US Government Entities Hard Spec Hikvision

Author: Brian Karas, Published 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 government's primarily owned manufacturer, Hikvision, they are requiring all bidders to use Hikvision.

Is this a smart or dangerous move? Inside, we review the RFPs and the issues in hard specifying products, in general, and specifically Hikvision.

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Comments (50)

Hard specifying products can be justified when the buyer needs a very specific feature or function.

Aren't they also justifiable when they are specified because the entity has standardized on a single vendor to ensure homogeneity and increase interoperability and reduce related support issues?

Yes, though from a pure bid perspective I think that is less common.

In many cases if they already have an installed base of product and they want to expand they are going to go back to the same bidder as the original system. Of course, this might vary if the expansion is at a remote site, or several years have passed and it needs to be re-bid by current integrators.

Also, in the case you describe they still might not be justified in hard-specing. You could specify "a camera compatible with Avigilon VMS, with HDSM 3.0 support", or "A VMS that offers full functionality with DvTel cameras". Granted, there is really only going to be 1 option, but it opens the possibility that a bidder could present an actual alternative product the customer wasn't aware of yet.

Also, if a product manufacturer is being hard-spec'd for expansion purposes, the bid will usually have less A&E-style wording (as this one did) and will just say "Bids to install 10 Model X, 14 Model Y and 27 Model Q cameras from FooCam, Inc., plus setup and configuration into existing FooVMS."

Sad. If only a robot employed US factory will rise and be competitive enough to take back the business.

This Haverford bid also has a no substitutions section for Avigilon, what do you make of that:

We noticed that as well, though that is for a different system (it's also a different section of the doc 282310 vs. 282300).

We've covered Only Bids For Avigilon Will Be Accepted in a previous discussion.

The core topic this behind this report is not just about any product being hard-spec'd, as much as it is about US Government (and thereby most likely taxpayer-funded) projects hard-specing Hikvision (which has documented ties to Chinese government), and potential concerns around that.

The core topic this behind this report is not just about any product being hard-spec'd...

No but I'm guessing Simplex Grinnell has had ample opportunity to explain to Haverford where exactly Hik comes from, like any responsible competitor would.

Then again maybe SG is planning on providing the Hik as well.

Unless I am missing something, this is not the US Federal Government requesting these but a small municipal government in Pennsylvania.

It feels like these Hikvision articles are more for fear mongering than meaningful conversation at this point.

[I work in an environment that due to security concerns will never install Hik products, but do have them at my personal residence]

U3,

In general, hard specifying products is a controversial practice among integrators and manufacturers (e.g., the above referenced Avigilon case). Indeed, hard specifying is frequently abused and violates US government contracting rules. That, in and of itself, it something that people in the industry want to hear and discuss.

Beyond that, we believe there is a real issue that US government entities, whether local, state or federal, are not fully aware of the background of Hikvision.

You're welcome to contribute to a meaningful conversation but, ironically, calling it fear mongering undermines your stated intention.

First, and not trying to be argumentative - I agree with the distinction that U3 is pointing out above: Among my peer groups - both in my industry (I'm an end user) and in the emergency response communities I often interact with - the phrase "U.S. government" is generally taken to mean the Federal government. There are typically clear distinctions between Federal, state, county, and municipal governments, and to some extent there are different sets of laws governing each, with those laws varying to some degree on a state-by-state and/or locality-by-locality basis.

I would submit that the title of the article is somewhat misleading, as the examples used above are a municipality and a county. Perhaps "PA Local Government Entities Hard Spec Hikvision" would be a more appropriate and informative title. I read the article expecting to see a spec sheet from NSA or U.S. Secret Service calling for Hikvision. :-)

That said, I think hard specs like these examples, particularly where there are MANY equal or better products available make it very difficult to justify a sole-source selection. Not impossible, mind you, just very difficult. There may be issues of interoperability (not all ONVIF devices are created equal), lack of full use of camera feature sets from within their chosen VMS (not all VMSs speak the same dialect of ONVIF), etc., that might be a basis for justification, but I didn't read the full specs that were linked with these examples.

dang it. I think I mistakenly clicked yes on teh survey but 100% meant NO they should not hard spec or even consider HIK

...I mistakenly clicked yes...

