As we all know, the industry has a very clear definition for traditional security system integration. Security system integration refers to the integrated design, installation and debugging, interface customization development and application support of relevant equipment and software by using generic cabling technology, communication technology, network interconnection technology, multimedia application technology, security protection technology, network security technology, etc. for the purpose of building a security management platform within an organization.

The subsystems for the integrated implementation of the security system include: access control system, building intercom system, monitoring system, anti-theft alarm, all in one card, parking management, fire protection system, multimedia display system and remote conference system. Security system integration can not only be an independent system integration project, but also be included in the intelligent building system integration as a subsystem.

In recent years, China’s urbanization process has been accelerating, the urban operation system has become increasingly complex, the security risks have been increasing, there is a large imbalance between the current situation of rapid urban development and the ability of urban security governance, and the scope of urban public security has been expanding. From social security to traffic safety, from production safety to life safety, ecological safety, etc.

On the other hand, with the construction and application of new infrastructure such as artificial intelligence, cloud computing, big data, 5g and the Internet of things, as well as the continuous iterative updating of video technology, “ai+ security” capability has broken through the connotation of traditional monitoring and security, and the business boundary of security system integration is constantly expanding and penetrating into business applications in all walks of life, which means that the industry is gradually entering the pan security era.

Under this general trend of evolution, the business model of the security system integration market is also changing, specifically as follows: the construction mode continues through conventional, bt/bot advance by stages and other construction modes, while the proportion of new cooperation modes such as PPP joint development is expanding, the forms of cooperation between integrators and Internet giants and operators are becoming more and more, and the interaction mode with downstream customers is gradually changing; In addition, customized and personalized services make the software more viscous.

It is worth mentioning that, unlike other subdivisions of Ti integration, the domestic security system integration industry presents a cyclical feature. As most security projects are government public security investment projects, the public security investment mainly comes from the party and government departments. The planning and investment of engineering projects will fluctuate with the investment planning of the party and government departments; The investment in operation and management shows a trend of rapid growth year by year, which is mainly related to the annual increase in the total amount of investment projects. On the other hand, with the promotion of urbanization, the increase of urbanization rate, and the shift of security construction focus to rural construction in key areas, the total amount of security projects will continue to increase. In addition, with the upgrading of security products and technologies, the replacement project will also form a corresponding rigid demand. Therefore, the periodicity of security projects is closely related to the government budget, the overall government investment behavior and the changes of social security needs.

“Policy + technology” double drive, security system integration enters a period of development opportunities

Driven by national policies and internal demands of the industry, as well as emerging technologies such as artificial intelligence, IOT and 5g, the security system integration industry has maintained a stable growth and a high prosperity.

(1) Driven by policy and industry demand growth

In recent years, the driving factors for the rapid development of China’s security industry mainly come from the strong demand of safe cities, bright projects, intelligent transportation, public security, justice, finance, education and the military. At this stage, China is in the process of high-speed urbanization. The economic development, especially the implementation of policies such as safe city, smart city and intelligent transportation construction, which are closely related to the security development, and the enhancement of public security awareness have still maintained a good growth momentum in the security industry.

In the past three years, the central ministries and commissions and local governments have intensively issued a large number of policies to guide and promote the development of industries related to intelligent perception, artificial intelligence, big data, cloud computing, etc.

In january2018, the general office of the CPC Central Committee and the general office of the State Council issued the opinions on promoting urban development. In June 2018, the Ministry of industry and information technology, the Ministry of emergency management, the Ministry of Finance and the Ministry of science and technology jointly issued the guiding opinions on accelerating the development of safety industry. In December 2018, the central economic work conference redefined infrastructure construction, defining 5g, artificial intelligence, industrial Internet and Internet of things as “new infrastructure construction”, Infrastructure is listed as one of the key tasks in 2019.

In october2019, the Fourth Plenary Session of the 19th Central Committee of the Communist Party of China adopted the decision of the Central Committee of the Communist Party of China on several major issues concerning upholding and improving the socialist system with Chinese characteristics and promoting the modernization of the national governance system and governance capacity, which clearly established and improved the system and rules for administrative management by using the Internet, big data, artificial intelligence and other technical means, promoted the construction of digital government, and strengthened the orderly sharing of data, We will accelerate the construction of a three-dimensional and information-based social security prevention and control system.

By promoting the modernization of urban governance through big data, cloud computing, artificial intelligence and other means, big cities can also become more “smart”.

The continuous introduction of smart security and related policies will drive the security industry and industrial Internet to converge in the largest application scenario of smart city. After being grafted into the framework of smart city, the market space for security system integration continues to expand.

(2) AI technology brings intelligent upgrade application

After decades of development, China’s security industry has become a growing information industry with broad market applications, relatively complete industrial chain and a certain scale. Under the wide influence of 5g technology, Internet of things, big data, cloud computing, smart city applications, artificial intelligence algorithms and other new technologies and applications, the security system integration industry continues to iterate, and the industry has huge incremental space.

