Introduction: In today's world, we all know that China is the fastest-growing economy in the world and has enormous potential in all walks of life. China's security market is changing rapidly, especially in terms of its size and complexity.
Today, we are fortunate to have invited Jae-hoon Bae, LG Electronics Business Solutions, and VP of Business Solutions, LG Electronics, and LG Electronics Business Solutions and Jin-yong Kim, Senior Vice President of Business Solutions, LG Electronics. Mr. David KiM, Senior Marketing Manager, Business Solutions Business Unit, LG Electronics.
In this interview, we will understand how LG helps business partners make better use of the development trend of security, and will also let everyone better understand how LG achieves its goals.
China Security Network: First of all, please give Mr. David KiM a detailed introduction of the specific business situation of the Security Products Division and its development in China.
David KiM: First of all, I would like to introduce you to LG Electronics Business Solutions, which was established to integrate many of the company's products and solutions into our existing market share. As the company continues to develop, we have also discovered that we can offer a wide variety of solutions to many markets, one of which is to tailor solutions for our business partners. In our business scope, there are mainly four blocks, one is our monitor, such as our LCD monitor, our car infotainment service, onboard information service and so on. The third piece is our security equipment. The fourth piece is our commercial display. We will continue to invest in these products and set some new standards in the industry. We also ensure that these very fine individual products are derived from our very good solutions, that is, these individual products can provide a strong backing for our solutions. To this end, we must make a transition from a traditional single product supplier to a solution provider. We have a lot of winning solutions. Now that we have a lot of package options, we have created this new company, the Electronic Business Solutions Company, which aims to provide tailor-made solutions for vertical market customers, and we also Establish partnerships with a range of market leaders.
First of all, let me introduce this security company. As you can see, this security company is very large. The main focus of LG's is to integrate the two devices and systems. We are now seeing more and more devices integrated with our system. So many companies will change from providing products to providing solutions.
Let's take a look at the situation of this equipment in the security industry. Globally, the share of this market is still growing. It may be that the recent financial crisis has had some impact on this. In the first and second quarter of this year, it suffered some negative impacts, but we have already seen that this year’s third There are signs of improvement in the fourth quarter. We expect the market to improve in the fourth quarter of this year and the first quarter of 2010.
This year, more of our focus is on the solution of our platform. Now we are slowly becoming a solution provider. In the end, our goal is to become a solution integrator and provide everyone with a variety of solutions. With the continuous innovation of this technology, the security market has also undergone a series of changes. The main change is to provide some enhanced features, as well as to bring more convenience to our customers and users.
First of all, the current security system has played a more important role. In the past, we only looked at what happened in a certain place and we did more on this basis. How did people use security systems in the past? They are the crime scene and who needs to do something to see this security system, but we think that the behavioral habits of this kind of use have changed. This system is becoming more and more intelligent because we can analyze the data already stored and see what happens during specific time periods. The goal of our security solution is to provide everyone with preventable, positive and dynamic Management system, they can better use this enhanced security technology. Another feature we all can observe is the current security companies, many of which are integrated and integrated in a comprehensive security solution. We have all found that there is a tendency for web cameras to become more common in next-generation security solutions. Due to this trend, it is now becoming easier to integrate a wide range of security systems based on this network. Our LG security solution can provide this integration, allowing our users to monitor and manage all security systems more efficiently and more easily, from our supervision to access. It is not just the management of the network, but also the management of our information. We can even allow other brands of products to interoperate under our system.
We can now look at the distribution of our global outlets. The company is a global company. We have our business offices across several continents around the world. We have a total of 84,000 employees. They are distributed all over the world. Help us better understand the needs of each local community and make our understanding of these communities more clear. We are also in the production base and we are expanding globally so that our products can be sold in various communities and places around the world, and products based on the needs of the local market can be produced. We hope to produce these products to meet the needs of various continents and various local markets. In all production bases, there are specialized production bases for security products, both in South Korea and China. Our R&D strength is undisputed. One of LG's products is to develop our products and technology. Make a perfect fusion. We also hope that we can become the leader of our company in this piece. Our products are flexible and of superior quality. We can cooperate with 34 R&D centers around the world to make some designs for local products. LG's products have been certified by some of the most important organizations in the world. I am very proud to say that the quality of our company is unparalleled. In order to enhance quality, our company has also adopted a series of processes to manage our quality. As a global company, LG offers industry-leading security products that can provide this product in all areas of the world. We believe that with such a globalization as a foundation, we can provide the best solutions on a global scale, not only serving other markets, but also better serving the Chinese market. The most important thing is to bring benefits to our partners and end users.