If it's any consolation, I mistakenly clicked no...

I don't know how they got around BAA (Buy America Act). If you use Federal Dollars on any project (including local jobs with Federal Funding), you have to write substantial justifications to move the needle to allowing foreign products. In regard to Chinese Products, that needle is very hard to overcome. I used to write justifications for Mobotix Products. As they were a favored trading partner on an approved list, it wasn't that hard. That said, China is not on a friendly list. This is a shocking turn-of-events. I won't stoop to denigration of the HikVision line of products, its just that the Federal government CANNOT circumvent their own policies (https://www.gpo.gov/fdsys/pkg/CFR-2010-title48-vol2/pdf/CFR-2010-title48-vol2-sec52-225-11.pdf)

Furthermore - here is the list of approved countries from the FAR/DFAR:

225.872-1 General.

(a) As a result of memoranda of understanding and other international agreements, DoD has determined it inconsistent with the public interest to apply restrictions of the Buy American statute or the Balance of Payments Program to the acquisition of qualifying country end products from the following qualifying countries:

Australia

Belgium

Canada

Czech Republic

Denmark

Egypt

Federal Republic of Germany

Finland

France

Greece

Israel

Italy

Luxembourg

Netherlands

Norway

Poland

Portugal

Spain

Sweden

Switzerland

Turkey

United Kingdom of Great Britain and Northern Ireland

Do you see CHINA on this list? - Nope.

That said, the FCO (Federal Contracting Officer) can make a decision to go with a less expensive product IF they are part of a trade agreement OR if they believe that the price of domestically available products is excessive.

Here's my take on this - the FCO sought through an RFI pricing for camera products (in a generic sense) and government suppliers (contractors) provided bids that were wholly unacceptable to the FCO with the exception of the HikVision vendor. I would still think that those vendors who sought to bid the work can play the BAA and ask for certifications from the FCO (even to the point of going to the GAO and Federal Ombudsman authority) to seek consideration.

The last thing is that with the price being so low on some of their products (HikVision) in addition to the direct intervention by the Chinese Government (fiscal support), it's unfortunate that our Government (US) hasn't pursued a WTO violation on this product line - it's clearly an effort to prop up an industry to destroy local commerce. The only real people who start one of these initiatives is the state department and they just seem to be "treading water" right now with the entire email scandal. I'd suggest that a US manufacture lodge a direct complaint with the State Department and seek a WTO case for ruling against the Chinese Government.

My two-bits...

The last thing is that with the price being so low on some of their products (HikVision) in addition to the direct intervention by the Chinese Government (fiscal support), it's unfortunate that our Government (US) hasn't pursued a WTO violation on this product line

Related: Should The U.S. Government Investigate Hikvision For Predatory Pricing?

I'd suggest that a US manufacture lodge a direct complaint with the State Department and seek a WTO case for ruling against the Chinese Government.

Ed, this topic came up on discussions with a number of manufacturers. The main concern raised was that any manufacturer who lodged a complaint against China would very likely face retribution in China (i.e. you try to block our sales, we will block you out of China). So, if that happened, it would likely have to be a manufacturer who did not sell to China.

Surely western manufacturers don't sell that much in china anyway.

The lure for many Western manufacturers is that the Chinese market is so large so they think "hey if I only got 1%", etc., etc.

Perhaps the calculations will change now that Chinese companies are selling so much in the West, i.e., the potential Chinese market becomes less than the actual Western market they stand to lose.

