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Challenges and opportunities in Asian physical security market now

Challenges and opportunities in Asian physical security market now
Post-COVID-19, Asia's physical security market confronts a challenging landscape.
Post-COVID-19, Asia's physical security market confronts a challenging landscape. The pandemic-induced economic downturn has significantly impacted the region, with countries like Thailand and Vietnam, heavily reliant on tourism, facing slow recovery. This backdrop sets the stage for heightened competition, particularly from cost-effective Chinese alternatives, pushing regional players to reassess their strategies.
Complicating the scenario further are the rapidly advancing technologies in AI and digital security, requiring continuous innovation. Additionally, the sector grapples with diverse regulatory standards across Asia, demanding tailored solutions for varying market needs.
This article examines these critical challenges and the strategic adaptations by industry players, offering a glimpse into the future trajectory of physical security in the Asian context.

Economic and market challenges

The Asian physical security market is navigating through a phase of slow economic recovery, a repercussion of the global pandemic. This sluggish rebound is particularly pronounced in regions like Southeast Asia, where economies heavily reliant on sectors such as tourism are struggling to regain momentum. The impact is not just localized but echoes across the broader Asian market, underscoring the interlinked nature of global and regional economies.
“The Asian market took longer to recover from the COVID-19 pandemic due to lengthier lockdowns and travel restrictions,” explained Alex Lee, Senior Sales Manager, IDIS MEA & Asia. “The economic bounce back in some countries hasn’t been as fast as in the U.S. The tourism sector in Thailand and Vietnam is one example, and some countries are still facing the threat of recession caused by increased energy prices and inflation.”
Additionally, the ongoing Russia-Ukraine conflict introduces another layer of complexity. This geopolitical event has far-reaching consequences, affecting global supply chains and causing further disruptions in an already strained market. It has led to increased uncertainty, making it difficult for companies to plan long-term strategies and investments.

Competition and pricing pressure

A defining feature of the Asian physical security market is its price-driven nature, setting the stage for intense competition, particularly from cost-effective Chinese manufacturers. These competitors, known for their aggressive pricing strategies, have significantly influenced market dynamics, posing a challenge for other players aiming to maintain market share and profitability.
“One of the biggest challenges in Asian countries is that they remain price driven, meaning surveillance manufacturers need to combat the threat of cheap competition coming from China,” Lee added. “One strategy is to focus on large government and conglomerate, enterprise customers, which are far less price sensitive. These institutions are more focused on NDAA compliance, cybersecurity, proven end-to-end solutions, high-performance and robust hardware, and a low total cost of ownership.”
Targeting specific market segments less sensitive to price, such as government and large enterprise projects, has become a common tactic. These segments often prioritize factors like compliance, durability, and comprehensive solutions over cost, providing an opportunity for companies to leverage their strengths beyond pricing.

Clarifying misconceptions and enhancing education

Addressing misconceptions about AI technology and enhancing customer education is crucial. Companies are focusing on demystifying AI's capabilities and limitations to set realistic expectations for its application in security. This involves clear communication about AI's practical benefits, such as improved threat detection, while also acknowledging its boundaries.
“First, there are misconceptions about AI analysis capabilities,” said Alex Kuo, APAC regional business head at VIVOTEK. “VIVOTEK addresses this by offering powerful AI products, clarifying customer needs, and providing education. We customize AI solutions to meet our customers' requirements. Second, there is intense price competition in the IP camera industry. VIVOTEK enhances product education, local support, and after-sales service, thereby increasing brand competitiveness and fostering customer loyalty.”

Regulatory navigation

The Asian physical security sector faces the challenge of navigating a mosaic of diverse regulatory standards across different markets. Each country in Asia has its own set of regulations governing security technologies and practices, necessitating a flexible and adaptive approach from companies in the industry.
“Asia has very diverse regulatory standards and navigating these varying regulatory frameworks, different economic conditions, and different levels of technological readiness across the markets in Asia are top challenges,” said David Thean, General Manager for Asia at Gallagher Security. “Big markets in Asia (like China) are also becoming more protective of locally made products and are setting up higher barriers against foreign brands. At Gallagher, we adapt our strategy to meet these regional challenges by establishing local partnerships. For example, we research the different regulatory frameworks established by local government agencies and offer products that can cater to these different requirements by different markets in Asia.”

Technological advancements and strategic partnerships

To maintain competitiveness in Asia's fast-evolving physical security market, companies must focus on regular technological updates and strategic collaborations. Keeping up with technological trends and innovating through partnerships with tech developers and industry experts is crucial. These alliances not only spur innovation but also help in staying aligned with the latest industry standards, ensuring that companies can offer advanced and relevant security solutions to their clients.
“I think one major challenge is the rapid pace of technological advancements, which requires companies to constantly update their skills and knowledge to stay competitive,” said Vivianna Wang, GM of Marketing & Channel Development at Hikvision. “In the face of such immense competition, businesses are also finding it increasingly challenging to differentiate their offerings and impress the market.”
To overcome these challenges, companies in the industry are adapting their strategies in several ways, such as investing in R&D to create more advanced and comprehensive solutions, collaborating with technology partners and industry associations to stay up to date with the latest trends and best practices, and focusing on providing more customized solutions that address specific customer needs.
“For Hikvision, we see it as an opportunity to innovate our technologies and improve our solutions to offer more values to customers, pushing boundaries of our businesses,” Wang added.


In conclusion, Asia's physical security market is navigating through a period of significant transformation. The challenges posed by economic recovery, competitive pricing pressures, technological advancements, and diverse regulatory landscapes are driving companies to adapt and innovate. By focusing on specialized market segments, embracing technological upgrades, and forging strategic collaborations, these firms are not only overcoming current challenges but also positioning themselves for future growth. The resilience and adaptability demonstrated by the industry promise a robust and dynamic future for physical security in Asia.
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