LG's camera incorporates the latest XDI technology developed by LG. This technology was developed exclusively for this camera. Because of this very advanced XDI chip, the current camera only needs such a system-level chip, rather than the traditional five chips in the past. One of the first features is that the high quality, wide dynamic range now reduces unnecessary backlighting and, most importantly, provides images that are close to natural light. The second feature is that we use 3D digital noise reduction, and the third is that we provide this kind of electronic image stabilization function, that is, in the case of shaking, the image is still very clear, and I believe that these technologies are for everyone. No stranger to it. We used the high-definition television technology equipment in LG, and I believe this area is also a very strong field in LG Electronics. Our LG network cameras also provide video content analysis, which can be used for smart supervision, but also to further use our security system. This is the equipment we have specially developed for home personnel, which allows us to better enter the security market. Now for everyone to mainly explain some of the characteristics of using VC features, the first example is across a line of examples, we can draw a line, and then develop the direction of this line, you can identify intruders. We can also formulate relevant characteristics. If this feature is violated, it can be identified. I think this feature of detecting intruders is not only used in other facilities such as the past, it is going further, there are other characteristics, such as how many we count this number, the second is Detecting some of the damaged features, the third is to detect the physical objects that were originally placed there to be removed. These features are widely used in the management of our airport, management of retail stores, and management of factories. We will talk about specific applications in a few slides that we will talk about. This is the application of smart supervision.
We have a comprehensive range of products for everyone to choose from. These products can be used in our complete security solution system. These products include cameras, recorders, and other consumables and accessories such as our monitors and consoles. Even the camera's shelf can be provided. As you can see from the above slide, we have to provide everyone with a systematic solution instead of a single product.
I think one of the key changes in our industry is the change from analog signals. Our IP surveillance systems or regulatory solutions from LG include network cameras, system management applications, and our network attached storage. Timely monitoring and management of relevant information, wherever you are and where you are, can be managed in real time through this network connection. At the same time, we have world-class monitors. Our solutions can even be combined with analog video cameras. They can connect with our video servers, so that we can seamlessly connect with our security system, and finally we can achieve from IP to IP. Analog signal cameras match each other. LG also helps you take very active measures to use our preventive supervisory security system.
To share with you an example, this example is that you put LG's security system in a factory you can get some very useful information, because our monitor also helps you monitor the situation. Before installing this smart security system, factory workers had to look at their products one by one to see which product had holes. But now this job can be completely completed by LG's smart security system. This system can help you manage the production process, and it is very efficient to help you manage, and more importantly, it can help you to see where the problems occur. For example, where the machine stopped, he will warn you. This system we have installed, in the production base in South Korea. I believe that this example is a good example of the passive supervision from the past to the very active security supervision. Another example is our parking lot. Our regulatory solutions and solutions can also bring very good benefits. This solution system can help us monitor whether there are some unauthorized cars parked in the limited areas of our region. At the same time, we can avoid some accidents and thefts by providing some analyzed data. I believe that everyone has the experience that you parked your car in the parking lot, but when you come back to find this car, you don't remember where you stopped. Usually, I will use my car alarm system button to see it. Where it stops, this can be a fusion with our digital surveillance system. This system can tell you exactly where your car is parked. Just enter this number into this monitor and you will know Where is your car parked? So, recognizing this license plate function allows us to know which unauthorized cars are parked in this parking lot. The other, more important, is how long it takes to automatically see how long it takes and how long it takes without charging. In this case, the system can also be connected to the management system in the parking lot.
Finally, for an example, in the telecommunications industry, LG is also very advanced. China is now deploying 3G networks nationwide. Our LG solution also fully supports this wireless network environment, and it can also help you better use this. The internet. For example, if you are opening a shop, you can use your mobile phone to try to monitor what happened to your shop, even if you are not in the shop but outside. This system can also help you to take some positive measures, such as allowing you to control alarms, control air-conditioning, natural gas, etc., while we visit customers worldwide, not only in Korea or China, but also in this integrated system. In the country or other continents.
One thing I emphasize again is that we LG will be a leader in security companies, and we will also provide a series of innovative solutions for all operators and users in the Chinese industry. I believe that the economic and social development in China is now accelerating. With the continuous development of the economy and society, we hope that our company will grow together with China. We have done an internal analysis and research on the Chinese market. We predict that In 2010, security companies will reach 1.2 billion yuan, and the annual growth rate will reach 15%. At the same time, we also noticed that the camera and camera market accounted for 50% of the entire market, so there is a great market potential, so that the competitiveness of LG is released, this is a fast-growing market, and we also see this market The demand has been increasing in all areas. China is a strategic market for LG, and we also have a very talented team here. Together with us, we can build a very powerful and very powerful commercial organization that allows us to serve some markets in China. Therefore, we LG will play the role of the only leader in the security enterprise, and at the same time, it will also provide their innovative solutions for all industries in China, especially in the field of social and economic development.
According to our research from the China Security magazine, I discovered that security solutions are hot in the financial, safe city, commercial, and transportation fields. That's why we are in the exhibition hall of the Ambow Exhibition Hall. We are also in the exhibition area. Divided into four pieces, such as city security, as well as shops, transportation and banking. At this time, we have these products in the exhibition halls of Anbo, and we have also introduced some new products. This time the Expo is not an end. We will create more and more intelligent products in this process. It will bring convenience to some of our key customers. Finally, thank you again for taking the time to participate in this event. I hope that we can understand this market and we can all exchange opinions and let us grow together. Thank you all.