How Axis can win deals of any size in China is a mystery to me.

because

  1. They must be even more price disparity as Axis has added sales/logistics cost and Hik has less.
  2. Hikua's product line in China is far more extensive than what we see here.
  3. What Chinese business would want to look disloyal by buying from the West?

Maybe if they were selling Xprotect or something China really needs...

Maybe if they were selling Xprotect or something China really needs...

They may need it but that does not mean it's valued. From talking to Western manufacturers, the impression they give was that VMS software is not broadly valued.

To your #3 question, there are some large private Chinese businesses and there are Western companies with divisions / branches / offices that value or standardize on Axis / Milestone / Genetec / Sony, etc. but that's the exception rather than the rule.

We touched on this here: Pelco Hires Axis China Sales Director

Simon - they don't sell a lot based upon Chinese Government trade restrictions prohibiting them from selling in that market. It's not that they don't want to, they can't or are prohibited unless they expose their "back-end" code for Government Inspection. The U.S. (in the security industry) is not a leader. It is, however, a large consumer and we buy (mostly from Asian Rim countries - Japan, Korea, Taiwan, China) an appreciable amount of their tech. To be fair, I think that we need to get our heads out of the notion that we are ever going to be relevant in the digital "camera" space unless we place substantial restrictions on trade from countries that dump their product in our market. It's hard to have innovation in the U.S. when your design, engineering, manufacturing base is so expensive.

U.S. companies would do better to be the innovators and look at ways of changing the market through technology advances in areas OTHER than camera manufacturing. We're simply not good at it (and I don't think until we change our perspective on purchasing - we ever will). It's funny, however, that Apple now only focuses on "software dev" in the US and outsources it's hardware form factors to FOXCONN. I challenge you to name, at minimum, five GOOD U.S. manufacturers of digital camera products. (note the GOOD in that statement - quality is important).

Waiver # 3 thats how

Can you share the text Waiver #3 with us, since I assume you have it in front of you?

I have no desire to get into any type of contest over this as it has been thoroughly discussed many many times over. I am simply answering your question to display waiver # 3 as I indicated.

Thank you for your understanding.

No, thank you, Marty as I wanted to be sure we were looking at the same thing. This exemption applies to buy america with respect to raw materials only. Maybe there is another one like it that applies to manufactured goods?

I think western companies need to get there act together especially Canon/Axis/Milestone before there's not much left. There is no point being afraid of a market that you don't have and will probably never get and one that is taking your existing market.

And there's no point innovating and going for that market if like you say they have to expose there "back-end" code. They will only copy it and you wont have leg to stand on.

I totally disagree with you there. Look, we (in the west) have a much higher tolerance to paying "real" money for goods and services. For instance, a Mercedes in Germany costs a fraction of what it does in the US - why? Tarrifs, duties, transport? Maybe, but perhaps its the fact that we have, and excuse the language, a crap load of money to burn through and these things are "status" symbols. In China, a similarly equipped Mercedes goes for 1/4 the price the US market would pay for the same vehicle. The real issue here is, our manufacturing (western) can't afford to compete in China at the price points they're pushing on the local market. AND When China won't play by the rules (currency manipulation, market flooding, illegal subsidies) there's really no point in trying to compete when you're going to fail from the outset. We need to lower our overall expectations of what is "profitable" and be content for less OR we need to outsource our manufacturing (as most camera manufactures do) to the Chinese to create our products less expensively for broader mass market appeal at a "walmart" price. This is a losing battle on commodity products - sorry. When I appealed to the innovation side of the coin, it's inevitable that they will copy, change and resell for 10% of the US price - just to kill the competition. China doesn't respect our IP laws (patents or otherwise). When I speak of innovation, I'm referring to products that enhance (Remember the old BASF ad - we don't make the rubber - we make it better). That's what we need to be doing. I think of things like Radar or perimeter protection. The camera becomes a commodity in that vein, the Radar is the real star.

Okay - enough of this rant.

