the next few years will no doubt pay serious consideration to cloud services.
Our latest global report “The Physical Security Business 2019 to 2024” estimates that the market size for VSaaS in 2019 was approximately $1.2Bn. Most forecasts now predict that it will grow at a CAGR of 20% over the next 5 years which we think is too optimistic; more like 15% reaching $2.4Bn in 2024, but growth accelerating as it reaches 2024.
Growth should continue well into the next decade as prices fall and more end users turn to “security as a service”. VSaaS should deliver the most value across many applications. We have already noted that all of the world’s major IT companies are expanding their cloud services fast, including Amazon, Apple, Google and Microsoft, driven by the anticipated demand from a number of sources including ACaaS and VSaaS.
VSaaS was launched in the late 2000’s with many commentators predicting that within 5 years it would be a multi-billion market. Whilst it failed to deliver against this target, in the last 4 years it has broken through a number of roadblocks. New technology features have helped the service deliver major improvements. These include upstream bandwidth availability and the relative cost of centralised storage, whilst bandwidth prices have fallen, and peak speeds have been increasing, making VSaaS potentially more viable in a larger range of applications. Smart CODECs and the introduction of H.265, can reduce the amount of bandwidth the cameras consume, potentially overcoming the bandwidth cost and data cap barriers.
A major value propositions for clients is that VSaaS is continually monitored 24/7. Paying through a monthly service charge ensures failures are fixed promptly so reliability improves. This should ensure that the quality of the video is satisfactory for forensic purposes and that all aspects of usability, (like how do I retrieve the video and share it) are taken care of.
These value propositions look favourable to companies with large building estates. However such organisations have been reluctant to risk outsourcing and have already invested significant sums of money in their own equipment and staff to operate it. When this equipment becomes outdated they will become prime candidates to move over to VSaaS.
Currently most believe VSaaS offers the small and medium building sector the most attractive proposition for buyers because they would rather pay a monthly fee for this service and reduce their upfront capital expenditure.