IP Cameras Lose Buy America ProtectionBy IPVM Team, Published on Mar 28, 2017
IP Cameras have lost the US government's 'Buy America' protection as the Security Industry Association (SIA) successfully lobbied the government to waive this requirement based on falsely describing IP cameras as a 'DVR with a lens' and that 'IP cameras are capable of being employed without using the lens and image sensor'.
Background Buy America
The intent of Buy America, as described by the US Department of Transportation, is to:
keep American companies healthy and families working.
To that extent, Buy America requires purchasing American made products (e.g., in IP cameras, Avigilon, Arecont, Iris, some Pelco, some Aventura, etc.).
The act does have an exclusion that allows for non American made products to be waived / used:
a general public interest waiver from the Buy America requirements applies to microprocessors, computers, microcomputers, or software, or other such devices, which are used solely for the purpose of processing or storing data. This general waiver does not extend to a product or device which merely contains a microprocessor or microcomputer and is not used solely for the purpose of processing or storing data. [emphasis added]
It is this clause that has been used to waive IP camera protection.
SIA Argues 'DVR With A Lens'
SIA contended to the US government that an IP camera is 'DVR with a lens' and that just as DVRs were granted a waiver in 2008, IP cameras should be.
Below is an excerpt of SIA's petition to the US government that they provided to us:
The 'main unit' and 'lens' are from the Axis 'modular' F series. Note that SIA contends this 'IP camera' can be:
configured without the lens and image sensor at all for glass break detection - so no video files are being produced
This claim is important since the waiver requires that the device is used 'solely' for processing and storing, not transmitting, such as sending video files / streams.
US FTA Accepts
The Chief Counsel of the US FTA, Ellen Partridge [link no longer available], accepted SIA's petition and granted a waiver for IP cameras from Buy America:
The FTA accepted SIA's claim that 'IP cameras are capable of being employed without using the lens and image sensor'.
SIA's argument is technologically wrong:
- An IP camera is no longer an IP camera if it does not use a lens and an image sensor. A lens and imager are both required for a camera. Without those components, you can have an IP device but it is no longer a camera.
- Likewise, an IP camera is not a DVR with a lens. In practice, easily 95%+ of IP cameras just stream video out and do not record any video on-board (which is what DVRs and NVRs do).
- The Axis main unit + lens example is neither an IP camera nor representative of Axis or any manufacturer's IP cameras. The Axis main unit + lens is a digital camera, with a digital output, simply packaged with a DVR. Specifically, calling it a 'lens' is false since the unit contains both a lens and an imager, i.e., a digital camera. Regardless, those main unit + lens models represent less than 10% of Axis cameras, so even if that example was accepted, it could not apply to the other 90%+ of conventional IP cameras on the market.
- The Act requires the device to 'solely' process or store data. SIA has constructed this false argument to avoid the incontrovertible fact that nearly all IP cameras are used primarily to send video to other devices, and therefore fails the 'solely' process or store data waiver requirement.
SIA Defense / Explanation
In response to our criticisms, SIA explained that their interpretation was that the "purpose of the Buy America waivers was to exclude IT equipment" and that IP cameras should be included in the waiver as IT equipment. With regards to the 'DVR with a lens' argument, SIA emphasized that the "FTA has a very narrow set of regulatory requirements based on specific laws that we had to tailor our arguments based on the factors that we have to consider." However, we do not believe that 'tailoring' technologically false claims to achieve their goals is appropriate.
Hikvision Championing This
Hikvision, the Chinese government owned manufacturer, has been championing this within the industry and to SIA. Previously, they had been submitting waivers individually but now that SIA has successfully convinced the FTA on false grounds, Hikvision and other foreign manufacturers have a clear path to undersell and beat American firms. Not only does this hurt American businesses, it increases the security risk to US government buyers.
We will be sending this report and member comments to the Chief Counsel of the FTC to inform them of these false technological claims in SIA's petition.