security technology market The $19.9 billion video surveillance market threatened by the corona virus London, UK The corona virus outbreak has had only a minimal impact on the video surveillance market so far, but the risk of falling demand and a potential production bottleneck is spurred by labour and component shortages in China, according to Omdia, the newly formed research company following the merger of Informa Tech and the IHS Markit technology division. Production of video surveillance equipment is heavily concentrated in China, with the country accounting for 90 percent of global production of video surveillance cameras, and 45 percent of worldwide global market revenue in 2019. As a result, the analysts suggest that any corona virusrelated disruption to production, supply chains or workforces in the country could have a significant impact for a global video surveillance market totalling $19.9 billion in 2019. “Given China’s status as the world’s largest producer and consumer of video-surveillance cameras, the country wields a proportionately massive influence on the global market for these products,” said By Tommy Zhu, senior analyst, video surveillance, at Omdia. “Video surveillance equipment suppliers in China currently are contending with reduced production because of a lack of manpower and delays following the Lunar New Year. Meanwhile, domestic demand for general-purpose video surveillance products is likely to cease or suffer delays as the Chinese government focuses on corona virus control.” Production delay With the lockdown of Hubei province, severely affected neighbouring areas—such as the cities of Beijing and Shanghai, and the provinces of Guangdong, Zhejiang, and Jiangsu—are taking various measures to control the spread of the epidemic. One such measure was the extension of the Chinese Spring Festival holiday— initially set to end Jan. 30—to Feb. 2, with a majority of the country’s provinces, municipalities and autonomous regions ordering businesses not to reopen until at least Feb. 10. A 14-day quarantine is also being imposed on specific sectors of the population affected by the outbreak. Meanwhile, companies that needed to start work after the holiday were ordered to obtain permission from the government, and employees were encouraged to work from home as much as possible. “While these labour issues Production of video surveillance equipment is heavily concentrated in China, with the country accounting for 90 percent of global production of video surveillance cameras. have had only a minor impact so far, if the epidemic continues to spread and infections rise in number in the second quarter, the effects of the corona virus on video surveillance hardware supply will be severe, not only in China but worldwide,” Zhu said. Logistical nightmares Transportation and logistics issues are having a huge impact on the supply of video surveillance equipment, given the backlog incurred before the Spring Festival, combined with new restrictions in travel and transport in place both domestically and internationally due to the corona virus. Component supplies China is home to several major suppliers of lenses, CMOS sensors and system-on-chip devices used in cameras and other video surveillance devices. These companies have now gradually returned to work after the Spring Festival holiday. However, staff shortages are possible because the epidemic may reduce the output of various components, even as the full impact of the virus is yet to be determined. On the flip side, the major video surveillance equipment vendors are the top clients for video surveillance component suppliers, and supply to video surveillance is likely to be prioritised. Looking forward In the best-case scenario, Zhu believes that with the epidemic successfully contained by the end of March and the disruptions reduced by April, the impact of the virus on the video surveillance market will be minor. However, if the epidemic continues to spread and infections rise in number in the second quarter, then the effects of the corona virus on the video surveillance industry and on many other markets will be severe. …and the smart home market expected to fall $20 billion short London, UK Amid the continued fallout of the coronavirus crisis, the global smart home market is expected to fall nearly $20 billion short of revenue expectations in 2020, according to Omdia. The global smart home market will total $101.1 billion in 2020, down from Omdia’s previous forecast of $120.6 billion. Smart home device shipments are now projected to reach 603.5 million units in 2020, down from the earlier forecast of 693.8 million. The smart home market consists of devices that have digital connectivity and act as part of a smart home, including appliances, security systems and climate and lighting control. “Due to the vast number of products available, the smart-home market tends to be more resilient in the face of economic challenges like corona virus compared to other, less-diversified industries,” said Blake Kozak, principal analyst at Omdia. “Nevertheless, the smart home market is expected to undergo a correction during 2020, where growth will slow for most countries.” Regional ramifications Asia is forecast to see the biggest slowdown in 2020, with a downward revenue revision equating to $7.8 billion and 66.2 million fewer shipments than originally forecast. In the Americas, the smart home device revenue outlook has been reduced by 10.6 percent. Device growth in the United States is forecast to remain stronger than other countries. Growth projections could be further reduced if stock markets do not rebound or if the virus spreads to influence U.S. supply chains. Overall, despite the diversity of smart home ecosystems, supply chain challenges combined with a restrained consumer market and installation and service delays could further slow adoption of smart home technology in 2020. Security News Every Day – www. securityworldmarket.com 8 • d ete ktor internati onal