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Global Embedded Systems Market: Rising Demand from Automotive Sector and Burgeoning Smart Devices Boosting Growth, finds TMR

Posted on Nov 15, 2016

The global embedded systems market is fragmented and cutthroat. The barriers to entry are low. As a result, there are many vendors – both established and new – competing against each other for a higher market share on the basis of quality products. Further, the soaring demand for embedded systems alongside tanking microcontroller prices has brought about a diverse landscape. 

Some of the key players in the market are Renesas Electronics Corporation, Freescale Semiconductor Inc, Cypress Semiconductor, Synaptics, Intel Corporation, Silicon Labs, Dallas Semiconductor, and National Semiconductor. In 2014, Renesas Electronic Corporation held a dominant share of approximately 30% in the global microcontrollers market, which is a key component of the embedded system market. It has expanded its global footprint primarily via acquisitions and agreements and also through highly differentiated products and solutions keeping in mind the requirements of target markets. Freescale Semiconductor Inc. has consistently tried to better its position through innovative product launches. Not wanting to be left behind, other players in the market are also strategizing sagaciously to push their products. 

On account of stiff competition, revenue created in the global market for embedded systems is predicted to be worth US$233.19 bn by 2021, expanding at a healthy CAGR of 6.4% between 2015 and 2021.  

Automotive Sector Has Marginally Higher Market Share 

Application-wise, the automotive sector has been leading the market with a marginal difference. This is because every car plying on the streets makes use of embedded systems in some form or the other. It is slated to hold on to its dominant position from 2015 to 2021, expanding at a steady CAGR of 5.8%. Healthcare, however, is expected to exhibit the strongest CAGR due to the spiking demand for efficient portable medical devices, in which embedded systems find application. 

Type-wise, the embedded hardware section has a relatively larger share in the market compared to embedded software, which primarily includes operating systems, development tools, and middleware. It is expected to maintain its leading share in the coming years despite the embedded software market clocking a far more impressive CAGR. 

North America has held a dominant share in the global embedded system market, on account of high penetration of technology and extensive research and development activities. Its market was worth US$62.91 bn in 2015. The region is expected to maintain its leading share in market in the coming years too. Asia Pacific follows next and is predicted to remain in the second position in the coming years as well. Europe holds the third largest market share. 

Proliferating Smart Devices a Major Factor Propelling Market 

A lot of factors are providing a fillip to the global embedded systems market. One of them is the burgeoning demand for smart devices, which use embedded systems that enable them to communicate effectively with other devices. Conventional devices, with low power microprocessors and limited user interfaces, can be made smart by embedded systems, which help process information and make intelligent decisions. The rising demand for more efficient power consuming digital consumer electronics has also propelled growth of newer models of embedded systems having multi-core technologies and embedded graphics. 

The major restraint on this market is design constraints on real-time embedded systems. The analyst of the TMR report explains, “Embedded real-time control processors are computers that are an integral portion of equipment such as automobiles, computer peripherals, airplanes, audio electronics, and military equipment. Embedded real-time applications impose severe demand on the embedded microprocessors. They have stringent constraints on power, size, weight, cooling, reliability, computing performance, and cost. This is because the processor is merely a component of a larger system that has its own manufacturing constraints and operating requirements.” 

This review is based on the findings of a TMR report titled “Embedded System Market - Global Industry Analysis, Size, Share, Growth, Trends and Forecast 2015-2021.” 

Global Embedded System Market, by Functionality: 

  • Standalone Embedded Systems
  • Real Time Embedded Systems
  • Networked Embedded Systems
  • Mobile Embedded Systems 

Global Embedded System Market, by Microcontroller: 

  • Small Scale Embedded Systems
  • Medium Scale Embedded Systems
  • Large Scale Embedded Systems 

Global Embedded System Market, by Type: 

  • Embedded Hardware
  • Embedded Software 

Global Embedded System Market, by Application: 

  • Automotive
  • Healthcare
  • Telecom
  • Industrial
  • Consumer Electronics
  • Aerospace and Defense 

Global Embedded System Market, by Geography: 

  • Europe
  • Asia Pacific
  • North America
  • Rest of the World

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