International visitors to SecuTech Expo 2009 stressed the importance of establishing and nurturing partnerships with Asian manufacturers, and many see Taiwan, Korea and China as leaders in video surveillance and access control systems.
With the recession inflicting its impact on different regions of the world, international buyers shared their product needs and selection criteria. Differences in quality and support services among Korean and Taiwanese products versus Chinese ones were mentioned. Although substantial improvement has been made on the quality of Made-in-China products, lack of after-sales support and consistent quality assurance makes them generally less acceptable.
The U.S. economy is currently contracting, and local manufacturers lean toward government projects such as schools, public surveillance and transportation infrastructure to hedge the downward projection of financial, retail and residential sectors. Many projects have recently resumed, with government stimulus attempting to reinvigorate the economy.
U.S. access control giants such as Ingersoll Rand visited SecuTech for Taiwanese access control system components: door locks and power supplies. While Korea is renowned for biometric solutions, U.S. buyers looked to source their system components from Taiwan and develop their high-end solutions locally.
The government of Trinidad and Tobago recently invested US$8 million dollars on improving infrastructure and construction. As a tourist hotspot, Trinidad and Tobago needs to improve its security implementations, from megapixel cameras and RFID tracking devices to multipurpose scanners and central management systems. Buyers from Trinidad and Tobago currently source their video management software and DVRs from Taiwanese vendors, and cameras from Korean companies.
Security markets such as Argentina, Venezuela and Brazil are stimulated by rising crime rates and political instability. Distributors visited SecuTech to find the latest network cameras and DVRs, intelligent analytics, video management software and sophisticated biometric solutions.
South America's access control market amounts to one fifth of the U.S. market, and buyers from Brazil are optimistic about steady growth for e-passports and health insurance projects. Biometrics sourced from Asia should have at least 96-percent accuracy with 0.01-second recognition.
Argentine buyers were interested in Chinese analog cameras, a mature product category for acceptable quality, but turned to Taiwanese companies for network cameras and Korean companies for high-end DVRs. Taiwanese companies provide stable PTZ domes and CCD cameras for banks, casinos, airports and transportation infrastructure, while Korean companies provide high-quality DVRs and DVR cards. Mid- to low-end systems for homes and stores, where violent crime is not uncommon, look to economical Chinese analog CCD cameras.
Countries such as Turkey, Poland and the Czech Republic are ripe with opportunities and growth. The Turkish security market, currently estimated to be about $400 million, is reaching to IP-based solutions for growing verticals such as finance, retail and education. Though only 10 percent of existing systems are IP-based, network cameras and mobile solutions are gaining traction. Turkish buyers prefer Taiwanese network cameras and Korean DVRs. They mentioned that Chinese products are attractive in price but doubts of quality weigh heavily on procurement decisions.
Polish buyers err on the side of caution, factoring in the recession with price and system maintenance for IP network infrastructure, and remain loyal to analog systems. However, to improve existing systems and reduce camera count, Polish buyers were looking to source from Taiwanese providers for megapixel cameras and Korean vendors for DVRs, mainly because they are of competitive quality to European and U.S. brands but less costly.
The Czech Republic, with a security market of roughly $5 million, was hit severely by the recession last year but has been seeing signs of recovery in private companies such as small shops, factories and businesses. Czech representatives remained tuned to analog systems, provided mainly by Korean manufacturers by reason of reliability. However, some predicted that in three years IP systems will take up half the market, so buyers kept an eye out for megapixel cameras from Taiwan as well. From Chinese vendors, Czech buyers looked for mature products such as alarm system batteries and cables. It was agreed that products from China will improve in quality with time.
Mature markets such as Italy, France, Germany, Finland and Britain have been hit hard by the recession, with major projects delayed. As a result, high-end verticals such as health care, military and public surveillance have received less purchasing volume, and users are afraid to adopt innovative technologies. Buyers from Italy mentioned that in Western Europe nothing is applicable to the common market (private houses or shops), and were intent on finding low-price but quality megapixel cameras, DVRs, lens and monitors.
In Germany where quality is held in the highest esteem, buyers characterized their selection criteria as quality, delivery time, technical support and innovative technology. Megapixel cameras, video analytics and more sophisticated lenses were of major interest to German buyers, though analog cameras are still the most in demand locally. Korean and Taiwanese providers entertained German buyers with their quality and reliable products, whereas Chinese manufacturers were criticized for making "me-too" products. Buyers from Finland commented that Chinese products were fine, but they preferred Taiwanese products because of Taiwan's strong background in consumer electronics.
IP-based solutions are in high demand, with growth prospects for popular verticals such as banks, large corporations and health facilities.
