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The industrial ethernet market size is forecast to increase by USD 43.52 billion, at a CAGR of 13.29% between 2023 and 2028. The market's growth trajectory is influenced by several factors, notably the proliferation of smart grid initiatives aimed at enhancing energy distribution efficiency and reliability. Additionally, there is a notable trend towards replacing traditional fieldbus systems with more advanced industrial Ethernet solutions, driven by the need for faster and more reliable data communication in industrial environments. Furthermore, the growing adoption of Industrial Internet of Things (IIoT) technologies is contributing to market expansion by enabling enhanced connectivity and data analytics capabilities in industrial settings. These factors collectively shape the market landscape, driving innovation and adoption of advanced technologies in the energy and industrial sectors.
Market Forecast 2024-2028
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The hardware segment will account for a major share of the market's growth during the forecast period. Increasing demand for scalable, faster, reliable, and interoperable communication solutions is one of the key factors expected to drive the growth of the market during the forecast period.
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The hardware segment was valued at USD 11.92 billion in 2018. Digitalization, the convergence of IT and OT, and the Industrial Internet of Things are increasing the demands of the industrial environment. Industrial ethernet hardware is used in various applications within industries such as manufacturing, Information Technologies, defense, telecommunications, utilities, security, infrastructure, gaming, agriculture, and medicine. Thus, the above factors are expected to drive market growth during the forecast period.
Based on technology, the market has been segmented into Ethernet/IP, PROFINET, EtherCAT, Modbus TCP/IP and others. The EtherNet/IP?segment will account for the largest share of this segment.? The EtherNet/IP enables end-users to use off-the-shelf Ethernet cables, such as fiber and copper, without any modifications. It is equally compatible with wireless networks. Due to high flexibility and performance, growing implementation of IIoT, and increased penetration of ethernet networks in process industries, the demand for Ethernet/IP is increasing.PROFINET of things, which is gaining traction because of its fast data access, uptime, and openness, is one of the important trends driving market growth. Modbus TCP/IP is often used in industrial environments owing to the ease of maintenance and deployment. Thus it is expected to drive the growth of this segment during the forecast period.
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North America is estimated to contribute 40% to the growth by 2028. Technavio's analysts have provided extensive insight into the market forecasting, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period. The food and beverage industry in APAC has been expanding owing to the changes in eating habits. The spending on food and beverage products has increased over the last five years in conjunction with the increase in consumers purchasing power. Further, the oil and gas industry in APAC is expected to experience growth during the forecast period because of the rise in the need of countries to minimize the dependence on Gulf countries for oil and gas imports. The rising need for fuels and hydrocarbons is likely to drive the growth of the market during the forecast period.
The market is rapidly evolving to meet the demands of various sectors such as automotive and transportation, aerospace industry, and factory automation. With the emergence of Smart city applications and Energy management systems, the demand for robust network infrastructure and Ethernet Advanced Physical Layer (APL) solutions is increasing. Manufacturers are focusing on enhancing data security and energy efficiency while integrating IoT-enabled devices and smart factory concepts. Additionally, the market is witnessing advancements in communication networks, artificial intelligence, and robotics, driving the adoption of advanced automation systems and connected devices in industrial automation and control systems (IACS). The European industrial sector, while facing challenges like recession and harsh field site conditions, also presents significant opportunities for growth and innovation. With the advent of 5G technology and the rise of the Industrial Internet of Things (IIoT), industries have the potential to leverage advanced connectivity and automation to overcome obstacles such as severe shocks, high temperatures, and operating costs.
In particular, the service segment stands to benefit from the integration of IIoT devices and network administrators' expertise in managing and optimizing industrial networks. Technologies like the MODBUS-TCP protocol enable seamless communication between devices, enhancing efficiency and productivity across various sectors. Furthermore, advancements in engineering and fabrication techniques have revolutionized structural parts manufacturing, empowering the fabrication industry to meet the demands of modern industrialization. Despite challenges posed by recession and harsh field conditions, European industries are poised to capitalize on these opportunities, driving growth and competitiveness in the global market.
Our researchers studied the market research and growth data for years, with 2023 as the base year and 2023 as the estimated year, and presented the key drivers, trends, and challenges for the market.
With the advent of Industry 4.0 and the continued implementation of IIoT, the need for continuous connectivity from the smallest sensors to enterprise-level systems and beyond, the use of Industrial Ethernet is the preferred choice for end-user industries. Increased availability of affordable processors and sensors that enable real-time access to information, as well as advances in technology, are expected to drive growth. Industrial ethernet seamlessly integrates with IoT as it offers high-speed transmission of up to 1Gbps. This is the platform of choice for many future digital factories.
