Hikvision Buys Baltics' Largest Distributor (BK Group)

By Robert Wren Gordon, Published on Aug 20, 2020

While Hikvision faces global scrutiny over its connections to the PRC government, the world's largest security camera manufacturer bought the Baltic region's largest distributor, BK Group.

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Inside this note, we examine the details of the Hikvision acquisition as well as the significance of Hikvision directly owning a regional distributor.

  • Background
  • Hikvision Acquisition
  • Hikvision Presence in the Baltics
  • Criticism from Lithuanian Ministry of National Defence
  • Similarities to Hikvision in India
  • Hikvision: No Comment
  • BK Group: "Refer to Official Information"
  • Benefits of Owning a Distributor

**** ************** ******** ********** ******** to ******** *** ** Group, *** ******* *********** in *** ******* **** subsidiaries ** *******, ******, and *********,*** ** *********** ******.

**********

** ***** ********** ** *********** *******-********* ********* ********** ** Estonia, ******, *********, ***, since ****, ** ******. (According ** ************* ******** by ****, *** ****** BK ***** *******, ***** BK **. * *.*., was *** ******** ** the ********* ********.)

******* ******** ** *****'* *************, English-language ******* ****** ******** of "****** €** *******" and ********* ** "**** 70."

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******* **** *********** *********** ************* **** ** ***** as ********* * ******** of *********-******* ********:

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*** ******* ***** ******** products **** **** ********* security ******* *** ******* international *************. **** ** the ******** ******* *** HIKVISION ********* ***. ***. products[.]

************, ***** * ******* ** the *******-******** ******* ** the *********,*******'* ****** *** ******* newspaper, ***** ** ***** as *** ******* *********** of ******** ******* ** the *******:

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** ***** ** *** largest ********** ** ******** systems ** *** *******.

Hikvision ***********

********* ** *** ******** Competition *********, ** **** *, BK ***** *** ********* applied *** ******** ********** approval ** *********'* ******** of ***% ********* ** (i) *******-********** ** ***** AS, (**) ******-********** *** "BK ******", *** (***) Lithuania-registered *** "** ****ė" for ** *********** ******** price. (******** ** *******'************ ***, ********** ******** ** required ******* (*) *** Estonian ******** ** *** of *** ******* ******* €6 **********(**) *** ******** ******** of **** ******* (*.*. BK ***** *** *********) exceeds €* *******.)

********* ** ***** ******* from *** *********** ************ ***** ** ******* ******* ****** ******, ********* ***** ** acquire ** ***** ** order ** "******* *** marketing **********" ** *** region:

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Purpose ** *** ******** ***********

********* **** ******* * direct **** ********* **** BK ** ***** ** improve *** ********* ********** in *** ****** *********.

** **** **, *** Estonian *********** ********* ******** the ********* ******** ****** that ** ***** "*** significantly ****** *** *********** situation:"

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[*]** ****** **** *** significantly ****** *** *********** situation ** *** ********* of *** ******* *******.

**** ****** * **-*** appeal ****** *** *** passed, **** ******** ******* from *******'**-******** ***********, ** ** ****** 18 *** ****** **, in *** ********** ***** of ** ***** *** BK *****, ***** **** no ******* ** ******* Hikvision ********* ***. ***. (Hikvision's ********** ******) ** a *********** ** ********** owner ** ****** ** Eesti ** ** *****.

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Hikvision ******** ** *** *******

********* *** ***** * strong ***** ** *** Baltics. ** *******,**** ********** *********'* *********** **** *ū****, *** ****-**-****-**-**** ********* of **** ****, *********'* *** ****** division.

** *********** ** ********* **** **** ****** from ********** ****** *********** LRT, ********* ********* **** been ********* *** *** used ** ****-***** ********** government ******, ********* *** country's***** ****** ***** ******************* ********** *******.

***********, ********* ****** ** deemphasize *** ***** ******** in *** ** ***** acquisition ****** **** *** Estonian *********** *********, ****** a **** *** ****** report ***** ****** *** market ***** ** "**** below [**-**]%:"

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********* ********* ***. ***.-******* products *** *********, *** their ****** ***** ** well ***** [**-**]%.

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Criticism **** ********** ******** ** ******** *******

***** **** ******* *** ******** ***** Security ****** ***** *** [Lithuanian]******** ** ******** ************ ******* **** ***** and ********* ********* ****** that *** *********' "******* are **** ** ** institutions ****** *** *******." The ***** *** ********* critical ** *** ******** of **** ***** *** Hikvision *********, ******* **** Hikvision ******* *** "******** packages **** ***** ******** vulnerabilities" *** **** *********'* "update ************** ** ******* on ******* *** ******* servers."

Similarities ** ********* ** *****

********** ** **** ** July, ********* ** *********** ******* ***** ********* ***** Pvt. ***. ** *****, which ** ****** ** Hikvision's **** ****** ****** as * ***** ******:

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*** ***** ********* ******* in ***** ******** ********* insofar ** ** ****** Hikvision ** ** ****** to *** ****** ********* and ******* ********* ********* in * *****, *** market.

Hikvision: ** *******

* ********* ******* ************ declined ** ******* ** the ** ***** ***********.

BK *****: "***** ** *** ******** ***********"

**** ******* *** ********* *******č***, * ******** *********** director ** ** *****, who **** *** ********* response:

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Benefits ** ****** * ***********

********* * *********** ** an ******* **** *** a ************. ********, * manufacturer ***** *** **** to *** * *********** as ***** *** ********* is *********** *** ********* focus **** *** **** business.

***** *********'* ****** ******* for ********** ** ***** is "********* *** ********* activities" ** *** ****** region, ****** ** ***** allows ********* ** ******* its *** ******* ** ensuring **** ** *****, which ******* ********* ******* Hikvision *********, ********* ** prioritize ********* ***** ** the ****** ******. *** acquisition **** ******* *** risk ** *** *********** unilaterally ******** ** ********** another ************ ** *** detriment ** *********.

**** ****** ********* ********* to **** ************* ********* due ** *** ****** (and *********) ***** ** the *** **********, ********* remains *** *****'* ******* manufacturer *** *** ****** of **** ** ****. Thus, ** ** ********** to ****** **** ********* would **** ** **** direct ******* **** *** sales *** ********* ** the ****** ****** ** exchange *** * ********** small **********. *** ** Group *********** ***** ***** to ** * ******** for ********* ** ***** regions ***** *** ******* may ****** ** **** more ******* **** ********** as ** ********* ** face ********** ****** *** world.

Comments (6)

"Improve" remains to be seen, INCREASE it most definitely will!

Interesting comment. I have been working on building contacts in the region and have already received a few positive responses. It would be intriguing to see if Hikvision does indeed amp up its marketing activities in the Baltics.

This is not good news for the local region. They are no longer a an interdependent distributor they are Hikvision. I hope all of the installers understand the end game here.

Brasil did a great job of repelling them and not allowing such a foothold in that market.

Yours is an extremely interesting comment and I would love to have a one-on-one chat, especially if you are knowledgeable about Brazil.

Brasil did a great job of repelling them and not allowing such a foothold in that market.

I do not see how you can claim this given Hikvision's assembly plant in Manaus. While enterprise and government may have a preference for non-China manufacturers, it is hard to argue that Brazil has completely repelled Hikvision when they have in-country assembly and sales and they have a price-conscious customer base among residential and small-scale industrial users. If anything, wouldn't you say that the Real dropping from 4.0 to 5.6 since 01/01/20 has strengthened Hikvision's local position?

What a great opportunity for a competing distributor to take the business of Hikvision's competitors.

Lithuanian National Cyber Security Centre: "Not Optimistic" About Security of Hikvision and Dahua Cameras

Dr. Tautvydas Bakšys at the National Cyber Security Centre at the Lithuanian Ministry of National Defence sent IPVM the following comment to this post on August 24, 2020.

We are glad to make a comment to IPVM about the Analysis of Hikvision and Dahua Product Samples dated June 2020.

National Cyber Security Centre at the Ministry of National Defence (NCSC) is the main Lithuanian cyber security institution, responsible for unified management of cyber incidents, monitoring and control of the implementation of cyber security requirements, accreditation of information resources. NCSC Research and Development division conducts high – scale cyber security oriented researches and design works covering Embedded Electronics, Operating Systems, Network Equipment, Mobile Applications, Desktop – Server Applied Software, including end-user equipment (e.g., IP Cameras, SME Routers).

It is worth mentioning, that NCSC closely monitors cyber security situation in the Baltic region and assures that IPVM article covering the selected theme can be considered as important and well – timed.

As is known, in Analysis of Hikvision and Dahua Product Samples, NCSC determined, that the products of “Hikvision” and “Dahua” contains multiple cyber security vulnerabilities. Some of the core packages, used in the analyzed cameras, were outdated and could be exploited, resulting in disturbance of content streaming (or recording) processes. NCSC has issued guidelines allowing public and private sector to solve the emerging cyber security issues. The guidelines were well received by the institutions operating in Lithuania and good cyber security trends are observed.

After the analysis published, UAB “BK grupe” have contacted NCSC to discuss the observations that resulted in an UAB “BK grupe” agreeing with the majority of the Centers researchers’ findings.

Findings led to a new NCSC study that examines more “Hikvision” and “Dahua” equipment, includes other PRC camera manufacturers’ products – unfortunately, the results are not optimistic. The study will be released shortly.

Visible growth of vulnerable products in Baltic region indicates, that NCSC remarks about camera security should be an important aspect and may be a criteria for self-determination. The rise of cyber security risks increases the significance of the results of ongoing researches and requires to prepare for new challenges. [emphasis added]

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