Increased security demands are driving the accelerated adoption of biometric technology. We believe that security needs are the core driving force behind the development of the biometric technology market. 1) Personal security needs: The explosive growth of biometric technology applications in the smart terminal market. Based on our industry chain research, we predict that following the initial application of fingerprint recognition technology in the iPhone 5S, the Samsung Note 4, released in September, may feature iris scanning to enhance phone security, with other technology manufacturers following suit. 2) Public security needs: Government-led large-scale application systems will accelerate. With global economic development and urbanization, countries are increasing their investment in public security supervision, particularly regarding terrorism. Governments in major regions worldwide, such as the United States, the European Union, and India, have successively implemented large-scale biometric technology-related system engineering projects, promoting the accelerated adoption of biometric technology in the public security field.
 
  The global biometrics market is projected to grow at a CAGR of 35.2% over the next five years, reaching a market size of US$37 billion. Our model estimates that the biometrics market, primarily driven by fingerprint, facial, and iris recognition, will reach US$37.02 billion in 2018, representing a CAGR of 35.2% from 2013 to 2018. Structurally, fingerprint and iris recognition are primarily driven by the explosive growth of the smart terminal application market, while facial recognition is driven by increased demand in the public security market. Due to their smaller initial base, facial and iris recognition are poised for rapid growth, with their share of the overall biometrics market increasing from 11.4% and 5.1% respectively in 2013 to 22.4% and 22.1% in 2018. In China, a populous country, the potential market space for biometrics is rapidly expanding, driven by multiple factors including information security needs, public safety requirements, and the standardization of biometric identification.
 
  Investment Strategy: We recommend leading companies in specific sub-sectors. Biometrics is an industry with extremely high technological barriers, requiring long-term R&D investment and accumulation. We are optimistic about the technology pioneers in this industry. Although my country's biometrics technology industry is currently in its early stages of development, once the technology is effectively integrated into downstream application markets, its explosive growth and potential are enormous. Examples include voice recognition and the education industry, fingerprint recognition, iris recognition and consumer electronics, facial recognition and video surveillance, etc.