Hardware and Electronic Equipment Industry: Market Research Reports, Statistics and Analysis

Trends

The computer hardware market is constantly evolving due to technological innovation. Consumer demand for new products seems endless, with growth potential remaining for devices such as ultra-minimal desktops and tablet PCs. The more long standing PC market, however, has seen a degree of company commodification resulting in price pressure, which in turn drags down profit. The less established part of the market, characterized by innovation, is time sensitive in that companies quickest to get their products to market benefit from the newness factor sought after by consumers eager to keep up with the times.

Computer hardware companies enjoy international presence, selling their wares worldwide. On the manufacturing side of the business, much hardware design and production is carried out in Asia, in particular in China, Japan and India. Many high-tech companies work in conjunction with universities, and are often located close to third-level educational institutions.

Companies are less bound by borders than before, with electronic equipment outfits often basing their headquarters in one country and locating factories and development facilities in other countries. Hoovers estimates there are as many as 13,000 US electronic equipment repair service outlets, collectively generating close to $20 billion. Heavily reliant on corporate demand, the electronics equipment market tends to rise and fall with corporate profit. In the US, corporate profit climbed almost 8% in the third fiscal quarter of 2011, compared with 2010.

Key Market Segments

• Visiongain estimates the global wireless roaming market will exceed $66 billion in 2016. Long-term evolution services are set to impact the overall telecom industry but in particular the roaming sector. Roaming costs will be kept in check by regulatory bodies, meaning that companies will benefit from reviewing their roaming pricing practices.

• Visiongain predicts cyberwarfare expenditure will near $16 billion in 2012, as companies and governments seek to protect their data from cyber attacks. As computer network systems become more connected and intricate, the demand for cyber security will continue to grow.

• The world semiconductor market was worth almost $347 billion in 2010, according to MarketLine. The market is expected to grow at a yearly rate of almost 5.5% through 2015 to reach almost $450 billion. The integrated sector represents the leading market segment, exceeding $277 billion in 2010, accounting for 80% of the overall market.

• The global Ethernet switch industry is expected to expand more than 10% between 2010 and 2014, reports TechNavio. Increasing numbers of data centers are being set up, fuelling the market, while the market’s dependence on component providers is considered an obstacle to expansion.

Market Outlook

Technological innovation in the global computer hardware and electronic equipment industries calls for new applications and products to be introduced with relatively high frequency. Research and development is, therefore, key to market growth. Companies are under pressure to come up with new ideas and get new products to market before rivals.

Computer hardware companies continue to focus on product capabilities as companies from many sectors concentrate on crossover products such as phones with video viewing or internet surfing options.

Computer hardware outfits are turning increasingly to outsourcing to cut costs. Many US companies keep their design activities with in the US, while outsourcing production to countries such as China and the Philippines to minimize labor costs. Consolidation is another cost-cutting option increasingly taken up by computer hardware companies.

Leading Industry Associations

• American Hardware Manufacturers Association www.ahma.org
• Manufacturer’s Association of IT Industry www.mait.com
• China National Hardware Association www.chinahardware.org.cn
• Computer Hardware Manufacturing Benchmarking Association http://chmba.com/
• National Electrical Manufacturers Association www.nema.org
• Industry Council for Electronic Equipment Recycling www.icer.org.uk
• Electronic Components Association www.ecaus.org