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Frost & Sullivan predicts global shift to outsourcing security
London, UK
New analysis from Frost & Sul-
livan entitled, Analysis of the
Global Managed Security Services
Market, finds that the market will
be around USD 66.25 billion
in 2012 and estimates this to
increase to USD 139.10 billion
by 2021. The research covers two
key service segments: physical and
IT security.
The increasing complexity
of both IT and physical security
requirements for commercial and
government organisations will
drive a shift towards outsourcing
security to managed security ser-
vice providers (MSSPs). Adopting
an outsourced model reduces the
need for in-house provision and
can provide the most cost-efficient
approach to an organisations'
security.
"In current times, many
organisations remain highly cost-
conscious, motivating them to
outsource their security require-
ments and reduce operating
costs," noted Frost & Sullivan
Aerospace & Defence Research
Analyst Anthony Leather. "Even
while security remains a priority
for organsiations, chief decision
makers are looking to the industry
to provide them with the most
advanced security solutions at the
most competitive prices."
The growing threat and com-
plexity of attacks, especially in the
IT segment, is spurring greater
investment in new and existing
solutions to ensure both physical
and network security. Shifting
security operations to MSSPs
enables organsiations to outsource
progressively more complex secu-
rity requirements to the experts,
while focusing on their own core
business processes.
While there are cost-efficiencies
to be gained through a security
outsourcing model, some organisa-
tions still prefer to keep security
in-house. This allows them to ad-
dress issues immediately, without
relying on outside companies.
"A common concern among
security managers is the wide
range of companies that MSSPs
have to monitor," added Leather.
"This might result in the untimely
handling of security breaches or
incidents."
Focusing on the larger markets,
such as North America and
Europe where outsourcing security
services is a more accepted prac-
tice, will help build market share
and a strong customer base for
companies. This trend is expected
to spread to other regions, with
Asia Pacific anticipated to experi-
ence the highest growth in the
next ten years.
"As MSSPs become more estab-
lished and demonstrate high levels
of security with excellent customer
service, organisations will become
more comfortable with outsourc-
ing security services," concluded
Leather.
Vietnam set to be fastest growth market
Wellingborough, Northamptonshire (UK)
In its first edition report on the
South East Asia video surveillance
market, IMS Research forecasts
that the Vietnam is fastest growing
market between 2010 and 2015.
At a compound annual growth
rate of 22.3 percent over the
forecast period those are certainly
impressive figures, however, it
should be noted that the market in
Vietnam was estimated to account
for less than 10 percent market
share in this region in 2010.
South East Asia is comprised
of not only developed markets
like Singapore, but also new
emerging markets like Vietnam
and Indonesia. In these emerg-
ing markets, the government
is continuing its investment in
infrastructure and industry devel-
opment. For example, Vietnam
recorded a year-on-year GDP
growth rate of 7.7 percent for the
industry and construction sector
in 2010. Its aim is to become an
industrialised and modernised
country by 2020.
Cheryl Li, report author and
research analyst at IMS Research
comments, "The highest priorities
for Vietnam are transportation,
energy, irrigation and urban de-
velopment projects. For example,
about 600 kilometres of roadway
construction is planned by 2015;
the existing railway will be up-
graded; and several international
airports and electrical plants will
be developed. All these projects
create huge demand for security
products and systems."
Li continues, "Import tax has
been as high as 30 percent 35
percent in Vietnam; therefore
many European and American
manufacturers did not focus
on this market. After entering
the World Trade Organisation
(WTO), Vietnam has reduced
import tax, which has attracted
more companies to this market.
Most of the governmental projects
use network video surveillance
systems; therefore the network
equipment market is forecast to
exceed the analogue market by
2012 in Vietnam."
IMS Research's recently
published report, The South East
Asia Market for CCTV and Video
Surveillance Equipment - 2012
Edition provides more incisive
analysis for each of the follow-
ing countries in South East Asia
region: Singapore, Malaysia,
Thailand, Philippines, Indonesia
and Vietnam.
China surveillance market maintains momentum
Wellingborough, Northamptonshire (UK)
In its latest report on the Chinese
video surveillance market, IMS
Research estimated that the market
was worth $2.6 billion in 2011, an
increase of more than 30 percent
over 2010. A key driver of this
growth was the network security
camera market.
City surveillance and trans-
portation are the largest end-user
industries in China. However, as
economic growth slowed in 2011,
investment in city surveillance
also declined. In the second half
of 2011, a number of high-speed
railway construction projects were
stopped or delayed due to financ-
ing difficulties caused by the global
financial crisis. As a result, growth
in the analogue video surveil-
lance equipment market started to
slacken.
Cheryl Li, report author and
research analyst at IMS Research
comments, "Due to the increas-
ing demand for high resolution
images, network security products,
especially network cameras, gained
market share in 2011. In fact,
network camera revenue increased
130 percent in 2011. In addi-
tion, the growth also benefited
from the increasing number of
participants in the market. It
should be noted that competition
also reduced pricing, which is an
important element in the market."
Li continues, "High definition
is a definite trend for the video
surveillance market in China over
the next few years. Besides net-
work security products, HD-SDI
products also gained greater atten-
tion. However, HD-SDI products
are still expensive, and lack of
a complete HD solution in the
market. As a result, we estimated
that it only had limited shipments
in 2011."
China's GDP growth is targeted
at 7.5 percent for 2012, marking
the first time the figure has dropped
below 8 percent in the past eight
years. However, the government
is continuing its investment in the
western area, which may create
new opportunities in end-user
industries, such as city surveillance,
airports and railways. In this latest
China video surveillance market re-
search, IMS Research forecasts that
the market will grow at a relatively
high compound annual growth rate
(CAGR) of 20 percent over the
next five years.