I appreciate the sentiment regarding other sophisticated systems such as radar, but I wonder if commercialization of these technologies are really likely to be any more fruitful than security cameras have been?

Very inexpensive software defined radios are democratizing the development of many kinds of radar. Exciting things are happening in garages and basements around the world. Unfortunately, this implies that "the west," while very capable, no longer has a lock on this sort of technology. In fact, with the advent of Radio Frequency chips like the AD9361, the center of gravity is moving toward the chip fabs.

So, in my admittedly uninformed opinion, it may be more relevant to ask, "Which countries have the most impediments to successfully commercializing technology? Which have the most support?"

There, some evidence is available.

Who has been the most successful at commercializing and globally marketing:

TVs?

Computers?

Stereos?

Cameras?

Automobiles?

etc.

Structurally, I'm curious about why the west no longer holds a commanding lead. Is it others just catching up? Is it just manpower costs? ...or are there other issues?

Energy costs,

trade tarrifs,

Unfair financial aid to countries that don't need it (they have space programs for f*~ks sake) to name a few.

You probably were never in the military, you have a "Let's just give up mentality." So who decides what is important? You, or others, and we just get told what we can manufacture, only if we can make it better, because China can produce it lower if not better?

When Americans stand up and say, OK, China, it is time for you to play by the same rules, then we will be on same level and our manufacturing can and will turn around. More jobs in the U.S.

Hello, Look at the trade deficit with China, You think the staggering difference helps the US.

YOU should have taken Economics in college and passed it

You probably were never in the military, you have a "Let's just give up mentality."

Temper Fi, Undisclosed 9 Marine :)

Canon/Axis/Milestone is NOT a western brand any longer. They are Japanese owned.

Canon/Axis/Milestone is NOT a western brand any longer. They are Japanese owned.

In this industry at least, some of us consider the Japanese to be honorary members of Team West.

Economics make strange bedfellows.

Not when they have started buying cameras as OEM from China

A Chinese camera is a Chinese camera, does not matter if you change the white label to a Japanese label or a white label sold by ADI, Tri-ed, ect.....

I worked for the Japanese for years and I never thought I would see Japanese company, Panasonic, buying lower end cameras to compete in US. Seems to me, desperate measures.

Seems to me, desperate measures.

...for desperate times.

"In China, a similarly equipped Mercedes goes for 1/4 the price the US market would pay for the same vehicle."

Huh?? Which China?

It's another way around. Mercedes/BMW etc pricing in China is much much higher than what pay here in the States.

Good article, thanks, Brian.

This inspired me to spend a significant amount of time searching Federal Business Opportunities at FBO.gov for any solicitations from any agency, for any location, and any classification, over the past 365 days (the maximum history accessible to search), related to video surveillance and security cameras.

When restricting Google search to site:fbo.gov, Google tells us that "A description for this result is not available because of this site's robots.txt"

Since FBO is inaccessible to Google, you're at the mercy of Federal excellence in software, which as multiple recent events have demonstrated, provides a consistently superior user interface for absolutely superb federal transparency.

I searched for a variety of Hikvision models from the IPVM camera finder, across a range of resolutions, prices, and functions, without discovering a single federal solicitation over the past year that specified the Hikvision brand or Hikvision models, even by example.

More broadly, although searching the FBO.gov archive with keywords "security camera" and "video surveillance" turned up only a limited number of solicitations, some of those called out specific models (or equivalent), typically associated with very specific needs or else with compatibility when replacing inoperative cameras or expanding systems. Just by way of example,

M00263-16-T-1014 requested Pelco Spectra IV SE and Pelco FD5-DV10-6 or equivalent.

N6893613F0107 requested FieldPro 5X MWIR cameras

P15PS02002a requested Avigilon 2.0-H3-B1, Avigilon ES-HD-HWS-SM, Avigilon 3.0W-H3-DO2, etc.

