Dahua Ban Response: NOT Chinese Government Owned

By John Honovich, Published Aug 08, 2018, 11:42am EDT

Dahua has responded to the US Congress passing a US government ban on Dahua and Hikvision's products. While Dahua offered the now standard cybersecurity defense, it led with an interesting and direct assertion, that Dahua is "not a government-owned entity."

That is a true statement, from our research. How much does this help them and how can they position themselves vis a vis Chinese government-owned Hikvision?

Statement ********

*****'* ************ ***** ******* ********* with *** ***-********** *********:

**** ****** ********** *** quite ****, ****** *** only ***** ******** ******* statement *** ** ******** 2016, ********* ********** ****** criticism ** *********:

*** **** ** *** 2018 **** ********* ** primarily *** **** **** cybersecurity *********.

Terrible ** *************

**** *** ******* **** recently (*****'* ******** *************) ** ** **** not ****** *********. ******* to ***, *** *********** of ********* ****** *** lack ** ************* ************ has **** *************** ****. And ** *****'* *****, that ** ******* *** because ** ******* ********** ownership *** ******* ***** China ** ****** ******* (e.g.,***** ******** **** ** Out). *****'* *****-****** **** this ****** ** * key ****** ** *** Chinese ********** *** ******* out ******* *********** ****** of *****, ******** ***** to **** **** **** disorganized ******** *********.

Not ********** *****

*************** *** *** ***** and ********* ****** ******* from *** ******* **********, ***** **, ** all ********, * ******* company (** ** ********** private ** ~$* ******* revenue ******* *** ** in *****). ***** *** a ***** ********** ** its ***** **** ** entities ******* ** *** Chinese ********** *** ******* akin ** *** ******* that ********* ***.

'Connected' ** *** ******* **********?

*** ******** **** ******** **** includes ********* '*********' ** the ******* **********:

*** *** ** ********** is ******** '*********' ** unclear *** *** **** itself, ** ***** *******, is *****. *******,***** *** *** ****** $1 ******* *** ** government ********* *** ******* oppressing ********** ** ************ *** **** * years, ***** *** **** and *********** ** ***** projects, ***** ** ******* some '**********' ******* *** Chinese ********** *** *****. Whether **** ********** ** sufficient ** ********** ******* is * *** ********.

Relatively ****** *** *****

******** ** ********* ** the ***, ***** *** much **** ******. ** addition ** *** ***** owned ** *** ******* government, **** *** **** smaller, ** **** **** less ** ****/********. ********, Dahua *** *** * clear ******* ** ****** (ex-FLIR ***** ****) ***** Hikvision *** **** ******* in * ***** ******* national. *** ************** *** ******* ******* out ** **** ***, ********* *******, ***** is ******* **.

** **** ** *****, though, *** **** ** these *********.

Comments (25)

 

Dahua has a small percentage of its stock held by entities related to the Chinese government but nothing akin to the control that Hikvision has.

Dahua Exec #1: Sir, rumor has it that Huawei and Hikvision are being added to a U.S. government list giving them “special treatment” in the procurement process, probably due to their ownership structure.

Dahua CEO: I am sick and tired of being upstaged by Hik and their government connections.  Listen, you get us on that list, whatever it takes!  And I better not see Longse on that list either!

I am glad that Dahua is distinguishing themselves from Hikvision and this is definitely the kind of public statement they need to make more often in the wake of the their ban from government use. For too long the term Hikhua was all too true, so I hope this is a trend that they continue with.

Also we all know from Bashis and other sources that Dahua has had a terrible cybersecurity history. I will say that in my most recent experience they take any sign of hacking (and glitchy firmware) very seriously. This level of support I hope becomes the norm for them and they continue building on their internal systems, people, and processes to achieve the level of maturity you would expect out of a multi-billion dollar corporation.

I mean us small time integrators and even regional distributors can maybe get by with haphazard systems and a “ma & pa” vibe... but the world’s second largest cctv manufacturer???

I think if they can become more transparent and stay responsive to the issues that affect their dealers, and ultimately their end users, then they can have a successful future in the SMB and middle/upper middle class home markets. To these clients a few thousand in equipment costs can be a make or break difference, but they are willing to to pay a bit above the bottom of the barrel.

Having spent the eary years of our company doing a lot of installs for clients who bought their own Qsee and Lorex kits (we got “wise” early on and started refusing the swann and other kits because their failure rate was just too high... as if the others were that much better?) we know how much better the pro lines work than the el cheapo specials. I am sure we could insert some other low cost providers in there like uniview, milesight, etc. but none of them have the product selection and personal support of Dahua USA.

Even the big OEMs like IC and Saavy (or whatever they are now lol) cannot have boots on the ground for job walks, sales engineers for designs (though we IPVM members who use the calculator can get by without that ;) ), and sheer volume of leads, materials, and trainings nationwide that Dahua is capable of.

It will be an uphill battle for sure, and I think every dealer in the wake of the ban needs a non-Chinese alternative for clients who have serious cybersecurity concerns or are just generally concerned about Chinese made devices.

This just goes to show you how much thought (or lack therof) was put into the Government Ban. Typical government boneheadedness implementing/imposing rules without thinking things through.

So we arent allowed to install Dahua or Hikvision in govt installs but we are allowed to install XM equipment or the other Chinese vendors who had vulnerabilities found? Genius!!! 

I think the govt official who thought up this mindless bill read too many IPVM headlines but wasnt a full member. Thus they only read the countless free Hikua-Damning articles articles OR the ones that werent free in which you could only read the first paragraph and not get the whole story. By the way, this is a compliment to IPVM for their lobbying powers so please dont take it the wrong way.

I think the govt official who thought up this mindless bill read too many IPVM headlines but wasnt a full member. 

