Industrial Ethernet Market Size, Share & Industry Trends

Updated on : Sep 16, 2024

Industrial Ethernet Market Size & Share

The global industrial ethernet market size is projected to grow from USD 11.0 billion in 2023 to USD 15.8 billion by 2028; it is expected to record at a CAGR of 7.5% during the forecast period. Growing popularity of smart automobiles and rising adoption of 5G are expected to fuel the growth of the industrial ethernet industry.

Industrial Ethernet Market Forecast to 2028

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Industrial Ethernet Market Segment 

Service segment to account for the largest share of the industrial ethernet market by 2028

Rapid changes in network infrastructure and the growing adoption of IIoT have led to the adoption of cloud and virtualization. This has significantly increased the pressure on network administrators to manage the network infrastructure. Hence, manufacturing industries are outsourcing network services to ensure better network management quality and reduced operating costs. Companies are adopting remote network monitoring services, which are expected to boost the services market during the forecast period.

Industrial Ethernet Market for MODBUS–TCP protocol to grow with significant CAGR during the forecast period

MODBUS–TCP can interact with EtherNet/IP and other industrial Ethernet protocols (i.e., HTTP, FTP, and Telnet) without any non-standard network interface cards and/or switching infrastructure, and thus, offering a high level of interoperability for industrial communication network devices.

Industrial Ethernet Market for Engineering/Fabrication to have significant CAGR during the forecast period

The industrial ethernet is mainly used in engineering design and fabrication of metal, steel, and other structural parts manufacturing. In the fabrication industry, different networking technologies can be implemented.

For instance, the Industrial ethernet ensures consistent, uninterrupted mobile connectivity for workers, vehicles, and equipment while extending connectivity outside the plant (transportation yard and interconnected buildings). It also supports features such as data security and allows workers to coordinate workforce activities and communicate in real-time for better safety management and increasing productivity.

Industrial Ethernet Switch Market Growth and Trends

Industrial Ethernet Market Regional Analysis

Asia Pacific to grow at the highest CAGR in the industrial ethernet market during the forecast period

Asia Pacific is currently the largest manufacturing hub for automobile and electronic companies. To compete with other global players, the industrial ethernet companies in Asia Pacific use advanced automation systems, which require highly reliable communication networks that can help in machine-to-machine (M2M) communication in the plants.

The manufacturing companies in Asia Pacific extensively adopt the smart factory concept for implementing advanced manufacturing technologies on the factory floor. This innovative concept has transformed the manufacturing sector in Asia Pacific and has increased the implementation of smart automation in factories. The growing acceptance of Industrial Revolution 4.0 in Asia Pacific is also a factor driving the growth of the regional market.

Industrial Ethernet Market by Region

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Top Industrial Ethernet Companies - Key Market Players

• Cisco (US),
• Siemens (Germany),
• Rockwell Automation (US),
• OMRON (Japan),
• Moxa (Taiwan),
• Belden( US),
• Huawei Technologies (China),
• SICK (Germany),
• Schneider Electric (France), and
• ABB (Switzerland) are few major industrial ethernet companies.

Recent Developments in Industrial Ethernet Industry

• In November  2022, Siemens launched its new Industrial Edge Management System, an optimized license management solution, as well as new devices at the SPS trade fair in Nuremberg, Germany from November 8 to 10, 2022. The newly launched management systems will bring Operational Technology (OT) and IT closer together in industrial production, enabling a seamless flow of data from the field level to the cloud.
• In October 2022,  OMRON signed a pan-European distribution agreement with Conrad Electronic, the Germany-based sourcing platform for technical supplies operating in 17 European countries.

Recession Impact

The market for industrial ethernet might experience slow down due to the coming recession in 2023 and 2024. The companies in the industrial ethernet market have a strong base in the North American and European regions. As the recession is expected to have a major impact in these regions, the overall market for industrial ethernet industry is expected to witness a slow growth rate during the years 2023 and 2024. Automotive & transportation, electrical & electronics, and oil & gas are some of the major industries in this market to be affected by the coming recession.

In-depth interviews have been conducted with chief executive officers (CEOs), marketing directors, other innovation and technology directors, and executives from various key organizations operating in the industrial ethernet marketplace.

• By Company Type: Tier 1 - 18%, Tier 2 – 22%, and Tier 3 - 60%
• By Designation: C-Level Executives - 21%, Managers - 35%, and Others – 44%
• By Region: North America - 22%, Europe - 26%, Asia Pacific (APAC)- 39%, and RoW - 13%

Industrial Ethernet Market Trends

Driver: Increasing initiatives by governments of developing countries to promote adoption of industrial automation

The governments of developing countries worldwide are supporting the development of various industries to achieve holistic growth. This has led to an increase in the adoption of various automation and communication components and technologies for the structural development of industries. Governments are highly focused on the process and discrete industries. For instance, the Government of Singapore has partnered with various associations, such as the Singapore Food Manufacturing Association (SFMA) and the Food Innovation Resource Centre, to implement the latest automation solutions, including SCADA, PLC, DCS, robots, and cables, in the food & beverage industry.

The Government of Malaysia introduced a 200% automation capital allowance (ACA) in its 2015 budget to encourage labor-intensive manufacturing industries, such as textile, rubber, and plastics, to adopt the latest automation technologies to improve their overall productivity. Under ACA, the government writes off capital expenditure for manufacturing companies within 3 years (an initial allowance of 40% and an annual allowance of 20%).

India is one of the emerging countries with a fast-growing manufacturing sector. The formulation of the National Manufacturing Policy (NMP) by the central government has increased the development of its manufacturing sector. The government has also launched the Make in India policy to encourage companies to implement automation processes in their manufacturing plants. Thus, the measures taken by the governments to support the adoption of industrial control and factory automation are expected to fuel the growth of the market during the forecast period.

Restraint:  Absence of standardization in industrial communication protocols and interfaces

Industrial equipment or devices communicate through various interfaces, technologies, and protocols. The absence of standardization in these communication interfaces and protocols might result in the misrepresentation of data. It also can complicate the integration of systems and hinder the use of plug-and-play features for unrelated systems. This is one of the major restraints for the industrial ethernet market in coming years.

Opportunity:  Emergence of 5G to create lucrative opportunities for market players

Industrial communication is a vital element of Industry 4.0. The demand for 5G technology is growing in the manufacturing industry, as 5G helps to overcome the shortcomings of other wireless systems. With the onset of 5G technology, the manufacturing industry will experience a major transformation. With the increasing demand of 5G the demand for industrial ethernet will also increase.

Challenge: Harsh field site conditions-high-voltage transients, severe shocks and vibrations, and extremely high temperatures

Industrial Ethernet devices are deployed in remote field locations which are prone to the effects of unfavorable and harsh conditions, such as high-voltage transients, shocks and vibrations, and extremely high temperatures. High voltage transients result from electrostatic discharge (ESD), bursts, electrical fast transients (EFT), and lightning strikes. These are a few challenges faced in industrial ethernet technology deployment. Therefore, there is a requirement for robust industrial communication equipment to withstand harsh conditions.

Industrial Ethernet Market Report Scope

Industrial Ethernet Market Highlights

This research report categorizes the industrial ethernet market based on by offering, protocol, and end-use industry and Region

Frequently Asked Questions (FAQ):

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