China Security Network: Thank you, David KiM for introducing us to the specific strategies of LG's products. So, what is the current share of LG security products in the Chinese market? Because LG consumer electronics is more famous in the Chinese market, will LG's sales channels for security products and consumer electronic products be reused?
Jin-yong Kim: I'll answer your question. At the moment we can't say exactly how much such a market share is. But everyone can come from today's people are from the high level of our newly established company. We're here. The purpose is to show everyone that LG consumer electronics and LG security products are related to it. LG sees the Chinese market not only as a market for selling our products and solutions. We can see that China is in the security industry. It said that its market is developing very fast, and at the same time, in other areas, such as the development of the system and operating platform is very rapid. At the time of our solution supply, Korean companies invested a lot of R&D strength to form the final solution. I believe that when we enter the local market, we also carry out research and development of the local market. It can be said that the Chinese market is one of the most important markets for us to enter the world, and it can complete our transformation into a successful solution provider. the road. As David said just now, we now have a production base in China. I would like to increase the investment of engineers in China to make new research and development for our security products. Now when we do recruiting, more are recruiting. An engineer with a Ph.D. degree came to us to do research, and also hoped that Chinese engineers would provide us with new security solutions that meet China's consumer market, such as the video analysis technology just now. Once again, China is seen as a crucial strategic market for LG. I hope that LG's growth will go hand in hand with China's growth. As a solution company and a commercial solution company for security products, we have a lot of use. The sales channel issue that you mentioned, due to the characteristics and different requirements of the security products industry itself, we have actually established a dedicated sales force. The sales force is still growing, and they will have a lot of features in the security industry. A good understanding will also make even greater contributions to our sales.
China Security Network: You just mentioned that your LG solution can be integrated with China's 3G, can you tell us how to apply it? Are you currently working with China's telecom operators on security solutions?
David KiM: We have also conducted tests now. For example, in South Korea, we have cooperated with Korea Telecom. This is a good use of our capabilities. We are now testing a concept called U surveillance or U surveillance, better To use this 3G network, for example, we already have smart phone technology, and we also have smart security technology. Integrating these two technologies together becomes a technical solution and we can realize that I just talked to you. connection. Therefore, we want to make a copy of the results of our successful experiments and apply this commercial model to China and other countries outside of China. Of course, in the process of application, some customers need to be established, and then close contact with operators and service providers. At the same time, we will also pay attention to some of the major vertical market users and communicate with them to see what their needs are because we want to understand what the key requirements are between different markets, and then I also know that the demand for each market is Differently, in order to meet these needs, we will make our deployment.
Jin-yong Kim: Just now David talked a bit with you. I hope to add it again. On the technical level, we have already tested with several Chinese operators. Therefore, this piece of technology should be no problem. This technological level is integrated into our solutions. We have had a lot of experience before, such as our experience in security testing, as well as automotive, automotive entertainment services, and navigation system services. In terms of car navigation systems and car entertainment services, we certainly cooperate with many car companies. I believe the same applies to the integration of 3G. As David said just now, we are more concerned with the needs of our customers and hope that in the near future, we will choose networks and solutions for Chinese consumers.
China Security Network: Just now David KiM said that the current security system is changing from analog to digital. In the process of transition from analog to digital, what are the main psychological challenges for customers to accept digital security? From a technical and market point of view, as a user, he turned from analog to digital, what psychological challenges did he have to overcome?
Jin-yong Kim: We think that in this world, it is difficult to achieve 100% coverage, because sometimes there are many other factors involved, but more importantly, after we both pass the psychological and technical levels, we will It can be followed that the most important thing is to provide a high-quality service. For example, our strategy is to provide some complete solutions that can meet the needs of our vertical customers and vertical terminals. These two points are crucial, such as: Some customers need us to provide some cameras for IP signals. They also hope that this camera can be integrated with his other applications. To achieve this solution, we must have a good environment, as well as our use environment, our goal. Can provide a very matchable environment. For example, a Blu-ray player, which can not only play Blu-ray discs, but also play content on the Internet. Its interoperability with other environments is very large. This can meet customer requirements. At this point, we have invested a lot of research and development; in the consumer electronics sector, we have only stored information from the past, and we have changed to a variety of different information that we can broadcast to. I believe that after this technological environment becomes available, devices There will be interoperability between devices, and I believe that this technical problem will be solved. In addition, we also made this preparation in this medium. For example, we are now mixing DVR with analog signal interface and IP interface. In order to meet the needs of some vertical customers, we provide him with an interface for analog signals, so that the analog signal camera and other equipment You can make a recording through our product. Of course, we also provide the IP signal interface, can also let our IP camera to connect, these two together reflect the advantages of our hybrid DVR.