OK, but in your previous posts you have been unable to differentiate the severity of an Axis vulnerability from a Hikvision exploit, distilling it all down to "every vendor has cyber security problems". Maybe the officials are a little more clued in than you give them credit for?

Sorry, here are the differences:

- With Hikvision, we got a detailed how to guide on how to exploit the exploit  and a expertly designed hack-map with 100+ responses

- With Axis (much like Genetec), we got a "congratulations", "its not that big of a deal". "Way to go! Good job on handling it!" With a handful of responses.

That help?

Got it, you still don't know the differences.

No. Sean does understand the differences.  His position is only defensible if he remains willfully ignorant.  

i look forward to your opinion ladies. 

Spoken like a true HikVision OEM:

https://ipvm.com/reports/hik-oems-dir

(Nelly’s Security)

Although I must admit that your foresight to partner with HikVision has paid off, I’m sure in the early days many would have see this as a risky gamble. It’s no doubt paid off, but recent events may now impact your business in a negative way - just like HikVision and Dahua’s market capitalisation.

So we arent allowed to install Dahua or Hikvision in govt installs but we are allowed to install XM equipment or the other Chinese vendors who had vulnerabilities found? Genius!!!

I agree with you that XM et al are a security risk. The practical difference is that very little XM gear (including OEMed) is installed by the US government or other serious entities. The lack of local support and sales effectively blocks them from such projects, as is. To be clear, I do think for thoroughness, it would be good to include those but it is much a major practical issue. However, maybe this changes if OEMs effectively downgrade to XM or similar and heavily market those offerings.

Btw, Sean, are you still on the Hikvision train? And would you describe it as full steam ahead or?

Still chuggin but hate to admit we have had some small derailments today. One of my top 10s said that one of his bank jobs said that they cant do hikvision because they were put on a watch list. He is also concerned about a hospital job he has coming. 

Just curious have you actively lobbied to a gov rep about this stuff?

Sean, that's interesting feedback. It does not surprise me but it does make sense that impact would expand broader than just strictly federal facilities.

No, we have not lobbied any government reps on this. We did speak to SIA's lobbyist in favor of the ban after they sent out an email that was strongly negative to the ban, which did not fairly represent other industry viewpoints. We wrote about this here - SIA Lobbyists Working On House Bill Ban of Dahua and Hikvision

Overall, though, we think we have the most impact by researching and reporting on things that otherwise would not get exposure, e.g., Hikvision Chinese Government Owner CETHIK ExposedHikvision's Minority AnalyticsHikvision Wins Chinese Government Forced Facial Recognition Project Across 967 Mosques, etc.

Even if Dahua is allowed on a technicality, I would be very hesitant to recommend or use them at these sites.

The spirit of the bill seems to be to keep Chinese products out of sensitive areas. It could easily be expanded or clarified to mention Dahua, XM, Longse, etc. by name. If you put Dahua in today, and then things get amended to be more specific about not using ANY Chinese products, you risk winding up in a scenario where you have to rip and replace the Dahua equipment with something else. While I suppose that could technically be a win for the integrator, the customer would probably be less than ecstatic.

 

The govt pays more per hour for 1tech just to install a Hik camera. Why would they want to buy the cheapest product out there? $420 to install a $79 dollar camera.... 

I'm already hearing rumors that LTS is positioning itself to "take over" Hik. LTS is not state owned like Hik, a far as I know. If the branding changes and they prove they are no longer a Hik OEM, this could side step the ban.

NOTICE: This comment has been moved to its own discussion: LTS Reaction To Hikvision US Gov Ban?

What exactly does "take over" mean? Like do you mean they wont be ordering Hikvision anymore? What do you mean if branding changes? They are already branded "LTS" and they often claim that they are the manufacturer. The only way they could side step the Ban is if they dont order products manufactured by Hikvision or Dahua.

Sean I don't really know the full specifics but from what I gather is that the manufacturing facilities would be "sold" to LTS from Hik. This would separate the government ownership to a privately held company. As far a branding I take it as Hik would become LTS. 

Very Interesting!

Seems to me that LTS and maybe even Hik have been plotting this course of action for a while as LTS was presenting itself as a Hik competitor then starting selling Hik products like a distributor.  This is sort of thing is common business practice for large corporations to avert any laws.

Possible. I have always wondered if LTS and Hik are brothers of some sort. In other words, its seems LTS is more than just a customer to Hik. This could be great for LTS. 

Even if they put the factories under LTS ownership it still would not subvert the ban. Dahua is not government owned and is still subject... so Hik and LTS playing hide the hack is just going to lead to an international game of a whack a mole.

LTS is trying to lie to everyone about their own branded line. Their rep Michael (young sounding kid with a fairly thick accent) straight up told me their cameras are not made by Hikvision and they own the brand...? I told him he was lieing because their cams are OEMed by Hikvision and they just slap their logo on them, and that the only thing they manufacture are dishonest schemes.

Odds are the rumors you heard were a new line (lie?) manufactured at the LTS “factory”

Well, the reality of it is that decisions on anything this specialized should be made with the input of industry professionals in the matter. If anything, this is where we need put our heads together as an industry and find a way to become a part of the system that is currently blind to the actual situation.

Moreover, Dahua now has a clear veteran US leader (ex-FLIR Wayne Hurd)

 

Dahua has the history of hiring good people but not being able to keep them.  Again, the key is not hiring the right person.  I seriously doubt Mr. Hurd is in the position where he can do his job the right way.

I seriously doubt Mr. Hurd is in the position where he can do his job the right way.

Given their track record, I would agree. On the other hand, maybe Dahua will now realize that they need to defer.

Dahua USA was clearly (way) overconfident the past few years. Perhaps their failures in that time, combined with the impending ban, will make them more realistic. 

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