2007-2008 China Security Industry Updates

2007-2008 China Security Industry Updates
During the past 10 years, some 1,000 security manufacturers have emerged in China. These players are becoming a key link in global production. Analog CCTV cameras and DVRs are still Chinese strong field. Higher performance and more product features displayed in their latest launches. Access control and alarm products, without much update though, become more aesthetic.

In the following, A&S provide you one comprehensive China Security Industry Report from 2007 to 2008.

China's economy will grow at around eight percent annually from 2006 to 2010, predicted the Chinese government. In 2007, the Chinese security industry performed even better. There were almost 700 companies at a recent Chinese security show. Strong domestic demand is spurring advances.

First, the Safe City Project is being widely implemented in many major and secondary cities, and the 2008 Beijing Olympic Games and 2010 Shanghai World Expo are seeing security become a top priority. The endless stream of new commercial buildings, luxury villas and even intelligent communities is driving Chinese security manufacturers, especially the intercom industry, to churn out more and more products. Economies of scale are also giving Chinese companies a leg up in developing export markets.

In addition, telecommunication players are entering the security sector. They are expected to play a crucial role in the near future. They are also propelling vendors to develop products from end-user points of view.

On the corporate side, the number of mergers and acquisitions is increasing. In 2007, CSST, encompassing all its many subsidiaries, was listed on the New York Stock Market in October.

IP Surveillance: In Focus

One of the most significant trends in 2008 will be increasing focus on IP surveillance, which is just starting to take off. Intelligent functions are gaining favor in the CCTV, access control, intercom and alarm sectors with more and more features integrated into one comprehensive system. For video surveillance, the three main directions are networkability, IP storage and multifunctional platforms. Chinese network products, however, have yet to win over international buyers.

That is not the case with network cameras, though. Many Chinese camera vendors are launching updated network cameras, but compared with their Japanese, European and American counterparts, performance and features still require improvements.

China Telecom, one of the leading telecommunication providers in China, has launched IP video surveillance solutions. The company has partnered with network camera and video server manufacturers to work on "Mega Eye" projects. With one IP address, end users can do monitoring anytime, anywhere via mobile devices, such as cell phones, PDAs, PC and laptops.

In the future, more network camera vendors are seeking partnerships with telecommunication providers. In fact, the Chinese market for these types of products and services will replace North America as the world largest by 2030, forecast i & i Proplan.

Compared with other markets, transmission bandwidth in China varies by region. Local players have, therefore, become highly experienced in providing solutions to deal with such problems. Image quality and recording speed, for example, can be flexibly adjusted to suit different needs.

For large-scale surveillance, adoption of DVSs with strong network processing will step up pace. Since Chinese vendors developed H.264 algorithms in the early 2000s, the compression format has became a must-have item for DVRs, DVSs and even network cameras. Some experts, however, view Chinese H.264 products as being more like advanced MPEG-4.

Chinese DVRs, however, do not have many upgraded features. Intelligent analysis, and smart search and control are being offered by only a few vendors. These leading players are focusing more on upgrading stability and performance through integrat ion of video processing chipsets and algorithms as well as providing solutions for different market sectors, most notably transportation and finance. Furthermore, they are not producing many hybrid DVRs or NVRs either.

Multi-function Platform Providers

Application and Internet service providers are jumping into the fray. According to some experts, Chinese IP surveillance technologies may follow those being promoted by IT and communication providers. What they do in video surveillance may change the entire Chinese industry, pushing it to faster adoption of IP.

Currently, H3C has products that feature the IT over IP concept. This is being used to construct IP video surveillance platformsa combination of network, algorithm, storage and communications. Large projects, such as Safe City, suffer from many technical glitches. H3Cˇs strong point, particularly for its Epon solution, is communication via IT/IP.

Moreover, Tisson launched its e-Touch solutiona highly integrated central management system that integrates wired and wireless IP networks. The key feature is integration of geographical information and GPS systems to provide more convenient city surveillance; it is becoming very popular with the public transportation industry.

Kedacom also launched three IP video surveillance solutions for public, specific and enterprise networks with different bandwidth and management software. They provide platforms as management centers, integrating with alarm sensors. Company executives believe that NVRs will replace DVRs, and that management functionality and platforms will be key to dealing with large quantities of data.

Thanks to Safe City projects, fiber optic solutions are being used for multifunctional IP platforms. They are getting quite a bit of attention. The local demand for fiber optics getting larger produces more players. Products such as 8-channel fiber optic transceivers sell quite well in China and overseas. For large-scale surveillance, those fiber optic transceivers are embedded with matrices to connect and process more data signals. Some companies are also skilled in bundling several channels of bandwidths together to ensure the high quality transmission under the bandwidth.

