June 2014
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Video surveillance- New Battleground for Ethernet Switch Manufacturers?

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With a maturing IT industry becoming ever more consolidated, manufacturers of Ethernet switches are looking for new market segments to diversify. A recent report from IHS points to the video surveillance industry as a potentially lucrative answer.
 
A prolonged migration from analogue to network video surveillance equipment and the continued worldwide expansion in the use of video surveillance has sustained market growth rates for networked video surveillance equipment, with current growth forecast at 21.6%. However, there is expected to be even more growth in the market for Ethernet switches that are used in video surveillance applications. In fact, IHS forecasts that this market will more than double over the next three years and top $500m in 2018.
 
Market Drivers
 
Although the majority of networked security cameras have PoE capability, end users are only just realizing the full potential due to increased homogenization between standards bodies and manufacturers. The result is that installers are now designing a video surveillance network with PoE Ethernet switches as standard.
 
The growing size and complexity of video surveillance networks also fuels growth in the market for Ethernet switches. The development of more sophisticated video surveillance networks undoubtedly puts strain on the cabling and infrastructure. As a result, unsuitable equipment can easily become overloaded. Network bottlenecks are one of the leading causes of video surveillance network problems, yet network infrastructure commands a comparatively low spend when compared to cameras and recorders.
 
Competitive Environment
 
Reliable Controls Some vendors have been quick to capitalize on growth in this market. For example, a number of leading Ethernet switch manufacturers have started producing a line of products tailored for use in video surveillance applications. Furthermore, there has been a host of new partnerships between video surveillance equipment manufacturers and networking equipment manufacturers such as a recent partnership between Extreme Networks and Milestone Systems. Such partnerships are likely to lead to video surveillance being increasingly incorporated on wider networks with more than one purpose for example telecom, IT, access control and video surveillance.
 
However, as this market matures it is likely to be become a difficult one to ignore for even the biggest IT focused switch manufacturers. Right now only a handful offer products tailored for the video surveillance market, such as Allied Telesis, D-link Corporation and Extreme Networks.   
 
Research Note from Aaron Dale, Market Analyst for IHS Inc







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