Novaira Insights research finds global video surveillance market impacted by China slowdown

New research from Novaira Insights reveals that the global video surveillance market declined by 3.4% in 2022 due to a massive 18.6% decline in the Chinese market.

However, the research, also shows that outside China, most markets continued to grow. The market in the world excluding China grew by 13.2% in 2022.

A decline in Chinese markets

According to Lead Analyst and Founder of Novaira Insights, Josh Woodhouse, “The decline in China was primarily the result of lockdowns causing restrictions on business during 2022 waves of the COVID pandemic."

He adds, "In the public sector, Chinese Government spending was diverted away from areas such as video surveillance, and towards battling COVID-19 and supporting the economy during the lockdowns. Restrictions lasted much longer than many observers had anticipated with the Chinese Government finally only easing its “zero COVID” policy in December 2022.”

Video surveillance equipment stats

Outside China, the market grew quickly in 2022 as vendors continued to serve pent-up demand

China is estimated to have remained the world’s largest regional market for video surveillance equipment, accounting for 44% of the world market in 2022. However, this is a reduction from the previous year when it accounted for 52%.

Outside China, the market grew quickly in 2022 as vendors continued to serve pent-up demand caused by the abnormal business climate and shortages caused by the COVID-19 pandemic.

Inflation in 2022

However, in 2022 it was general inflation that led to higher prices for video surveillance hardware, and this played a role in higher market revenues. With utility prices, labour, and raw material costs all rising quickly, many video surveillance vendors passed on cost increases to their customers.

Most regional markets grew quickly, with the highest growth in 2022 measured in India, the Middle East, and North America.

The supply base

There were also still hundreds of suppliers of video surveillance equipment in 2022. However, four of them accounted for half of the global revenues (Hikvision, Dahua, Axis Communications, and Motorola Solutions). 

The Chinese vendors, Hikvision and Dahua, dominated supply in China and still retained leading or high market shares in most markets outside China. Nevertheless, they both continued to lose share in the USA with tariffs and trade restrictions playing a major role.

Cloud video surveillance (VSaaS)

Cloud VSaaS revenues accounted for an increasing proportion of the total video surveillance software and services market

Cloud video surveillance continued to be one of the highest growth categories and this was driven by the North American market. Here, the installed base of cloud-connected cameras increased by over 80% in 2022.

Cloud video surveillance SaaS revenues accounted for an increasing proportion of the total video surveillance software and services market, closing the gap on the proportion of the market accounted for by traditional on-premise video surveillance management software licences and associated software service agreements.

Market outlook

The world market for video surveillance equipment is forecast to return to growth by the end of 2023 as the Chinese market recovers. In the world excluding China, market growth is forecast to slow slightly in 2023 as inflation eases in many countries.

The combined effect means that the world market for video surveillance equipment is forecast to grow 11.8%, making it worth over USD 27 billion in 2023.