Industrial networking growth highest in Asia-Pacific

Venture Development Corporation (VDC) finds healthy growth prospects for the worldwide $1.7 billion industrial wireline networking infrastructure market. According to the recently published research study, “Industrial Networking Global Market Intelligence Service”, VDC expects the global market for network infrastructure products shipped for use in industrial facilities to increase at almost a 25 percent CAGR through 2011.

Of three regions covered in the research, the highest overall market growth rate through 2011 is forecast for the Asia-Pacific region as seen in the following figure. The increasing investment in manufacturing capacity by multinational companies is one factor driving high demand for automation in this region. In the markets studied, much of this investment is being directed toward Ethernet-based networking products, making this segment attractive for vendors.


Factors expected to account for this growth include:

• A trend in general to networking in industrial facilities as a means of reducing costs, increasing efficiency, and improving productivity

• Networking provides the ability to monitor and control operations and machinery remotely.

• Networking eliminates point-to-point hard wiring, which is both expensive to install, difficult to troubleshoot, and hard to modify

• The growing acceptance of standard solutions, particularly Ethernet, which provide interoperability of equipment and devices from many suppliers and result in better performance and lower prices


The VDC market study covers the following wireline infrastructure products shipped for use in industrial facilities: Networking Components – bridges, console servers, device servers, fiber optic transceivers, gateways, hubs, modems, multiplexers, repeaters, routers, switches; Industrial-grade Interconnect Products – connectors, cable & cord sets, distribution boxes; and Network Management Software.

Shipments of the wireline networking infrastructure products studied for use in industrial facilities to Asia-Pacific markets totaled $298 million in 2006. Of this, 76% consisted of products for Ethernet networks, and the Ethernet share is forecast to increase to over 81% of a $1 billion market in 2011. These are the highest Ethernet shares among the three major geographic regions. One reason is that in the other two regions use of other buses/networks is more established, and harder to displace. However, the Ethernet shares in those regions also are expected to increase.