NICE Acquires Orsus - Confirms Weak PSIM Market

Author: John Honovich, Published on Nov 22, 2009

NICE Systems has acquired Orsus for $22 Million. While this looks to be a good deal for NICE, it raises many important questions for the state of the PSIM market.

Background

On November 23, 2009, NICE confirmed that it is acquiring Orsus. NICE, one of the leading video surveillance manufacturers, plans to integrate Orsus's PSIM offering (called Situator) with NICE's portfolio of video and security product offerings.

Earlier reports indicate that Orsus raised over $70 Million in funding. However, over half of that funding was raised during the dot.com bubble prior to switching to and developing a security product.

NICE disclosed that Orsus's revenue will contribute "several millions of dollars in 2010."

The Good

We see two good and positive signs from this acquisition:

  1. Given NICE's strength, size and complimentary market position to Orsus's product, NICE should successfully expand the sales and deployments of Orsus's products.
  2. Given NICE's relatively conservative acquisition history, this acquisition signals that a major player believes that PSIM products can be financially profitable.
 
The Bad
 
At the same time, the acquisition raises some troubling concerns:
  1. Orsus is one of the leading PSIM providers with the most publicly announced wins yet has low revenue.
  2. If PSIM is the next 'big thing' as many convergence proponents advocate, a $22 Million acquisition does little to validate this.
  3. The other PSIM companies (including CNL, Proximex and Vidsys) now have a fairly low benchmark for their own valuations.
 
We have been bearish on PSIM over-hype for a long time. See our original examination of PSIM's problems.
 
Examining NICE and Orsus
 
In the premium section of this report, we examine NICE and Orsus's products, how their joint offering is likely to be positioned and the potential impact on the PSIM market.

**** ******* *** ******** ***** *** $** *******. ***** **** looks ** ** * **** **** *** ****, ** ****** many ********* ********* *** *** ***** ** *** **** ******.

**********

** ******** **, ****,**** ********* **** ** ** ********* *****. ****, *** ** *** ******* ***** ************ *************, ***** to ********* *****'* **** ******** (**************) **** ****'* ********* ******* *** ******** ******* *********.

******* ******* ******** **** ***** ****** **** $** ******* ** funding. *******, **** **** ** **** ******* *** ****** ****** the ***.*** ****** ***** ** ********* ** *** ********** * security *******.

**** ********* **** *****'* ******* **** ********** "******* ******** ** dollars ** ****."

The ****

** *** *** **** *** ******** ***** **** **** ***********:

  1. ***** ****'* ********, **** *** ************* ****** ******** ** *****'* product, **** ****** ************ ****** *** ***** *** *********** ** Orsus's ********.
  2. ***** ****'* ********** ************ *********** *******, **** *********** ******* **** a ***** ****** ******** **** **** ******** *** ** *********** profitable.
 
The ***
 
** *** **** ****, *** *********** ****** **** ********* ********:
  1. ***** ** *** ** *** ******* **** ********* **** *** most ******** ********* **** *** *** *** *******.
  2. ** **** ** *** **** '*** *****' ** **** *********** proponents ********, * $** ******* *********** **** ****** ** ******** this.
  3. *** ***** **** ********* (************,*****************) *** **** * ****** *** ********* *** ***** *** valuations.
 
** **** **** ******* ** **** ****-**** *** * **** time. *** *** ******** *********** ******'* ********.
 
Examining **** *** *****
 
** *** ******* ******* ** **** ******, ** ******* **** and *****'* ********, *** ***** ***** ******** ** ****** ** be ********** *** *** ********* ****** ** *** **** ******.

[***************]

NICE ******* ********

**** ******* ********* $*** ******* *** ** **** ******* *** has * ****** ************** ** ***** $*.* ******* *** (******* ***** *****).

**** ***** **% ** ****'* ***** ******** **** **** *** public ****** *** ******** ******. *** ******** ** ******* ** from****'* ********** *********** *********.

****'* "****** ****** *** ******** ******" ******* $*** ******* *** revenue ** ****, ** **** $*** ******* *** ******* ** 2007 (*** **** ** ** ***** **** ****** ******). ** **** ******* *** **** **% **** **** **** ($35 * *** ** **** ** $** * *** ** 2008).

***** *** ******* *** *** ***** *** ** ****'* ******** $100-$150 ******* ****** ******** ******, **** *** **** ******** ********** Orsus' ******** ** * ********* *** *** ********** ******, ***** Situator ** * ********** ****.

NICE's ******** *** ***********

** *** ******** ******, **** ****** * ***** ********* ** video ************ ******** ******* **** ********, ****, ****, ** ***** management ********. *** **** ********* ****** ***** ** **** *** products *** ******** ** *** **** *** ** *** ****** that ***** ******** ********.

******* ******** ****'* ***-***** ****** ********** **** ****** ***** ** ****** and ****** ***** **** ****'* ******* ********* *** ********. ************* includes ***** ********** *** ******* ****** - *** ********* ******** for **** *** / ********** ***********.

