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Slow PACS/Imaging Growth Ahead, Report Indicates

September 14, 2012
by Gabriel Perna
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According to new research from the Mountain View, Calif.-based research firm, Frost & Sullivan, the radiology picture archiving and communication systems (PACSs) industry will see slow growth over the coming years. The report’s authors say the market earned revenues of $1.1 billion in 2011 and estimate it will reach $1.4 billion in 2018.

The report, Analysis of the North American Radiology Image and Information Management Systems Market, indicates there are several reasons for the slow growth. For one, there has been a slowing of imaging procedure volume growth and declining reimbursement levels over the last few years. In this regard, the industry’s vendors have to adjust to customer's reality of narrower profit margins and less capital-intensive revenue streams, the authors from Frost & Sullivan says, adding that there will be vendor consolidation from large-scale vendors, and fragmentation in smaller-scale segments.

"As vendors in the consolidated PACS industry strive to revive past growth synergies in the radiology informatics market, imaging providers are only slowly buying into the value proposition of new generation systems," Frost & Sullivan principal analyst Nadim Daher said in a statement.  "In a market where PACS penetration is expected to cross the 90 percent mark across all imaging providers in 2014, replacement cycles stabilizing below the current seven year cycle could maintain sustainable–even if slow–revenue growth."

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