The security industry is undergoing a significant transformation, with competition intensifying at an unprecedented rate. Industry insiders suggest that companies not in the top tier must either collaborate with leading firms to provide supporting services or focus on specific sub-sectors to build their own core competencies. It's clear that apart from Hikvision and Dahua, traditional security firms have evolved into major players. Newcomers like Hanwang Technology, iFLYTEK, and Shang Tang are also rising rapidly, leveraging AI as their key technological edge.
**Industrial Development Speed**
As smart cities, smart parks, and intelligent transportation systems continue to expand, security technologies are becoming more deeply integrated into these infrastructures, playing a vital role in their development. According to Tonglian Data, from 2012 to 2016, China’s major listed security companies experienced strong growth, with revenues increasing significantly. The biometric identification sector also saw rapid progress alongside the industry's expansion.
Hanwang Technology has developed a range of intelligent security products and system solutions, widely used across government, education, finance, transportation, public security, customs, airports, border control, smart cities, communities, construction sites, and healthcare. Companies like iFLYTEK and Shang Tang have also entered the security space, using facial recognition as a breakthrough. As technology evolves, security needs are shifting from single products or services to comprehensive solutions.
Hikvision focuses on delivering full-scale solutions in areas such as public safety, transportation, and smart buildings. Dahua Group has expanded its overall solution approach to include smart city initiatives and traffic control. GTS Technology has built industry-specific solutions around smart cameras and cloud services, covering applications like face recognition access control, sky-eye monitoring, and dynamic facial recognition. These solutions have been adopted by national agencies including border and public security departments.
Providing holistic solutions has become a common strategy among leading security companies for years now.
**Collaborate with Industry Leaders or Focus on Niche Markets**
With the rise of artificial intelligence, big data, cloud computing, and the Internet of Things, the security industry is evolving toward greater intelligence. AI has not only addressed long-standing issues but has also transformed the industry into a smarter, more tech-driven sector.
As competition intensifies, small and medium-sized security firms may struggle to compete directly with giants like Hikvision and Dahua. However, in the long run, the emergence of AI has created new business opportunities. AI-focused companies tend to outperform traditional security firms in vertical markets.
One challenge in China’s security industry is the ease of entering the market. During periods of high demand and fast growth, many inefficient or half-baked companies have joined, often focusing on low-end products and short-term profits, which has led to quality issues.
With the rise of the internet, the security industry is moving towards integration, networking, and intelligence. New entrants should closely follow advancements in frontier technologies, accelerate their shift toward networked and intelligent systems, and focus on niche sectors or support roles to build sustainable competitiveness and capture broader market opportunities.
Artificial intelligence has become one of the most urgent needs in the security field. The future of China’s security industry lies in intelligent hardware. The question is: who can use AI to define hardware? Who can achieve seamless hardware-software integration? This remains a challenge for both AI startups and traditional manufacturers.
Industry experts believe that AI companies currently favored by investors still face disadvantages in terms of market presence, application scenarios, and real-world samples. They need time to refine their technology and business models.
Security is one of the AI sectors where large-scale implementation is possible. To succeed, these companies must position themselves as product and solution providers, thinking from the perspective of real-world applications and understanding the actual needs of the security industry. Their goal should be to do what matters most, rather than just doing what's easiest.
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