The proliferation of electronics in the mainstream end- user application market especially automotive, medical, IT, and telecommunications has opened up opportunities and challenges for the electronic test services market. With the rise of Big Data analytics, companies are constantly on the look for faster data generation, collection and analysis for informed decision making. With increasing upgrades in smartphones and cellular networks, with 5G and mm wave technologies on the rise, OEMs now have a cumulative necessity for secure, accurate, interoperable and scalable electronics product.
The emerging need of electronics test services is palpable with a huge upsurge of the market in the sectors of manufacturing, automotive and medicine. The electronic test and measurement in manufacturing applications alone grossed to $1,531.6 million in 2015. Today 40% of the on- board components in car are estimated to be electronics based. Moreover, with the advent of connectivity trends and cloud computing, the scope of applicability for electronics is rising. This consequently has created prospective market opportunities as well as challenges for the electronics test service providers.
Key Drivers and Challenges for the Test Services Market
New technologies are constantly evolving in the complex ecosystem of cloud based platforms, ICT and IoT. This has resulted in increased penetration of sensors, passive electronic components and semiconductors in major consumer markets. OEMs are understanding the need to partner with technology solution providers to integrate technologies outside key areas of expertise.
The need for accurate, responsive and efficient electronics is becoming more critical and this has widened the prospects for the EMS to provide improved test services that are not only hardware centric but also platform centric.
The market pull factors for the electronic testing services can be broadly attributed to the emerging technology and wider applicability of the electronics market.
IoT and Connectivity Trends
Electronics is the enabler and driver for the IoT and for channeling the connectivity trends. This increased demand from OEMs to provide testing services to ensure reliability of the electronic components is has currently become more critical than ever.
Electronics has penetrated to the manufacturing and medical sectors via IoT landscape which has created a pressing need of accurate testing services. The Industrial Internet of things (IIoT) has emerged as the rising trend in the manufacturing industry and Sensors 4.0 are at its forefront. IIoT technologies include smart sensors, wireless sensor network, cognitive computing and so on. This could be the key driver for testing services as the sensors need to be highly parallel, modular, and easily convertible. As sensors are the main data collectors and analyzers, their accuracy is critical to facilitate agility and optimization in the industrial environment. The overall test and measurement market for IIoT recorded a revenue of $71.1 million in 2016 and is expected to grow at a CAGR of 6.7% from 2016 to 2022.
Increasing use of smart medicine and wearable sensors is paving the way to personalized and connected medicine. The electronic testing market has key opportunities and challenges in this sector as it is presumably a new avenue and also the one that demands the most from the testing services. The precision medicine could probably be challenging market prospect for the test and measurement services as this has a direct impact on the consumer. Researchers recently claimed that the medical tracking by Fitbit Charge 2 deviated from the normal ECG ratings for tracking of the heart rates which could affect the patient monitoring and their well-being as a whole. This indicates the growing need of test and measurement services in precision medicine.
Similarly, the automotive sector is also currently electronic driven. With the rise of self-driving cars and automation, market opportunities for testing services are huge. The global integrated automotive testing services market consisting of mechatronics test systems is expected to grow at a CAGR of 6.8% from 2017 to 2024.
Electronics being the backbone of IoT has penetrated into automotive, medicine and manufacturing sector, providing lucrative market prospects and critical challenges to the electronic test service providers.
5G and RF technologies
The rise of 5G is prominent driver for the electronics test and measurement arenas as the success of 5G requires close correspondence of the test services with the 5G technology. Deployment of 5G would present the test and measurement services market with the option of using such services to develop the equipment and ensure their efficient deployment.
The test equipment services demand is expected to rise with the dominance of RF technologies and the emergence of 5G. Revenue for the RF test equipment is slated to come from the 5G-related technologies and is expected to increase at a CAGR of 5.6%.
Already service providers have extended their solutions to accommodate 5G in their forthcoming deployments. Viavi Solutions launched NITRO platform to facilitate its service provider to optimize the performance throughout the network lifecycle. This intelligence platform was also designed to accommodate the 5G when it would be deployed in the future.
Test service providers are becoming more platform based and are combining hardware and software analytics to address the demands and needs of emerging 5G and cellular networks technology.
Data Centers
As cloud computing gains a significant presence in handling of computed instances, the number of the hyper scale data centers is projected to grow. These data centers should be redundant, which requires continuous monitoring of environment parameters and sensors lie on forefront to ensure this. This has created a market pull for advanced and automated test technologies and solutions for the test services providers. The need for redundancy is crucial in data centers and hence the testing services need to come up with automated testing solutions for monitoring of data centers.
The global electronic test services market is currently presented with a plethora of opportunities for the service providers and in the complexities of IoT and connectivity landscape, faces a number of challenges to provide accurate and responsive electronic components to OEMs and consumers.
