Addressing the Installed Base is the Key
In recent years, many programmable logic controllers (PLCs) have evolved into programmable automation controller (PACs), which integrate logic, motion, and safety control with cyber security and even energy management functionality within a common platform.
Today, the majority of PLC revenues worldwide come from PLC-based PACs and these revenues are growing at a faster rate than for traditional PLCs. Thanks to the success of PLC-based PACs, PLC technology has further penetrated the process industries, where they now often replace large distributed control systems (DCS). This trend is stronger in emerging markets, as PLCs are easier to maintain and engineers are scarce. In 2013, more than one third of all PLCs sold worldwide were sold into the process industries.
PLCs benefitted from the development in the process industries. In North America, the hydraulic fracturing boom drives PLC sales for use in the oil & gas industry.
In the power industry in EMEA, PLCs are predominantly used in renewable energy, wind turbines, solar fields, water, or small combined heat power plants.
The market for PLC and PLC-based PACs increasingly depends both on the installed base and increasing deployment in the process industries.
With a replacement rate of roughly 10 percent across all segments, ARC estimates that around 50 percent of the total market by 2018 represents will be replacement business.
In the PLC market, different issues apply to suppliers, OEMs, and end users of the technology. Machine builders have different priorities than users. PLC suppliers must closely collaborate with their clients to generate value and thereby defend their market position. This study addresses key questions, such as:
- How can suppliers increase their value proposition?
- Are different strategies required for new installations vs. retrofit?
- Will new distribution channels be required?
- How critical is initial cost in relation to lifecycle cost?
- How will niche market products impact the total market?