Subscriber Discussion

Hikvision Mid To Long Term Outlook For US Business - Do You Think Hikvision Is Going To Be Gone From US Market In 3 To 5 Yrs Or Will They Continue On?

UI
Undisclosed Integrator #1
Jul 05, 2018

We've been testing various cameras for our business and are about to pull the trigger to standardize on HikVision.  Before we go there, I wanted to get some opinions re: with all the negatives about Hik with US Gov't, cyber security, industry bad press/reputation etc., do you think HikVision is going to be gone from US market in 3 to 5 yrs or will they continue on?  For our application the cyber stuff is not a concern and in our testing the cameras were sufficient, if not the best, for what we need and the price was definitely lower than most.  I just don't want to make a big capital commitment today that won't be supported or expandable 3 years down the road if I can avoid it.

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JH
John Honovich
Jul 05, 2018
IPVM

It's a great question and a timely one.

On the one hand, I don't think they will be gone from the US market, as in legally prohibited entirely as the US has little track record doing such things.

On the other hand, It's a real question of how widely Hikvision will be barred from certain markets, hit with tariffs and/or faced with continued negative press.

Moreover, related to that, you should also ask yourself what will happen to Hikvision's low prices and their technical support (already strained) in the next few years. Dealing with all these issues increases cost. If it continues, do they pass this on to customers or just absorb more losses?

How bad (or not) this becomes in the next few years is impossible to determine now but it's clearly a risk far greater for them than any other manufacturer.

Since you mentioned price, the next closest price big non-Chinee manufacturer is Hanwha. Have you ruled them out already? If so, curious to hear the issues.

Also, curious to hear what others have to say.

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U
Undisclosed #3
Jul 06, 2018
IPVMU Certified

Since you mentioned price, the next closest price big non-Chinese manufacturer is Hanwha.

Anything worth mentioning in the “other” China (Taiwan), Vivotek, Geovision et al?

UI
Undisclosed Integrator #1
Jul 06, 2018

We didn't look closely at Hanwha although we did briefly consider them. They didn't pass the "local support" test early in our evaluation.  That's very important to us and we didn't get warm & fuzzies from regional or disti's when we inquired about the products. The feeling was more along the lines of "come back and see me when you have a $50k+ order and then I'll be very interested in your business and supporting you".  We prefer partners with vision and who value loyalty and didn't get the feeling that exists with Hanwha at least not in our area. The ones we evaluated passed the support test with flying colors.  We looked at Mobotix, Axis, HikVision and TKH/Sequra.

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UI
Undisclosed Integrator #5
Jul 09, 2018

Hah, my Hikvision regional sales rep couldn't care less about me. I guess he figures I'm a "trunk slammer" as I only do camera jobs on the side as it's my interest/hobby, although I've bought several thousands of dollars in Hikvision equipment over the years and enjoy using them exclusively. I'm surprised that Hikvision met your customer service expectations, based on my own experience.

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Rick Caruthers
Jul 09, 2018
Galaxy Control Systems

For what it's worth, we deployed several hundred TKH/Sequra cameras on a project in Ethiopia for the African Union Government HQ and they have worked flawlessly. We also used their VDG Recorders and had all integrated into our software and the customer has been very happy. I'm sure that TKH is the lessor known of the ones you have tested but I know the management in the US and more importantly the senior level management in the Netherlands and they are an outstanding company. Perhaps they are worth a second look?  

CK
Carl Kristoffersen
Jul 06, 2018

I don't see an issue standardizing on any equipment that is not proprietary.  In 3-5 years, if you have to replace a camera to a different manufacturer, then just change it.  In the infancy of the IP revolution, I tried a few different cameras and have had to replace some of the not-so-good cameras more recently with new manufactures and had no issues doing so.  
I found that just the software changes on the same manufacturer over time is more of a learning curve that changing manufacturers.

