23 Mar 2021

The Growth of Cloud-Based Services Since the Pandemic

There is no doubt that COVID-19 has changed the way we work, consume and live. More and more is happening online.

Since the pandemic struck in 2020, working hours from home have increased by 150 percent. Naturally, this has created an increased need for cloud services.

Here is where companies like ACRE’s Vanderbilt see an opening to expand cloud services, with an improved security value where specific individual needs can be met more simply and cost-effectively.

Alex Holmström, Global Sales & Marketing Director for ACRE International, explains: “In 2021, end-users' expenses for publicly available cloud-based services are expected to increase by more than 18 percent. Therefore, the importance of cloud solutions for the security industry cannot be underestimated.

Software-as-a-Service (SaaS), which can generate recurring revenue for system integrators and vendors, is an ongoing trend that is now also being felt in the physical security market,” he says.

System installers and integrators can now switch to a service-based business model that provides recurring subscription-based monthly revenue through the cloud. For instance, instead of just selling traditional security systems, alarm center services and offering traditional service agreements, they can now offer full-service concepts via open platforms where system health checks, cybersecurity functions, and other professional services can be included.

Holmström believes that we have only seen the beginning of the development. In particular, he refers to Gartner's latest report, in which companies' SaaS purchases in 2020 are estimated at 105 billion dollars.

“More and more companies realize that cloud solutions can be effective in solving new challenges,” he states. “The expected annual global growth is 15 to 20 percent in the foreseeable future for physical security solutions as a service.”

Due to the pandemic, many integrators are applying a new business model based on a business that delivers remote services and offers new and more advanced functions than before. However, Holmström is clear that it is not the pandemic that started the cloud trend:

“The pandemic did not start this trend. It merely accelerated it. Instead, this trend’s origin can be traced back to the benefits for the end-users. These benefits also benefit the supplier level too.”

SaaS and cloud-based business ideas enable integrators to develop stronger contact with the customer. The flexibility and scalability of cloud solutions also make it easier to efficiently deliver solutions and services tailored to customers' specific needs and challenges.

“The strong partnership with the customer creates good conditions for more business,” Holmström concludes.