In this abridged preview of one of the key articles in our February edition, distributed in print and digital formats towards the end of January, Kevin Hilton reports that although supply chains and installations were disrupted in 2020, some technological changes already underway were accelerated as the market adapted to a new way of working.
At the beginning of 2020, there was optimism that digital signage (DS) was consolidating its position and seeing improvements in the sector compared to 2019. New technologies were starting to have more influence and competition was increasing as newcomers began to take business from more established companies. In his introduction to the Digital Signage Summit (DSS) during ISE last February, Florian Rotberg, managing director of invidis consulting, observed: “The market is still growing and there are a lot of opportunities.”
Even as the DSS was taking place, the impact of Covid-19 was already being felt in the West. For the DS sector this potentially meant shortages in component supplies due to the shutdown of manufacturing plants in China, although most companies had stockpiled to cover the expected closure of factories over the Chinese New Year. Rotberg warned that the situation could disrupt display production and “cascade” through 2020.
This prediction appears to be borne out by research by Futuresource, showing that quarter three of 2020 was 24 percent down on the same period in 2019. “The DS market is undeniably under pressure and was suppressed in 2020 due to the effects of COVID-19,” explains Martin Cooke, market analyst for displays. “The market saw a slight recovery in quarter 2 when countries opened up after the first lockdown and projects that had been delayed or postponed because integrators could not get to site could be fulfilled. However, there are few new projects being signed off at this time, so the future remains uncertain.”
The forecast is even starker from AV and integrated systems trade body AVIXA. Its 2020 Industry Outlook and Trends Analysis expects digital signage revenues to decline by approximately 11 percent to $31bn. “The pandemic is the overall cause,” comments senior director of market intelligence, Sean Wargo. “Both hospitality and retail, the core markets for signage, have faced major declines in business. But we do expect growth to return in earnest in 2021 as revenues rise by seven percent.”
However, although the coronavirus pandemic has affected manufacturing and installations, it has provided a new role for signage, which, through the application of emerging technologies, can only become smarter and even more a part of everyday life.
“The DS market hasn’t grown as much as expected but it’s stable and advancing steadily,” says Tom Fenton, senior business development manager for Europe, the Middle East and Africa (EMEA) at display mount and kiosk specialist Peerless-AV. “The pandemic and necessity to work remotely has had a positive impact on technology that has been trying to get into the market for some time. Most notably this applies to video conferencing. Covid has forced us to test and implement the technology quicker and under more strain but platforms such as Zoom, Microsoft Teams and WebEx have proved themselves invaluable for continued business collaboration, which had led to a growth in peripherals.”
The full version of this article will appear in our February edition.