In 2016, the European pro AV market was worth $42 billion, according to a new InfoComm International study.
This is a drop of 4% from 2015, says HIS Markit, the analyst firm InfoComm hired to conduct the research.
The study predicts a compound annual growth rate (CAGR) of 4% through 2022, which is approximately an additional $10 billion in revenue.
Contraction finally gives way to growth
What's changed since the 2014? A lot, starting with the recession's effect on spending.
"In 2016, industry value contracted in Central Europe, Eastern Europe and Western Europe," the report says. "Relative to the industry's 2014 value, Central, Eastern and Western European revenues shrunk by 7%, 7% and 4% CAGR, respectively.
"Scandinavia is the only European sub-region to have grown from 2015 to 2016. Scandinavia's monetary independence, coupled with its intrinsic propensity to adopt new technologies, largely explains the sub-region's ability to buck neighbouring, contractionary trends."
The report predicts that through 2022, the rest of the European sub-regions all will resume growing. Although Western Europe will continue to drive about 70% of the region's proAV market, its CAGR through 2022 will be 3%. By comparison, Central and Eastern European AV revenues will have respective CAGRs of 7% and 9% through 2022.
A variety of factors are driving those numbers. Besides general economic trends, there are also industry-specific ones. For example, declining flat panel prices are helping grow the digital signage market.
"So we have a relatively bright outlook," Tom Morrod, the HIS vice president overseeing the reports, told InAVate.
Flat panel segment grows at projections expense
"The single largest technology evolution is coming from the replacement of projectors by professional-grade flat-panel displays," the report says. "Between 2014 and 2017, while the video displays market grew by 26%, the video projector market lost 40% of its value. The loss of $3 billion in projector sales was only offset by a gain of nearly $800 million in display sales."
The sector is still bottoming out, but there's light at the end of the tunnel because display sales continue to boom.
"We're going to start seeing a lot more displays in a lot more places because the price point can drop so much lower than the projection price point," Morrod says. "Projection will become very niche."
Services opportunity remains strong.
Services are another opportunity, with the report predicting compound annual growth of more than 4%.
"Through 2022, we anticipate that lighting systems will grow by 24% on average, year on year, driven largely by installations in retail, consumer high-end systems based around smart home and more complex systems in education and care environments," the report says.
Continued demand for energy efficiency and the rise of smart buildings will spur a lot of that growth.
"There's very, very significant investment that will run at least through our forecast period," Morrod says.
The rest of the report can be seen in the June copy of the InAVate magazine – the rest of the report outlines other areas of industry growth and where the growth is coming from.
