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Limited awareness remains growth inhibitor for PSIM market

Limited awareness remains growth inhibitor for PSIM market

The world market for PSIM software is estimated to have more than doubled between 2009 and 2011, but limited awareness tempered revenue projections for 2012 and continues to do so for 2013, according to a new report from IMS Research.

Despite strong growth from 2009 to 2011, the PSIM market remained below $100 million mostly due to lack of knowledge about the platform, IMS said. Confusion about the definition of PSIM—physical security information management—and more importantly, what it does, also were cited as obstacles to growth.

“In general, the industry has required time to get its message across to potential customers, and this remains a challenge,” said report author Niall Jenkins, who is a video surveillance and security services research manager for IMS. “There has also been a lack of new entrants in the market to drive marketing and education of the potential benefits of the technology. This is unusual for new technology markets and is directly related to the upfront cost and resource required to build a PSIM platform, creating a high barrier to entry.”

Jenkins said short-term challenges for the PSIM market include the time and cost associated with training as well as the limited number of current projects.

“Project-planning sales cycles for PSIM solutions are typically in the range of nine to 18 months,” he told Security Systems News. “Generally speaking, the greater the value of the project, the more extended the sales cycle, and market opportunities may be erratic as a consequence. From an end-user perspective, cost remains a key barrier.”

Despite the challenges, IMS predicts that the long-term prospects for the market look strong, especially in emerging regions such as Latin America, the Middle East, India and China. A key driver of growth will be the trend toward convergence of logical security systems—SQL databases and enterprise resource planning platforms, for example—and physical security systems, Jenkins said. Merger and acquisition activity also will play a big role.

“Following an acquisition, it is often difficult for the acquirer to operate a single unified physical and/or logical security system due to a large number of proprietary and/or disparate security platforms,” he said. “Prior to the advent of PSIM software, there were two main options available: Either rip and replace the old systems and install new, compatible equipment, or have a systems integrator manually integrate all disparate security platforms into a single user interface. PSIM software platforms offer an alternative solution. In some cases they can be more cost-effective than a 'rip and replace' approach and provide a greater level of functionality than traditional systems integration.”

Jenkins said that by 2014, growth in the PSIM market is projected to be back on track with pre-2012 forecasts.

“Customer referrals will continue to be a strong sales generator, with vendors specializing in specific vertical markets by accident as much as by design,” he said. “A number of vendors have also identified health care and high-end commercial as emerging markets for the platform, offering new opportunities for well-placed [companies] in the future.”


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