AV Magazine
Spain has emerged from recession to offer new opportunities while Italy lags in digital, both are strong in digital signage but state budget decisions may have an impact.
According to a preliminary look at InfoComm’s new Industry Outlook and Trends Analysis report, prepared by IHS Markit and due for publication after AV Magazine went to press, after a few years of a slightly contracting pro-AV industry in Europe, the market is expected to grow slightly in 2018 then maintain a steady, though modest, growth rate through 2022.
Not all countries in Europe will accelerate at the same time at the same pace, according to the IOTA report. Italy and Spain are not expected to return to positive growth in pro AV until 2019, and the Portuguese market will turn higher in 2020. In all cases, the market in these countries will then grow at roughly the same pace as the rest of Europe overall and Western Europe in particular – around four to six per cent per year.
As for technology trends, the report indicates a couple of significant market drivers. Sales of flat-panel and direct-view display technology appear set to nearly double in all three countries by 2022. Interestingly, a move to newer light sources will grow the market for fixed and portable lighting fixtures significantly by 2022. Also, in Western Europe in general, sales of control systems are expected to increase significantly, while sales of video projectors and projection screens are poised to fall.
Spanish expansion
After a long downturn, Spain’s economy has experienced steady year-on-year growth and is now rated as one of the fastest expanding in the Eurozone. The pro-AV market has mirrored these encouraging results.
“Pro AV is a growing market, maybe slower than the country’s overall economy, but with more room now for medium to large projects than three to four years ago,” reports James Kennedy, operations manager, Peavey Commercial Audio. “Many existing projects require an update with new technologies. Private investment has grown dramatically in the last two years, too.”
The current economic and business situation is very similar to France, finds Dan Ly, director of sales, southern Europe for Peerless-AV. “AV business is mainly managed by a number of smaller specialist AV companies. We feel that this may start to change over time as the local economy recovers and the AV and IT channels merge and more IT resellers take a share of the AV business.”
Like many companies, Maverick experienced a few difficult years in Spain due to the financial crisis. 2016 was a turning point, according to Joan Aixa, the distributor’s local director. “Markets such as digital signage consolidated, promoting growth in sales of professional monitors by over 30 per cent. This has helped minimise the negative impact of a reduction in the sales of AV products into educational settings, which was a result of the low investment in public tenders creating approximately a 60 per cent decrease in the sale of IWBs.”
For Maverick, the largest opportunity lies in the renovation and equipping of meeting rooms. “Being able to videoconference with your colleagues and collaborate in realtime is no longer a luxury limited to some managers, but a necessity and an obligation on the part of the company in offering these indispensable tools for all team members.”
At B-Tech Iberia, international sales manager Paul Haggarty says so far this year the market is buoyant. “However, there may be a slowdown in investment as inflation is predicted to jump and the unpopular minority-led government looks to tackle the public deficit with a range of spending cuts,” he warns.
Crestron too believes Spain is now a growth market “with corporates and international companies in particular investing in collaborative products,” says Christophe Malsot, regional director, Southern Europe. “Although residential remains flat the hotel industry is also helping our development in country with meeting room and common area AV.”
Haggarty suggests economic recovery has been consumer-led, a strength indicated in the retail integration sector. “Spain has been at the forefront of retail design innovation,” he says. “The growth in digital signage applications for in-store marketing, visual merchandising and shop window displays, has been phenomenal.”
Aixa agrees that retail represents a great opportunity. “Spain is one of the leading countries in fashion retail, a fast-changing and highly demanding sector,” he says.
Large number of start-ups
Creativity in local companies is considered strong as demonstrated by the large number of start-ups or smaller outfits innovating technology in sectors such as digital signage software and IoT solutions for retail. Spain also has strong public investment in sectors such as education – when there is a budget.
“Public investment has a direct consequence in the renovation of AV facilities in the classroom in private, concerted and non-regulated schools,” says Aixa. “At the same time, Spain has a business network mainly made up of SMEs, which makes it difficult and slow to implement large projects and escalate the adoption of new technologies.”
National brand Desigual has adopted AV to raise awareness and drive ROI in a competitive market. Peerless-AV finds digital signage for quick service restaurants is also growing and says it recently delivered a large volume of menu board mounts for a major international fast food chain in the country.
“Alfresco dining is incredibly common so there’s a greater opportunity to reach audiences with targeted messaging using high bright outdoor display solutions,” says Ly. “Transport and tourism are other verticals where we’re seeing interest in outdoor for wayfinding and ticketing applications.”
