Demand for CCTV cameras soars in India

The need for safety and security in almost every segment of life has fuelled the market with an overwhelming demand for closed circuit television (CCTV) cameras. The swell in crime rates and the recent terror attacks have made sur­veillance imperative for government and private bodies alike. It can also be attributed to the massive develop­ment in infrastructure in malls, BPOs, airports, MNCs, etc. According to RNCOS’ new market research report titled, ‘Global CCTV Market Analysis (2008-2012)’, the global CCTV mar­ket will be worth US$ 13 billion by 2012, with a growth rate of 27 per cent during 2008-2012. This soaring need for CCTV cameras has translated into a lucrative opportunity for all stakeholders of the CCTV domain, including traders, manufacturers and operators of CCTV cameras.

By Himanshu Yadav

Surging popularity: Saturday, July 18, 2009: Two years ago, US and Europe had 86 per cent share in the security camera market. Today, the Asia-Pacific re­gion is also catching up, with India expecting a growth rate of 30-35 per cent. The increase in crime has made government bodies more determined to safeguard all public places like markets, airports, railway stations, university campuses and malls. The terrorist attacks of 26/11 have firmly placed transportation security and surveillance on the government’s pri­ority agenda. The hotel industry has become immensely cautious and all high profile hotels have incorporated video surveillance in their premises. The entry of multinationals has fur­ther enhanced demand, owing to their need to have infrastructures similar to their western counterparts. The proliferation of malls, too, has spurred the need for more surveillance. BPOs, banks, jewellery shops, offices, ATM machines, retail shops, educational institutions, temples, gymnasiums, almost any place one can think of, has been endowed sufficiently with this technology.

Delhi Public School, R K Puram, one of the reputed schools of the coun­try, currently has a total of 15 cameras on its premises, which comprise basic fixed focus cameras and sophisticated infrared cameras, the price of which can go up to Rs 200,000. Nowadays, the usage of video surveillance machines is not only limited to security concerns. Firms have started to view them as effective management tools as well. Surveil­lance cameras are an excellent way to constantly monitor staff activities to ensure that employees are work­ing competently. Fazil Jamil, general manager, CatVision Products Ltd, says, “Apart from the security factor, com­panies are adopting this technology to guarantee that day to day operations in offices are proceeding smoothly.”

According to Bijumon Janardhanan O, managing director, E-Bird innova­tions, “Installing security cameras and video recording systems is becoming a de facto standard as security threats are increasing. Most new establish­ments install such security items dur­ing the construction process itself.”

Malls like Select Citywalk have about 250 CCTV cameras installed on its premises, to keep an eye on the working staff as well as trouble-making, potential shoplifters and thieves.

Lovi Raj Gupta, senior dean, Love­ly Faculty of Technology & Sciences, shares, “Video surveillance proves to be beneficial in educational institutes as it helps monitor the activities of teachers as well as students. We have security cameras installed in each of our classrooms and once classes are over, 60 minutes are devoted to view­ing recorded classroom activities.”

Globus Stores Pvt Ltd, a leading retail store chain, has recently de­ployed security cameras in its South Extension (New Delhi) branch due to which, it was able to prevent a major case of shoplifting. The store chain plans to integrate the technology in its other outlets soon.

“We have recently embraced this technology to guard the safety of our guests and as per the guidelines provided by the Delhi Police, we keep a backup of 7-10 days,” shares Dipankar Das, manager, operations, Hotel Blue Stone.

Rajendar Kaul, a senior repre­sentative of Somerville School, shares an incident that led to the deployment of CCTVs in the school, “There was a fire in the institute and to avoid such accidents in future, the management decided to incorporate security cam­eras in the campus. Now, we have 200 cameras, 16 DVRs and one centralised control room managed by the admin­istration. We retain a backup of up to 15-20 days.”

Import dependency

Despite the massive demand, how­ever, there is negligible manufacturing of CCTVs in the country. The industry seems to be oblivious to the enormous potential that lies in this domain and is amply content, merely sourcing products from foreign nations.

According to Syed Ishtiyaq, busi­ness development manager, Howell Protection Systems, a security solu­tions provider, “We import because the product is available at cheap rates outside India. Countries like China, Taiwan and Malaysia are pioneers in hardware manufacturing, so their products possess the latest trends and technologies, which our customers desire. Also, the volumes are high there as they cater to the world mar­ket, which is not the case with India. There is demand here but people still need time to commence fullfledged manufacturing, as it requires huge investments.”

At present, there are only two indigenous manufacturers in this space—Samriddhi Automation Pvt Ltd or Sparsh Securitech, the first to start manufacturing in India, and Electronic Eye Systems, LLC, which has started manufacturing only re­cently. A majority of enterprises are importing components and assem­bling them in India. They purchase equipment from UK, US, Europe and China, assemble them in India and then sell the goods under their own brand names.

P K Singh, managing director, Supra Silicon System Pvt Ltd, a distributor of charged couple device cameras, explains, “Setting up a basic surface mount device plant requires an investment of about Rs 40-50 million, an intimidating prospect for most. If the volumes are not high, the cost of production is not justified and companies find it more feasible to import.”

