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The world market for professional video surveillance equipment grew by 3.9 percent in 2016, despite a drop in camera prices, according to recently published estimates from IHS Markit through its Video Surveillance Intelligence Service.

“This is a higher rate of growth than in 2015 (1.9 percent) but still low by historical standards,” Jon Cropley, principal analyst, video surveillance, IHS Markit, said in the announcement.

IHS forecasts a slightly higher growth in the global market for 2017—at 5.5 percent—and as a result, the world market will be worth $16.2 billion in 2017.

Accounting for more than 40 percent of global revenues measured in U.S. dollars, the Chinese market grew by 7.2 percent in 2016, according to IHS, which noted that exchange rate changes did play a role in suppressing a higher calculated growth in that currency (as the average annual exchange rate of the Chinese Yuan Renminbi to the U.S. dollar fell by 6.6 percent in 2016). In the report, Hikvision took the top spot in several categories.

“The world market excluding China grew by just 1.6 percent in 2016,” Cropley pointed out. “Demand for security cameras grew rapidly but prices fell considerably, affecting revenues. In fact, revenues declined in a number of countries.”

IHS also found that the supply base for professional video surveillance equipment is gradually becoming more concentrated, although it remains highly fragmented compared with supply to many other markets.

“The top fifteen vendors accounted for 58 percent of revenues in 2016,” noted Cropley. “In 2016, a number of Chinese vendors continued to gain market share rapidly in regions outside China. They tend to offer products with low prices and this has been a major factor in average price erosion in those regions.”

The report also found that 59 percent of all security cameras shipped in 2016 were network cameras, and shipments of HD CCTV cameras more than doubled. Less than 1 percent of network cameras shipped were 4K-compliant, according to IHS.

                                                              

Reference: http://www.securitysystemsnews.com/blog/camera-demand-growing-prices-plummet