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Third-party suppliers take a slice of I/O sales

09 April, 2008

The global market for I/O modules is growing by around 5.6% a year, and will be worth nearly $8bn by 2011, according to a new forecast from IMS Research.

Although the traditional suppliers of I/O modules – manufacturers of PLC and DCS controllers – still dominate the market, third-party suppliers have become more active and stronger as the market for remote I/O expands. So far, however, the impact of these suppliers is more apparent in terms of new products and technology than in their market share, IMS reports.

Third-party suppliers were responsible for the development of concepts such as I/O products with high levels of physical protection (IP67), bit-modular (slice) I/O modules, the application of wireless technology, and the IO-Link system, IMS suggests. The presence of these suppliers has driven the introduction of new features and expanded the functions of I/O products.

Most of the third-party suppliers have used their technological expertise as terminal block manufacturers, or as specialist suppliers of I/O products, to develop I/O their products. This experience helps them when selling I/O modules as components, says IMS.

In addition, the third-party suppliers have been helped by the continuing development of open fieldbus networks and distributed architectures. By contrast, established I/O suppliers prefer to encourage customers to purchase integrated systems from a single source, which is then responsible for ensuring compatibility between the components in the automation system, and for solving any problems that arise. This selling strategy seems to be the most effective way for them to maintain and strengthen their market share, according to IMS.

Increased competition between third-party and traditional suppliers has not only driven the introduction of new features and functions into I/O products, but has also resulted in lower I/O module prices. Through their different strategies, both types of suppliers will continue to operate in the I/O market for the foreseeable future, IMS predicts.

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