Physical access control (PACS) is evolving from standalone door security into a software-defined platform at the centre of smart building operations, with cloud architectures, mobile credentials, and artificial intelligence reshaping how organisations secure facilities, manage identities, and optimise workplace experiences. It’s creating both strategic opportunities and competitive risks for everyone from manufacturers to systems integrators.

Analysts examine three core revenue categories: hardware, credentials, and software, critically, documenting how value capture is shifting from product sales to platform economics and is concentrating profits in different places across the value chain. This dramatic shift is coming about as recurring software revenue, managed services, and cloud subscriptions displace traditional hardware margins. This report maps these dynamics across vendor groups and identifies where profits are concentrating as the industry transitions from product sales to platform economics.

Access rights via mobile credentials

Mobile credentials represent a significant transformation in how organisations provision, manage, and revoke access rights. The market is shifting from proprietary app-based credentials toward wallet-native credentials embedded directly in Apple Wallet and Google Wallet, enabling tap-to-enter experiences without unlocking devices and supporting biometric authentication by default. This report analyses adoption patterns across vertical markets, quantifies infrastructure investment requirements, and evaluates competing standards.

The report is the second instalment of a two-part series covering Physical Security Technology. Part 1, covering Video Surveillance, was published in Q3 2025.

This latest report divides businesses in the access control sector into groups depending on revenues.  Group A companies (those with access control annual revenues exceeding $1 billion) collectively represent around 24% of global revenues. Meanwhile, Group B companies (those generating between $100 million and $1 billion annually) encompass 28 firms. Together, this group was found to account for a substantial 64%, demonstrating that mid-sized specialists continue to hold significant market influence.

Continued consolidation

The access control industry continues to experience consolidation. Between September 2023 and September 2025, 16 acquisition and merger transactions totaling $7.9 billion were completed. The most notable was Honeywell’s $4.95 billion acquisition of Carrier’s access control business, a deal that significantly alters the competitive dynamics in the market.

Finally, in terms of geography, the report predicts that Asia Pacific will overtake Europe as the second-largest market by 2030. Unlike mature markets driven by retrofits, Asia Pacific growth comes from new construction across offices, logistics, manufacturing, and government facilities.

Footnote:  The Memoori report “The Physical Access Control Business 2025 to 2030” can be ordered from AR Media International. For orders and more information about the report – click  here.