At the end of October 2019, ARC Advisory Group released a list of the top 50 global and North American automation companies of 2018. At the same time, analysts pointed out that with slower growth in some global markets, automation companies still have opportunities to grow against the trend.
Compared with the rankings of last year, the positions of some leading automation vendors have remained largely unchanged, but there are also many new suppliers parachuting into the industrial automation market from information technology (IT), Industrial Internet of Things (IIoT) and cybersecurity markets. These suppliers include companies providing edge computing, cloud computing, data analysis, machine learning and industrial network security. Despite the sluggish development of the traditional automation equipment field, the market segments of these emerging technologies are growing at double-digit rates.
Some emerging technology companies have begun to compete with traditional automation companies, and some have chosen to form alliances with or be acquired by existing automation giants. In any case, these emerging technologies are accelerating into the field of automation and will change automation technology and the market more deeply.
At present, the digital transformation and the application of the Internet of things are rapidly becoming realities. ARC Advisory Group observed that many end users are trying to explore digital transformations that fit their needs and seek to develop an appropriate route map. Today, devices and machines of all kinds are increasingly interconnected, and an unprecedented scale of data is being generated and accessed in factories by them, making it even more useful for advanced technologies like machine learning.
In the manufacturing industry, predicting equipment failures, optimizing production processes and improving product quality are the first three sectors that have gained quantitative benefits through digital transformation. Of course, in addition to these direct improvements, digital transformation also can improve and transform business and service models for a wide range of infrastructures, such as manufacturing industries, power and transportation. Therefore, the right transformation strategy is crucial to the sound development and viability of enterprises in the short and long term. This trend may provide considerable new business requirements for those automation companies that are ready.
The growth of the edge-computing market also confirms that traditional automation technology is approaching the IIoT. An edge control system usually is run locally, but it is very different from a traditional automatic control system not connected to the network. Many vendors are expanding their range of hardware, software, and services to meet this demand trend. It is not hard to see that mature edge control devices, integration of IT and operational technology (OT), and application execution environments are becoming increasingly common on the list of automation company offerings.
On one hand, facing the increasing evolvement of cyber threats to industrial infrastructure evolve, the industrial cyber security market continues to experience double-digit growth. On the other hand, the rapid influx of the IIoT technologies also makes it more common for users to weigh the potential network risks that these new technologies pose to production and security.
End users realize the importance of the internal network security system improvement and increasingly are willing to rely on professional third-party security service providers to help them develop and maintain effective network security strategies. At present, major automation vendors also are strengthening their network security portfolios through internal research and development, acquisitions, and cooperation. These include industrial firewalls, hosting services such as threat detection and response and network security assessment.
New opportunities and challenges are emerging in the evolving automation industry. Being aware of new trends as soon as possible and planning to adapt to changes is the correct way to fight for market share.
Stone Shi is executive editor-in-chief, Control Engineering China. Edited by Mark T. Hoske, content manager, Control Engineering, CFE Media, mhoske@cfemedia.com.