What’s holding back wireless communication in industry?
In spite of healthy growth, the vast majority of devices will still be connected to wires by 2015, suggesting that the wireless industry isn't as vast as commonly thought.
In a recent study, IMS Research estimated that the overall industrial wireless market would grow at an average annual growth rate of 18% to the end of 2015 (see Figure 1). That’s certainly well above the average rate we’d consider “normal” for industrial automation products (more typically 5-8%). This certainly explains the vendor community’s attraction to wireless products – how many areas of automation are both fast growing and high margin?
However, when you consider the relatively small size of the industrial wireless market, the attraction starts to wane! Despite the strong growth forecast for wireless networked devices, the vast majority of devices will continue to be connected with fibre and copper. Even by 2015, only 1.5% of devices shipped are forecast to be connected with a wireless network (about 3M wireless devices of an estimated 200M networkable devices shipped).
So what exactly is holding wireless in industry back? Well, first of all, the above statistics don’t tell the whole story. The growth forecast for the relative market sizes of wireless products sold to discrete and process industries varies significantly (see Figure 2).
One of the most influential factors is the nature of production in each industry. So far, automation component vendors have largely released products that focus on wire replacement. Due to the vast nature of process plants these wireless products are very attractive compared to the wired alternative. As copper prices continue to increase, pushing up the cost of networking components using wire, the benefits of wireless networking will also increase. Larger process plants are likely to be the biggest winners. Wireless measurement devices can help to provide more process data and in most cases can easily be integrated with existing wired networks. Two typical application examples can be found here and here.
Process industries have the higher rate of wireless penetration. For example, in 2009 – a tough year for process equipment in general – unit shipments of wireless process measurement instruments doubled. The future for these products also looks bright. Customers have trialled these products with initial success, with a future aim of rolling them out more widely. Wireless devices are appearing in plans for large Greenfield sites in the Middle East, India and China. In 2015, IMS Research projects that over 300K new wireless process measurement devices will be shipped. Whilst this figure represents a small proportion of total process equipment shipped, penetration is undoubtedly increasing.
Wire replacement applications have the potential to seed the market for future growth. Over the next few years, wireless will begin to extend its application reach with new solutions that will begin to focus on model-based maintenance, asset management and energy management.
However, the story for discrete automation is quite different. A wide variety of products targeted at this space do currently exist, but penetration within the market is much lower. While the benefits of networking in machines are well known, the smaller distances associated with machinery connectivity (either within the machine itself, or between different connected machines) mean that replacement of wired components with wireless alternatives has less of a cost benefit. Smaller cost benefits achievable from wireless monitoring devices and the use of wireless components for critical (machine control) applications are still some way off. Consequently, there is still some work to do before wireless technology is widely accepted by machine builder and discrete end-users.
To get traction, automation component vendors need to find new wireless use cases in discrete factory automation. It is likely that the current development of discrete automation wireless technologies will help – but market penetration won’t approach the level of process automation by 2015. Without a doubt, a huge potential for wireless technologies in discrete automation applications exists, and penetration will undoubtedly increase. However, due to the smaller potential cost reductions, it’s imperative that dedicated discrete wireless technologies and compelling use cases are established to increase market penetration.