China Security Network: After the popularity of 3G, there are things about security monitoring, including the foundation of some businesses. I am now concerned about whether there has been any substantial progress in cooperation with China’s communications operators. Does LG currently have some substantial, business breakthroughs? There is also a related issue. The entire security system of LG is still mainly operated in public monitoring. In the family application, what is the current situation and is there any difficulty?
David KiM: First of all, answer your first question. At this time, we have not specifically communicated with which service provider. As we just mentioned, we actually have cooperation with some service providers now. To cooperate with them in the scope of our business, we plan to quickly talk to these service providers about security business cooperation. We will conduct a commercial operability test. The second question about home security solutions, I believe the potential of this market is very large. This is also true on a global scale. We are assessing various home security measures and the measures they have adopted. Experiences vary from country to country. Therefore, we are now gradually mastering the analysis of China's home security measures and their behavior habits, so that we can effectively provide our home security solutions. Because now we are focusing on a professional market, I believe this home security should be viewed from a different point of view, I believe that LG company has a very good foundation in the customer's consumer goods. So, with this huge solution, we have great potential to go into home security products.
China Security Network: China's security market is largely driven by the government, such as Safe City, LG plans to cooperate with government departments to expand their business?
Jae-hoon Bae: Just now I also mentioned that for some ordinary customers, we have general solutions. For some special customers, we will formulate some solutions specifically and we will formulate them according to various different industry needs. Solutions, such as whether to give a trading department, a military department, or a security system done by a government department, are different solutions. As we just mentioned, first of all, we will start to fight in the education and government industries to meet their needs, provide our products and solutions, and more importantly, we now deal with some governments. We It will begin with existing government relations.
China Security Network: In the speech just now, LG has always emphasized that it needs to change from a single product supplier to a solution provider. At present, IT electronics manufacturers are all talking about themselves as suppliers to the solution. Many customers complain that the company will eventually In selling products, I would like to ask, LG how to ensure that they really become a solution provider for users to solve the problem?
Jae-hoon Bae: I don't know what the other industries you mentioned are, but for the security industry, we started the electronic business solutions company this year and early this year. After this company was established, we It integrates many technologies of the past LG into our new products. This integrated technology is designed to meet the specific requirements of markets in all areas of the world. For example, in the U.S. market, when we introduce HDTVs to their hotels, We don't just provide them with high-definition televisions. What's more, we provide content that can prevent people from recording and copying, so our market share in the US hotel market can reach 6% to 7%, which shows us Instead of just providing a TV set, it provides a solution to prevent the contents of their offerings from being burned and copied. The same is true in the industry. More importantly, not only is the device , is that all the technology behind the equipment is to meet the needs of a wide range of people, for the deployment of our company, We are not only for the general public, but also introduce them to our specific individual products, but we will also learn about different vertical markets, such as Chinese banks, Chinese education, Chinese government, etc. We will first understand that they Security needs, to provide them with an integrated solution, through this piece, we are all to achieve a commercial solution provider goals.
David KiM: Some of the other companies you just mentioned claim to be a solution provider, but the only reason to end up selling products is that their solutions are very limited. LG can be said to be a very good all-in-one solution. The reason for providing suppliers is because LG itself supports a series of products behind it, and there are also a series of solutions for us to merge. We are benefiting from the products and product solutions of LG's family. The hotel example just mentioned by Mr. Jae-hoon Bae proves this very well. Under a series of deployments, we can provide solutions with the top-down solution. This solution is not only limited to our security, but also The machines in our hotel television, even the washing machine in the hotel, etc. can be solved in such a solution.
China Security Network: In 2010, you predicted that the security system market, the proportion of analog and digital shipments will be what kind of situation?
David KiM: This question is difficult to answer. I believe that no one in the industry can give you a very accurate and accurate data. If I remember correctly, the IP market accounted for only 2% five years ago. At that time we also talked about This percentage, four years ago, we also discovered that this IP will occupy the global market, and will occupy the entire market in about 2010, which was the result of the discussion four years ago. When you look at the existing market again, there is no doubt that this market has already shifted to IP. In some specific markets, such as the Middle East market, we can see some concrete examples and the magnitude of the transition is as high as 40%. In other markets, we see only a 15% share. So now many give a very accurate market share, IP accounted for how much. The only thing I can say is that the share of this IP is accelerating, because the bandwidth of this broadband is also getting bigger and bigger, and there is also support in the overall infrastructure. In the near future, we can see the transition from analog signals. To IP signal. However, we also believe that this analog signal will still occupy a certain market share. This is why we invest in this analog signal when IP is used for large-scale investment. I believe this also answers your first question about mental disorders. From the analog signal to the IP signal, one of the points is that you always give people monitoring, like I am now, will also give a lot of people to monitor, such as some people say in the refrigerator is also equipped with a surveillance camera , So I believe that there are some psychological obstacles. What's more important is to see how the percentage of this market is going?
