Hikvision And The Chinese Government

Author: John Honovich, Published on Dec 07, 2015

Here are the facts about Hikvision's China government ownership.

#1 Fact - Hikvision CEO Admits China Government Ownership

In the China government's official website, Hikvsision's CEO admitted this (in English), saying:

“President XI’s visited means a full appreciation and support for CETC group and HIKVISION. As a state- owned company, we understand that reform and transformation cannot be accomplished in one day and should continue. In the future, we will still do our best to fulfill our mission and take responsibilities for our society and government.” [Emphasis Added]

This is a fact. IPVM first reported on this. Hikvision has never attempted to rebut this.

#2 Fact - Hikvision Financials Confirm Government Control

Contrary to their marketing claim of just having government shareholders, Hikvision's own financial report (p. 56) confirms that they are still, to this day, controlled by the Chinese government through CETC:

This is a fact. IPVM first reported on this. Hikvision has never attempted to rebut this.

Get Video Surveillance News In Your Inbox
Get Video Surveillance News In Your Inbox

#3 Fact - Hikvision's VP R&D Works For The Chinese Government

Hikvision's EVP of R&D simultaneously works for the Chinese government, specifically the police ministry infamous for torturing. Here is how Hikvision describes their executive:

This is a fact. IPVM reported on this. Hikvision has never attempted to rebut this.

#4 Fact - Hikvision's Chairman Is A Communist Party Secretary

Hikvision's chairman is a Chinese government official, a Communist Party secretary, as described in the Hikvision 2015 annual report (p. 62):

Chen currently serves as the head of 52nd Institute, the chairman and the Communist Party secretary of China Electronics Technology HIK Group Co., Ltd. (中电海康集团, CETHIK) and chairman of the Company [Hikvision] [Emphasis Added]

This is a fact. IPVM reported on this. Hikvision has never attempted to rebut this.

#5 Fact - Hikvision Pledges Accepting Communist Party Leadership

Contrary to their marketing claim of just being a commercial entity, Hikvision's Chairman / Communist Party Secretary declared:

"Every party member must consciously accept the [Communist] party's leadership, effectively strengthening the party's leadership, strengthen the Party's vitality, comply with party discipline.... All Party members united as one, as "personal dream", "Hikvision Dream", "China Dream" and efforts!" [IPVM emphasis added]

This is a fact. IPVM reported on this. Hikvision has never attempted to rebut this.

-----------

Recently, a series of gushing, congratulatory articles about Hikvision, from numerous trade magazines, have appeared.

There is a simple answer - Hikvision paid for it, as the smiling 'editors' shown in their group photo attest:

One of the editors / attendees attempted to answer 'what sets Hikvision apart?', declaring:

"What enabled a small, compression card maker to become the world’s leading supplier of video surveillance equipment in the span of a decade? The answer can be found in Hikvision’s intense focus around product development and being able to turn those ideas into a reality in short order."

No, there is a much simpler, more serious and significant reason - Chinese government ownership and Chinese government massive projects for Hikvision.

Government Ownership

As Hikvision itself acknowledged to us in this letter, Hikvision is more than 40% owned by Chinese government entities, euphemistically known as 'state owned enterprises', with Hikvision noting:

"42% of the company is jointly owned by CETHIK Group and CETG No. 52 Research Institute, both are state-owned enterprises."

Indeed, CETHIK is the largest shareholder of Hikvision by far, with a reported 39.9% ownership itself.

In any country, in an industry where government is a major buyer of your products, having your largest shareholder being a government owned entity is a massive advantage. And in Communist China, it is a particular powerful one that Hikvision has greatly benefited.

Update: Hikvision's 2015 financial report (p. 56) confirms that the Chinese government is the 'controlling shareholder' of Hikvision:

Update: Hikvision has been promoted to a Communist Party Committee, providing enhanced controlled and monitoring from the party / government.

Government Projects

Hikvision is by, all accounts, the largest supplier of video surveillance products to the Chinese government and its various state owned or controlled entities. In particular, 'safe city' projects have proved to be an enormously lucrative business for Hikvision. The most famous is the $800 million dollar deal Hikvision announced in 2010.

Smartly, Hikvision has become more quiet about its ongoing safe city projects despite the fact that it is a major driver in their unprecedented growth including growing from ~$2 billion USD domestic sales in 2014 to ~$3 billion USD in 2015. The most recent public declaration we found from Hikvision was back in 2012, when they listed a who's who of Chinese large cities:

Hikvision has made, and will continue to make, billions of US dollars from Chinese government projects.

"R&D"

Not surprisingly, Hikvision likes to tell the story from the opposite angle. In their typical explanation, Hikvision is a scrappy, hard-working R&D outfit that, through sheer technical superiority, became a goliath. Hikvision routinely throws out how many thousands of engineers they have - 2,000, 3,000, 4,000, now 5,000+.

Undoubtedly, Hikvision has thousands of people in some form of 'technical' capacity. Indeed, when you are selling direct and supporting / integrating safe city systems with millions of cameras combined, you will need a small army of 'engineers' to do so.

That noted, Hikvision, compared to most of their domestic Chinese rivals, is a massive R&D operation. Most Chinese 'manufacturers' are primarily assemblers and not developing anything at all.

However, compared to Western surveillance manufacturers, despite the 5,000+ engineers, Hikvision is basically average. On the other hand, their cybersecurity track record is, bar none, the worst amongst surveillance manufacturers. Plus, their 4200 CMS / VMS software still contains various errors / flaws uncommon in Western VMS developers that have 1/100th the amount of reported 'software engineers'.

Very Focused and Ambitious

On the positive side, Hikvision continues to show how focused and ambitious they are. This is not a company that is content to leverage their government ownership on just government jobs. They have done an excellent job using their government base as a foundation for global expansion.

Equally importantly, they have shown that they are capable of transitioning from a mega-enterprise provider inside China to a lowest cost disruptive entrant in the rest of the world. That, in itself, is extremely difficult to manage and the fact that they have done that so well is extremely impressive.

Price as a Weapon

Hikvision has leveraged their massive domestic government profits and their huge manufacturing base (from Chinese projects) to sell 'overseas' at prices and with support that no one has yet been capable of matching. Radically low pricing is a a weapon that Hikvision can and routinely does to break into any market they desire.

Pretending to be American

And, as they expand, they have increasingly obscured their Chinese origins from their marketing message.

Hikvision's new tactic is to pretend to be American. They are determined to trick American customers into thinking they are an American company, routinely declaring:

"EZVIZ is a North American company headquartered in City of Industry, California"

"EZVIZ, a California-based Wi-Fi cloud camera and video surveillance solutions manufacturer... The company manufacturers Wi-Fi cloud cameras and video surveillance kits"

When in reality, it is a brand of Hikvision. Ezviz is as much a separate company as Hikvision USA or Hikvision Europe is separate from the parent Hangzhou Hikvision Digital Technology Co. Ltd.

Dominate the Market

Hikvision may very well soon dominate the global video surveillance market but it is important not to be fooled into ignoring the foundation of their expansion - the Chinese government.

UPDATE - $6 Billion Financing

See: Hikvision Gets $3 Billion From Chinese Government Bank and now up to $6 Billion: Hikvision Doubles Chinese Government Funding

22 reports cite this report:

Hikvision President Addresses AI and USA Challenges on Oct 31, 2018
In frank recent China interviews, Hikvision's President Hu Yangzhong has addressed challenges impacting the video surveillance industry and...
Hikvision China Criticizes The WSJ on Nov 15, 2017
Hikvision, through the Chinese government's authoritative news service, has criticized the WSJ investigation into Hikvision. In this...
WSJ Investigates Hikvision on Nov 13, 2017
The Wall Street Journal (WSJ) has released a detailed investigation into Hikvision's government ownership and cybersecurity problems, hitting the...
Fortune 500 Company Bars Dahua and Hikvision on Aug 30, 2017
A Fortune 500 company has barred Dahua and Hikvision cameras from a large RFP due to cyber security concerns, IPVM has confirmed with the...
IP Camera Specification / RFP Guide 2017 on Aug 14, 2017
RFPs are hard. Do them 'right' and it takes a lot of knowledge and time. Do them 'wrong' and you can be (a) unwittingly locked into a specific...
Hikvision: IPVM Is "Destined To Fail" on Jun 14, 2017
Hikvision has accused IPVM of 'cyberbullying' them, declaring IPVM 'destined to fail.' This is the 3rd anti-IPVM Hikvision post in 2 weeks,...
Hikvision Gives IPVM An 'F' on Jun 06, 2017
Two weeks after Hikvision called IPVM 'absolutely unethical' and 'anti-everything', Hikvision has given IPVM, in their words, an 'F'. Hikvision...
Hikvision Hires Trade Magazine Editor on Aug 17, 2016
Hikvision PR challenges are increasing as understanding of the company's ownership by the Chinese government broadens and concerns about the...
US Government Entities Hard Spec Hikvision on May 26, 2016
The US and Chinese governments are working together. Now, US government entities are not only buying video surveillance products from the Chinese...
Hikvision Rejects Responsibility for Hacked Hikvision Cameras on May 10, 2016
After a massive number of Hikvision cameras were hacked, Hikvision has added new, and questionable legal language, declaring that Hikvision will...
Camera Innovation is Amazing on May 04, 2016
The innovation in the video surveillance camera market has never been higher or faster. While there is much negativity about the race to the...
Hikvision Exec Simultaneously Chinese Government Security Leader on Apr 27, 2016
New information shows a Hikvision executive is simultaneously a leader within the Chinese government national security ministry. This runs counter...
Hikvision (Stops) Lying About Ezviz Security on Mar 18, 2016
Hikvision promoted the security of their directly sold Ezviz consumer line to Americans in a March 9, 2016 release. False It featured this false...
Hikvision Ezviz Touts Robust Security on Mar 11, 2016
Hikvision's poor security track record, Chinese government ownership and hiding of their own brand in the consumer space has raised many concerns...
ADI Refuses to Fix Their OEM'd Hikvision Security Risks [Solved] on Mar 09, 2016
More than a year after massive hacks against Hikvision was disclosed; More than 9 months after Hikvision issued improved security firmware, mega...
Hikvision President Buys ~$100 Million USD Hikvision Stock on Mar 03, 2016
Hikvision's President is proving to be a loyal communist party member.  China, facing its toughest economic challenges in years, has been rocked...
Hikvision Launches American Enterprise Expansion on Jan 22, 2016
Hikvision has done well becoming the most common camera choice for American SMB customers but the company is still a minor player in the...
Hikvision and the China Communist Party on Jan 12, 2016
Just days after getting $3 billion financing from the Chinese government, Hikvision celebrated opening their own Communist Party company committee....
Ezviz = Hikvision = Chinese Government on Jan 08, 2016
Ezviz has seemingly come out of nowhere to become a major player in consumer electronics / security. Unfortunately, Ezviz consistently hides the...
Security Cameras 2016 Review on Dec 23, 2015
In 10 minutes, this note explains the current state of security / surveillance cameras in 2016, reflecting new technology changes and market...
An Inside Look Into Dahua on Dec 16, 2015
Dahua is the 'other' billion dollar plus Chinese manufacturer. Large in its own right, just not as huge or as well connected with the Chinese...
Hikvision Gets $3 Billion From Chinese Government Bank on Dec 09, 2015
Hikvision has secured the biggest financing ever in the video surveillance industry. Despite the groundbreaking news, Hikvision has been strangely...
Comments (57) : PRO Members only. Login. or Join.

Related Reports

NYPD Refutes False SCMP Hikvision Story on Jan 18, 2019
The NYPD has refuted the SCMP Hikvision story, the Voice of America has reported. On January 11, 2018, the SCMP alleged that the NYPD was using...
UK Fines Security Firms For Illegal Direct Marketing on Jan 16, 2019
Two UK security firms have paid over $200,000 in fines for illegally making hundreds of thousands of calls to people registered on a government...
Gorilla Technology AI Provider, Raises $15 Million, Profiled on Jan 15, 2019
Gorilla Technology is a Taiwanese video analytics manufacturer that recently announced a $15 million investment from SBI Group, saying this...
The False SCMP Story on Hikvision NYC AI on Jan 14, 2019
In the past week, one of Asia's largest publications, the South China Morning Post (SCMP), posted an article about "Chinese [facial recognition]...
CES 2019 Show Report on Jan 10, 2019
IPVM was at CES 2019 for the second year (see our CES 2018 Show Final Report) and is reporting on announcements and interesting news from the show...
2019 Video Surveillance Cameras Overview on Jan 07, 2019
Each year, IPVM summarizes the main advances and changes for video surveillance cameras, based on our industry-leading testing and...
Infinova Deletes Xinjiang References, Hiding Evidence on Jan 07, 2019
Infinova has deleted all posts about Xinjiang on its website due to IPVM’s investigation of its business ties there and successfully directed...
CyberExtruder Face Recognition Profile on Jan 04, 2019
CyberExtruder offers 3D modeling face recognition software that they say provides quicker and more accurate matches than other 2D face recognition...
"At Hikvision, We Build Trust" on Jan 03, 2019
Hikvision has joined a growing number of video surveillance manufacturers marketing their trustworthiness. In a recent trade magazine full page...
European Startup Ajax Profile - They "Stand Against Evil" on Jan 03, 2019
European intrusion detection startup Ajax Systems proclaims: How are they standing against evil? And what are the differentiators and potential...

Most Recent Industry Reports

The IP Camera Lock-In Trend: Meraki and Verkada on Jan 18, 2019
Open systems and interoperability have not only been big buzzwords over the past decade, but they have also become core features of video...
NYPD Refutes False SCMP Hikvision Story on Jan 18, 2019
The NYPD has refuted the SCMP Hikvision story, the Voice of America has reported. On January 11, 2018, the SCMP alleged that the NYPD was using...
Mobile Surveillance Trailers Guide on Jan 17, 2019
Putting cameras in a place for temporary surveillance where power and communications are not readily available can be complicated and expensive....
Exacq Favorability Results 2019 on Jan 17, 2019
Exacq favorability amongst integrators has declined sharply, in new IPVM statistics, compared to 2017 IPVM statistics for Exacq. Now, over 5 since...
Testing Bandwidth Vs. Low Light on Jan 16, 2019
Nighttime bandwidth spikes are a major concern in video surveillance. Many calculate bandwidth as a single 24/7 number, but bit rates vary...
Access Control Records Maintenance Guide on Jan 16, 2019
Weeding out old entries, turning off unused credentials, and updating who carries which credentials is as important as to maintaining security as...
UK Fines Security Firms For Illegal Direct Marketing on Jan 16, 2019
Two UK security firms have paid over $200,000 in fines for illegally making hundreds of thousands of calls to people registered on a government...
Access Control Cabling Tutorial on Jan 15, 2019
Access Control is only as reliable as its cables. While this aspect lacks the sexiness of other components, it remains a vital part of every...
Avigilon Favorability Results 2019 on Jan 15, 2019
Since IPVM's 2017 Avigilon favorability results, the company was acquired by Motorola and has shifted from being an aggressive startup to a more...
Gorilla Technology AI Provider, Raises $15 Million, Profiled on Jan 15, 2019
Gorilla Technology is a Taiwanese video analytics manufacturer that recently announced a $15 million investment from SBI Group, saying this...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact