Will PACS market ever measure up?

February 1, 1998

Will PACS market ever measure up?It has become common practice for many participants in the PACS industry to be generous in superlatives whenever asked to characterize the growth of the PACS market. And finally, it seems there is a good reason

Will PACS market ever measure up?

It has become common practice for many participants in the PACS industry to be generous in superlatives whenever asked to characterize the growth of the PACS market. And finally, it seems there is a good reason for it. Customer interest in digital image management seems to be at an all-time high, and vendors are devoting substantial resources, both in marketing and in technology development, to foster that demand.

But is anybody buying? At least one survey, conducted by Technology Marketing Group (see story, page 3), estimates that the U.S. PACS market generated only about $400 million in revenues in 1997, falling short of estimates made by the consulting group just a few years ago. TMG also believes that PACS in the next few years will see only a 5% to 10% growth rate, well off the 20% to 30% growth rates that previously were held as gospel by industry watchers.

On the surface, TMG's new numbers seem to hit the mark. Despite widespread pronunciations last year that the era of filmless radiology was finally at hand, the number of large-scale PACS contracts reported could be counted on the fingers of two hands.

But one thing to remember when evaluating the market is that PACS purchasing can take anywhere from 12 to 24 months, a time period that isn't getting any shorter now that other departments such as IS are increasingly involved in purchasing decisions. While demand for digital image management will continue to grow, the nature of PACS purchasing will likely hold back growth rates in the foreseeable future.

-Erik L. Ridley, Editor