For students heading off the college this past September, a larger percentage than ever used their phone as a credential to get into their dorm building and room, in addition to other buildings within the vast campus system. This transformation across college and university campuses is being led in part by the mobile credential culture created by this current generation Alpha that has no recollection of life before cell phones.
Add to that the mass adoption of electronic access control – including smart locks, cloud-based systems and mobile access solutions within the multifamily, commercial real estate, retail and corporate spaces – and the phone is quickly becoming the credential of choice.
While physical ID is still prevalent within the access control industry, mobile access credentials are gaining ground, with 39% (up from 32% in 2022) now actively using mobile identities, according to the latest research from a 2024 State of Physical Access Control (PAC) Report, produced by IFSEC Global in partnership with HID, which surveyed more than 1,200 security professionals.
Looking forward, security professionals state that nearly 80% of organizations will deploy mobile IDs within the next five years while industry partners are even more optimistic in their outlook, stating that 94% of their customers will have deployed mobile IDs by 2029, according HID’s 2024 State of the Security and Identity Report.
Diving deeper into the PAC report, respondents named touchless/contactless solutions (48%) and mobile access (44%) as the two largest trends shaping the wider access control industry. And technology research company Omdia estimates that nearly 50 million mobile credentials were downloaded globally in 2022 and that revenue from the sales of mobile credentials will grow at a 39.8% CAGR rate from 2022 until 2027.
Mobile Credential Culture
For physical access control, mobile credentials are not only more convenient – and unquestionably the biggest driver for organizations upgrading their systems in the report – but they also enable digital IDs to be stored within a digital wallet. For example, credentials in digital wallets such as Apple Wallet or Google Wallet enable smartphone and smart watch users to access a building, log on to their own workstation even print documents, rather than relying on a plastic card. The same technology is also being increasingly used for student ID cards as well as for hotel guests. When or where an employee badge is used, it is never shared or stored with either Apple or Google servers, helping to ensure privacy to the end user.
"Generation Z and Generation Alpha are set to significantly influence the demand and adoption of digital and mobile credentials,” says Stephenie Haldane, Vice President, End User Business Development, HID. “As these tech-savvy individuals transition from university to the workforce, their expectation for convenience and seamless integration into everyday activities is already being recognized by competitive industries. These industries are making advanced access control solutions a key part of their recruitment process, highlighting the need for organizations to innovate and adapt their access control strategies to ensure both security and user satisfaction in an increasingly digital world."
Looking closer at the numbers, in addition to 39% of companies now actively use mobile identities, the same number also use biometric technology, whether that’s fingerprint, facial or iris recognition for access control (up from 30% in our previous report).
“Typically, most people in offices now use a smartphone and for them it’s very natural to use it for access control instead of physical cards because there are less things for them to carry,” explains Sanjit Bardhan, HID’s Vice President and Head of Mobile. “It’s strange for people to use a mobile phone for everything else in a building and yet to have to use a physical card for access control.”
Bardhan astutely points out that using mobile credentials enables organizations, across most vertical businesses, to offer additional functionality to users. “Increasingly we are seeing companies combining physical access control with a more ‘digital experience’ via mobile,” he says, noting that there is a “use-case explosion,” as mobile credentials fulfill such needs seamlessly and with significantly improved user-experience.
Further, mobile access is now being used by organizations to achieve far better business outcomes due to various use-cases and services being addressed via a single platform and device. For example, in commercial real estate, real-estate companies are able to differentiate themselves from competitors and charge more rent too due to these value-added services.
Regarding cost, Bardhan says there is very little difference between using physical ID cards and mobile access, except that mobile access has the capability of providing a lot more value for a similar cost. “All of the readers we have sold for the last five to seven years support mobile access and can be configured for the specific mobile customer key,” he explains. “For installers there is no additional work.”
When it comes to installing physical access control systems, not surprisingly, it seems that ease of use is the number one priority. Asked to name the three biggest challenges they face on a day-to-day basis, the largest number of those surveyed responded ‘improving user convenience’ (47%), followed by ‘making physical access administration easier’ (41%).
Multifamily Boon Continues
Whether it is retrofitting existing properties or making these smart systems a part of any new construction project, the multifamily vertical is undoubtably leveraging electronic access control and mobile credentials, as tenants are coming to expect these conveniences. In fact, nearly 90% of multi-dwelling unit (MDU) owners and operators in the U.S. are planning to deploy, upgrade, or replace a smart building solution in the next 12 months, according to the latest Parks Associates research.
“Several years of high interest rates led to a lull in new construction, but many MDU operators realized new technologies are essential,” says Elizabeth Parks, President and CMO, Parks Associates. “Adoption of tech is becoming increasingly prominent in retrofits, and many systems added during the pandemic are now due for an upgrade. The market is primed for a new wave of investments, especially with the Federal Reserve cutting rates now and planning to do more in 2025.”
The research firm estimates adoption of both electronic access control systems and smart door locks is high, including:
· 70% of multifamily companies have an access control system on at least one property; 50% of those with systems report having one in their newest property
· 70% have smart door locks on at least one property
· 92% report having an intercom or callbox in at least one property
“Companies have found success with their access control system rollouts, reporting high satisfaction from residents, efficiency gains for property staff, streamlined operations, reduced rates of crime and safety incidents, lower operating costs, as well as other benefits,” she says, noting that the movement towards these new systems – and the shortening of access control replacement cycles – is being driven by several key factors:
· Efficiency gains
· Resident demand
· Enabling new capabilities for leasing agents.
· Addressing safety and security concerns: Parks Associates data finds that 53% of MDU residents in US internet households are far more concerned about the physical security of their home than they were 5 years ago.
· Package management
· Aging and broken systems:
· Rising costs of legacy infrastructure
Looking at the rise of mobile credentials and their role in the adoption of electronic access control and smart locks, Parks says she sees companies at different stages of their access control journeys.
“These companies have different preferences when it comes to features and functions, with companies at an earlier stage of their journey looking for smart door lock integration and mobile credential support and companies that have already moved to mobile credentials looking carefully towards video intercoms and guest management features for their next round of upgrades,” she explains.
Embracing Cloud-based Systems
In addition to increased adoption of smart building solutions, Parks Associates is seeing increased trust in the cloud and cloud-based systems, from access control to video to data analytics.
“Cloud-based systems have officially overtaken local ones, with higher adoption across main access control system components,” says Parks. “Companies that have adopted electronic access control technologies are moving away from local-only systems with on-site servers, and towards cloud-based solutions. This enables new use cases such as self-guided tours, app-based mobile access for residents and staff, and easy entry for delivery drivers and other authorized third parties, among others.”
The shift to the cloud also resolves the challenges local systems face – old and outdated servers that require regular maintenance and updates, the need for in-house expertise via dedicated IT or security teams, high maintenance costs with teams spending time and resources going to and from local sites, inefficiencies in managing user data and integrating with third-party systems, and less flexibility in scaling additional sites.
Looking at some of the reported benefits of adopting smart building solutions, Parks Associates’ research shows properties report a 20% efficiency boost and 10% fewer maintenance requests after installing smart door locks and electronic access control systems.
Delving deeper into the technology that is being utilized, Parks reveals 24% of properties report having a smart building provider or aggregator for at least one of the properties they serve.
“Respondents report using an average of three smart building platforms throughout their portfolios,” says Kristen Hanich, Research Director, Parks Associates. “This market is highly fragmented, far from settled, and competitors who can prove their value, ease of use, and positive customer support experiences can gain share across a company’s property portfolio.”
MDU owners and operators also report that smart building solutions have had a positive impact on tested metrics, including increasing operating efficiency and reducing operating costs, energy and water utility costs, and the number of safety or crime incidents across their portfolios.
“Companies are leveraging the experience they’ve gained in deploying the earlier generation of smart building technologies to create benchmarks for effectiveness,” Hanich adds. “These benchmarks serve as guides for their future deployments.”