The growing maturity of Internet of things, AI, big data, cloud computing and other technologies has led to the continuous expansion of the number and scale of new security systems, and the amount of data generated has grown exponentially; The penetration rate of AI is higher and higher, and it is closer to the actual application. The completed system has gradually begun to be intelligentized, and the whole market space is gradually being opened.

With the alternative breakthrough and iterative development of computing power, algorithms and data, the iteration speed of products in the public security industry will be accelerated, and the landing speed of intelligent security scenarios will also be accelerated. According to the 2019 Research Report on the development of China’s ai+ security industry by iResearch consulting, the average annual compound growth rate of the domestic ai+ security software and hardware market scale reached 125.5% from 2017 to 2020, doubling every year. It is expected that the smart security market scale will reach 45.3 billion yuan in 2020.

Globally, the public security situation is still grim, and the global security industry is growing rapidly. According to the prediction of Minsheng securities, the global intelligent security market currently maintains an average annual growth rate of 15%. Considering the increment brought by AI, it is expected to bring about 20% increment to the market from 2019 to 2025, opening up the long-term growth space of the security system integration industry.

The impact of non market factors is short-lived, and the growth trend can be expected in the future

Since entering the 21st century, the domestic security system integration market has been showing a trend of rapid growth. In 2019, the domestic economic growth slowed down to 6.1%. Due to the impact of the general environment and the governance and rectification of security end-users, the supply of industrial equipment and software is gradually saturated, and the growth of the security system integration industry has also slowed down in the short term.

From the perspective of volume, according to the statistical data of a&s research, the scale of China’s security system integration market from 2014 to 2019 was 219.764 billion yuan, 256.333 billion yuan, 281.966 billion yuan, 315.8 billion yuan, 363.170 billion yuan and 406.751 billion yuan respectively, with growth rates of 12%, 10%, 13%, 15% and 12% in recent five years.

In 2020, the national economic situation will stabilize, and cautious optimism is the general trend. The security industry continues to upgrade and expand along with the overall digital transformation wave of the country, looking for new development opportunities: new technologies bring new development momentum. Driven by the new generation of information technology, the Internet of things, big data, cloud computing and artificial intelligence are applied in the industry, the integration of cloud products and the empowerment of AI make the security intelligent front-end more and more abundant, and the 5g era is coming, It brings more application possibilities to the industry.

The outbreak of the new type of coronary pneumonia in early 2020 is expected to have a great impact on the global economy, and the growth rate of government and enterprise investment may be restrained in the short term. In the long run, the epidemic highlights the importance of public safety and emergency management, and the government and enterprises are expected to increase their investment in the field of public safety.

In the next few years, the entire security industry is still in a stage of rapid development, and security system integration, as an important part of it, will continue to grow for a long time in the future. The key drivers are:

The domestic and international demand for the basic construction of security technology products, the demand for system upgrading and the expansion of new business forms will maintain a steady growth trend, and the security market demand is still strong. The data shows that in July 2020, the prosperity of the security industry showed a warming trend month on month, with the amount of bidding +26%/101% year on year respectively. The continued improvement of the bidding end mainly benefited from the strong demand in the public security field.

With the wide application of 5g technology, cloud computing, big data, Internet of things, artificial intelligence, blockchain and other emerging technologies, emerging security needs are also emerging. Compliance needs and spontaneous needs will jointly drive the sustainable development of the industry space. At present, the security industry has begun to enter an intelligent period. The implementation of standards, the maturity of AI and other cutting-edge technologies have accelerated the construction of smart cities, which will bring the security industry into a new round of intelligent growth.

Since the beginning of the year, the new type of coronary pneumonia has had a far-reaching impact on the politics and economy of countries and regions all over the world. In the face of the threat of the sudden epidemic, the new type of security measures have also received further attention. Considering that the overseas epidemic is still not over, its impact on the security industry needs further observation.

Public safety investment continued, and emerging markets grew rapidly

With the continuous innovation of emerging product technologies in the industry, security integrators continue to expand their security products and application scenarios. Security system integration has covered the government, public security, transportation, justice, real estate, finance, energy, education, medical treatment, communication, military and other major fields.

According to the analysis of 2019 domestic system integration market data surveyed by a&s research, due to the tightening of credit, the pace of local government investment has slowed down, and the proportion of Ping’an city (including the bright project) has decreased, but it continues to lead the market segment, accounting for 17% of the security market share. Followed by intelligent transportation, finance, real estate and other market segments, which account for 14%, 10% and 9% of the entire security integration engineering market respectively. In addition, the fifth to ninth places are the campus, energy, justice and hospital, which have become an important puzzle in the security system integration market.

At present, the security system integration business mainly focuses on the application of public security fields such as safe city, intelligent transportation, public security inspection and law enforcement. In the future, it will be further expanded in the park, finance, elderly care and other commercial terminals, and the home application will also achieve rapid development.

Strong demand in the field of public security

National policies promote the sustainable development of the public security industry. The 13th five year plan accelerates the construction of security facilities. The central government has incorporated the construction of public security video surveillance system into the 13th five year plan and the national security capacity-building plan, so as to improve the social security prevention and control system. The core is to improve the overall efficiency. By 2020, China will basically achieve the goal of “full domain coverage, full network sharing, full-time availability and full process control” for the construction of public security video surveillance networking applications.

