The professional power amplifiers market, and professional audio in general, has been an area of long-term market growth. Despite the rise of powered speakers, the amplifiers market has continued to see regular replacements and new opportunities over recent years, driven by innovation and demand at a macro level. However, moving into 2020, the entire professional audio market was severely affected by the outbreak of COVID-19. The professional amplifiers market itself experienced significant losses, with rates of decline well into double figures. Despite this decline, there remained some key areas of positivity and stability throughout the crisis and full market recovery to 2019 levels is expected over the coming years.
The Live & Touring vertical was the most severely affected during the crisis, with the majority of amplifier revenues to this sector being “switched-off” overnight. The enforcement of social-distancing regulations and the cancellation of key events left rental providers with little requirement for new stock. From the beginning of the crisis, the touring vertical was phrased as “the first to go, and the last to come back” and moving into 2021 this held true, with regulations on large gatherings remaining in place for many nations — and becoming stricter for some.
Over recent months, with a build-up starting at the end of 2020, improving confidence has begun to show across the touring market. Mostly this has been driven by clear road maps and high vaccination rates in key nations, but also strength has been witnessed in financial indicators and the continued recovery of the installed live sound markets. Although the difficult times are far from over for touring manufacturers, government redevelopment funds and the phased return of live events is expected to provide significant recovery for the live events sector towards the end of 2021. 2022 is expected to be a record-breaking year for live events, and whilst this demand will take time to filter through to manufacturers, recovery is still expected within the five-year forecast period.
The market for installed live sound was impacted by many of the same trends as touring throughout the crisis. Despite this, throughout 2020 the market showed impressive resilience. It still experienced decline over the period, however also inspired confidence throughout the second half of the year, with many venue owners going ahead with projects and continuing to invest in audio equipment ready for the return of live events. Large projects in this category performed particularly well, driven by long-term investment plans and developments, whilst some smaller venues also witnessed positivity, particularly houses of worship in the U.S.
Outside of live sound and touring, the amplifiers market experienced much more stability over the past year. The Installed Commercial segment has been an area of growth and innovation for some time, demonstrating key adoption in class-D and audio networking technologies. Throughout the pandemic, it also showed the most resilience for amplifiers, and some subvertical markets even experienced growth. These growth areas included AV conferencing and higher education, both driven forwards by remote engagement trends necessitated by lockdowns and social distancing. Universities were launched into creating online lecture content overnight, and many chose to invest in both audio capture and sound reinforcement systems ready for the return of students. For amplifiers, this created a new opportunity, as hybrid learning installations caused a chain-reaction of device upgrades. Meanwhile, many can relate to the challenges faced by corporates over the last year, with video conferencing quickly becoming a vital tool for home working. Audio also benefitted significantly from this trend, firstly in the home for IT products, but also later, driven by the return to physical offices. Many corporates continue to cement work-from-home and return-to-office strategies, and it’s expected that over the course of this year even more demand will come for professional audio equipment in AV conferencing. A focus on quality and the use of AV conferencing and virtual events as a long-term strategy will be important in driving value for the amplifiers market.
PA/VA, life safety and background music have consistently been strong areas of commercial audio, and throughout 2020 these segments also provided stability for the amplifiers market. This was especially the case for PA/VA and life safety, driven by large projects and continued construction demand in the second half of the year. Although background music applications were some of the worst affected areas of commercial audio, they were still relatively strong compared to live sound. On average these applications depend much more on faster-paced, small business demand when compared with PA/VA, and therefore the segment was much more reactive to diminished sector revenues. Key applications include hospitality, restaurants, and retail, all of which were severely impacted by the virus. Despite severe declines, recovery is expected to be strong in these markets as economies begin to fully reopen worldwide.
Despite the challenging times faced by many amplifier vendors over the past year, confidence has begun to increase across all verticals. The installation segments have provided stability to the market, whilst underperforming sub-verticals are expected to rebound quickly. Although the touring and live sound segments have experienced record levels of decline, optimism is growing and recovery will arrive within the five-year forecast period. The overall market still faces many challenges in the coming years, including fallout from the AKM factory fire, other component shortages and poor channel health. That said, these negatives will be overshadowed by continued growth in the globally vaccinated population, the reopening of the leisure economies, and the recovery of demand for key applications which depend on professional audio.
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