“Spanish companies are always keen to demonstrate their creative flair,” submits Haggarty. “Strong digital media content is always a priority. If the budget permits, then there is a tendency to opt for premium software to go alongside reliable hardware.”
Spain’s commercial audio focused solutions are typically within shopping malls, hotels and open spaces – another consequence of the Spanish way of life. A good example, highlighted by Peavey, is the Fan Mallorca Shopping Mall where the proprietor invested €400,000 in equipment.
“The biggest challenge is to maintain this momentum,” says Haggarty. “Spain has definitely committed to modern AV technologies but if investment dries up then there will no doubt be a slowdown. Inevitably then, projects will become more price sensitive.”
Italy’s two economies
Broadly speaking, the country is comprised of two economies – the north is the business and industrial powerhouse, whereas the south is driven by tourism, agriculture and manufacturing. In cities such as Milan, Turin, Venice, Bologna, and in general across the north of Italy, the focus tends to be on staging and rental applications due to the number of car exhibitions, fashion shows, and international conventions. In central and southern Italy, AV is mainly tourism-related at historical sites and related museums.
“No matter where you are in the country, communication and demonstration is key,” says Claudio Ceroni, director at MecTech (a Dataton Premium Partner). “You have to get out there and talk to clients or potential users, face to face. That’s why we do lots of demonstrations – roadshows, for example – which bring together people from different fields of activity.”
The Italian rental market “thrives” due to prestigious corporate events and high-class weddings as Italy is a popular choice for couples from around the world, says Kennedy. “These types of events often allow for creativity through budget so the AV and lighting solutions are typically well engineered and imaginative.”
Private sector
Government investment in AV for education, health and transport is lagging. However, the abundance of private sector projects in digital signage for retail, corporate, banking, sporting and entertainment venues “will eventually convince the Italian treasury to re-think its AV plans going forward,” suggests Haggarty. “The main issue is that the industry feels there’s an under-representation of high-level technical staff. End-user awareness of what is available needs to be raised. Otherwise project decisions are driven by cost over solution and value.”
A much larger market than Spain but economic recession is having a negative impact on most industries and the pro-AV market here is no exception.
“Generally speaking, the market is quite good even if now we see something of a go-slow,” reports Ceroni. “Many projects in the pipeline are on hold waiting for changes in economic or political conditions before being realised.”
“The AV industry is optimistic, confidence is fairly high and sales are stable but cashflow and credit remain a concern,” is Haggarty’s take.
“Both public and private money appears to be in short supply for high tech fixed installation projects,” finds Kennedy. “Commodity box sales for simple solution projects does still exist in the corporate AV sector, for example, but budgets are being squeezed in this market too. On the upside, the rental market is in full swing accommodating the tourism and financial industries with weddings and corporate events.”
The biggest vertical is again retail signage, however it’s slightly more complicated in that “it is concentrated on small to medium sized artisanal retailers compared to Spain,” reports Ly.
Unfortunately, budget cuts are hampering what Kennedy calls the “perfectly engineered solution” within the permanent installed market. The overall effectiveness and functionality of a solution is considered more important than the creative side of things. Indeed, modern AV technology in permanent installs has not penetrated Italy to the same degree as some neighbouring countries.
Virtual reality, for example, is yet to make an impact although there are some good examples of video mapping solutions.
Nonetheless, the Museo del Suono is an interesting scientific application in partnership with Parma university. It features a 3D-VR audio solution expressed in three different technologies, including the ‘Lampadario Sonoro’ or sonic chandelier which can generate several audio sources dancing around, up and down your head, according to Kennedy.
On the other side of the road, Casa del Suono hosts an ambisonic studio which boasts an impressive 3D audio experience. “These are perhaps the only places you can find so many different approaches to 3D audio in this market,” remarks Kennedy.
Milan is Italy’s tech capital and where you’ll find the most prestigious and advanced projects such as the audio systems at the Duomo di Milano (Milan Cathedral).
“Rome seems to have constraints in spending with regards to the larger sectors such as corporate, hotels and leisure, although TV and themed entertainment are more affluent,” suggests Kennedy.
The biggest and boldest AV systems are to be found in the various theme parks scattered around the country, such as Etnaland in Sicily, Rome’s Cinecittà World, Gardaland in Verona and Mirabilandia in Ravenna.
The maritime market is significant, with plenty of active vessel and yacht building companies which, of course, require extensive AV solutions. Creston earmarks the private yacht sector as a growth market.
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