Some buyers, having known of Taiwan's high-quality network cameras, have already established up to 150 partnerships with Taiwanese vendors while doing solid business for DVRs and analog cameras with Korean manufacturers.
As with Europe, IP-based solutions in the Middle East take up roughly 15 percent of the video surveillance market, but users are more optimistic about its growth, owing to easy installation.
For a population of only six million, Israel leads the Middle East in IP based infrastructure with a market size of $20 million for video surveillance equipment alone. High-end verticals such as malls and public surveillance now take the stand as residential markets suffer from the recession. Some Israeli vendors looked to Chinese companies for interesting gadgets that have video or audio recording abilities like fountain pens with inbuilt cameras and voice recorders. Most however, centered on Taiwanese network cameras and Korean analog cameras.
Singapore's current security market is at least $250 million, and megapixel and intelligent edge devices are being evaluated for real-world implementations. Bandwidth issues and affordable analytics are major limitations for growth. Buyers chose Taiwanese and Korean products for high-end applications like hotels and banks, whereas Chinese products gained popularity at retail and residential sites. Taiwanese DVRs take the lead in Singapore's market, earning their reputation with continuous R&D development and innovative niche solutions.
Despite political instability, Thailand's security market, currently estimated to be less than $150 million, also poses potential, and neighboring countries with corporate footprints in Thailand source biometric products from Taiwan for their long warranty, though Chinese access control solutions, maturing in terms of quality and attractive in price, are optional alternatives. Video analytics and central management software, two major concerns for Thai buyers for flexibility, integration capabilities and technical support, are still weak in Asian products.
Communication is essential for lasting and fruitful partnerships, and no one values strong channels of communication more than Japanese buyers. Language barriers and maintenance are top considerations for Japanese buyers, who have a cultural preference for Taiwanese manufacturers. Although Japan is currently suffering from the recession, it is expected to recover after six months, helping IP-based solutions pick up momentum. Stringent quality control, reliability and communication are the main reasons Taiwanese cameras were chosen by Japanese buyers. On the other hand, Korean products (especially DVRs) are faster in processing and have user-friendly interfaces, both major advantages in today's marketplace.
Japanese buyers also prefer Taiwanese fingerprint, palm and facial recognition biometrics, as low-price biometric solutions are in demand.
The recession, pervading all corners of the world, has left India untouched. India's security market is estimated to grow no less than 15 percent in 2009, with IP solutions achieving 30- to 40-percent growth. Government-related projects continue to flourish due to terrorist threats, and airports, seaports and public surveillance are rapidly growing verticals.
Megapixel cameras with onboard analytics are now top priorities. Fast delivery of Taiwanese and Korean products is also a defining factor, and some added that Taiwan presents a good mixture of varieties, where users can find appropriate and cost-fitting products.
Australia and New Zealand
With the Australian dollar plummeting, importing from America becomes increasingly expensive, and Australian buyers are now turning to Asian manufacturers. Next door, New Zealand presents a niche market; with the a newly elected government, the recession's impact on the country has left a resounding message: quality products are needed at a competitive price.
Coming from a country characterized by outdoor yards and facilities, buyers focused on weather and vandal-proof domes. Like most international buyers, they preferred Taiwanese and Korean companies due to their good reputation and quality with fair prices and long warranties (up to three years).
In New Zealand, the market is opening to megapixel cameras, video management software and analytics at the edge. With moving parts on PTZ cameras and high breakdown rates from rotation and water seepage, vendors are now turning to megapixel cameras, but high prices make it difficult to make that transition.
From schools to car yards, video analytics need to function through inclement weather and darkness, but current solutions are far too expensive for mid-end applications. Buyers from New Zealand have yet to find suitable analytics that work under all sorts of environments. Many New Zealand buyers have worked with Asian suppliers for years and are prepared to pay a bit more for the good production quality of Taiwanese and Korean products. Past experience sourcing from Chinese partners has been disappointing, but they will keep a close eye on the developments in China.
There is no doubt that Chinese manufacturers are a growing force to be reckoned with. With global leaders shifting their production lines to factories in China, quality control and after-sales services will eventually be picked up by Chinese manufacturers, and Korean and Taiwanese vendors must prepare for more intensified competition.
Cross-strait relations between Taiwan and China are also improving, and the two countries transfer intelligence and knowledge more so than with Korea, making it expected that more Taiwanese manufacturers will move to China to bring down labor costs.
With the world gathering on the shores of Asian manufacturers, open systems, ease of use, quality control, price performance and ROI are all factors to be considered, and those who continue to innovate while keeping all these at bay will take their place as Asia's manufacturing elite.