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JH
John Honovich
Jul 06, 2018
IPVM

Carl, I agree with you in general. For example, an integrator whoo installed Pelco in the past can pretty easily justify switching today.

However, with hikvision the risk of selling it now is that it becomes increasingly recognized as a political and economic threat to the US (For example, consider the difficulties if the house bill ban becomes law). To that extent, It could cause significant issues with customers and prospects who push back with these concerns. This is already a problem for Hikvision and Dahua sales people.

The question is then, do you want to get started with the product that has that type of risk?

Now, if you are like Sean and are selling to smaller users with minimal security concerns but demanding low price, it should not be a risk. However if you are selling to users with more serious security concerns or government or police relationships, it certainly is a real risk.

Avatar
Sean Nelson
Jul 06, 2018
Nelly's Security

IMO, if you are a Hik Opponent, you have a more valid argument stating that the Government may shut down Hikvision than stating they are a security risk. Though still very weak, I think its more valid. 

Reason being is what are you going to continue saying after you tell the client that Hikvision is a security risk?

"Look, Hikvision is a bad cyber security risk, I recommend Axis instead"
or feel free to insert whatever brand you want to in place of Axis. 

I believe any level headed person knows that most networkable products will or have had security flaws, but as long as they are patched in a timely manner. Lets get the OP's opinion on the subject matter.

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JH
John Honovich
Jul 06, 2018
IPVM

what are you going to continue saying after you tell the client that Hikvision is a security risk?

You would then say they are owned by the Chinese government, have pledged allegiance to the China Communist Party, that their Chairman is a Communist Party Secretary and member of the Chinese national government, etc.

The 'security' issue is not an issue of how fast does a company patch 'flaws' but whether the buyer trusts the China Communist Party and Hikvision's control by it. Same for Huawei.

You, of course, do not care about this.

My point to #U1 is that many Americans do care about this and #U1 risks this becoming a bigger issue if the US government and mainstream media continue their increasing focus on this.

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Sean Nelson
Jul 06, 2018
Nelly's Security

I dont think they will be going anywhere. In my opinion, they will still probably be the #1 provider of cost effective reliable solutions. Unless there is a major disruptor that comes on the scene and gives them a run for their money. But all the other Chinese alternatives are simply "Just about the same" as Hikvision as their are no real big differentiators as far as features. As far as cost goes, there are some lower cost alternatives that are pretty decent but just dont have the product line that Hikvision does. But they definetely wont be completely exiting if that is your concern, atleast I think its super highly unlikely.

I'm curious as a new potential user of Hik products, what has caused you to look past the fear speak that is so prevalent on this site and made you decide to move forward?

UI
Undisclosed Integrator #1
Jul 06, 2018

We didn't look past it and it got a lot of discussion before we made this decision.  Some of our team had mild political/patriotic reasons to NOT go with Hik.  (The ones John mentioned "whether the buyer trusts the China Communist Party and Hikvision's control by it".)  Everyone has a price/litmus test right?  Well ours according to group consensus was that the cyber security risks were not a factor for us and that we could all support the idea of our Government not using the products because of the cyber risk but that a blanket boycott of another country's products because we don't like their politics really isn't a factor when it comes to running our business.  Since the products themselves performed well, the price is right and the software friendly, the only last concern (and reason for the post) was potential that the US ban might be further reaching and leave us with an anchor we can't get support on.

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UI
Undisclosed Integrator #2
Jul 06, 2018

What does standardized mean to you, 100 cameras? 1000? or 10,000?

UI
Undisclosed Integrator #1
Jul 06, 2018

As a new company, we hope 10,000 :) but realistically in the short/mid term we're probably in the 200-500 range.  Some of that answer will be driven by our success (or not) with funding rounds we're entering now.

UI
Undisclosed Integrator #4
Jul 06, 2018

Honestly their OEM brother LTS is way cheaper than Hikvision right now. If you are in the residential SMB/light commercial market it's an decent choice today though HIK isn't as strong as they were in 2013/2014. If price is a big concern, take a look at LTS though HIK has more sales people and resources to help you guys out if you are newer company. 

