It is reported that the acquisition cost is USD 50 million and Huawei is mainly interested in the company’s R&D sector in face recognition systems. Vokord has a team of 120 engineers. In addition to 20 years of experience in video surveillance cameras and software design, the company is also “sufficiently skilled” to commercialize the technology. This is also the main motivation for Huawei to acquire it.
A representative of Huawei confirmed to the Moscow News that the company’s Russian subsidiary and its Hong Kong subsidiary became co-owners of Igl SoftLab, but the details of the transaction were not disclosed. It is reported that Vokord not only sold its patent to Igl SoftLab but also took most of its staff with it. An expert stressed during an interview that China has generated the craze for facial recognition systems, and innovation projects like this in Russia are tens of times cheaper than in the United States.
Huawei already has its own face recognition algorithm, but experts say that the tech giant might be interested in the HD cameras with “smart” functions developed by the Russian company.
According to respondents edition experts, China is now experiencing a boom of face recognition system, while in Russia you can buy a startup in this field is ten times cheaper than in the US.
Huawei has been in the forefront of international media attention since last month when the United States added the tech giant to a trade blacklist amid security concerns. Several major US companies, including Google, have suspended business ties with the company. The US and several of its allies have accused the company of being controlled and sponsored by the Chinese state. Huawei dismissed the accusations and blasted the US move to blacklist it.
The market for intelligent recognition systems has recently become a highly attractive sphere for investments, mergers, and takeovers. Earlier this year, London-based retail execution monitoring service BeMyEye announced plans to acquire Russian crowdsourcing and image recognition provider Streetbee. In April, Russian state-run Sberbank agreed to acquire a 51% stake in Speech Technology Center (STC) from Gazprombank.
Russia’s top mobile network, MTS, also announced on Wednesday that it had reached an agreement with Huawei to bring 5G technology, the successor to the current 4G LTE, to the country. Testing is expected to start later this year.
Patrick Moorhead, a principal analyst at Moor Insights & Strategy, says that China and Russia have long shared a special bond and that Huawei’s Russian deals are likely business as usual.
“I don’t see any special significance in the deal because of this. Huawei unabashedly and unapologetically considers itself a leader in video surveillance, and is vertically integrated all, the way to the chips inside of the cameras to the network all the way to the data center,” he says.