Digital Transformation, Internet of Things, Industry 4.0, and other mega trends are expected to drive the usage of connected electronic devices across industry verticals and increase the demand for electronic test and measurement equipment. Increased demand for connectivity, autonomous driving, and electric vehicles is expected to drive the need for new testing equipment across industry verticals.
A report entitled ‘IoT and Hi-speed Communication Powering the Global Electronic Test and Measurement Market, 2020’, forecasts that the advancement of 5G and the implementation of Internet of Things (IoT) technology will help the market reach $18.94 billion by 2025, despite a decline of 0.7 per cent due to the pandemic.
Powered by the digital transformation, IoT, Industry 4.0, and other mega trends, the use of connected electronic devices is expected to grow regardless of vertical, along with the demand for electronic test and measurement equipment.
According to Prabhu Karunakaran, Industry Analyst, Frost & Sullivan, “test and measurement (T&M) equipment are utilised significantly in research, product development, prototyping, manufacturing, and field-testing applications.” Semiconductor automatic test equipment (ATE) should be the top revenue generator due to the sheer size of the market, ever-increasing end-user demand and the evolution of consumer electronics technologies.
Radio frequency (RF) test equipment is expected to represent the second-largest revenue opportunity, driven by continuing R&D investments in communications and other verticals—both current and future programs in 5G and 6G—and the commercialisation of 5G.
Further, Mr Karunakaran said: “The automotive end-user vertical is expected to emerge as a major contributor given the rapid progress of autonomous projects, which will fuel demand and continue to offer growth opportunities.”
In order to expand revenue opportunities, electronic T&M vendors should explore the following growth areas:
5G: Work with various stakeholders in the value chain to capitalise on the opportunities that advancement in mmWave technology and the proliferation of 5G use cases will bring.
Driverless automobiles: Aggressively monitor the development of electric vehicles (EV) and other new mobility technologies to develop solutions that address their natural testing needs.
Power applications: Develop innovative solutions that help design engineers better noise performance, more precision and the ability to catch fast, small, and unpredictable signals.
Edge IoT: To comprehend the varied requirements for testing and design equipment that are cost-effective and require minimum customisation.
Next-gen data centres: To work with end users and understand requirements and develop products to support such R&D activities.
Already in 2020, the communication test and measurement market is expected to witness a slowdown in 2020 due to the global lockdown. It goes without saying that the lockdown has impacted global manufacturing terribly, and supply chains and logistics as the continuity of operations for various verticals were badly hurt. The sectors primarily facing the worst drawbacks are manufacturing, transportation and logistics, and retail and food. The availability of essential items has been hindered due to the lack of manpower to work on production lines, supply chains, and transportation although the essential items are exempted from the lockdown.
In view of the current situation, most telecom companies across the globe have been offering networking tools for free or at reduced costs to aid customers in working from home. Additionally, companies are launching various communication test and measurement solutions to ramp up work productivity. However, the pandemic has had a positive impact on the cloud services market. One of the positives is that most employees are working remotely, which has increased the demand for networks to have better data and voice connectivity. This should boost the adoption of communication test and measurement solutions.
The COVID-19 pandemic has thrown the demand and supply chain of the test and measurement equipment market completely out of gear. This disruption has left various companies struggling in these pressing times. Fortunately, the global economy is slowly but steadily recovering and should be back on track to the pre-COVID levels in a few months.
According to the latest report of Market Research Future (MRFR), the global test and measurement equipment market size is projected to reach a size of $34,586.38 million by 2025. It is expected to exhibit a CAGR of 4.85 per cent CAGR over the forecast period (2019-2025). Test and measurement equipment ranges from automatic testing equipment to spectrum analysers. A major factor in driving up revenue is the need for testing new devices across industries of aerospace, healthcare, and automotive can drive market growth over the forecast period.
The COVID-19 pandemic has thrown up a golden opportunity for the market owing to the increased need for effective diagnostic equipment. The test and measurement equipment can be used for detecting COVID-19 cases fast and appropriate measures can be taken for stemming its proliferation. Development of cures and vaccines can rest on the foundations of well-made testing and measurement equipment. The digital transformation across industries can induce a higher market demand regardless of the vertical.
The global test and measurement equipment players are involved in solution launches, product launches, acquisitions, collaborations, and partnerships for gaining an edge in the market which lead to heavy concentration and stiff competition.
Communications test and measurement is often referred to as an “artificial kidney” of the manufacturing sector. The global impacts of the COVID-19 have already impacted various industries and has significantly affected the communications test and measurement market in 2020. We have to see how things pan out in this new year.
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Arijit Nag is a freelance journalist who writes on various aspects of the economy and current affairs.
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