“There are very few Indian prod­ucts in the market, so there is some confusion about whether these prod­ucts are actually being manufactured in India or not. Since no big Indian brand is engaged in production, it will take some time for people to digest the fact that a startup like ours is actually designing and manufacturing security products in India,” reveals Sanjeev Sehgal, director, Sparsh.

This abundance of advanced imported goods leaves little scope for the few manufacturers that are producing indigenously. In order to subsist, local manufacturers have to tap a much wider audience than the Indian terrain alone. They cannot rely exclusively on India for their revenue. “We have no competition with the Chinese or European products in terms of technology. They have an infinite number of modules, which local producers can’t even fathom producing. For local manufacturers, it is important to concentrate on local as well as foreign markets in order to survive,” remarks Amarjeet Singh, di­rector, Emsoniq Telecon & Technology Pvt Ltd, an importer of CCTVs.

Investments of vast proportions, want of government incentives and lack of technological advancement are some of the reasons that are withhold­ing companies from venturing into the manufacturing arena, leading to a helpless attachment to imports

Quality scores over price

There are two groups that exist in the market—one comprises smallscale buyers like factories, showrooms, etc, while the other consists of high profile clients like five star hotels, malls, BPOs, banks, etc. There is a gamut of brands for buyers to choose from—both mediocre but cheap, expensive but high quality products—are available in the market. The prices of these devices vary from Rs 1,000-200,000. For eg, Catvision Products Ltd deals with projects lesser less than Rs 100,000-200,000, whereas Supra Silicon System Pvt Ltd’s products range anywhere from Rs 6,000-80,000. Therefore, custom­ers are spoilt for choice as there is plenty to select from.

When a client contemplates a purchase, he seeks good quality in branded products, which are mostly from Europe. Customers look for af­fordable prices in Chinese products. Nevertheless, a majority of buyers give more weightage to quality over price as they feel security is a sensi­tive issue and price should not be a deciding factor.

The quality of the product and the support that a vendor is providing to the client are usually the supreme bechmarks in the purchasing process because security is not just about one product—it’s a complete solution. Training, replacement, adjustment and warranty collectively play a major role in directing the client towards a particular brand. Rasheesh Vashi, purchase manager, Globus, states, “We don’t opt for Chinese products. While obtaining quotations, quality, support and durability are what we look for.”

Choosing a product

Different buyers have different criteria for selection. The selection process of a product depends on the sincerity of the buyer. Some buyers conduct researches through thorough consul­tations with security experts, surveys and security audits, while others sim­ply buy the product online or as per vendors’ recommendations.

Jamil volunteers, “We cater to the high end segment and have executed projects for the likes of the Select Citywalk mall, The Oberoi chain of hotels, Hotel Vasant Inter Continen­tal, etc. A project like the one we did for Select Citywalk mall, which was worth Rs 13 million, requires concrete consultation and exhaustive surveying of the location. The mall authorities had their own security consultant and the project was car­ried out, based on their research and our suggestions. High profile hotels, which have become even more vigi­lant after 26/11, also hire their own security consultants, from UK and Hong Kong. They pick their products based on the consultants’ security audits and surveys.”

Share of challenges

The security camera market is bur­geoning but the industry has its share of challenges to face before it emerges victorious. There is lack of a regulatory framework. Many are still unaware of the boons of installing security products. Also, any legisla­tive support from the government for local manufacturers is missing.

Ishtiyaq laments, “There is no regulatory body to keep check on the industry’s activities, a bad situation for a business like security, which requires sincerity and knowledge.”

Sehgal adds, “Though Sparsh is growing steadily and indigenous manu­facturing has started to yield dividends, there are still numerous bottlenecks hindering wider adoption of these sys­tems. Barring the niche segment, there is a severe deficiency of knowledge pertaining to the importance of quality, reliability, and maintenance of security systems in buyers. Companies import low cost, low quality products to save cost and offer no service support and these substandard systems then fail to function or don’t work adequately, diluting the importance and useful­ness of these systems. Furthermore, the lack of legislative support for local manufacturers is also thwarting growth of indigenous manufacture.”

In terms of technology, one of the main challenges faced during video surveillance recording is the media requirement. “To store quality video recordings for three to six months is a big challenge. It is the responsibility of manufacturers to strive to reduce storage requirements and to maintain the quality of the recordings,” opines Janardhanan. “Our company is cur­rently developing a product which will provide on demand video monitoring and online recording of the video. The product is a mix of security system and IP cameras and will help in eliminating false triggering of security systems.”

In spite of these hurdles, the domestic market is flourishing and companies are noticing a climbing growth rate. Jamil says, “It’s true that the industry is predominantly disor­ganised, but as the market picks up pace, the sector will gradually become more organised and people will surely become more aware of the virtues of installing security cameras.”

“The Indian market for security solutions is experiencing a growth rate of 30-35 per cent every year and our company is expecting a growth rate of 50-60 per cent in the ensuing year,” Jamil concludes on a positive note.

Electronics Bazaar, South Asia’s No.1 Electronics B2B magazine