2021 China’s AI + Security and Protection Industry Report

Source:iResearchOctober 29,20217:34 PM Overview

Overall Development Situation of China’s Security and Protection Industry 

Affected by the Covid-19 pandemic, the industry output value is growing at a much lower rate

Thanks to emerging technologies, the security and protection industry is becoming more intelligent. The advancement of a series of major projects such as safe city, smart city and smart transportation have also contributed to the development of the industry. Therefore, despite the influence of the pandemic, the trend of intelligence will continue to affect the industry and help it maintain positive growth. In 2020 the total output value of China's security and protection industry was 851 billion yuan, increasing by 2.9% year on year. Compared to 2019, the proportions of security operation and maintenance and engineering market keep growing and the growth rate of the product market has fallen. There is an obvious trend that the security and protection market is transforming and upgrading from centering on the sales of software and hardware products to the services of AI, data operation & maintenance, cloud computing and so on.

 

Analysis of the AI + Security and Protection Industry Chain in China 

China's security and protection industry has been increasing investment in scientific and technological innovation and R&D in recent years, forming a industry chain covering R&D and manufacturing of chips and key components in the upstream, design and manufacturing of AI security and protection software and hardware products in the middle stream and system integration, operation and maintenance services in the downstream. The role of upstream manufacturers is fixed, while the boundaries between middle stream and downstream players are not clear. Manufacturers of security products, AI companies, Cloud service provider can provide customers with standardized or customized products and services both directly or through integrators. Some integrators can also provide customers with hardware products and software technologies and even operation and maintenance services related to AI security and protection directly. The competition and cooperation relationships among players are complicated an d the industry chain is very open.

Size of the AI + Security and Protection Market

The market scale is growing at a lower speed and is expected to exceed 90 billion yuan by 2025. Smart community might become a key sector

In 2020 the scale of China’s AI+security and protection software and hardware market hit 45.3 billion yuan. Since the Covid-19 pandemic has hindered the implementation of security and protection projects and increased raw material costs the growth rate of market scale dropped to 13.3%(the rate was nearly 250% in 2018)。As pandemic prevention is becoming moral and the start of the 14th five-year plan, the Xueliang Project  is nearly completed and is about to upgrade. The market scale is expected to increase to 54.2 billion yuan in 2021. iResearch predicts that the market will experience the period of industrial restructuring from 2021 to 2025. Its growth will slow down and its size will hit 90 billion yuan by 2025. AI is now penetration into the lower-tier markets of public security and transportation scenarios as well as the long-tail segments of pan-security and protection. The extensive development model has changed to refined upgrading and transformation. Among the segments, the pillar is public security and transportation. However, as the 13th five-year plan is reaching its end, this segment has almost completed intelligent video monitoring system coverage in key areas. Thus, its market is growing at a low rate. Other segments are promoted by factors such as security demand and accelerated technology iteration will keep eroding the market share of public security and transportation. In particular, the smart community centering on smart city governance might become the focus of the second half.

Contents

AI + security and protection remain one of the tracks that feature the fastest commercial application of AI technology and the largest market size. It’s expected that in 2020, the size of AI + security and protection software and hardware market hit 45.3 billion Yuan. With pandemic prevention becoming normal and the start of the 14th Five Year Plan, the market will experience the industrial structure adjustment period from 2021-2025. The market size will grow at a lower rate and will exceed 90 billion yuan by 2025. AI has started spreading to the lower-tier markets of scenarios such as public security and transportation and the long-tail segments of pan-security and protection.

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