International. There are numerous items affected by the tariffs recently applied to Chinese goods by the Trump administration that, as noted above, will have a significant impact on the security industry, but now the three Harmonized Tariff Schedules (HTSUS) have subtitles with electronic circuit boards and components that come from China and are assembled in the US.
The rise of connected devices, the Internet of Things (IoT), virtual reality (VR) and artificial intelligence (AI) has led to the continued growth of microcomputer submarkets and storage devices. Industrial uses of products such as Adafruit's Raspberry Pi and Arduino continue to expand, especially in video processing and storage applications in smaller use cases, such as quick-service stores and residential properties. The price is unparalleled; Why do we now have restrictions in a growth security market?
In the previous tariffs, both copper stock, commonly used in network cabling, and fiber optic packages were selected. In light of the increasing reliance on CAT 6A and 7 cables, which require more copper to manufacture, the unit cost of installing all major safety sensors will increase.
Given a fixed budget, an end user will always build the infrastructure and then estimate the additional systems for the rest of the funds. This equates to fewer devices and subsequently less revenue for all parts of the security ecosystem.
The impact of the third round of tariffs, which is actually a complement to the second HTSUS and dated 8/7/2018, is as follows:
(Note: The official document of the Office of the United States Trade Representative (USTR) (USTR-2018-0005) is classified into 8-digit subheadings, so where possible, the eight-digit number of the Harmonized Tariff Schedule (HTS) will be listed in parentheses)
High impact
Electronic integrated circuits, processors, controllers, memory, amplifiers, and assembly parts (8542.31.00, 8542.32.00, 8542.33.00, 8542.39.00, 8542.90.00): Affected electronic security systems include video surveillance, burglar alarm, and access control systems from manufacturers that assemble using PCBs from China, South Korea, Taiwan, and the Philippines. Commercial, residential, DIY and crowdfunded markets use microcomputers and controllers from China. For example, the most popular microcomputer used in the electronic security industry, the Raspberry Pi, is manufactured in China and the United Kingdom. Also used are Intel's microcomputer modules, whose processor boards are assembled and tested in western China and Malaysia.
Medium impact
Antennas and antenna reflectors of all types and parts (8529.10.91) affect all wireless access points, wireless bridges, backhauls and point-to-point systems used to transmit video surveillance, alarm signals and object detection data.
Connectors for optical fibers, beams or fiber optic cables (8536.70.00): Affects virtually all fiber optic terminations, splices, connection panels and tracks. This also affects economies of scale for sites that require a large number of telecommunications cabinets or "equipment rooms", Intermediate Cross Connects (ICC or IC) and Main Cross Connects.
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