Among them, Ping’an city is gradually transforming to digitalization, high-definition, networking and intelligence. New technologies such as big data technology, cloud computing technology, edge computing technology and the Internet of things are gradually integrated into systems and products, so that the urban safety prevention and control system involving public safety gradually has the characteristics of perception, IOT and sharing.

The bright project promotes the improvement of rural security facilities. On February 19, 2019, several opinions of the Central Committee of the Communist Party of China and the State Council on adhering to the priority development of agriculture and rural areas and doing a good job in the work of “agriculture, rural areas and farmers” were issued. After the snow project was written into the No. 1 central document, the No. 1 document in 2019 again continued to emphasize the strengthening of the construction of the rural “snow project”, which means that the construction of safe villages will be further accelerated. The construction of Xueliang project is not only to expand the monitoring coverage, but also to meet the new needs of many different levels, such as video processing technology, command and dispatching, alarm, prevention and control.

From top-level design to supporting implementation, the policy dividend of the intelligent transportation industry has been continuously released, the construction of digital collection system, networked transmission system and intelligent application system has been accelerated, the new infrastructure policy has been continuously enhanced, and the digital economy has become an important means and support to accelerate industrial development and upgrading in the new era. The two wheel drive of policy demand has helped the intelligent transportation industry usher in a sustained high boom. For example, in the field of urban rail transit, the intelligentization of urban rail transit is at the starting point of a new round of “acceleration and upgrading”. Through the application of artificial intelligence technologies such as computer vision, big data, cloud computing, etc., the comprehensive intelligent upgrading of the subway can be accelerated. The “new line construction + stock transformation” of China’s urban rail transit will drive 100 billion level of digital and information investment.

In addition, the field of smart security belongs to the cross field of new infrastructure and traditional infrastructure, and the market demand for construction in related fields under the new infrastructure policy will usher in a round of outbreak. The strategic layout of “new infrastructure” vigorously promoted by the national policy promotes the construction of a digital, intelligent and innovative infrastructure system, mainly including the construction of information infrastructure, integrated infrastructure and innovation infrastructure. The “new infrastructure” will drive the city to develop in a more intelligent and digital direction, making the city more “smart”, which is a major development opportunity for the entire intelligent security system integration industry.

In addition, the epidemic has further highlighted the need and urgency of cross sectoral and cross city data fusion. In this process, a large number of digital applications have been quickly implemented and brought into full play. From emergency management, public safety, government services to smart communities, the construction of digital government will usher in another wave of accelerated investment.

The rise of emerging application markets

At present, it is an important period for the transformation of new and old drivers. With the support of emerging technologies such as AI and cloud computing, the demand for business integration and innovation of security applications and downstream industries such as financial IOT, smart parks, smart communities and smart elderly care continues to release, which together inject new impetus for the sustainable development of the industry.

In the field of financial IOT, the overall demand of the industry has significantly upgraded. According to the statistics of China Banking and Insurance Regulatory Commission, by the end of June 2019, there were 4597 banking financial institutions in China, an increase of 9 over the end of 2018. The total number of bank outlets stabilized at 228600, and further sank to township areas. Although the growth of bank outlets has slowed down in absolute value, the demand for upgrading of various outlets has begun to burst. In addition to the demand for financial security, the demand of banks and other financial institutions for smart IOT, security operation, smart operation, risk control and other IOT and business management is growing. In addition, the bank adopted the “self construction + joint construction” mode, increased the integration with the campus, new retail, enterprises and other scenarios, and arranged the hospital, campus, government affairs, transportation and other financial related business scenarios outside the bank’s outlets, resulting in more diverse security application innovation needs.

In the field of smart communities, the transformation of old residential areas has created a security demand of 10 billion yuan. On april1,2020, the executive meeting of the State Council made it clear that this year, it is expected to focus on the residential areas built before the end of 2000 to transform 39000 old urban communities nationwide, twice the number of last year. The upgrading of the security technology prevention system in the old community includes the analog to high-definition video monitoring system, some community entrance and exit control systems (community entrance and exit vehicles, sidewalk gates), the addition of digital building intercom, and the construction of a security protection network without dead corners and blind areas with “machine management instead of human management and technical prevention instead of human air defense”. According to the median of 500000 yuan invested in the security transformation of a single community, the market scale this year is expected to be about 19.5 billion yuan.

The accelerated construction of “new infrastructure” has also brought great benefits to the security system integration industry. Intelligent security should focus on both “prevention” and “control”, through automatic information collection, real-time monitoring and analysis, early warning before the arrival of danger; After a disaster, more intelligent equipment such as robots will be used to assist or replace manual operations, so as to reduce the cost of disaster relief and control. For example, the intelligent analysis based on surveillance video in the power industry can realize the identification and alarm of engineering vehicles around the power distribution room and high-voltage tower, and the identification and alarm of wearing engineering caps in the entrance and exit station buildings.

Responsible editor: GT

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