********** ***** ****'* ** ***** ********** ******** **** ******** **** *** appliances *** ******** **** ********.

********** ********* ****'* *********** *** **** ********* * ****** - *** high *** *** **** ******** ** ** ** ****** ******** per *********, *** *** *** **** **** ******** ** ** 32 ******** *** *** ***** ********* *** ** ** * channels.

********** *********** ****'* **-***** ***** ********* *********. ****** **** ***** *** providers, **** ******** *** ******** ***** *** ******** ***** ********* that *** *** ** ***** *** ********** ** ** ******* using ****'* *** ** ***** ********.

********** ********* ****'* ***** ***** ** ***** ******** ********* ** ******** only ** ** ** *** *********. **** ** *** **** non-enterprise ********** *******. *******, **** **** ** ******** ** ** fully ********** *** *********** ** ****'* ********** *******.

*******: ***** **** **** *** ******** ******* ********, ** ** well ***** **** ***** ******* ** ******* *** ********* ******* or ******* ***** ********** ***** ******** **** ** ******, *********, Genetec, ***.

Orsus's **** ********

***** ****** * ****** ******* -********- * ******** ******** **** (*) ********** **** ******* *** party ******* *** (*) ******** *********** ** *********** ********** ******* improved ******** *** *********** **** ********** ***-*******.

***** ******* *** *************/******** **** * ********:

  • ****** ***, **** ** ***** ************** ** *********** **** ********** *** response *********. **** ******** ******* ** *********** **** ******* ********** including *****, **** *** *** *********** ********** ** ****-**** **** various ****** ****** (**** ********, ******, ***.)
  • **********, **** ****** ****** ********** ** ******* *** ******* ***** standard ********* ********** ** ******** ******* *********.
  • *************, **** ** ** ************* *** ******** **** **** ***** operators ********** ********* *** ********* **** ******* ****** ** **** to ****** ****** *********.
 
***** **** *** ******** ******** ***** *** ***** ************ (******* to ****** *** **** ********* *** *** ****** ********* ** show *** ***** * ********** ** ***** ******* *** *********). That *****, **** ******** *******, ** *** *** **** ***** integrated **** ****** ** ******* ******* *** ****** *** *** of *** **** ********* **** ** *** ***** ******* *********. [Update: **** ********* *****'* ******* ************, ******** * ***** ** '150 ********* ************'.]
 
*******: ***** **** *** ******** ******* (******* ** ****** *** PSIM *********). *******, *****'* ******** **** ** ** **** ***** scale. ** ******** **** **** ** ***** ******** *** ** least $***,*** *** **** * ****** ***** ****** $* ******* USD. *** ** ******** ** ***** ********, ********'* **** ***** *********.

*****'* **** ****** ******** ******* ** ******* *.* (******** ** 2009). *.*'* ******** *** ********** ** *** **** **** *** of *** ******. ************, ***** ********** ***** **** *** *** only ******** *** *****-***** ******* *********** ***.

***** *.* ******* ******** * ******* ** ****** ************* ********* a ********* ****** ******* ********** *********, *****/********* *** ******** *********, changes ** *** ***** ****** ** ****** ******* ***** ********** and * ********* **** ** ************* *********** **** ******* ** access ******* *******.

*** ***** ************ ******** ******** ***** *******: (*) * ***** pursuit ******** **** ********** ******** ******** **** ****** ** ****** (at * **** *****, ** ***** ******* ** ******** ********* from ****** *** ********) *** (*) *** ******* ** ****** different ****** *** ** **** ********'* *********** (******** *** ********, for ********, ** *** * ** *** *** ******* *** (say *** * ******) ** *** * ** ***).

** ******** ****, ***** ****** *******. ***** ******* **** *** *********** *** **** ********* *** Cinario's ******** **** (** ******) *** **** *** ********** *** similar *** *** ********* ** ***** ******** ********).

NICE - ***** ****** ***********

***** *** '***** ** ****' *** **** ** ** ******* an *********** ****** **** ********** ******* ***-*******, **** ** **** likely ** ** ** *** ******** *********.

*****, **** **** ** ****, ******* *** ********* ** ** integrate ***** ******** "**** ** ******* * ************* ***-********** ********* of ******** ********** *********."

********, *** ***** ******* **** ** * ***** ********* ** NICE's ******* ********* ***'* ******* **** **** ** ** ********** the **** ** ****'* ******** ******** ****** **** ** **** an '***********' **** ******.

*****, ***** **** ********** ******** ***** ***** *******, **** *** never ********** ****** ** * '**** ********' ******* **** ***** to ********* **** ******** ** *** ***** ******* (******** ** an '****' ****). ******, ** ** ****** **** ********** ** use ***** ** ******* ****'* **** ******** **** ** ******* an '****' ****.

* **** ********** ******** *** *** ****/***** *********** *** ****'* ******** *********- * ******* *** ******* ****** **** ******** *** ***** systems *** ** ********** **** *** ******* ** **'* ********.