Moreover, the integration of IIoT with Ethernet/IP-based devices will lead to the development of smart factories, increasing productivity and throughput and reducing maintenance costs. This saves manufacturers planned repair and maintenance costs and avoids unplanned breakdowns. Therefore, IIoT (Industrial Internet of Things) is one of the major factors driving the growth of the market. The exponential growth in the number of IIoT-connected devices is also a major factor. Such factors are expected to drive the growth of the market during the forecast period.
The advent of smart factories is changing the facade of manufacturing. It is classified as a slow transition from conventional automation to a flexible, networked system. The network facilitates the interconnection for communication and data flow, whereas the cloud delivers powerful and elastic computing and storage abilities for Big Data and intelligent applications for further analysis. Industrial Ethernet protocols, such as EtherCAT, are selected to implement machine network (controller to sensors/actuators communication), machine-to-cloud communication, and machine-to-machine communication in the smart factory to attain such connectivity specifications.
Further, the idea of smart factories is spreading and becoming more widely accepted due to a number of factors, including ongoing technological advancements, growing supply chain complexity, increased pressure from competitors globally, ongoing organizational realignments brought about by information technology (IT) and operational technology (OT), and increased investments by end-user industries. This will drive the growth of the market during the forecast period.
Wireless communication is creating challenges for the market. Wireless technology eliminates unnecessary wiring work in many cases. It is easy to access and adapt to changes compared to wired networks. For Instance, wireless communication protocols currently account for approximately 8% of the global communication network market.
However, the benefits gained from using wireless networks are increasing acceptance of these solutions in the end-user industry. Wireless networks have a wide operating range, and it has lower maintenance and repair costs. All these benefits associated with wireless communication technology may be a major challenge for the market during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market companies, including:
Cisco Systems Inc., Eaton Corp. Plc, Hitachi Ltd., HMS Networks AB, Honeywell International Inc., Microchip Technology Inc., Nexans SA, OMRON Corp., Rockwell Automation Inc., Schneider Electric SE, Siemens AG, Texas Instruments Inc., Hans Turck GmbH and Co KG, Patton LLC, Yokogawa Electric Corp., Signamax Inc., and Moxa Inc.
Technavio market forecast the an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies companies into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Companies are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.
The market report forecasts market growth analysis by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
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The market is witnessing significant growth driven by various factors such as the adoption of PROFINET IRT and other industrial communication protocols. With the rise of Advanced Driver Assistance Systems (ADAS) and transportation systems, there's a growing need for robust network infrastructure and interfaces to ensure seamless integration of systems. Technologies like Single Pair Ethernet (SPE) and 5G are enabling wireless systems in remote field locations, while cloud and virtualization solutions enhance network administration and remote network monitoring services. Furthermore, advancements in hardware components and software solutions are driving the evolution of such systems for applications in aerospace and defense, automobile, and smart factory concepts. Investment in industrial automation presents an opportunity for Engineering/Fabrication industries to embrace smart automation. With a focus on consumer electronics, this investment fosters innovation and efficiency, driving growth and competitiveness in modern manufacturing processes. Further, the market is evolving rapidly, propelled by factors such as network cabling services and the demand for robust electrical and electronics infrastructure.
Moreover, the integration is streamlined with plug-and-play features, ensuring efficiency even in environments prone to high-voltage transients and shocks and vibrations. Network management is facilitated through protocols like MODBUS–TCP, FTP, and Telnet, while advancements in engineering and fabrication techniques optimize the use of materials like metal and steel. Electronic companies are leveraging the smart factory concept and Internet of Things (IoT) to enhance network value and functionality, with applications spanning aerospace and defense, infotainment systems, and factory floor. The market is pivotal in modern manufacturing hubs, driven by the need for robust networking technologies enabling real-time communication. Rapid industrialization fuels demand, with Ethernet serving as an exclusive data intelligence tool integrating databases for precedence statistics. Standardization ensures interoperability across diverse systems, enhancing efficiency in industrial operations. As manufacturing hubs expand globally, Industrial Ethernet continues to evolve, supporting advanced connectivity solutions that streamline processes and optimize productivity in dynamic industrial environments.
Market Scope |
|
Report Coverage |
Details |
Page number |
188 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 13.29% |
Market Growth 2024-2028 |
USD 43.52 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
12.55 |
Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
Performing market contribution |
North America at 40% |
Key countries |
US, China, Japan, Germany, and UK |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
ABB Ltd., Analog Devices Inc., Belden Inc., Cisco Systems Inc., Eaton Corp. Plc, Hitachi Ltd., HMS Networks AB, Honeywell International Inc., Microchip Technology Inc., Nexans SA, OMRON Corp., Rockwell Automation Inc., Schneider Electric SE, Siemens AG, Texas Instruments Inc., Hans Turck GmbH and Co KG, Patton LLC, Yokogawa Electric Corp., Signamax Inc., and Moxa Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Component
7 Market Segmentation by Technology
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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