Obstacles for growth

Stockholm, Sweden

Lennart Alexandrie, CEO and Publisher, AR Media International AB

In 2019 the IoT-revolution got a definite grip on the security technology market. Now, IoT is not just a hype, but a concrete reality that has been fully adopted by the market leaders of the security industry. This trend was clearly confirmed at all major events in 2019. At ISC West in Las Vegas, Ifsec in London and at CPSE in Shenzhen, there was a significant increase in the number of security technology solutions launched that clearly contribute to further enrich the IoT-market with opportunities.

Several examples of IoT innovations are also to be found among the 12 products/solutions that gained recognition through the recent presentation of the Detektor International Awards 2019 that took place at Sectech in Stockholm in November. The technology was not only present in the three products that were awarded in the IoT category, but it also featured strongly in the video surveillance category.

With an increasing number of open platforms and cloud-based solutions the security industry is ready to meet the market demands for scalability and flexibility. It will further open up a market with service-based business models where the customer’s needs for specific functions can be met cost efficiently. With the use of todays network technology, the security industry will also be able to offer values beyond security, using the technology to save costs, increase effectiveness and profitability for the customers.

Opportunities for the security industry

IoT means huge opportunities. Smart buildings and smart cities will be highly dependent on security. With artificial intelligence (AI) we will see further development in the processes of developing smart buildings and smart cities. The progresses in AI are fast. At this year’s final big event CPSE in China, there were several exhibitors displaying solutions based on AI. However, the way to use AI in Europe will certainly be different from the way it is used in China due to privacy laws and legislations within the EU.

The soon to come 5G, will further boom the IoT-development and create real opportunities to develop smart cities. So there are reasons to believe in continuing strong growth for the security industry. Especially since the demand for security is increasing in most countries due to increasing severe criminality (not least IT-related criminality) and of course the terrorist threats. But there are also obstacles.

The battle of the giants

The strong growth for many years has also been based on a general economic boom in most industrial countries. Now, there is reason to be more cautious in forecasting the future. The trade war between USA and China is a factor that accelerates the end of the boom. What this leads to very much depends on the outcome of the negotiations between the two superpowers.

So when summarising 2019, it must be said that it is a year in which, more than anything, politics has played a direct role on the market for security technology. Especially since the US government decision to blacklist the video surveillance manufacturers Hikvision and Dahua, among 26 other Chinese tech companies. The reason behind the decision to blacklist 28 Chinese companies, according to the US Commerce Department, is that “the entities have been implicated in human rights violations and abuses in the implementation of China’s campaign of repression, mass arbitrary detention, and high-technology surveillance against Uighurs, Kazakhs, and other members of Muslim minority groups.”

This ban against the two video surveillance giants – with an estimated total global market share of more than 30 percent – means that they are not allowed to buy components from US companies . Also Sensetime Group Ltd and Megvii Technology Ltd – leaders in facial recognition technology – are also included on the blacklist.

The ban will of course affect Hikvision and Dahua but also their US partners. If countries in Europe and Asia also take similar actions against Chinese companies then the impact of the trade war will be even more severe, not only affecting the growth of the security market but the world economy as a whole.


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