Infrastructure Projects Outpace Industrial Automation
Industrial Ethernet Switches are distinguished from their commercial brethren in areas such as ruggedized enclosures, passive cooling, ability to operate in extended temperature ranges, and conformance to industrial as well as COTS standards.
The year 2009 cemented a sea change in this market as traditional automation sectors, such as automotive and machinery, faded into the second tier and infrastructure investments took leading roles. As private investment dried up in the face of the global economic downturn, governments and utilities were the primary investors in areas such as intelligent transportation (ITS), renewable energy, and other infrastructure projects.
This phenomenon was true on a global scale, with governments from the US to China participating. This trend will continue as activities in segments such as renewable energy and intelligent transportation systems provide growth going forward and traditional manufacturing markets endure what is shaping up to be a prolonged recovery.
Shifting fortunes by industry sector are mirrored in the prospects by geography. Asia in general, China and India in particular, and the EMEA nations will benefit most from investments in key growth segments.
Strategic Issues
As the industrial Ethernet switch market assumes a more vertical versus horizontal emphasis, suppliers must tailor their products to meet the requirements of target sectors. In determining the optimal geographic presence, suppliers need to look at where their product is applied in the value chain, and by whom.
- What are the requirements for success and revenue projections for key verticals, including energy T&D, ITS, water and waste, and security/surveillance?
- Which segments will be impacted most by the rise in embedded switching?
- Who is the customer, and how/where do they want to manage the network?
- What sales and distribution strategies are needed to succeed going forward?
