This article was written by Daphne Tomlinson of Tomlinson Business Research.
PSIM, or Physical Security Information Management, is a category of software, created by middleware developers, which is designed to integrate multiple unconnected security applications and devices and control them through one comprehensive user interface.
These solutions aimed at large facilities have been deployed to help secure a broad range of organizations, such as banks, utility companies, airports, transportation systems, major public buildings and the sites of Fortune 500 companies.
Memoori’s 2014 Annual Report on the Physical Security Business estimates that PSIM sales were approximately $200m in 2014 and growing at around 20% per annum. It is therefore a relatively small market with high initial cost that is limiting its growth.
Disruptive trends such as cloud computing, cybersecurity and the Internet of Things are driving profound IT changes across all industries, including the enterprise security market, creating opportunities and challenges for PSIM players.
While the PSIM acronym continues to be widely used by the many smaller firms in the physical security management systems market, the leading players including Qognify, Verint, VidSys and Siemens have moved away from the term in order to differentiate themselves from the competition. Negative connotations around complexity and high cost are likely to have also played a part in vendors rebranding their offerings.
Applications beyond physical security are being highlighted by the key players. For example, Vidsys now offers a Converged Security and Information Management (CSIM) software platform, announcing on its web site that: “The increasingly popular label of PSIM fails to capture the full scope of our rapidly-evolving integration platform, one that is facilitating cloud-based solutions and the convergence of a common operating picture linking security systems, building management systems and IT network management tools for asset owners globally”
Moti Shabtai, president of Qognify (formerly Nice Systems Physical Security), told Security Systems News in a recent interview that Qognify Situator “takes PSIM to the next level … to provide situation management and operational intelligence.” confirming the trend of vendors to move beyond PSIM into non-security related applications such as maintaining business continuity and optimizing operational efficiency.
Mobile technology has been increasingly adopted to enhance field operations. For example, Verint Situational Awareness and Intelligence platform was enhanced in Sep 2015 with Mobile Reporter and Mobile Responder functionalities enabling local citizens to share information directly from their smart devices and providing field personnel with more real-time, accurate intelligence about an incident before arriving on-site.
Acquisitions, Alliances and Funding
Two of the leading PSIM players, Qognify and Vidys are funded through private equity and venture capital and ultimately can be expected to acquire new owners.
Battery Ventures, the private equity firm, acquired Nice Systems Physical Security Business Unit (PSBU) in August 2015 in a deal worth up to $100 million. The company has subsequently been renamed Qognify.
There are plans to continue to grow the company by maintaining its focus on the physical security market, while expanding the unit's solutions for daily operations management. Battery also hopes to complement the company's existing technology through strategic acquisitions.
In its latest financing round, Vidsys received $15.65 million equity financing in Aug 2013 led by NewSpring Capital. Also participating were VidSys’ existing Investors, Atlanta Equity, Flybridge Capital Partners, JVax Investment Group and Motorola Solutions Venture Capital. Cisco has also invested in Vidsys in a previous financing round in 2011.
More recently, Vidsys announced a strategic alliance with S1 Corporation, an affiliate of the Samsung group in Korea, which is adopting VidSys as its exclusive go-to-market PSIM platform for security integration and critical infrastructure in support of key projects around the world.
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Even though cloud applications are still at an early stage in physical security, they are destined to transform the PSIM market.
One early adopter of a cloud-based solution is Octopus, a start-up company, based in Tel Aviv that makes command and control PSIM software for large facilities such as airports, factories, hospitals, and commercial buildings. The company has recently raised $2.5 million venture capital funding from Singulariteam and will use the funds to expand in the U.S. and Asia. Octopus’ products are already used in Israel by the government, 28 Coca-Cola factories, VISA, and three national banks.
The company’s converged PSIM solution runs on the cloud or on-premises and brings to the market a security management and integrated command and control system with more than 35 different modules and a mobile phone platform allowing a complete all-in-one system for physical security and dispatch, cyber security alerts and social media analysis.
Co-founder and chief executive officer Tal Bar Or says that his company’s advantage is an already fully-deployed and tested cloud-based system, as well as its focus on cybersecurity.
With increased risk of terrorist activities and incidents both in the workplace and in public places, effective PSIM platforms are needed more than ever, within the framework of situational awareness, situation management and situation reconstruction. Their capability to also go beyond physical security and provide operational intelligence gives them a promising outlook for the future.