The global home security systems market size is valued at USD 53.6 billion in 2020 and is expected to reach USD 78.9 billion by 2025, at a CAGR of 8.0% during the forecast period. The growth of the home security systems market is driven by factors such as growing awareness regarding home security systems, the emergence of the Internet of Things (IoT) and wireless technologies and increasing adoption of IP cameras for video surveillance amid COVID-19 crisis.
Covid-19 impact on home security system market
The pandemic COVID-19 has severely impacted the growth of the global home security systems market. Global sales are expected to decline by 5–10% in this fiscal year, depending upon the progression of the virus spread. The impact of COVID-19 on major markets such as the US and China has been significantly adverse, as supply chain disruption in China has resulted in a decline in the demand for home security systems. The decrease in the number of new construction projects and the closure of manufacturing facilities are some of the factors affecting the demand in China. The market in the US is expected to show stronger growth in comparison to other countries in the Americas region. Still, a decline in the adoption of security systems in the short term and ongoing trade tension with China are expected to affect the growth of the home security systems market in the region.
Market dynamics
Drivers: The emergence of the Internet of Things (IoT) and wireless technologies
The emergence of IoT has led to the development of miniaturized sensors and actuators and low-power wireless communication technologies. Besides, the growing adoption of the internet, tablets, and smartphones is paving the way for the introduction of IoT in home security, with the use of smart applications. The IoT has enhanced the quality of products and the consistency of automation systems. Mobile devices and the web act as an interface for the connection of security systems to the cloud; the integration of home security systems with cloud helps in remote monitoring of homes or other infrastructure. The recent advancements in smart sensing and actuating devices, and relevant communication technologies such as Bluetooth Low Energy (BLE), ZigBee, and ANT have eased the integration of IoT in home security systems. The successful integration of the IoT network, which facilitates remote, real-time, and automated monitoring of the home environment, has helped in the development of smart homes. Thus, the wireless technology-enabled security systems are among the major advancements in the field of home security solutions and IoT, which are widely preferred by the homeowners to ensure effective protection. The wireless access to several security options, such as access control, and fire and gas detection systems, offers flexibility, convenience, and assurance to consumers. Wireless control over the smart home devices has increased consumers’ likelihood of purchasing these devices.
Restraints: High installation, maintenance, and operational costs
The high cost associated with the installation and maintenance of home security systems is expected to be the key factor limiting the growth of the market. Customers are increasingly becoming aware of the benefits of home security systems; at the same time, they are skeptical of making investments since the prices of security systems are still not affordable for many consumers. Expensive hardware and cost of ownership have hampered the adoption of home security systems. Expensive hardware and consultation regarding the use of these systems increase the installation cost. Moreover, the cost of ownership will be even higher as it includes maintenance charges, monitoring subscription fees, the replacement cost of parts, as well as installation costs. The monthly subscription fees charged by third-party monitoring players range from USD 150 to USD 1500. In addition to this, the cost incurred by residents installing home security systems varies with customization demanded to add extra features and services, such as two-way communication, smart video monitoring (including AI and other advanced image sensors), and cellular back up. Moreover, the software installed in the home security systems for advanced analytics is expensive, which also adds to the overall cost of security devices
Opportunities: Implementation of artificial intelligence (AI) and deep learning in home security systems
The introduction of security solutions based on data-driven machine learning and AI is the emerging trend in the home security systems market. The intelligent virtual assistants (IVA), such as Alexa and Google, have already been integrated by companies in different home security systems. The surveillance cameras today use AI and deep learning to empower security with more reliability and accuracy. For instance, Hangzhou Hikvision Digital Technology (China) launched DeepinView Camera Series enabled with the deep learning feature to provide accurate and consistent video content analytics (VCA) performance. The key benefits of this new technology include human body detection, facial recognition, people counting, and vehicle management. The AI-based deep learning and computer vision predict the occurrence of a crime before the actual event. The system can recognize the owners of the house. It learns the residing family’s daily routine, especially with the families having frequent visitors, and any unusual event. AI powers the surveillance cameras enabling them to analyze live video.
Challenges: Disruption in the supply chain due to the COVID-19 pandemic
Major Chinese manufacturers of home security systems are headquartered in Hubei province, the epicenter of the pandemic, impacting domestic vendors such as Hikvision, ZKTeco, and Dahua with labor shortages and production delays throughout the country.
The effect the coronavirus will have on the global supply of security equipment will largely depend on how the situation in China stabilizes and by when the factories resume operations. Furthermore, the chances of a trade war between the US and China have led many American suppliers to stockpile products and components manufactured in China cautiously.
Video Surveillance Systems to dominate the home security systems market
Video surveillance systems accounted for the largest market share of the market. Video analytics enhances the performance of video surveillance systems through real-time event detection, post-event analysis, and statistical data extraction while saving manpower costs and increasing the effectiveness of the surveillance system operations. Video analytics algorithms may be implemented to analyze recorded video, which is a challenging and time-consuming task for a human operator, especially in cases where the volume of video data to be removed is huge. Through the rapid analysis of a recorded video, video analytics can pinpoint an event in the recorded video and retrieve the relevant video segment from the stored video.
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