Impact ** ***** **** *********

** *** ******** **** *** ***** **** *************, **** ****** reduces ***********. **** **** **** ****** ***** ** ***** ******** customer **** *** ******** ***** **** *** ******** **** **** have * ****** *********** ** ******* **** ***** ******* ******* portfolio.

** *** ******** ****, **** ******** ******** *** **** ****** of *** **** ******. ** ** **** ** **** ***** stage ******* ** ******** ** ********* *** ******** ****** ********* success. **** ********** *** ******* ***** ** **************** *** **** ***** be **** ** ******* ***** *****'* ********** **** ****** ** publicly ********* ******* ****.

*** *** **** ******* ****** **** *** **** **** ********** that ***** *** - ********* ****** *** ******** *******, **** costs *** ************ ** ********* ****** (** ********) ** *************, complex *** ****** *********** **** *********** *** *** ******* **********.

** *** ***** ****, ***** ******* **** ** **** *** other **** ******** ** ******* ** **** ***, *******, ***** scale *********. *** **** *** **** ** **** *** ** the ********* ************ *** **** **** ****** *** ********** ****** to ******* ** **** ****** **********. **** *** ****** *** with *** ********* **** ****, ** ***** ** ** * long **** ******.

Login to read this IPVM report.
Why do I need to log in?
IPVM conducts unique testing and research funded by member's payments enabling us to offer the most independent, accurate and in-depth information.

Related Reports

Sentry360 Bankruptcy on Nov 30, 2017
Sentry360, a US-based video surveillance manufacturer, most well-known for its panoramic cameras, has filed for Chapter 7 bankruptcy. In this...
Video Developer Digital Barriers Selling Off Its Video Business on Oct 31, 2017
~92% of Digital Barrier's $32M USD revenue is from video surveillance. The company is most well known for its products such as perimeter detection...
Genetec Citigraf Big Data Platform Analyzed on Oct 26, 2017
A big industry debate is whether VMS software is now a commodity. However, Genetec believes it can charge a substantial premium for higher-end...
Assa Abloy Acquires August on Oct 25, 2017
The mega access control manufacturer, Assa Abbloy, has acquired one of the most well funded access control startups, smart lock...
Failed Arecont China Acquisition on Oct 25, 2017
Arecont cameras are not the only things that fail. Arecont spent months trying to be acquired by a Chinese manufacturer, only for the deal to...
ADI To Be Spun Out of Honeywell on Oct 10, 2017
Honeywell has announced it will spin off ADI and its Home products division into a new public company. This is a big move for the mega-security...
Vivotek Delta Acquisition Concludes on Oct 02, 2017
On August 8, 2017, Delta Group made an offer to acquire Vivotek. Now, the acquisition process has concluded. Inside this note, we examine the...
ASIS Show 2017 Final Report on Sep 27, 2017
ASIS is in Dallas for 2017 and this is our final show report (compare to our 2016 ASIS show report). When walking in, one is greeted with Dahua's...
HID Buys Mercury Security on Sep 19, 2017
One of the biggest access control deals in years. Mercury Security, the most widely used access hardware OEM, and partner to 20+ manufacturers,...
CNL PSIM Profile on Sep 06, 2017
CNL has been one of the strongest advocates for PSIM, as one of the earliest entrants into the market releasing their command and control software...

Most Recent Industry Reports

Robot Vandalism on Dec 11, 2017
Vandalism of security systems is a common concern. It is so common that camera vandalism statistics show that designers routinely sacrifice camera...
Access Controller Software Guide on Dec 11, 2017
Properly configuring access controllers software is key to a professional access system. These devices have fundamental settings that must be...
2018 Video Surveillance Cameras Overview on Dec 11, 2017
This report concisely explains the developments for surveillance cameras offered in 2017 and the state of offerings going into 2018, including...
Imperial Capital Security Investor Conference Review on Dec 08, 2017
Investment bank Imperial Capital holds an annual Security Investor Conference where 60+ companies present, including this year: IPVM bought a...
Integrator GPS Vehicle Tracking Statistics and Success Examined on Dec 08, 2017
GPS vehicle tracking is a growing but somewhat controversial topic. On the plus side, tracking may increases productivity by providing greater...
Hikvision NA Biggest Sale of 2017 on Dec 07, 2017
Hikvision North America has been relatively disciplined the past 5 months, reducing the number of sales and the breadth of what is on sale. No...
Security Integrator IT Expertise Statistics on Dec 07, 2017
20 years ago, putting physical security systems on IP networks was just emerging. Today, almost every system is networked in some way, IP cameras...
Lighthouse Deep Learning Camera Tested on Dec 07, 2017
A Silicon Valley startup, Lighthouse, with a Stanford PhD CTO, has released a deep learning AI camera with 3D sensors for just $300. The company...
Access Control Course Winter 2018 on Dec 07, 2017
Learn more below about the Winter 2018 IPVM Access Control Course. Register here. IPVM offers the most comprehensive access control course in...
Broken Hikvision App Exposes Hypocrisy on Dec 06, 2017
While Hikvision talks about a commitment to cybersecurity, their broken app and their insecure 'solution' exposes not only their engineering...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact