IHS estimates revenue for both internal and external HDDs in video-surveillance applications will rise from $638.7 million this year to $1.0 billion by 2017, a remarkable 57 percent increase. Growth this year alone is forecast to reach 23 percent from 2012 revenue of $521.1 million, and double-digit-percentage revenue expansion will ensue each year for the next four years.
IHS finds the revenue figures translate to 7.3 million units in shipments by 2017, up from 2.4 million units in 2012 and a projected 3.5 million units this year.
“The HDD industry as a whole will reap the benefits of a fast-growing video surveillance industry that requires ample storage, with the need for higher-quality video, network connectivity and cloud storage also driving the market,” said Fang Zhang, analyst for storage systems at IHS. “At present, internal HDDs that combine storage capacity with the recording system in one unit have a larger market than external HDDs in which the drive is separate. Shipments of HDDs for internal storage were higher than those for HDDs in external storage during 2012—a feat that will be replicated this year.”
The other findings and suggestions from IHS includes:
Products on the market today that use internal HDDs for video surveillance include internal direct attached storage (DAS), enterprise digital video recording (DVR), box appliance network video recorder (NVR) and PC-based network video recorders.
Next year, however, the tables get turned permanently as external storage HDD shipments take the lead. From a 48 percent share of the market in shipments last year of the total HDD space for video surveillance, external HDDs leap over internal HDDs in 2014 with a slight majority of 51 percent share of the market. And while internal HDDs continue to retain a viable portion of the market, external HDDs will keep gaining in the market with their share hitting approximately 54 percent by 2017.
Internal vs. external storage
While internal storage is a cost-effective way of storing video data, external storage boasts larger capacities that can be added flexibly to a system as the need arises.
External storage also has more versatile applications as it can be connected or viewed anywhere, such as in the cloud, where the potential for external storage is plentiful and abundant. The capability of external systems to scale and accommodate large amounts of video data is one reason why more hard disk drives will be needed in the coming years, pushing both shipments and revenues up. Another reason is that high-quality video itself will demand more storage space, which also will help boost HDD use in video surveillance.
All told, total HDD shipments for video surveillance will grow at a compound annual growth rate of 29 percent from 2012 to 2017, with revenue likewise increasing at a lower but still-solid rate of 14 percent during the same period.