As the telecommunications industry continues to evolve, value-added services (VAS) have become a crucial driver for business differentiation, customer retention, and new revenue streams. Initially, telecom operators provided basic services such as voice and data, but with the rise of digitalization, they began offering more advanced services, leading to the development of VAS. Integrating VAS Platforms, including VSaaS, allows operators to create ecosystems that offer customers a comprehensive solution—from basic telecom services to sophisticated security and analytics systems. This contributes to longer customer retention and higher average revenue per user.
Key Stages of VAS Platforms Evolution:
- Early Beginnings. VAS initially included services like entertainment, information, and mobile apps, allowing telecoms to expand revenue beyond basic offerings.
- Cloud Transition. As cloud tech advanced, the “as a Service” model became popular, reducing upfront costs and enabling continuous updates.
- The Rise of VSaaS. The introduction of cloud-based video surveillance solutions brought scalability, flexible payments, and integration with AI analytics, revolutionizing the security industry.
Over time, the introduction of cloud technologies and AI has transformed how these services are delivered, leading to the rise of Video Surveillance as a Service (VSaaS).
AT&T, Verizon, Vodafone, and Orange have already demonstrated successful VAS implementations in their portfolios. In particular, the integration of video surveillance as a service (VSaaS) enables them to transition to subscription models and build long-term customer relationships.
AT&T and Verizon (North America) are actively deploying cloud-based video surveillance solutions for the corporate segment. Project examples demonstrate reduced operational costs and improved response times thanks to centralized management and real-time analytics.
Vodafone (Europe) is a part of smart city pilot projects, using VSaaS for integration with urban management systems. This not only enables the monitoring of public safety but also optimizes transportation and infrastructure by combining data from other digital services.
Chinese Operators (Asia) actively support government-backed smart city initiatives to integrate VSaaS into national security systems. Such solutions often involve large-scale projects with thousands of cameras consolidated into a unified analytics platform.
Modern Trends Driving Growth:
- Increased Security Demand. As cybersecurity threats rise, the need for video surveillance systems to monitor public spaces and facilities grows.
- Cloud Adoption. VSaaS significantly reduces costs by leveraging centralized cloud services, making it accessible even in regions with limited infrastructure.
- AI & IoT Integration. AI-powered analytics, including facial recognition and anomaly detection, are now standard features, enabling smarter surveillance systems.
- Smart Cities. Governments are investing in digital infrastructure, using VSaaS as a key component in managing urban environments.
Market and Investment Dynamics
The rising popularity of Video Surveillance as a Service (VSaaS) is not only driven by technological advancements but also by substantial investments from both telecom operators and investors.
- Decreasing Cost of Cloud Technologies
- Increased Demand for Integrated Solutions
- Active Development of AI and Analytics Technologies
- The Need for Enhanced Security Amid Digitalization
The VSaaS market is experiencing an annual growth rate of 15-20%, with investments focused on modernizing infrastructure and integrating cloud-based surveillance solutions. The shift from CAPEX (capital expenditure) to OPEX (operational expenditure) is a key driver, reducing the financial burden for clients and increasing the scalability of services.
Key Investment Trends for VSaaS
North America and Europe
Major players like AT&T, Verizon, and Vodafone are investing millions of dollars to modernize their video surveillance systems. For example, AT&T has allocated around USD 75 million for cloud-based surveillance solutions, with VAS Platforms improving operational efficiency and reducing costs for their corporate clients.
Major operators such as Vodafone have invested between EUR 30–70 million in smart city pilot projects and the integration of VSaaS into urban infrastructure. Frost & Sullivan reports note that the total investment in the cloud-based video surveillance segment in North America could reach USD 300–500 million over the next 3–5 years.
Asia
In regions like China, telecom giants are investing heavily in national smart city projects, with operators like China Mobile dedicating USD 200 million to develop and integrate VSaaS platforms into urban infrastructure. The Indian market is also demonstrating growth: it is forecast that the total volume of investments in the VSaaS segment in India will reach USD 50–100 million in the coming years.
VAS Platforms. ROI and Future Growth
Investors are increasingly confident in the return on investment (ROI) from VSaaS. By switching to a subscription-based model, operators can recover their investment in just 2-3 years. This model not only offers a faster return but also generates consistent revenue streams over the long term, while offering scalability, security, and cost flexibility for businesses. According to reports from leading agencies like IDC and Frost & Sullivan, the continued expansion of the VSaaS market is expected to drive even higher returns as demand for integrated surveillance and smart city solutions continues to grow (to $2–3 billion by 2025 if the current investment dynamics – 15–20% annual growth – continue). In regions undergoing active digital transformation, such as Asia and Latin America, growth rates may be even higher.
For telecom operators and investors, integrating VSaaS into their portfolios not only supports digital transformation but also paves the way for new revenue streams and improved customer loyalty. The move towards cloud-based video surveillance is a strategic investment that promises significant growth and long-term benefits.
To explore more on investment opportunities and strategies in the VAS including VSaaS sector, download the full report!
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