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JH
John Honovich
Jul 06, 2018
IPVM

Related, it makes me laugh that LTS sales pitch is so brazen "We're the same thing as Hikvision but cheaper." It's a crazy model and I feel for Hikvision USA's salespeople there...

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U
Undisclosed #3
Jul 07, 2018
IPVMU Certified

“We're the same thing as Hikvision but cheaper."

Question, if someone OEMed LTS, would they get even cheaper? ;)

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LT
Larry Tracy
Jul 09, 2018

U1

Hikvision isn't going anywhere and even though the House bill limits their sales to government entities the bill that passed the senate did not. 

I use Hikvision exclusively for the last 8 years and never regretted it once, in fact I have done so well in my markets that my competitors are now using their cameras. I don't see anyone dropping the product line.

Sure tariffs can be imposed but not only on Hikvision products but anything coming out of China. We as a country need to address the huge trade deficits and get into balance. I for one are not worried about it, everyone else's costs will go up as well. 

Hikvision has great field support with very knowledgeable personnel. 

I think despite the bad press they get, the growth rate continues at a rapid pace both here and around the world. I was recently in Denmark and the only camera brand I saw installed was Hikvision. 

Disclaimer: I consulted with Hikvision in their early days in the US market and know the management team pretty well. 

JH
John Honovich
Jul 10, 2018
IPVM

I don't see anyone dropping the product line.

Neither the dealers nor Hikvision are running to publicize this. However, you can check this recent LinkedIn post from a Hikvision dealer, excerpts:

TelData is a Hikvision partner and have been selling and installing Hik systems for years. 

So Hik's claim of independence to the World Market has been misleading to say the least.

So as we hold our breathe to see which path this soap opera will go down we are hesitant to move forward aggressively with Hik until the final ruling is made.

In the meantime we will continue to provide quality video and security solution through our other manufacturers . . . unfortunately without the HIK pricing option.

Avatar
Mick Brown
Jul 09, 2018

is it more of a question weather their customers are still in business in 3 years

you can simply check hikvision pricing online and margins for its partners are miserable

check out dvs in the uk were over 30 percent now around 18 and declining 

U
Undisclosed #3
Jul 09, 2018
IPVMU Certified

check out dvs in the uk were over 30 percent now around 18 and declining...

Because they’re all going to Denmark ;)

UI
Undisclosed Integrator #5
Jul 09, 2018

Hikvision will likely continue having a strong market share in SMBs where cybersecurity is a distant concern (i.e. as long as my DVR isn't hacked, I don't care if the Chinese government wants to spy on my driveway) compared to cost and performance.

Hikvision is good at offering affordable equipment that performs extremely well. Many SMB owners are not interested in multinational politics when buying products that don't generate them any revenue. They just want it to work and for as little expenditure as possible. Most of the customers I do installs for (side jobs) couldn't care less about the brand. I use Hikvision because they have an affordable and very extensive line, is supported locally, and I am familiar with it.

Companies like Axis and Panasonic have government, infrastructure, and large businesses pretty much sewn up. Hikvision may pretend that they're a serious contender in that marketplace but there's been far too much negative press about them lately and I doubt they'll be able to gain significant penetration there. However for every 1000-camera Ikea install there are a hundred 10-camera SMBs with needs to fulfill. That's where I see them being for the short term until they get their act together on cybersecurity and their Chinese ownership, but I won't hold my breath for that day.

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RT
Robert T
Jul 10, 2018

They won't be going anywhere... as long as they've got their little brother, LTS, hawking their wares

JH
John Honovich
Jun 29, 2021
IPVM

I just don't want to make a big capital commitment today that won't be supported or expandable 3 years down the road if I can avoid it.

It's 3 years later now.

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