By Prasanth Aby Thomas, Consultant Editor
Article originally posted via A&S International.
The US ban and shortage of HiSilicon chips that were an integral component of many companies’ security products, was probably one of the biggest news in 2019. Although the issue has continued to hit the headlines with several accusations back and forth at political and business levels, the industry seems to have broadly accepted that they need to find alternative solutions.
In this article, we share comments from some of the largest physical security solutions manufacturers on how they plan to deal with this new change in the US, and how they are dealing with the shortage of HiSilicon chips.
Keen Yao, VP, Hikvision Digital Technology
As a matter of company policy established at its founding, Hikvision has never relied on any exclusive supplier relationships during the product design process. In light of the increasingly uncertain geopolitical situation that began in 2018, the company has focused on alternative supply plans for significant components. We will remain focused on continuously providing quality products and services to our partners through the company’s sustainable and compliant global supply chain.
Joon Jun, President of Global Business Division, IDIS
As a result of both the changes to NDAA in the US in August and growing awareness and demand for increased cybersecurity, we saw the ‘race to the bottom’ in terms of pricing come to an end in mid-2019. The market has stabilized since.
In the short term, manufacturers will certainly have more scope to increase pricing for NDAA-compliant kit, but since all major and respected players are on track to migrate away from HiSilicon chipsets or have lineups that are compliant, this is likely to be short-lived.
And the demand for NDAA-compliant cameras and recorders has increased not just in the US but across much of Europe as large end users and systems integrators consider existing US operations or future ones. We expect this to be a continuing trend.
Yoon Chang-Soo, Head of MEA and APAC Sales, Hanwha Techwin
Hanwha TechwinWe are expanding the NDAA-compliant product lineup. We will also embed new chipsets in our storage for a range of lineups from cost-effective to high end. We will remove any barriers to purchase that our customers may experience.
Peter Chang, Director of Product Development Division, VIVOTEK
For VIVOTEK, we will choose different chipset suppliers to meet the client’s needs. Except for pricing, customers care more about NDAA- compliance, quality, and value-addition. We expect there will be more chipset supplier upgrades and offer more powerful chipset in an affordable range next year.
We see two factors might drive growth for the coming year. One is an NDAA-compliant product, and the other one is the post-pandemic solution. As for NDAA, it will be stricter in 2021. HiSilicon used to be one of the biggest suppliers in the surveillance market, but the US now bans vendors providing products/services with HiSilicon. This action will drive video surveillance provider to speed up transformation to select alternative options compliant with NDAA.
We do not resell cameras today. However, they are a key integration item for us as we deploy large scale enterprise solutions and even smaller cloud-based deployments. We are expecting that cameras from companies that are not banned will be able to backfill the market needs. While this could result in a slight increase to costs, the added security gained will drive continued sales and future deployments.
Despite the controversy surrounding a ban in the US, companies worldwide appear to focus on alternate chipset makers to avoid further disruptions to their business. This is a pragmatic decision at this stage when most of them are already struggling with the impact of COVID-19 and the financial crisis that followed. But what remains to be seen is what will emerge as the biggest replacement to HiSilicon.