classic | mobile
Follow us on:
Follow us on Facebook  Share via Twitter  Share via LinkedIn

Hi-Tech Security Solutions Business Directory
Residential Estate Security Handbook 2017

Someone’s doing business
March 2018, News

It’s hard to say if 2017 was a good or bad year for the security industry. For some companies it was a booming year, but for many it was one of just making it through to the end. Recent research from Memoori states that the total value of physical security products “at factory gate prices in 2017” was $29.2 billion. This represents an increase of about 5% on 2016.

While not a top performing year, 2017 was better than the past year or two on a global scale. Memoori says the past eight years has seen the market growing at an annual CGR of 6.41%, and the company expects the market to reach $41.27 billion in 2022, a CAGR of 7.2%.

The access control market was the best performer, producing about 7% in growth to capture a healthy 23.5% of the total physical security market. Intruder alarms command a 22% presence, but with lower growth (2.5%), and the surveillance market rules the roost with 54.5% of the market, but again with lower growth (5.9%). If you’re interested in the report, you can buy it at

So what is happening in the local market that saw so many companies taking strain over the past year? The first culprit must be the political situation which came to a head in December and has shown more positive signs in the first two months of 2018 than we have seen in years. The uncertainty kept many wallets shut with a ‘wait and see’ attitude taking precedence over doing what was necessary.

There are other reasons, however. What is known as the ‘race to the bottom’ had an impact as well. Today we see companies selling large numbers of devices at very low prices, making it especially hard for the traditional market leaders to maintain their pricing and revenue streams. Some have managed, others not so well.

There is nothing wrong with pushing the prices of technology down as the end user benefits at the end of the day. There is a problem when it is done in a way that is unsustainable and that damages the industry in the long term.

One of the problems lower prices create is that the middleman – the installer and integrator – is caught between a rock and a hard place. They can’t make much margin on products (if any), some even go so far as to sell cheap technology at a loss in the hopes of getting a deal and making some money on services. The result is poor service, poor support and rushed jobs in the pursuit of a profit.

We can also see poor skills becoming a problem because training is too costly. Even free training is too costly because technicians on a course are unproductive for however long they are away from the office or customer sites.

Yet we still have the race to the bottom and customers seem to love it as they save on the initial costs. But perhaps we should see the race to the bottom as commoditisation of a technology. Taking this approach (which is simplistic, as it doesn’t cater for all the market factors) leaves the traditional technology leaders in a position of having to add value – and unfortunately the definition of value can differ broadly. They need to start looking more closely at their total cost of ownership (TCO) and return on investment (ROI).

This issue of value is why we are seeing companies spending money on cybersecurity, IoT (Internet of Things), integration, automation and artificial intelligence – to name a few. Customers don’t want more megapixels, they want results and if the value you deliver helps them get those results, you have a foot in the door. Then all you have to do is deliver.

Andrew Seldon


Supplied By: Technews Publishing
Tel: +27 11 543 5804
Fax: +27 11 787 8052
  Share via Twitter   Share via LinkedIn      

Further reading:

  • CCTV isn’t just CCTV anymore
    April 2018, Technews Publishing, News
    Sometimes it seems as if the world of surveillance is similar to the world of IT programming. Companies don’t want to hire new staff with no experience, nor do they want to spend the money training staff ...
  • The question of value
    April 2018, Technews Publishing, This Week's Editor's Pick, CCTV, Surveillance & Remote Monitoring, Cyber Security, Integrated Solutions
    How do you know your surveillance installation is delivering value? Do your service providers deliver value?
  • Beyond the hype: tomorrow’s surveillance, today’s reality
    April 2018, Technews Publishing, This Week's Editor's Pick, CCTV, Surveillance & Remote Monitoring, Cyber Security, Integrated Solutions, IT infrastructure, Conferences & Events, Training & Education
    iLegal 2017 once again lived up to its reputation and saw a host of presenters offering insights and advice into a range of aspects related to the surveillance world.
  • Are you not entertained?
    April 2018, Technews Publishing, News
    You will notice that your parcel from Hi-Tech Security Solutions this month is a bit larger than normal. In addition to the April issue you will also receive the CCTV Handbook 2018, consisting of 104 ...
  • South Africa joins global artificial intelligence community
    March 2018, News
    Global non-profit organisation City.AI welcomes South Africa as a new member of its City.AI community. The first Cape Town City.AI event will take place on 27 March 2018.
  • MiRO adds ZKTeco products
    April 2018, MiRO Distribution, News, Access Control & Identity Management
    MiRO has added the ZKTeco range of IP access control solutions to its growing portfolio.
  • Augmented identity takes shape
    April 2018, News, Access Control & Identity Management, Integrated Solutions
    Idemia recently held its launch event in South Africa, to introduce the new company and clarify its focus on augmented identity going forward.
  • Dahua launches consumer brand Lechange
    April 2018, Zhejiang Dahua Technology, News, CCTV, Surveillance & Remote Monitoring, Products
    Dahua Technology has launched a range of consumer products under the Lechange brand.
  • Super Recognisers International trains first super recognisers worldwide
    April 2018, News, Conferences & Events, Training & Education
    A group of UK police officers, including internationally renowned Mike Neville who were involved in initiating and running super recognition projects within the Metropolitan police have now set up Super Recognisers International as a private initiative.
  • Milestone appoints new VP for EMEA
    April 2018, Milestone Systems, News
    New Milestone VP to boost growth in the EMEA region and drive innovation in the partner community.
  • Milestone focuses on performance and privacy
    April 2018, Milestone Systems, News, CCTV, Surveillance & Remote Monitoring
    With the latest update of Milestone XProtect 2018 R1 video management software, Milestone introduces client-side hardware acceleration with NVIDIA and enhanced privacy masking.
  • IDS Pretoria is open for business
    April 2018, News
    IDS has announced the opening of its new branch in Pretoria, expanding its geographical footprint across South Africa, driven by customer need in the Tshwane region.

Technews Publishing (Pty) Ltd
1st Floor, Stabilitas House
265 Kent Ave, Randburg, 2194
South Africa
Publications by Technews
Dataweek Electronics & Communications Technology
Electronic Buyers Guide (EBG)

Hi-Tech Security Solutions
Hi-Tech Security Business Directory (HSBD)

Motion Control in Southern Africa
Motion Control Buyers’ Guide (MCBG)

South African Instrumentation & Control
South African Instrumentation & Control Buyers’ Guide (IBG)
Terms & conditions of use, including privacy policy
PAIA Manual
    Mobile | Classic

Copyright © Technews Publishing (Pty) Ltd. All rights reserved.