Today, we are fortunate to have invited Jae-hoon Bae, LG Electronics Business Solutions, and VP of Business Solutions, LG Electronics, and LG Electronics Business Solutions and Jin-yong Kim, Senior Vice President of Business Solutions, LG Electronics. Mr. David KiM, Senior Marketing Manager, Business Solutions Business Unit, LG Electronics.
In this interview, we will understand how LG helps business partners make better use of the development trend of security, and will also let everyone better understand how LG achieves its goals.
China Security Network: First of all, please give Mr. David KiM a detailed introduction of the specific business situation of the Security Products Division and its development in China.
David KiM: First of all, I would like to introduce you to LG Electronics Business Solutions, which was established to integrate many of the company's products and solutions into our existing market share. As the company continues to develop, we have also discovered that we can offer a wide variety of solutions to many markets, one of which is to tailor solutions for our business partners. In our business scope, there are mainly four blocks, one is our monitor, such as our LCD monitor, our car infotainment service, onboard information service and so on. The third piece is our security equipment. The fourth piece is our commercial display. We will continue to invest in these products and set some new standards in the industry. We also ensure that these very fine individual products are derived from our very good solutions, that is, these individual products can provide a strong backing for our solutions. To this end, we must make a transition from a traditional single product supplier to a solution provider. We have a lot of winning solutions. Now that we have a lot of package options, we have created this new company, the Electronic Business Solutions Company, which aims to provide tailor-made solutions for vertical market customers, and we also Establish partnerships with a range of market leaders.
First of all, let me introduce this security company. As you can see, this security company is very large. The main focus of LG's is to integrate the two devices and systems. We are now seeing more and more devices integrated with our system. So many companies will change from providing products to providing solutions.
Let's take a look at the situation of this equipment in the security industry. Globally, the share of this market is still growing. It may be that the recent financial crisis has had some impact on this. In the first and second quarter of this year, it suffered some negative impacts, but we have already seen that this year’s third There are signs of improvement in the fourth quarter. We expect the market to improve in the fourth quarter of this year and the first quarter of 2010.
This year, more of our focus is on the solution of our platform. Now we are slowly becoming a solution provider. In the end, our goal is to become a solution integrator and provide everyone with a variety of solutions. With the continuous innovation of this technology, the security market has also undergone a series of changes. The main change is to provide some enhanced features, as well as to bring more convenience to our customers and users.
First of all, the current security system has played a more important role. In the past, we only looked at what happened in a certain place and we did more on this basis. How did people use security systems in the past? They are the crime scene and who needs to do something to see this security system, but we think that the behavioral habits of this kind of use have changed. This system is becoming more and more intelligent because we can analyze the data already stored and see what happens during specific time periods. The goal of our security solution is to provide everyone with preventable, positive and dynamic Management system, they can better use this enhanced security technology. Another feature we all can observe is the current security companies, many of which are integrated and integrated in a comprehensive security solution. We have all found that there is a tendency for web cameras to become more common in next-generation security solutions. Due to this trend, it is now becoming easier to integrate a wide range of security systems based on this network. Our LG security solution can provide this integration, allowing our users to monitor and manage all security systems more efficiently and more easily, from our supervision to access. It is not just the management of the network, but also the management of our information. We can even allow other brands of products to interoperate under our system.
We can now look at the distribution of our global outlets. The company is a global company. We have our business offices across several continents around the world. We have a total of 84,000 employees. They are distributed all over the world. Help us better understand the needs of each local community and make our understanding of these communities more clear. We are also in the production base and we are expanding globally so that our products can be sold in various communities and places around the world, and products based on the needs of the local market can be produced. We hope to produce these products to meet the needs of various continents and various local markets. In all production bases, there are specialized production bases for security products, both in South Korea and China. Our R&D strength is undisputed. One of LG's products is to develop our products and technology. Make a perfect fusion. We also hope that we can become the leader of our company in this piece. Our products are flexible and of superior quality. We can cooperate with 34 R&D centers around the world to make some designs for local products. LG's products have been certified by some of the most important organizations in the world. I am very proud to say that the quality of our company is unparalleled. In order to enhance quality, our company has also adopted a series of processes to manage our quality. As a global company, LG offers industry-leading security products that can provide this product in all areas of the world. We believe that with such a globalization as a foundation, we can provide the best solutions on a global scale, not only serving other markets, but also better serving the Chinese market. The most important thing is to bring benefits to our partners and end users.