Moreover, the Chinese intercom industry is going for IP in a big way. This is boosting development of intelligent home network systems in China. The crucial reason, of course, is the explosion in construction of intelligent communities. The number of intelligent home network system vendors is accelerating, and some vendors now provide IP cabling for home network systems. Meanwhile, even surveillance monitors, for example, produced by Stonesonic are highlighting IP cabling.

Analog Products Still Visible

Analog products, such as CCTV cameras, are strong in China because they are such attractive cost-effective solutions. IR cameras and domes are still the most popular. During the next five years, more Chinese players will be looking to motion detection and three-dimensional tracking technology; for now, however, the technology is not yet mature.

Meanwhile, Chinese security manufacturers are developing special hous ings wi th PTZ sys tems for large-scale, outdoor surveillance and law enforcement. Companies, such as Yaan, Minking, SAE and JEC, have launched various models especially for Safe City projects.

For night-time surveillance, Chinese manufacturers are extremely strong in IR cameras; they use high-quality IR LEDs in different arrays. Furthermore, dual-CCD IR cameras are solving traditional problems when switching from day to night. Then, many thermal or even laser cameras are meeting critical requirement for night-time surveillance. Even though CCD cameras still dominate the market, companies like Sunell are using different sensors to provide high-quality wide dynamic range. Finally, many others are working on interfaces and heat ventilation.

Besides CCTV, the analog products such as matrices and intercom within traditional cabling are still growing stably. Take matrix for instance. It has become quite powerful in scalability and is going to extend to over 65,000 channels. For some traditional analog companies, the applications of analog products are still big in certain places, such as some less-developed countries or country villages. Meanwhile, the scalability in some analog products are also being focused.

Upping Intelligence

In 2007, intercom growth rates become much higher than for CCTVs. Chinese brands Anjubao, Lonbon, Leelen, Aurine, Genway and WRTare getting stronger. Compared with overseas brands, Chinese vendors are reacting more quickly to ride IP network trends.

Since 2004, development of intelligent communities is transforming the Chinese intercom industry. One community can have thousands of residences. Solving complex cabling and networking problems to connect all these units into one system is a pressing urgent need. Chinese vendors view IP networking products as the best way to connect network up to 10 kilometers. While some companies are using IP cabling for intercoms, this is less suitable for European or U.S. markets where the distance between homes is far greater.

Single intercoms are, thus, evolving into intelligent home network systems, connecting air conditioning, lighting, and closing and opening of curtains with home surveillance equipment. Chinese manufacturers have managed to dominate the domestic market, pushing out many well-known international brands. Chinese intelligent home network systems can also connect to alarm control systems and sensors to provide protection.

This trend is also extending to card readers and controllers, which are increasingly incorporating smartcard applications and innovations in systems integration and technology. Elevators, intercoms and access control are all integrated and connected. Reformer is focusing on parking lots and access control management for large office buildings. In addition, Coson is also eyeing residential security, emphasizing products for intelligent communities that can be upgraded remotely.

About the intelligent video surveillance software development in China, some Chinese manufacturers have developed some intelligent features, such as people counting, tracking and abandoned object detection embedded in DVRs, DVS or cameras. The Chinese companies are Thakral and Launch. However, it could only be applied to some places such as unmanned environments and the functions are really simple as well. In terms of technology advancement, Chinese intelligent video surveillance is still just in the beginning.

Where the Industry Is Heading

For overseas buyers, China is very disorderly, very chaotic; it offers very little patent protection. The plethora of me-too products in China also makes it difficult for buyers to find quality products, while the explosion in the number of security providers makes finding the right partner problematic.

To differentiate themselves, many Chinese companies are launching products for niche markets. DVRs for banks and casinos, for example, are quitedifferent from those used for mobile applications. Then, other vendors are trying to give their speed domes a more aesthetic appearance to attract buyers. Finally, companies are spending more on R&D to provide higher zoom ratios, higher resolutions, stronger housings and more innovative PTZ systems.

Second, Chinese manufacturers are adapting wireless technologies for use in security. Wireless cameras for home security, wireless alarm control systems with high-expansion zoom capabilities, long-distance read ranges and even wireless intercoms are becoming hot.

Third, access control products, especially intercoms, are focusing not on the hardware but services and improve aesthetics. Alean launched a seashell PIR detector, while Sunnet Security Technology's IR photobeam sensors look like garden lamps.

With regards to the highly booming Chinese industry and too many similar products produced by China, A&S will unveil an exclusive report about Top 10 Chinese Brands, chosen by China local systems integrators and distributors, in the next issue. Total 50 winners in CCTV, digital surveillance, access control, intercom and intrusion alarm are the qualified manufacturers who have been successfully providing their updated technology, products and services to the users in China. Many of them are also selling products to overseas right now.

This report will cover some in-depth introductions to the companies, including how they gain their edge in the market, what their direction to the future market and what their potential is in selling products to overseas. It gives buyers the first ever chance to get to know these excellent Chinese manufacturers at one time.
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