PSIM's Greatest Value

By John Honovich, Published Jan 17, 2013, 07:00pm EST

PSIM has great value. It's just typically not for the people who buy and use them.

Let me tell you a story. I know an integrator who is an evil genius. One of the cleverest tricks he uses is a territory exclusive for a PSIM. This obviously helps to sell the product but that is not the real value of his deal. He does not particularly care how much money he gets from selling PSIM.

It is all about getting his virus in. Once a project specifies 'his' PSIM, the real magic happens. Rarely is a PSIM sold alone and typically the other 'stuff' (cameras, readers, installation, etc.) are worth far more. However, if his competitors cannot get a core RFP item, they cannot bid. And what will they do? Call him up and ask for a price quote? :) And this is just stage 1.

More value comes long-term - service contracts, system expansion and standardization across facilities. If you make your PSIM required, you can block out or at least make it much harder for competitors to get a piece of that business.

This is not fool-proof. PSIM vendors have an interest in not screwing their customers. On the other hand, if you have a sales partner (i.e., integrator) who is pushing a lot of product you may be reluctant to tamper with the arrangement. Plus, end users need to be either gullible, stupid or paid off enough to go along for this ride.

However, whatever a security team uses as its front end system is hard to replace, especially if legacy systems are custom integrated.

ADT, NICE, Verint

This is the real genius of ADT, NICE and Verint buying PSIMs. The value of PSIMs for them is the pull through - what other things can they sell. For NICE and Verint, it's clearly video management systems because once they have their PSIM in, even if the customer standardizes on Milestone or Genetec or whomever, they can clearly and regularly push for their own VMS for new sites, upgrades, etc. For ADT, it is even better. They can then push a broad slew of both security products and integration services.

Unfortunately PSIM products are not really innovating but the sales tactics are strengthening as they get incorporated into big vendors.

 

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