Hikvision Chinese Government Owner CETHIK
By: John Honovich, Published on Nov 20, 2017Hikvision deceives about its Chinese government ownership.
Contrary to their claims about 'independence' and simply having 'shareholders' that are 'state-owned', Hikvision is controlled by a Chinese government entity (CETHIK) that exists specifically for running Hikvision. In this note, we expose this ownership, sharing proof from their own Chinese language records.
This emerged as a significant issue in the WSJ Investigation into Hikvision, with Hikvision responding:
Hikvision deceives about the 'SOE' they note, which is CETHIK. As the last three letters indicate, CETHIK is a Chinese government organization that controls Hikvision. CETHIK, and its government parent, CETC, do not simply 'own' shares, as 'passive' investors in companies. This information is hiding in plain sight, at least in Chinese, and can be reviewed at www.cethik.com.
Same Naming / Group Leadership
Hikvision's Chinese government parent is the "CLP Hikvision Group Limited" (from the cethik.com website). The name clearly references what CETHIK does, it is a government run group centered around Hikvision, as their own graphic shows:
Hikvision Core Of That Group
CETHIK / CLP Hikvision Group reports:
achieved [2016] revenue of 33.91 billion yuan, a total profit of 8.25 billion yuan.
This contradicts Hikvision's marketing claim of being 'independent' as CETHIK claims Hikvision's revenue as their own. Hikvision reported 2016 revenue of 31.9 billion yuan and profit of 7.4 billion yuan. Hikvision is ~90% of CETHIK's revenue and profit, showing that CETHIK is literally little more than Hikvision.
And if CETHIK was simply a 'shareholder', as Hikvision marketing alleges, than CETHIK could not claim Hikvision's revenue as their own.
CETHIK Claims Hikvision Employees
Moreover, CETHIK claims Hikvision's ~20,000 employees as its own, declaring:
I would like to thank more than 20,000 serving staff for your dedication and hard work and for today's CLP Hikvision.
Again, this contradicts Hikvision's marketing claim that they are 'independent' and that CETHIK is just a 'shareholder'.
Same Chairman For CETHIK and Hikvision
The leader/chairman of CETHIK, Chen Zongnian, is simultaneously the chairman of Hikvision, shown on CETHIK's leader's speech webpage and in the image below:
Indeed, Hikvision's own financials (see p. 56) expose Hikvision's marketing deception, showing that CETHIK is Hikvision's controlling shareholder.
The fact that these organizations share the same chairman, claims the same revenue and employees shows that CETHIK controls Hikvision.
Do Not Blame Hikvision Overseas Employees
Hikvision overseas employees are not to be blamed here. Hikvision management is hiding this from them as well. Given local employee's general lack of knowledge of Chinese language and Chinese government structure, this is not something they could easily determine for themselves. Worse, these Western employees have it even harder as they are caught in the middle and on the front lines of this.
Blame Hikvision Chinese Leadership
On the other hand, surely Hikvision Chinese leadership (e.g., Hu Yangzhong, Jeffrey He [link no longer available], Jason Yang [link no longer available], etc.) knows all about CETC, CETHIK and how they truly work.
Trust Problems For Hikvision
That Hikvision is willing to deceive people about something that can so clearly and distinctly be disproven by their own Chinese language documentation raises serious concerns. How does one trust a company that does this? And if Hikvision is going to be deceptive about this, what other things, like cybersecurity, are they willing to deceive about?
21 reports cite this report:
Comments (28)
How does one trust a company that does this? And if Hikvision is going to be deceptive about this, what other things, like cybersecurity, are they willing to deceive about?
There will always be integrators who just grab what is on the endcap at ADI or stops and asks at the counter for the cheapest camera available. For those folks, the only thing that will shake them from Hik-addiction will be when the subsidization train ends.
Hikvision management is hiding this from them as well. Given local employee's general lack of knowledge of Chinese language and Chinese government structure, this is not something they could easily determine for themselves.
But as you show, the controlling relationship by a Central State-owned entity is in the English language financials:
That’s pretty convincing all on its own.
If it looks like a duck, walks like a duck & quacks like a duck - what is it?
Answer from HIK - It is a fish
And that my friends, is why myself and others left.
Money was great but at some point your soul has to be worth something. The more this information m and day to day company practices were revealed it was hard to reconcile.
Proactively addressing “Nelly” before he mentions it, my current employer has ethics guidelines that requests we not speak ill of competitors. This struck a chord and I had to say something.
What I want to know is what exactly is "Italian Bo Tech" and who is their mysterious "Love Letter Promise" for? Sounds sinister to me!
so, what is the problem? Don't expose your Hik devices to Internet and you're safe. Make sure you monitor internal network as well.
I'd say most of the cheap solutions shouldn't have any other access except VPN to your router and local connection after that. No port mapping, no hik-connect or similar services, no gateway settings for the devices itself
I don't want to hijack this thread but as someone who has sold Hik & LTS product, I have been looking for alternatives and at Digital ID View of Dallas, Texas and have found nothing on IPVM, not a single mention. Does anyone have any experience with this company? Thanks?
NOTICE: This comment has been moved to its own discussion: Hikvision/Lts Alternative With Good US Support?
Also, Brian, you can't judge a book by it's cover or a company by it's website.
Slick websites abound on the NET but quality US customer support, not so much...
Just returned from a two week trip to China. Of course we flew to Hangzhou as well.
Truly, EVERYONE with any exposure to this industry is aware Hik is controlled and owned by the Chinese Communist Government. Every manufacturer in China aware and they also verbalize it frequently.
It's late so i'll keep it short.
EVERY CCTV distributor, re-seller, installer, online purveyor can sell Hik products. There are no barriers to entry with Hik and the others. So you are not "special" or unique if selling Hik. You are simply spreading a disease.
Any American marketing and selling Hikvision has crossed an ethics line that will likely sometime in the future cause real damage to their reputation. It is refreshing to hear so many firms refusing to cooperate with Hik these days based on their moral compass.
WE CAN ALL sell it, yet more and more refuse due to integrity standards.
For those still supporting Hik, making a quick buck on Hik, "enough already" with the excuses. If its OK to sell a Chinese government owned product, then why are YOU NOT disclosing this key fact in your marketing material? Why? because you know your sales would go to 0.00 if your customers knew the truth.
You can end your Hik addiction.
Its so easy.
Offer Hik and a competing brand simultaneously.
Customer inquires, use that opportunity to sell your other brand after advising them
Hik is owned by the communist China government. You are indeed using their brand awareness to build someone else, to grow a more transparent manufacturer, to grow your future. That's called "justice".
NOTICE: This comment has been moved to its own discussion: EVERYONE With Any Exposure To This Industry Is Aware Hik Is Controlled And Owned By The Chinese Communist Government
Hikvision Europe published a 'Corporate Background' 10 days after this post, commenting on CETHIK:
Good Article, John, informative as always. A few thoughts came to mind:
CCTV is all networking now, it's not analog, it's not BNCs. The good ol boys who have been doing it for 30 years are still doing it, and they're doing it wrong because no one is telling them, or holding them accountable to doing it right. The same teams doing low voltage work should not be the same ones doing CCTV still, but this is all too common.
As a system administrator, network engineer, and integrator, I am skeptical of every network device that gets installed on my networks. People want to single out HikVision, or blame hardware manufacturing for problems that should be managed and mitigated by the installers, integrators, and managers of said equipment.
Regardless of HikVision's ownership status, any device can be compromised and used for malicious activity; the difference is whether it was deployed in an environment where it can actually do so. I feel this is this is the responsibility of the installer, and no one owns it.
Physically segment your networks; cameras should never be connected to a switching infrastructure with internet on it. If your server needs to be remotely accessed, do so through a VPN, or source lock the NAT policies.
This was well written. It explains the publicly available information on the ownership and then compares the concept of a Chinese SOE to that of a German SOE.
It all seems perfectly square to me now, well...
If Germany were a Communist country with a ruling leader that just appointed himself ruler for life. Term Limits Removed or if they swore an oath to the party Leadership and Party and if we knew who the balance of shareholders were.
Which leads me to Wikipedia and although I wouldn't bet my life on their information, it does seem to identify some connections and that the "Party" may have a little more influence than they are letting on. Wikipedia
Oh well.