From this, I conclude that particular vendors and models (or equivalent) are being specified in federal solicitations. While it's difficult to prove a negative, the fact that a reasonable search fails to turn up federal solicitations for Hikvision brand or models suggests that such federal activity is, at most, uncommon.

The challenges experienced while researching this post may have turned up a whole new topic: searches for video surveillance exposed less than 100 results across the entire federal solicitation base for the past year, yet it seems reasonable that there must have been at least several thousand video surveillance procurements across the federal infrastructure in that timeframe. Perhaps there's an art to pulling relevant information from FBO.gov. In some cases, it seemed as if FBO.gov was pushing information seekers to non-government web sites that appeared to be less accessible and transparent, placing some of the solicitation information behind a registration wall (perhaps this is only the case for solicitations which are no longer open?). Certainly there has been a deliberate choice to prevent the kind of transparency that Google indexing can provide.

From my poor search results, I suspect that businesses which understand how to discover opportunities within FBO have a very significant selective advantage in accessing the federal marketplace. With its video surveillance focus, who knows -- there might be the basis of an IPVM article here...

FWIW, I noticed this one from 2014, for 38 Hik cameras.

Wow, nice one! I don't know enough to replicate that search, but from your post I learned that you can specify a date more than 1 year in the past. Still a lot to learn about FBO.gov...

FBO is a great tool but when looking for a state or local bid, may or may not be able to search for the opportunity.

I would be astonished if there was not a significant financial inducement involved and one hopes that the facts are bought to light soon. I struggle to understand the lack of concern for cyber security. Basically

Here's a bid for a school in India that was pre-loaded for Hik, but done a bit too obviously to get away with.

Couple of quotes:

Seem the specs has been copied from HIKVISION its their nomenclature. Request to please make it generalized for all.

Generally Bosch/Pelco/Sony cannot compete with Hikvision in term of technology & costing. Request you to keep same range of make or add equivalent brand of Dahua or CP Plus which are equivalent with Hikvision

Out of the 4 brands mentioned only Hikvision has 256 channel NVR. Therefore requesting you to add CP Plus and Dahua brand so that there is fare competition

The technical specification of all CCTV products in the tender seem to be inclined towards a particular OEM – “Hikvision”. Therefore, request you to please make general technical specification of CCTV products to give equal opportunity to all. Also as per CVC guidelines, Point no. 8.3 – “Unduly restrictive criteria, creating entry barrier for potential bidders” is restricted.

Central vigilance commission guidelines for public Procurement. It is mentioned in the check list that “Whether there is any deliberate attempt to make the pre- qualification criteria suiting to particular bidder(s)”

1, good find. Often, end users / consultants just double down when called on this but it looks like this one was more reasonable. This was particularly funny:

"Make sure and get the housing size written in, and its a cinch!"

So John, when will this appear in the local news paper's investigative reporting section... or better yet, tweeted to Trump... could be the Chinese will supply us with ample "Fireworks" for the 4th in the form of headlines if this hits Fox news...

It's not unusual for city and state government to buy cheap anything.

You will not see DOD buying Hikvision. China is not a favored country and will never be one as long as it is ruled by Communism. So until something freezes over.

I don't think anyone gave the end user info on Hikvision background and I doubt if the decision maker has the intelligence to check anything out besides pricing.

We just bid on 3 major opportunities and in all cases, customer excluded any company that has product made in China. This also excluded Panasonic's new low end line.

This was after they were given verbal info we shared from IPVM.

Have to give IPVM credit. I may not always agree with IPVM but I like their words when it comes to US protection.

What line did you quote?

Government entities specifying a product that has been reviewed, tested and proven un-secured and low performing is simply IRRESPONSIBLE.

Are we talking about Axis here?

No, I believe he means these guys:

Or....

Bosch

Panasonic

Avigilon

Don't get me started on Sony :)

Bottom line is no manufacturer is immune to exploits. For sure, some handle them better/quicker than others. But, to dismiss one manufacturer due to past issues is to condemn them all.

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