| 10 January 2017
As another year begins, we catch up with Keith Bloodworth, CEO of CNL Software for his PSIM highlights of 2016 plus predictions of what is waiting for the security integration market in the coming 12 months.
For CNL Software, 2016 was another big expansion year, we beat market growth forecasts by a sizable margin for the second year in a row. With increased head count, globally, and escalated sales in both the US & EMEA, the company has solidified its position as one of the technology leaders in the global PSIM market. We not only grew our number of staff, offices, customers and partners in the last 12 months, but we also developed a greater understanding of what is valuable to our partners and clients. We recognize and sincerely thank our sales partners, without whom, we would have not achieved this level of growth.
The PSIM Market in 2016
In a year where national security has been shown to be relatively powerless against the evolving threat of small terror cells, the need for coverage of large scale CCTV, both public space and private has never been greater. At a time when almost all police and mass transit operations are facing reduced budgets for security operations, meaning fewer feet on the street, there has been an increased focus on the use of technology, using digital “eyes” as a force multiplier for officers and guards. These eyes on the street, work 24/7/365 with a low cost of maintenance and little intervention required. The may not prevent attacks, but they can assist investigations and the apprehension of offenders.
With the increased requirement for CCTV, however, comes the need to rapidly retrieve footage from both public and private systems along with the problem of integrating “legacy” systems, which, in many cases, it best served by a PSIM solution. This is not in itself, a Safe City solution, but it is a surveillance solution that forms a vital part of a much wider Safe City program. PSIM is a smart way to connect vast numbers of DVR/NVR/CCTV systems, from multiple different vendors, to retrieve video of interest for distribution to the force operatives who require the information. What has been significant in 2016 is the growing number of law enforcement agencies around the world who now acknowledge that the best solution comprises public/private co-operation as well as use of phones, drones and whatever technology gives them access to video most accurately and/or quickly.
With market analysts across the board predicting very high growth in the PSIM market – on average about 25%, but some as high as nearly 35% CAGR, the question is not if PSIM has a value proposition, but how do the Systems Integrators (SI’s) engage and work with the PSIM vendors. There are currently only a limited number of real PSIM “enabled” SI’s, who can handle from sales enquiry through to implementation and maintenance support. The challenge to System Integrators has been the large, complex, one off solutions that require ongoing maintenance and development, where not just security and facilities are involved, but increasingly business process as well. Those who have been working with PSIM are seeing the benefits of their investment with increased revenue, increased margin as well as improved customer relationships.
Predictions and Observations for the 2017 PSIM Market
Many of the higher end Video Management Systems (VMS) and Access Control Systems (ACS) manufacturers have added 3rd party integration capability to their solutions, partly due to market need and partly to compete with entry level PSIM players, who mainly offer a “Common Operating Picture” without much added intelligence, custom GUI designs or workflow. Entry level PSIM vendors are finding it harder to demonstrate additional value to the market as the integrated solutions from mainstream VMS companies have an increasingly good offering at that level. We predict the demise of some of the “pseudo” PSIM vendors in 2017, as well as an increase in the entry PSIM market share taken by VMS vendors.
We expect to see ongoing significant growth for Enterprise level PSIM vendors, where PSIM is a customized, mission critical solution for the client, with tailored user interfaces, workflows and standard operating procedures. Here PSIM is widely recognized as a requirement of all high-end integration programs, particularly in the Critical Infrastructure Protection, mass transit, Oil and Gas, nuclear and Homeland Security markets.
Market Consolidation and Specialization
The overall acquisition trend continued during 2016, resulting in more major consolidation taking place. Larger global players led on the acquisition front, particularly of IP based vendors, examples being Konica buying Mobotix, Honeywell acquired Xtralis and Axis buying 2N, an emerging IP based intercom vendor as well as Cognimatics, a video analytics specialist in retail solutions. M & A has been on the rise for some years and this year has given the security world one of its largest upheavals with JCI tying up with Tyco, making a seriously large global player, and potentially one of the few global System Integrators.