LG's camera incorporates the latest XDI technology developed by LG. This technology was developed exclusively for this camera. Because of this very advanced XDI chip, the current camera only needs such a system-level chip, rather than the traditional five chips in the past. One of the first features is that the high quality, wide dynamic range now reduces unnecessary backlighting and, most importantly, provides images that are close to natural light. The second feature is that we use 3D digital noise reduction, and the third is that we provide this kind of electronic image stabilization function, that is, in the case of shaking, the image is still very clear, and I believe that these technologies are for everyone. No stranger to it. We used the high-definition television technology equipment in LG, and I believe this area is also a very strong field in LG Electronics. Our LG network cameras also provide video content analysis, which can be used for smart supervision, but also to further use our security system. This is the equipment we have specially developed for home personnel, which allows us to better enter the security market. Now for everyone to mainly explain some of the characteristics of using VC features, the first example is across a line of examples, we can draw a line, and then develop the direction of this line, you can identify intruders. We can also formulate relevant characteristics. If this feature is violated, it can be identified. I think this feature of detecting intruders is not only used in other facilities such as the past, it is going further, there are other characteristics, such as how many we count this number, the second is Detecting some of the damaged features, the third is to detect the physical objects that were originally placed there to be removed. These features are widely used in the management of our airport, management of retail stores, and management of factories. We will talk about specific applications in a few slides that we will talk about. This is the application of smart supervision.
We have a comprehensive range of products for everyone to choose from. These products can be used in our complete security solution system. These products include cameras, recorders, and other consumables and accessories such as our monitors and consoles. Even the camera's shelf can be provided. As you can see from the above slide, we have to provide everyone with a systematic solution instead of a single product.
I think one of the key changes in our industry is the change from analog signals. Our IP surveillance systems or regulatory solutions from LG include network cameras, system management applications, and our network attached storage. Timely monitoring and management of relevant information, wherever you are and where you are, can be managed in real time through this network connection. At the same time, we have world-class monitors. Our solutions can even be combined with analog video cameras. They can connect with our video servers, so that we can seamlessly connect with our security system, and finally we can achieve from IP to IP. Analog signal cameras match each other. LG also helps you take very active measures to use our preventive supervisory security system.
To share with you an example, this example is that you put LG's security system in a factory you can get some very useful information, because our monitor also helps you monitor the situation. Before installing this smart security system, factory workers had to look at their products one by one to see which product had holes. But now this job can be completely completed by LG's smart security system. This system can help you manage the production process, and it is very efficient to help you manage, and more importantly, it can help you to see where the problems occur. For example, where the machine stopped, he will warn you. This system we have installed, in the production base in South Korea. I believe that this example is a good example of the passive supervision from the past to the very active security supervision. Another example is our parking lot. Our regulatory solutions and solutions can also bring very good benefits. This solution system can help us monitor whether there are some unauthorized cars parked in the limited areas of our region. At the same time, we can avoid some accidents and thefts by providing some analyzed data. I believe that everyone has the experience that you parked your car in the parking lot, but when you come back to find this car, you don't remember where you stopped. Usually, I will use my car alarm system button to see it. Where it stops, this can be a fusion with our digital surveillance system. This system can tell you exactly where your car is parked. Just enter this number into this monitor and you will know Where is your car parked? So, recognizing this license plate function allows us to know which unauthorized cars are parked in this parking lot. The other, more important, is how long it takes to automatically see how long it takes and how long it takes without charging. In this case, the system can also be connected to the management system in the parking lot.
Finally, for an example, in the telecommunications industry, LG is also very advanced. China is now deploying 3G networks nationwide. Our LG solution also fully supports this wireless network environment, and it can also help you better use this. The internet. For example, if you are opening a shop, you can use your mobile phone to try to monitor what happened to your shop, even if you are not in the shop but outside. This system can also help you to take some positive measures, such as allowing you to control alarms, control air-conditioning, natural gas, etc., while we visit customers worldwide, not only in Korea or China, but also in this integrated system. In the country or other continents.
One thing I emphasize again is that we LG will be a leader in security companies, and we will also provide a series of innovative solutions for all operators and users in the Chinese industry. I believe that the economic and social development in China is now accelerating. With the continuous development of the economy and society, we hope that our company will grow together with China. We have done an internal analysis and research on the Chinese market. We predict that In 2010, security companies will reach 1.2 billion yuan, and the annual growth rate will reach 15%. At the same time, we also noticed that the camera and camera market accounted for 50% of the entire market, so there is a great market potential, so that the competitiveness of LG is released, this is a fast-growing market, and we also see this market The demand has been increasing in all areas. China is a strategic market for LG, and we also have a very talented team here. Together with us, we can build a very powerful and very powerful commercial organization that allows us to serve some markets in China. Therefore, we LG will play the role of the only leader in the security enterprise, and at the same time, it will also provide their innovative solutions for all industries in China, especially in the field of social and economic development.
According to our research from the China Security magazine, I discovered that security solutions are hot in the financial, safe city, commercial, and transportation fields. That's why we are in the exhibition hall of the Ambow Exhibition Hall. We are also in the exhibition area. Divided into four pieces, such as city security, as well as shops, transportation and banking. At this time, we have these products in the exhibition halls of Anbo, and we have also introduced some new products. This time the Expo is not an end. We will create more and more intelligent products in this process. It will bring convenience to some of our key customers. Finally, thank you again for taking the time to participate in this event. I hope that we can understand this market and we can all exchange opinions and let us grow together. Thank you all.
China Security Network: Thank you, David KiM for introducing us to the specific strategies of LG's products. So, what is the current share of LG security products in the Chinese market? Because LG consumer electronics is more famous in the Chinese market, will LG's sales channels for security products and consumer electronic products be reused?
Jin-yong Kim: I'll answer your question. At the moment we can't say exactly how much such a market share is. But everyone can come from today's people are from the high level of our newly established company. We're here. The purpose is to show everyone that LG consumer electronics and LG security products are related to it. LG sees the Chinese market not only as a market for selling our products and solutions. We can see that China is in the security industry. It said that its market is developing very fast, and at the same time, in other areas, such as the development of the system and operating platform is very rapid. At the time of our solution supply, Korean companies invested a lot of R&D strength to form the final solution. I believe that when we enter the local market, we also carry out research and development of the local market. It can be said that the Chinese market is one of the most important markets for us to enter the world, and it can complete our transformation into a successful solution provider. the road. As David said just now, we now have a production base in China. I would like to increase the investment of engineers in China to make new research and development for our security products. Now when we do recruiting, more are recruiting. An engineer with a Ph.D. degree came to us to do research, and also hoped that Chinese engineers would provide us with new security solutions that meet China's consumer market, such as the video analysis technology just now. Once again, China is seen as a crucial strategic market for LG. I hope that LG's growth will go hand in hand with China's growth. As a solution company and a commercial solution company for security products, we have a lot of use. The sales channel issue that you mentioned, due to the characteristics and different requirements of the security products industry itself, we have actually established a dedicated sales force. The sales force is still growing, and they will have a lot of features in the security industry. A good understanding will also make even greater contributions to our sales.
China Security Network: You just mentioned that your LG solution can be integrated with China's 3G, can you tell us how to apply it? Are you currently working with China's telecom operators on security solutions?
David KiM: We have also conducted tests now. For example, in South Korea, we have cooperated with Korea Telecom. This is a good use of our capabilities. We are now testing a concept called U surveillance or U surveillance, better To use this 3G network, for example, we already have smart phone technology, and we also have smart security technology. Integrating these two technologies together becomes a technical solution and we can realize that I just talked to you. connection. Therefore, we want to make a copy of the results of our successful experiments and apply this commercial model to China and other countries outside of China. Of course, in the process of application, some customers need to be established, and then close contact with operators and service providers. At the same time, we will also pay attention to some of the major vertical market users and communicate with them to see what their needs are because we want to understand what the key requirements are between different markets, and then I also know that the demand for each market is Differently, in order to meet these needs, we will make our deployment.
Jin-yong Kim: Just now David talked a bit with you. I hope to add it again. On the technical level, we have already tested with several Chinese operators. Therefore, this piece of technology should be no problem. This technological level is integrated into our solutions. We have had a lot of experience before, such as our experience in security testing, as well as automotive, automotive entertainment services, and navigation system services. In terms of car navigation systems and car entertainment services, we certainly cooperate with many car companies. I believe the same applies to the integration of 3G. As David said just now, we are more concerned with the needs of our customers and hope that in the near future, we will choose networks and solutions for Chinese consumers.
China Security Network: Just now David KiM said that the current security system is changing from analog to digital. In the process of transition from analog to digital, what are the main psychological challenges for customers to accept digital security? From a technical and market point of view, as a user, he turned from analog to digital, what psychological challenges did he have to overcome?
Jin-yong Kim: We think that in this world, it is difficult to achieve 100% coverage, because sometimes there are many other factors involved, but more importantly, after we both pass the psychological and technical levels, we will It can be followed that the most important thing is to provide a high-quality service. For example, our strategy is to provide some complete solutions that can meet the needs of our vertical customers and vertical terminals. These two points are crucial, such as: Some customers need us to provide some cameras for IP signals. They also hope that this camera can be integrated with his other applications. To achieve this solution, we must have a good environment, as well as our use environment, our goal. Can provide a very matchable environment. For example, a Blu-ray player, which can not only play Blu-ray discs, but also play content on the Internet. Its interoperability with other environments is very large. This can meet customer requirements. At this point, we have invested a lot of research and development; in the consumer electronics sector, we have only stored information from the past, and we have changed to a variety of different information that we can broadcast to. I believe that after this technological environment becomes available, devices There will be interoperability between devices, and I believe that this technical problem will be solved. In addition, we also made this preparation in this medium. For example, we are now mixing DVR with analog signal interface and IP interface. In order to meet the needs of some vertical customers, we provide him with an interface for analog signals, so that the analog signal camera and other equipment You can make a recording through our product. Of course, we also provide the IP signal interface, can also let our IP camera to connect, these two together reflect the advantages of our hybrid DVR.