From the end users view, it is good that these leading market players are buying exciting new technologies, in turn making them more accessible through their larger distribution networks. It may seem odd that Securitas for example has bought an integrator (Diebold) as they are best known for their man guarding business, but perhaps it is time that companies hiring out security staff will be investing in supplying high value technology solutions that could supplement the man guarding element of their offerings, providing more value to their clients.
PSIM + Analytics = Increased Efficiency
2016 saw the return of several highly promising technologies which have failed to deliver to the security market the first time around. Most notably, video analytics is back, especially embedded in the camera for live detection or as a forensic tool to retrieve video clips needed for post incident investigations.
Where this becomes interesting is the use of mixed technologies from multiple vendors to build an end user application, as required and defined by a client. This is how PSIM and other 3rd party vendors, particularly analytics can offer huge reduction in operations, costs and time by allowing automation in event identification and process. Analytics used on their own are not a solution, but as part of a wider, more encompassing operation, can add detection and tracking as well as identify from vast amounts of video data from multiple vendors.
Security Assets Saving Operational Costs – Watch this space in 2017
A major development this year has been the mixed use of security assets to support business operations. CNL Software has previously deployed rail transit solutions with operational as well as security benefits, but in 2016, we saw this strategy adopted by port and airport End Users. Now, mobile phone and tablets are used to communicate to and from the control room, managing operational incidents in the field such as accidents, equipment maintenance and logistics, etc. In this way, security assets are used to support business operations and pave the way for even further investments in security technology as it is supporting the business mission. This “business” critical element will remain the domain of Enterprise PSIM vendors.
Drones: The Double-Edged Sword
Fast emerging in the first responder community is the use of low cost drones, which can be deployed and utilized as fast and geo flexible CCTV cameras for incident management of all types. However, this evolving technology needs to be managed, to provide the required information on the situation as the right time and technology is now required in the command and control room for identification and bi-directional use of this geo located video – hence the need for even smarter PSIM solutions with the ability to take the workflow elements out of the field and in the hands of operations staff. The problem for many control rooms is that drones are also in the hands of the criminals, so detection and elimination will also come to the control room. One of the major benefits here for PSIM is the ability to rapidly change and add new technologies in a fast-changing world.
Federated Solutions for Larger Enterprises
Users of multiple numbers of control rooms are now looking for them to be aggregated and managed from a central command facility, maintaining both local and centralized operations. CNL Software has several very large examples, where this is now in use and is having a huge ROI on deployment, management of the assets, Enterprise wide updating as well as managing all the required information at all points in the enterprise. DHS, Armed Forces, Government and ministries are obvious areas in need of this federated approach to PSIM, and this is set to grow as a specialization in the next few years. It is already a complex market for high end command and control solutions, however, it is perfect replacement for expensive bespoke solution.
Tackling the Cyber Front
No predictions would be complete without mentioning cyber security, especially considering recent attacks. Today, cyber represents one of the biggest threats to security as large scale aggregations increase the threat surface. Partnerships are becoming catalysts for co-operation between cyber vendors and physical security specialist, to offer End Users a complete solution. CNL Software, as founder members of the IoT Security Foundation, is working with the cyber industry to both understand and meet the challenges of today and tomorrow. We do not, however, believe we should be a cyber vendor, just encompass the best solutions via our PSIM platform.
In 2017, Enterprise PSIM will continue to raise its game in areas that were once the reserve of defense contractors and semi military companies. Further expansion into C2i will see greater levels of intelligence, including tracking, slew to cue, aggregation of sonar and radar, mass communications, 3D, Federated systems and custom built applications such as incident management, for specific verticals. Many of these will be at a scale that only dedicated PSIM products will perform, both defining and confirming the requirement for PSIM in verticals where security hugely impacts business efficiencies.
PSIM will oppose the industry trend and in contrast to other security systems, its greater capability and value creation will drive its growth as opposed to ever reducing prices. Will 2017 be the breakthrough year for PSIM? Perhaps not, but it will be the year that many of the global SIs start to define strategies for their participation in this growing market – both in importance and revenues.