China Security Network: After the popularity of 3G, there are things about security monitoring, including the foundation of some businesses. I am now concerned about whether there has been any substantial progress in cooperation with China’s communications operators. Does LG currently have some substantial, business breakthroughs? There is also a related issue. The entire security system of LG is still mainly operated in public monitoring. In the family application, what is the current situation and is there any difficulty?
David KiM: First of all, answer your first question. At this time, we have not specifically communicated with which service provider. As we just mentioned, we actually have cooperation with some service providers now. To cooperate with them in the scope of our business, we plan to quickly talk to these service providers about security business cooperation. We will conduct a commercial operability test. The second question about home security solutions, I believe the potential of this market is very large. This is also true on a global scale. We are assessing various home security measures and the measures they have adopted. Experiences vary from country to country. Therefore, we are now gradually mastering the analysis of China's home security measures and their behavior habits, so that we can effectively provide our home security solutions. Because now we are focusing on a professional market, I believe this home security should be viewed from a different point of view, I believe that LG company has a very good foundation in the customer's consumer goods. So, with this huge solution, we have great potential to go into home security products.
China Security Network: China's security market is largely driven by the government, such as Safe City, LG plans to cooperate with government departments to expand their business?
Jae-hoon Bae: Just now I also mentioned that for some ordinary customers, we have general solutions. For some special customers, we will formulate some solutions specifically and we will formulate them according to various different industry needs. Solutions, such as whether to give a trading department, a military department, or a security system done by a government department, are different solutions. As we just mentioned, first of all, we will start to fight in the education and government industries to meet their needs, provide our products and solutions, and more importantly, we now deal with some governments. We It will begin with existing government relations.
China Security Network: In the speech just now, LG has always emphasized that it needs to change from a single product supplier to a solution provider. At present, IT electronics manufacturers are all talking about themselves as suppliers to the solution. Many customers complain that the company will eventually In selling products, I would like to ask, LG how to ensure that they really become a solution provider for users to solve the problem?
Jae-hoon Bae: I don't know what the other industries you mentioned are, but for the security industry, we started the electronic business solutions company this year and early this year. After this company was established, we It integrates many technologies of the past LG into our new products. This integrated technology is designed to meet the specific requirements of markets in all areas of the world. For example, in the U.S. market, when we introduce HDTVs to their hotels, We don't just provide them with high-definition televisions. What's more, we provide content that can prevent people from recording and copying, so our market share in the US hotel market can reach 6% to 7%, which shows us Instead of just providing a TV set, it provides a solution to prevent the contents of their offerings from being burned and copied. The same is true in the industry. More importantly, not only is the device , is that all the technology behind the equipment is to meet the needs of a wide range of people, for the deployment of our company, We are not only for the general public, but also introduce them to our specific individual products, but we will also learn about different vertical markets, such as Chinese banks, Chinese education, Chinese government, etc. We will first understand that they Security needs, to provide them with an integrated solution, through this piece, we are all to achieve a commercial solution provider goals.
David KiM: Some of the other companies you just mentioned claim to be a solution provider, but the only reason to end up selling products is that their solutions are very limited. LG can be said to be a very good all-in-one solution. The reason for providing suppliers is because LG itself supports a series of products behind it, and there are also a series of solutions for us to merge. We are benefiting from the products and product solutions of LG's family. The hotel example just mentioned by Mr. Jae-hoon Bae proves this very well. Under a series of deployments, we can provide solutions with the top-down solution. This solution is not only limited to our security, but also The machines in our hotel television, even the washing machine in the hotel, etc. can be solved in such a solution.
China Security Network: In 2010, you predicted that the security system market, the proportion of analog and digital shipments will be what kind of situation?
David KiM: This question is difficult to answer. I believe that no one in the industry can give you a very accurate and accurate data. If I remember correctly, the IP market accounted for only 2% five years ago. At that time we also talked about This percentage, four years ago, we also discovered that this IP will occupy the global market, and will occupy the entire market in about 2010, which was the result of the discussion four years ago. When you look at the existing market again, there is no doubt that this market has already shifted to IP. In some specific markets, such as the Middle East market, we can see some concrete examples and the magnitude of the transition is as high as 40%. In other markets, we see only a 15% share. So now many give a very accurate market share, IP accounted for how much. The only thing I can say is that the share of this IP is accelerating, because the bandwidth of this broadband is also getting bigger and bigger, and there is also support in the overall infrastructure. In the near future, we can see the transition from analog signals. To IP signal. However, we also believe that this analog signal will still occupy a certain market share. This is why we invest in this analog signal when IP is used for large-scale investment. I believe this also answers your first question about mental disorders. From the analog signal to the IP signal, one of the points is that you always give people monitoring, like I am now, will also give a lot of people to monitor, such as some people say in the refrigerator is also equipped with a surveillance camera , So I believe that there are some psychological obstacles. What's more important is to see how the percentage of this market is going?
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